U.S. pressing India to avoid capping medical device prices, allow withdrawals

Abbott India

04/10/2017 07:26

* India policy on medical device price caps a concern: US 
official 
    * U.S. says in talks to resolve issue through bilateral 
talks 
    * India wants to make medical devices more affordable for 
patients 
    * Foreign firms disappointed with India's policy on price 
caps 
 
    By Aditya Kalra 
    NEW DELHI, Oct 4 (Reuters) - The United States is pressing 
India not to extend price caps on  medical devices and wants New 
Delhi to allow firms to withdraw products from the market if 
they do not wish to sell at government determined rates, a U.S. 
trade official told Reuters. 
    Indian Prime Minister Narendra Modi's government has in 
recent months slashed prices of medical devices such as knee 
implants and heart stents by up to 75 percent to make them more 
affordable. 
    But the $5 billion Indian medical-technology industry - 
which counts U.S. firms such as Abbott Laboratories  ABT.N , 
Boston Scientific Corp  BSX.N  and Johnson & Johnson  JNJ.N  as 
key players - has protested these moves, saying they hurt 
innovation, profits and future investment.  urn:newsml:reuters.com:*:nL4N1HY4O1 
    A senior United States Trade Representative (USTR) official 
said they were pressing India to not extend price caps to other 
devices, allow for higher pricing for technologically advanced 
equipment and let companies withdraw their products if they wish 
to. 
    India last month issued orders which effectively barred 
companies from any immediate withdrawals of heart stents or knee 
implants following price capping to ensure adequate supply of 
devices for patients. Abbott, for example, wants to withdraw one 
of its stents saying it's not commercially viable under 
government set prices, but India has rejected its plea. 
    "It is a principal concern for the United States," the U.S. 
official said on condition of anonymity. 
    India's trade ministry, which co-chairs such discussions 
under the U.S.-India Trade Policy Forum did not respond to a 
request for comment. The federal drug pricing regulator referred 
questions to the department of pharmaceutical, which did not 
respond to queries. 
    Modi, however, has previously said that providing affordable 
healthcare to patients takes precedence over the interests of 
companies.  
    The government has equated high margins charged for some 
medical devices with "illegal profiteering". In some cases these 
margins can exceed 400 percent.  
    The United States has been increasing pressure on India to 
revise its stance on price caps for medical devices. A person 
familiar with the matter said assistant USTR Mark Linscott and 
his delegation last month conveyed their concerns to Indian 
trade officials in New Delhi.      
    In May, a group of U.S. Congress members urged India to 
reconsider its decision to cap prices of stents, which are tiny 
wire mesh tubes used to treat blocked arteries.  urn:newsml:reuters.com:*:nL3N1JD3MY     
    Tanoubi Ngangom, an associate fellow for healthcare at the 
New Delhi-based Observer Research Foundation, said India must 
continue to develop policies based on its requirements and not 
succumb to diplomatic pressure. 
    "Indian government should retain a pro-public health stance 
on pricing medical devices to ensure access to affordable 
healthcare," she said. 
 
 (Reporting by Aditya Kalra; Editing by Sanjeev Miglani & Shri 
Navaratnam) 
 ((aditya.kalra@thomsonreuters.com; +91-011-49548021; Reuters 
Messaging: aditya.kalra.thomsonreuters.com@reuters.net)(Twitter: 
@adityakalra)) 
 
Keywords: INDIA MEDTECH/US