stent trade

price control for stents

companies operate the markets

It is now officially confirmed that a stent can cost the patient over 10 times by the time it moves from the manufacturer to the patient. The National Pharmaceutical Pricing Authority NPPA ) on Monday released data on margins made by players at various levels in theOf all the players, hospital margins appear to be the highest, touching about 650%. Incidentally, along with stent companies, it is hospitals and cardiologists who have been most vocal against. Based on data submitted by stent companies, NPPA has worked out the margins at every level and the data shows that the margin on stents range from 270% to about 1,000%.While the biggest jump in price seems to happen at the level of hospitals, not all hospitals might be charging that high a margin as it ranges from 11% to 654%.The manufacturing cost of a drug eluting stent (DES) for a domestic company is about Rs 8,000 and the price of an imported DES starts at about Rs 5,000. Combining of the data for DES along with bioabsorbable stents makes it difficult to get an exact idea of just how much the mark-up on DES alone could be. DES constitutes over 95% of the stents used in India.While the data seems to indicate that the importers or manufacturers charge the lowest margins compared to the margin of distributors (13% to almost 200%) and hospitals, it is well known that manythrough their distributors. With most companies claiming to follow ethical codes of marketing, the illegal marketing practices of kickbacks to doctors and hefty cuts to hospitals are left to the dealers or distributors. Hence the margin allowed to dealers ranging from 13% to 196% is said to include the cost of these practices too. In the case of imported stents, there is also the issue of transfer pricing.With the import being done by the same company, the company could fix whatever price suits it, depending on where it wants to show its profits. Hospital associations, after initially coming out against price control, have since modified their position to say that they are not against price control but are only concerned about the latest innovations in stent technology being available to patients and about the quality of stents.The official billing prices of stents to hospitals often disguise bigger cuts through a system of distributors giving them a bill showing a higher price. The real price to hospitals is often lower.