India is reopening discussions about its price caps on coronary stents next year, after protests from medical-device companies that want to pull their high-end stents off the Indian market because they say they are being forced to sell them at a loss.
In February, India's National Pharmaceutical Pricing Authority (NPPA) imposed a one-year price cap limiting the prices of drug-eluting stents to about $450. Before the price ceiling was imposed, the tiny metal-mesh tubes that prop open clogged arteries fetched an average of $1,821 in India, according to a May 2017 article in Circulation. U.S. hospitals pay an average of about $1,300 for drug-eluting stents.
Last week the Indian drug authority, which has jurisdiction over "essential" medical devices including stents and knee implants, announced that it plans to reopen the debate on stent prices and accept a new round of public comments.
Academics and regulators say high stent prices in India are a barrier to health care in a nation of 1.3 billion people where many patients pay cash, sometimes up front, to get a medical procedure. But the price cut was so steep, and so attention-grabbing internationally, that stent makers told the White House last month it may represent "an existential threat" to domestic stent makers.
Industry trade group AdvaMed filed a complaint with the U.S. Trade Representative's office in October after price caps were extended to knee implants and bone cement in India. Other nations including Indonesia and Pakistan are reportedly considering similar price controls, while officials in China have ordered manufacturers to report the prices obtained for stents in India.
Contacted via e-mail, NPPA Chairman Bhupendra Singh said the new hearing was called because the original price-control order passed on Feb. 13 is only effective for one year. He declined to speculate on whether the authority would change or eliminate the price caps, or take other steps, calling such questions "premature."
Several of the largest manufacturers of stents have major business ties in Minnesota, including Abbott Laboratories, Boston Scientific and Medtronic. For the most part, the companies have not been permitted to remove their priciest stents from the Indian market, which means they have to sell them for prices that are lower than the cost of making and importing them.
Under India's Drug Prices Control Order of 2013, drug and device manufacturers have to provide at least six months' notice of their intent to withdraw an essential product from the market, which includes coronary stents. The order also says the government can force a manufacturer to keep importing the product for up to a year.
Abby Pratt, vice president of global strategy and analysis at Washington-based med-tech trade group AdvaMed, said it's hard to know whether industry's concerns will be addressed at the upcoming meeting.
Critics of the price caps are likely to focus on whether patients getting stents in India have paid less for procedures since the price caps were enacted, or whether hospitals have seen any uptick in volume from greater access afforded by lowered prices.
"We're seeing reports directly from hospitals and others that the so-called benefits of the price control — the cost savings from the price controls — are not being passed along to patients," Pratt said. "The price of angioplasty [implanting a stent] has not come down in any meaningful way. And the numbers of procedures are not necessarily increasing. … You are not seeing any benefits to the patient."
Although manufacturers don't dispute there are valid concerns about excessive out-of-pocket costs for stenting in India, Pratt said research shows that local hospitals and distributors are responsible for the high cost, not the stent importers.
"The question is, what can the government do to step in and bring about greater transparency and greater efficiencies in the supply chain, and tackle probably some of the corruption that exists in the supply chain?" Pratt said.
The NPPA has said it imposed the price controls after hearing from officials who claimed large multinational stent companies charge widely varying prices for devices that produce the same results.
The authority said none of the importers could provide scientific evidence that their newer and more expensive stents work better than previous versions.
Economic data on stents in India showed the markups on imported stents "were exorbitant and irrational, indicating vulgar 'profiteering' at every level and mostly at the level of hospitals," the authority's minutes from February say. The price markups "indicated a failed market system where asymmetry of information had resulted in unethical practices and exorbitant prices for coronary stents."
Dr. Brahmajee Nallamothu, a clinician and health-services researcher at the University of Michigan, said via e-mail that some hospitals in India have contributed to the problem, but not all of them.
"It is important to point out," he said via e-mail, "that these markups were not universal. I work with many great Indian cardiologists who are at hospitals where this did not occur."