Recent Government Policy on Knee Implants

People in India frequently suffer from joint pain and arthritis. There has been a rise in the cases of surgeries and knee replacements by 30% from 2004 to 2008. The huge profit margin extracted out of the business of knee implants has made the National Pharmaceutical Pricing Authority (NPPA) to slash prices of such implants.

National Pharmaceutical Pricing Authority (NPPA)

It is an organisation under Government of India which fixes, revises and reviews the prices on various pharmaceutical drugs, procedures as well as equipment for such procedures in the country. It works according to the Drug (Prices and Control) order 1995. It recently set up a price ceiling on bioresorbable stents slashing the prices up to 85% on 13th February 2017.

Following this, NPPA has set up a price ceiling on Knee Implants cutting their prices by 69%. The regulator has taken the advantage of ‘emergency circumstances’ under the order to provide such ceiling.

• The regulator claims that the business of knee implants has been extracting a trade margin of 450% which goes into the pockets of distributors, manufacturers and hospitals. It comes under unethical profiteering
• It has led to arthroplasty (surgeries related to joints) becoming increasingly unaffordable to many
• About 1.5 to 2 crore people are in the need of arthroplasty every year. But due to the prices of one such implant including all the procedures and material reaching up to 2 lakhs, only 1 lakh are able to avail such surgeries
• According to a WHO report, osteoarthritis will be the fourth biggest reason for disability in the world by 2020 and India would be a leading country which is a grim scenario.

Government Policy

• Price capping of cobalt chromium implant to Rs. 54,720, down 65% from its average maximum retail price of Rs. 1.58 lakh’.
• Price capping of zirconium and titanium to 76,600, or 69% lower than the original average MRP
• Price capping of a second surgery if first implant has failed to 1.14 lakh, or 59% lower compared with an average price of `2.77 lakh
• It highlights that each component of a surgery has been price ceiled. Although the ceiling is material based but in some components, price has been set up irrespective of the materials used
• The prices set up are exclusive of GST but inclusive of trade margins

Impact

The policy would help save 15,000 crore of the patients annually. It will make the implants affordable and help in reducing the disability accruing from inability to get the surgeries done.