The price of cardiac stents will be capped – but no one knows how the new costs will be calculated

Late on Wednesday night, the Department of Pharmaceuticals issued a notification bringing life-saving cardiac stents used to unblock arteries under the Drug Price Control Order thus capping the price of stents and making them more affordable.

The notification was passed a day before the Delhi High Court heard a public interest litigation seeking to bring cardiac stents under the Drug Price Control Order on Thursday morning. Once a drug or medical device is on the Drug Price Control Order list, the National Pharmaceutical Pricing Authority or NPPA fixes a ceiling price on it, often bringing down prices dramatically.

Stents are currently priced anywhere between Rs 23,000 to Rs 2.5 lakhs each.

The bench told the government to fix a ceiling price by March 1, said Birender Sangwan, the petitioner in the case. Bhupendra Singh, the chairman of NPPA said that the authority will fix the ceiling price on stents within 60 days.

The court had sought a reply from the central government as to why the life-saving medical device was not already under the Drug Price Control Order. Stents had been put on the National List of Essential Drugs on July 19, after Sangwan had filed a Public Interest Litigation seeking the order in 2015. Since July, the government had been dragging its feet on adding stents in the Drug Price Control Order. Now, the ball is in the NPPA’s court to actually fix a reasonable price for stents.

Inflated prices

A stent is a short wire-mesh tube that acts as a scaffold to keep a blocked artery of the heart open. A bare metal stent is an older generation device that consists only of the scaffolding. The newer drug-eluting stent has a coat of medicine, which it releases in the artery after its insertion. The drug prevents further blockage in the artery of the heart.

The drug-eluting stents now constitute 78% of the 2.16 lakh stents used annually, as per data from 2013 provided by the National Interventional Council, a forum for interventional cardiologists who conduct angioplasties using stents.

An NPPA report on stent manufacturers showed that the difference between the landed cost of the stent – which includes original manufacturing cost, cost of logistics, shipping, and customs duties – and the final cost to the patient or maximum retail price is considerable.

The Maharashtra Food and Drug Administration in a 2015 report noted that the price of one of the more popular brands of stents increased from Rs 40,710 at the time of import to Rs 1.2 lakh in a hospital.

Stents made by multinational companies such as Abbott, Medtronic and Boston Scientific, together account for nearly 60% of the market share of stents in the country.

For Abbott, the difference between the landed cost and maximum retail price ranges between 294% to 740%. The difference of prices of stents for various brands from landed cost to maximum retail price ranges from 464% to 1200%, the NPPA report said.

Government hospitals are able to get a good bulk price for stents, even for foreign-made drugs. The Central Government Health Scheme that provides treatment to central government employees has listed a department price for stents at Rs 23,675.

Industry disagrees

AdvaMed, an association made of manufacturers of medical devices including Abbott, opposed the government’s move.

The official statement made by the association said, “Putting all drug-eluting stents into one category undermines the progress made in innovative device development over the years and could lead to equating less tested devices or devices not approved for use in complex patient cases or coexisting conditions, at par with innovative devices with large clinical evidence and due approvals for complex cases and coexisting conditions.”

The international lobby wants classification of stents, a move that is supported by the cardiologist lobby.

Cardiologist Dr MS Hiremat, who is the president of the Cardiological Society of India said that, in discussions with the government, he had proposed that there be differential pricing for different kinds of drug-eluting stents based on the generation of stents.. Hiremat said that there was more data available for foreign-made stents, as compared to the Indian ones.

“We have developed a matrix in which the latest generation of stent (the third generation) would get more points as compared to the earlier generations,” he said. The older generation of stents need more blood thinners compared to the new ones, he said.

However, Malini Aisola of the All India Drug Action Network, a network of nonprofit organisations that works towards increasing access to medicines, said that there is no data to show that one particular drug-eluting stent is better than another in terms of patient outcomes.

The local vs foreign debate

In India, imported and more expensive stents are more popular as compared to the locally made stents with more than 75% of the stents used in India being imported.

“Though standard Indian stent brands are far more economical compared to popular imported brands, and they fully meet international specifications, the demand for them is very low, which may be attributed to steep information asymmetry and aggressive promotional practices of big companies, which does not enable the patient to make an informed decision,” said the NPPA report.

The steep information asymmetry refers to the lack of information the patient has before opting for a stent, as often the choice of stent is made by the cardiologist. The patient is also given too little time to decide, even when there is no emergency.

While cardiologists claim that the foreign-made stents are better, there is no basis for this claim, said Chinu Srinivasan, who runs LOCOST, a small scale non-profit pharmaceutical maker in Vadodara.

“There is a lobby of cardiologists who support imported stents,” said Srinivasan. “Their arguments are supposedly scientific, and they say they are better than Indian stents. However, there is no study to prove those are better. It is a subjective opinion.”

What formula will be used?

The usual method of fixing the price of stents would be to take an average of maximum retail price of various brands over a period of six months. But health activists say that the regular formula will be unfair since it would still keep the price of a stent above Rs 100,000 and still highly unaffordable.

“We are still contemplating how we will go about it,” said NPPA chairman Singh. “We will have to consider the difference between the landing cost and MRP before we go about it.” He added that the department will not differentiate between the locally-made stents and a foreign stents while fixing a price.

Stents are not available in markets, like other drugs, but stocked by the hospitals or by cardiologists themselves. The price range from the distributor to the maximum retail price paid by the patient ranges from 175% to 809%.

In January 2015, an official from the Ministry of Chemical and Fertilisers wrote to the Drug Controller of India GN Singh, saying that the manufacturers of medical devices often mark prices with “transient stickers” that are used only for purposes of import.

Activists are hoping that the government will consider the skewed market conditions governing stents before it decides on how to fix the price. “There is an urgent need to examine alternative options for fixing the ceiling price that would ensure stents are available at an affordable price,” said Aisola.

Said Srinivasan, “If the regular formula [that uses the average of prices] is used, the remedy may be worse than the disease.”