What Is Govt’s New Medical Device Policy & How Will It Impact The Industry: All You Need To Know
The Union Government in the evening hours of Wednesday announced the much awaited framework for the medical devices sector, the National Medical Devices Policy, 2023, after it had asked for proposals on the draft policy issued last year. Under the policy, the government has proposed six strategic areas which it says will enable the medical devices industry to grow exponentially in the coming years.
Recognized as one of the sunrise sectors under the Make In India scheme, the medical device industry is valued at USD 11 billion and is growing at a Compound Annual Growth Rate (CAGR) of 15 per cent, according to a 2022 India Brand Equity Foundation (IBEF) report. The report also states the industry in India is growing 2.5 times faster than the global growth rate and that India is the fourth largest medical device market in Asia after Japan, China and South Korea.
As per the IBEF report, The Indian medical device market is driven by 70-80 per cent imports from countries such as the US, China and Germany. The centre through the policy aims to reduce this dependency and envisions to expand the share of Indian manufacturers in the global market to 12 to 15 per cent from current 1.5 per cent over the next 25 years, while also helping the industry to reach a valuation of USD 50 billion by 2030.
Presently, as per the Invest India website, there are close to 750-800 domestic medical device manufacturers, accounting for 65 per cent of the players in the Indian market. Whereas the start-up ecosystem in the sector contributes over 250 companies engaged in innovation, addressing crucial health challenges.
What Does The Policy Entail?
The six strategies of the National Medical Device Policy 2023, propose to augment the growth story of the medical devices industry in India and entail focus areas such as streamlining regulation, enabling infrastructure, facilitating R&D and innovation, inviting investments, facilitating skilled manpower and promoting the industry for exports.
In an effort to streamline the regulatory framework, the government has proposed a ‘Single Window Clearance System’ for availing speedy licensing of medical devices, which will encompass all the stakeholder departments such as AERB, MeitY, DAHD etc. The regulatory framework of the policy will also enhance the role of Indian Standards like Bureau of Indian Standards (BIS) and further plans to design a coherent pricing regulation of the medical devices.
The next key area that the policy caters to is enabling a strong infrastructure for the sector by establishing and strengthening medical device parks, clusters equipped with common infrastructure facilities in close proximity to economic zones.
While briefing the media on Wednesday, Union Minister of Health and Family Welfare, Mansukh Mandaviya stated that in order to develop the medical device sector, enabling of the required infrastructure is quite crucial, “We have made the medical device parks ensuring the clustered approach so that small industries can flourish, and for these industries you need specific training and the comprehensive policy plan ensures that,” he said.
The Minister further added that the policy also plans to create a framework for researching and manufacturing of the small components that are required to make the medical devices.
The policy has also given due diligence to the R&D and innovation segment in which the government aims to establish Centre of Excellences, innovation hubs and plug and play infrastructures in the country. The policy also encourages investor interest in the sector by promoting private investments from Venture Capitalists (VCs) and also Public Private Partnerships (PPPs).
Further, to strengthen and power the medical devices sector with sustained manpower, the National Medical Device Policy 2023 has envisaged supplying a skilled workforce across the medical devices value chain by leveraging the Ministry of Skill Development and Entrepreneurship.
Lastly, the medical device policy will also focus on branding the Indian devices in foreign markets and will initiate studies to learn from the best global practices of manufacturing and skilling by the establishment of an Export Promotion Council which the government announced in September last year.
Industry Lauds, Awaits Fine Prints
The announcement of the National Medical Devices Policy 2023, has been welcomed by open arms from the medical devices industry, with lauds, praise and hope pouring from the different stakeholders of the sector.
Rajiv Nath, Forum Coordinator of Association of Indian Medical Device Industry (AiMeD) while applauding the Government told BW Healthcare World “We congratulate the Government wholeheartedly for approving the much-needed, long-awaited direction we had sought since the initial draft policy of June 2014 for a ‘National Medical Devices Policy”
“We are more than hopeful that the policy details will help boost local manufacturing, help traders and importers to start investing in putting up factories and end the 70-80 per cent import dependency forced upon India and the ever-rising import bill which last year shot up by a steep 41 per cent to over Rs 63000 Cr and make quality healthcare accessible and affordable for common masses worldwide,” Nath further added.
Mudit Dandwate, CEO and Co-Founder of Dozee stated that the reality that India still imports 75 per cent of its medicinal equipment is a major obstacle when it comes to making medical care affordable for all. “Therefore, the substantial investment of Rs 1,206 crore which the policy commits to the allotment, will be tremendously beneficial in reinforcing its domestic production,” he said.
He further delineated that the policy’s special emphasis on skill development to equip medical professionals better adapt to technology will help bring innovators and healthcare practitioners together to work towards providing quality care.
While speaking to BW Healthcare World, Sunil Khurana, CEO and MD, BPL Medical Technologies stated that having a dedicated body to understand the nuances of medical devices will enable the sector to implement the right decisions and will be a major factor in building the medical device sector. “The policy will boost Make in India rapidly and accelerate growth,” he said.
Welcoming the policy, Pavan Choudary, Chairman, Medical Technology Association of India (MTaI) said, “Though we still have to go through the fine print, we are encouraged by the spotlight turned on R&D. While India has only 1.5 per cent of the global medical device market, it has 8 per cent share of the MedTech R&D work force already. This is a fertile and proven area to focus on.”
He further said that the emphasis on creating a systematic brand positioning and awareness creation program is also long due and laudable. “All in all from what is available so far in the public domain it seems a policy which harnesses both the domestic and international currents to optimally forge the path ahead,” Choudary added.
Concerns
While applauding the new medical device policy the industry leaders also highlighted certain concerns and expectations awaited from the details of the policy, Khurana told BW Healthcare World that at present garnering support from the State and Central governments in exporting Indian-made products to other countries is challenging, for instance the easy issuance of Free Sale Certificates (FSC) especially when Central Drugs Standard Control Organisation (CDSCO) is overloaded with pending approvals and regulatory framework.
Nath said “We hope AiMeD’s and the Parliamentary Committee’s recommendations are reflected in the policy details and we will see this neglected sector flourish finally as have the mobile phones and the toy sector recently with right policy support.”
Promising Catalysts
Going forward the medical devices sector is expected to benefit from promising catalysts such as the growing Indian population with rising life expectancy, disease burden shifting to Non Communicable Diseases (NCDs), a growing middle class with rising disposable income, increasing health insurance penetration and a booming medical value tourism sector which will ensure a steady rise of the sunrise industry.
According to the IBEF report, the diagnostic imaging market is estimated to expand at a CAGR of 13.5 per cent between 2020 to 2025. The report also states that in 2021, India exported medical devices worth USD 2.53 billion which is set to touch USD 10 billion by 2025. As per the report, Foreign Direct Investment (FDI) in the medical and surgical appliances sector stood at USD 2.71 billion between April 2000 to June 2022.
