MEDICAL DEVICES MANUFACTURING INDUSTRY : ESTIMATION OF

MARKET SIZE AND IMPORT DEPENDENCE IN INDIA

To be presented by:
JANMEJAYA PANDA

Under the guidance of

Dr. Gopal Sharan Parashari

DEPARTMENT OF HUMANITIES AND SOCIAL SCIENCES

INDIAN INSTITUTE OF TECHNOLOGY, DHARWAD
 INTRODUCTION
 The 60th World Health Assembly (WHO 2007) heavily acknowledged that health technology , typically
medical devices and equipment is necessary for an effective health care system.

 Incrising dependence on healthcare technology has increased in recent years. (Mahal et al 2006)

 OECD countries have witnessed increasing costs of healthcare.(Sorenson et al 2013)

 About 95% of the medical devices in the developing countries are imported. (WHO 2006)

 With limited domestic industries, it increases out of pocket expenditure substantially.

 Developing countries like India have to gain from effective use of the technology.

 The factors affecting are domestic production capacity, import intensity and how the govt. is regulating
the market.
 Contd…
 India is the 4th largest market for medical devices all over Asia. (DOP 2015,Appendix 5)

 The first attempt to estimate the size of the Indian market of medical devices by the task
force formulated by the department of pharmaceuticals of MoCF. (2015)

 Data from AIMED and MOCI.

 The report : 800 manufacturers having turn over of Rs. 20,500 crores( 2012/13);domestic
production was Rs. 16,400 crores

 Size of the Indian market (domestic + import export)equivalent to 30,900 crores.

 Research questions
 What is the value of the market for medical devices in India?
 What is the intensity of import for medical devices in India?
 OBJECTIVES
 To estimate the size of the Indian medical devices market and industry.
 To compute the import dependence of India for medical devices.
 Data and methodology
 The unit level disaggregated figures from the Annual survey of Industries (ASI, CSO_ IS WIng)
and the Export Import Data Bank(EIDB, Version 7.1) ~ Tradestat

 The estimation period spans for 4 years (2010_11 to 2013_14)

 All possible manufacturing activity that may produce medical devices have been taken into
consideration.

 From the ASI data, 41% of the value of the products produced in Indian industries are truly
medical and the remaining are other products and by products. (General purpose
machinery, plastics, etc.)

 This study filters out all those other non medical devices . (NPCMS 2011)
 Findings
I. Domestic Production of Medical Devices.

 During 2010_11, 73% of the Gross Sales value (GSV) was from manufacturing of
instruments and appliances used in medical, surgical or veterinary sciences [CPC 48150].

 But in 2013/14, only 32% of the GSV of the domestic manufacturers were from medical
appliances and instrument.

 In 2013_14, the Indian industry have begun manufacturing more sophisticated devices and
apparatus (Orthopaedic appliances, Fracture appliances etc , CPC 42121, CPC 48171, CPC
48180).

 Thus Indian industries have progressed spectacularly in recent years.

 Findings continues…
II. Export and import of medical devices and equipment

 India is emerging as a importer of medical devices and equipments with 1.2% share in the
global import which is increasing continuously. (WITS database,WB)

 During the four period span, the import of medical devices has increased 12% per annum.

 The export is increasing also at a rate of 15% per annum.

 The domestic production capacity is rising at 8% per annum.

 In 2013_14, India became a net exporter of UV and IR ray apparatus.

 Nevertheless India continues to be a net importer with a value of Rs. 103.5 billion on
2013_14. (69.8%: Table 1
 Discussions
 Use of medical devices is one of the major drivers of healthcare expenditure growth.

 The use of imported medical devices has given a boost to the already sizeable out of pocket
(OOP) health expenditure.

 The share of OOP expenses in the national expenses on health is 16% in US and 12% in
Japan, but it is 68% in India. the share of diagnostic expenses in OOP spending is 7.6% after
a steady rise from 2.2% in 1993_94. (WHO 2006)

 No distinction between new and refurbished medical devices. (Francis 2008)

 There is emergence if the market of refurbished medical devices. (PR Newswire 2018)

 Large unregulated market for medical devices.

 Continued…
 22 Notified Medical devices are under Drugs and Cosmetics Rules, 1945 till now.

 Need to bring all devices under regulation.

 Need to restrict the inflow of refurbished devices.

 The price control mechanism to be implemented to bring down own prices and OOP
expenses.
 References
 Datta P and Selvaraj S (April 2009): “Medical Devices Manufacturing Industry : Estimation of
Market Size and Import Dependence In India,” Economic and Political Weekly, Vol LIV No 5
pp 46_52.
 DoP (2015): “recommendations of the task force on Medical devices sector in india, 2015”
Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers , Government of India,
http://pharmaceuticals.gov.in/sites/default/files/MedicalDevicessector_o.pdf.
 Mahal, A, Anil Varshney and Srinivas Taman (2006): “Diffusion of Diagnostic Medical Devices
and Policy Implications for India,” International Journal of Technology Assessment in Health
Care, Vol 22 No 2 pp84_90.
 Sorenson,C, Drummond, M and Khan B B (2013) “Medical Technology as a Key Driver of
Rising Health expenditure: Disentangling the Relationship,” Clinico Economics and Outcome
Research, No 5 pp223_234,
http://www.ncbi..nlm.nih.gov/pmc/articles/PMC3686328/pdf/ceor_5_2_23.pdf.
 WHO (2006): “The Role of Medical Devices and Equipment in Contemporary nHealth Care
and services,” World Health Organisation,
http://applications.emro.who.int/docsEM_RC53_Tech.Disc,2_en.pdf
THANK YOU