India up for a trade war over price control, but there’s a Plan B

Modi government’s move to cap prices of medical devices—stents and knee implants—has come to haunt Indian policymakers. As India stands accused of unfair trade practices, a new price control policy is in the offing

Last year, the global medical device association AdvaMed filed a petition to withdraw trade benefits that the US accords to Indian industries

On 8 June, Niti Aayog proposed a new kind of price control policy that caps margins rather than prices and asked the medical device sector for feedback

On 19 June, a public hearing to consider the withdrawal of trade benefits to Indian industries was held

Can the Indian government appease the medical device sector with this new proposed policy before the petition moves forward?

“Do not threaten us; let’s talk instead.”

On 8 June, government think-tank Niti Aayog first shared its proposed new price control policy for medical devices with US-headquartered medical device manufacturers. This new approach seeks to change the price control policy from one that currently caps prices on medical devices such as knee implants and stents without any room for flexibility. The new policy aims to cap margins on 18 other devices mentioned in the Drug Price Control Order 2013, instead. It came with the request mentioned above.

The request did not come out of the blue—it was in response to the US’ simmering unhappiness over the existing price control policy.

AUTHOR

Ruhi Kandhari

Ruhi writes on the impact of healthcare policies, trends in the healthcare sector and developments on the implementation of Electronic Health Records in India. She has an M. Sc. in Development Studies from the London School of Economics.

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