A government price cap on stents and artificial knee implants comes at a time of rising demand for cardiac disease and knee-replacement surgery. But the price caps could deter companies from selling the latest, mostly imported technology, prices of stents may not fall as steeply as the government claims, and hospitals could increase “incidental expenses”–from operation theatre charges to surgeon fees –to compensate, according to a FactChecker analysis.
While the move was largely welcomed, the government must offer patients a choice and allow stents using the latest technology–mostly imported–available without price caps, an expert told us. “It (capping of all stent prices) is like forcing everyone to travel by public transport,” said Vijay Surase, interventional cardiologist at Jupiter Hospital in Maharashtra’s Thane city.
The National Pharmaceutical Pricing Authority (NPPA), a regulator, capped the price of various models of knee implants to reduce the cost of knee replacement and revision surgeries on August 16, 2017, following Prime Minister Narendra Modi’s 2017 independence-day declaration to reduce these prices.
Companies had a profit margin of 499% for a knee “insert” used to replace a damaged bone or cartilage, The Times of India reported on August 5, 2017.
Health minister Jagat Prakash Nadda said about 15 million orthopaedic patients could benefit from the decision to cap implant prices.
— Jagat Prakash Nadda (@JPNadda) August 17, 2017
Chemicals minister Anant Kumar tweeted that knee-implant prices have been reduced 65%, from a range of Rs 54,720 to Rs 113,950–implants come in many varieties–to a range of Rs 158,324 to Rs 900,000.
— Ananthkumar (@AnanthKumar_BJP) August 17, 2017
While the knee-implant price cap was “a great move”, Nilen Shah, consultant orthopedic surgeon at Mumbai’s Wockhardt Hospitals, said it was misleading to claim prices would drop 40% or 60% because implants are never sold at maximum retail price but always at a discount.
“What this move will do is cap the handling charges that a hospital would add to the cost of the implant,” said Shah.
“Since the price of an implant is about 60% of a knee-replacement surgery bill, such procedures will become much more affordable,” said Shah.
Cardiac stent prices capped earlier
NPPA had capped the price of stents on February 13, 2017, following widespread complaints of importers/manufacturers, distributors and hospitals overcharging patients.
With cardiac diseases increasing, stenting–a procedure to insert bare metal tubes or medicated tubes to hold apart blocked arteries–has increased five-fold in 10 years from around 40,000 in 2006 to nearly 220,000 in 2013, according to the NPPA report on pricing on stents.
“Coronary atherosclerotic heart disease (CAD) is a common form of cardiovascular disease in India, which (sic) afflicts around 32 million people with a mortality of around 1.6 million per annum,” the NPPA report said.
Nearly 2% of CAD patients are treated with angioplasty, a common procedure, but the high cost of cardiac stents is a major cause of concern as it seriously affects the ability of the common man to access it, the NPPA said.
With 60% stents imported, consumers paid around Rs 200,000 per stent, four times the cost of a stent when it lands in India or twice the average Indian’s estimated annual per capita income of around Rs 103,000.
“We had expected a storm, but most of the stents, except the high-end biodegradable stents, are available in the market,” Jupiter Hospital’s Surase told Factchecker.
The issue reached the Delhi High Court when Birender Sangwan, a lawyer, filed a petition in the court asking stents to be included in the National List of Essential Medicines, the Hindustan Times reported on February 20, 2017.
By the time a patient received a stent, the increase from the original cost was often in the range of 1,000-2,000%, HT reported.
“It was a scam, and patients were being fleeced blatantly. There were no ethics followed,” Sangwan said. “Why should the patient be forced to buy a stent from a particular company? Why wasn’t there any regulatory mechanism in place? These questions disturbed me.”
In an election rally in Uttar Pradesh in February 2017, Modi said the government had been successful in capping stent prices at around Rs 8,000 and Rs 30,000, respectively.
Government (45%) and private (15%) insurance cover expenses in no more than 60% of cardiac cases. For the rest, the cost is met by out-of-pocket expenses by patients, the NPPA report said.
Latest stents unavailable, R&D affected
“There is tremendous pressure from the multinational lobby to rework the pricing cap,” Rajiv Nath, forum coordinator, Association of Indian Medical Device Industry (AiMeD) told IndiaSpend.
Two e-mails seeking comment from the Medical Technology Association of India (MTal), a nonprofit–whose members include multinational companies who sell stents and implants–went unanswered.
“MNCs are not conducting training conferences because they can no longer sell their latest products here… margins are not high to conduct these conferences or sessions,” said Jupiter Hospital’s Surase.
“There should be one uncapped category for those who can afford the latest stents, so that they can make the choice,” said Surase. “We are not getting the latest technological products due to this move.”
Wockhardt’s Shah said the latest technology did not matter. “Even if it means premium products will go out of market, it is not a great loss,” he said, “since there is no evidence that premium products give superior results.”
K M Cherian, and Ajeet Arul Kumar, cardiologists with Frontier Lifeline hospital, Chennai, wrote in the Indian Express on July 27, 2017, that research on indigenous stents would be affected by the government’s plan.
“Stent manufacturers typically spend millions of dollars on research before they can make the device and commercialise it,” wrote Cherian and Kumar. “ Some of the profit from sales is pumped back into research. Abruptly reducing stent prices will have adverse effects on the development of improved stents.”
“Even before the price control move was instituted, only 40% of the stents used in the country were indigenously manufactured; the rest were imported. With prices of imported stents and Indian stents now being the same, doctors and patients could prefer imported devices,” Cherian and Kumar wrote.
Nath said it was too early to say if research and development would be affected or MNCs would stop bringing high-quality stents to India.
“Those who are advised high-end, latest generation stents and can afford them, travel to nearby countries like Bangladesh and Pakistan to get them,” said Surase. “Also, patients who need the latest generation stents due to medical conditions are now advised bypass surgery.”
A drug-eluting stent–which prevents blood vessels from clogging again by release medication–are 1.476 times more effective than a bare-metal stent, a mesh-like tube of thin wire made of stainless steel or cobalt chromium alloy without any drug coating, said the NPPA report.
The report also said that a drug-eluting stent is 1.37 times more effective in reducing mortality within one year of angioplasty.
The common belief that imported stents are superior to made-in-India stents is not supported by clinical validations and “should be demolished through proper information dissemination”, the NPPA said in its report.