India’s Government Planning Medical Device ‘Parks’

India soon could have its own medical device “parks.”

The first such parks currently are being planned for Gujarat and Tamil Nadu, said Ananth Kumar, union minister of Chemicals and Fertilizers, who recently released a government-industry task-force report on boosting domestic production of high-end medical technology products.

“We have spoken to the Gujarat Chief Minister already on this, and the state-based National Institute of Pharmaceutical Education and Research will be the nodal institute to supervise it,” he noted, adding that talks are underway with the Tamil Nadu government to explore whether Chengalpattu could host the second such tech-park.

“We have also spoken to the finance minister and revenue secretary to firm up the incentive structure that can be provided for the same,” said Kumar.

Tax structure changes to boost domestic production

Acknowledging that the current duty structure which is favorable to imported products is anomalous, Kumar said he is working with the finance ministry to incentivize domestic medical device manufacturing. The task force headed by pharmaceuticals secretary V.K. Subburaj has recommended the import of second-hand diagnostic equipments be banned or made stringent, and zero or minimal duty be levied on the import of raw materials for medtech manufacturing.

The medical devices retail market in the country is estimated to be worth roughly Rs 60,000-70,000 crore. The indigenous medical devices industry in India is small, despite the fact that India is the fourth-largest market in Asia.

“Unfortunately we are an importing country as far as medical devices go, with our domestic industry accounting for 2 percent of the global industry, which stands at $250 billion. This is what we are aiming to change over the next five years under Prime Minister Narendra bhai Modi as we align with his vision to ‘Make in India,” said Kumar.

Subburaj’s recommendations could help India reduce its dependency on imported medical devices, officials claim.

“These recommendations will set the ball rolling to make India a powerhouse in manufacturing of medical devices. In particular, the recommendation to reverse duty bias against domestic goods will go a long way to reduce the humungous import-dependence in the sector,” said Rajiv Nath, joint managing director of Hindustan Syringes & Medical Devices, and the forum coordinator for the Association of Indian Medical Device Industry.

“The initiatives like exclusive medical technology parks, discounts on import duties on the raw materials for the production of medical devices, formulation of medical device regulatory act are encouraging and will be positive steps towards make in India vision of honorable prime minister,” read a Confederation of Indian Industry (CII) statement.

Bringing medical devices under price control

Kumar said he has written to the cabinet secretary to create a separate department for medical devices, which should be a part of an umbrella ministry dedicated to pharmaceuticals.

“We should create an essential list of medical devices on the lines of national list of essential medicines. Medical devices include implants, many of which are exorbitantly priced today and are out of reach for common man” he declared.

While commending the move to create a separate department for medical devices, some industry experts exressed concern about the government’s intent to regulate prices of medical devices.

“The earlier announced 100 percent FDI under automatic route in medical devices will be undermined and will also hamper ‘make in India’ as industry will not invest in a price- controlled environment. Therefore a right balance is required between access, affordability and return on innovation,” CII said in a formal statement.

“The recommendation to form a separate department for medical devices, and to have a separate legislation for medical device sector is of particular significance for the country as well this sector,” Nath said.