Express Pharma

India Pharma Inc’s place in Modicare

230

Pharma companies will have to come up with strategies to play a meaningful role in the NHPS

new-viveka-100x100This year’s Union Budget has come and gone with no announcements for the pharmaceutical sector. At best, the sector will reap benefits, and that too in the distant future, once the National Health Protection Scheme (NHPS), is rolled out. In fact, there is some relief that there were no surprises or radical changes on the policy front. The sector is also enthused at the emphasis on the public-private-partnership (PPP) model of the NHPS.

But no sector, pharma and healthcare included, is safe from policy changes and whips outside the budget. On February 12, pricing watchdog National Pharmaceutical Pricing Authority (NPPA) reviewed stent prices and fixed the prices of stents till March 31, next year (Bare Metal Stents (BMS) at Rs 7660 ex GST, Drug Eluting Stents at Rs 27890 ex GST). But more importantly, it “decided that there is no case for sub-classification of DES in the light of lack of enough clinical evidence to support superiority of one DES or other.” This was a key demand of certain manufacturers and shows that the NPPA will not budge on this point.

A second blow is that another notification analysed the trade margins in cardiac guide wires, balloon catheter and guiding catheters ”in recognition of the people’s right to information and also for introspection by the manufacturer/distributor/hospitals.” Given that the margins range from 234 per cent to 63 per cent, it is only to be expected that these devices are already on the radar and will soon face the axe.

This was the first budget after the implementation of the GST and the industry’s revenues are only just recovering from this major tax reform. Today, it is GST Council which wields much power and has the industry on tenterhooks as they wait for clarifications on eWay bills and the like.

As a social security net, the NHPS is an idea whose time has most definitely come. But where will India find the finances to roll it out? A complete dependence on PPPs with the private sector, be it hospitals, pharma companies, diagnostics companies as well as medical technologies players will leave the scheme open to abuse. Hence pharma companies will have to come up with strategies to play a meaningful role in the NHPS.

The NHPS cannot not be seen in isolation. The thrust towards digitisation, AI is critical for all sectors but more so for Modicare as it will expand care, monitor fund spends and provide data to improve health systems outcomes. Another key part is the consolidation of the PSU insurance industry. Modicare is most probably going to be covered by the resulting behemoth, and the sheer size of the market, 100 million poor families, with a total of 500 million family members, will allow the government to drive a hard bargain. Thus, Rs 5 lakh per year per family, suddenly seems doable, but there will be unscrupulous players looking to game the system.

- Advertisement -

Comments are closed.