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Introduction. Contextual Introduction.
Body. Nascent Indian medical device industry. What should be done?
Conclusion. Way forward.
The global medical device industry is highly innovative and technology driven, changing the face of healthcare worldwide. Globally, it is a rapidly advancing industry impacting and improving aspects such as diagnosis, treatment, and delivery, but in India, it is still very nascent with low levels of penetration and adoption. This presents an exciting opportunity to develop this industry and to play a larger role in the transformation of Indian healthcare. A good understanding of the nature of this industry will help ensure that the country is poised to capitalise on opportunities provided by medical technology to improve national healthcare.
Nascent Indian medical device industry:
- The healthcare industry in India has made rapid progress in the last decade, but significantly lags behind other nations in availability and quality of equitable medical care and services for citizens. This presents an enormous opportunity given the large population, growing economic prosperity, and the disease burden.
- There is prevalence of higher imports of medical devices in India. Reasons for this are:
- Lack of favourable policy and regulatory framework.
- Medical devices, unlike pharmaceuticals, are dependent on a mix of technologies such as engineering, electronics, material sciences and information technology.
- Innovation, capital and technology drive the industry. However, India has not been able to bridge the gap between investments, skilled resources and innovation to fully capitalise on these opportunities.
- There is no clear comparative cost advantage in comparison to other emerging markets and policy issues like inverted duty structure do not help in creating a positive environment.
- The medical devices industry in India is currently valued at approximately USD 6 billion and has expanded at a significant double digit growth rate over the past few years. The industry is still at a nascent stage with sub-optimal penetration and usage of medical devices. This demand innovation and R&D from medical device industry in order to push for indeginsation.
- Currently, India comprises only 1.7% of the world market, the industry is significantly import dependent, and current demand does not offer scale in various product categories. This will transform as demand significantly escalates to realize potential.
What should be done?
- As there is lack of scale in many products, the government should prioritize certain products for manufacturing in India.
- High volume, low-tech, labor intensive manufacturing sectors should be the initial target. Very rapid import substitution may not be practical or desirable.
- It is also felt that the government should position and promote India as a global manufacturing hub or destination, rather than focus on just the domestic market.
- Frugal innovation is a significant strength that India can offer the world. Innovation to develop new products for emerging markets should be encouraged, and this will also ensure manufacturing volumes needed for profitable operations.
- This approach will help India attract the right technology, upgrade manufacturing processes and quality, and build local R&D capability.
- A clear long term vision and roadmap for the industry and predictability of policy would excite the industry. The government needs to provide policy support for both the supply and demand side of the medical device industry to successfully accelerate growth.
The medical device industry is a unique blend of engineering and medicine. It involves the creation of machines that are then used to support life within the human body. Industry and government need to work together to improve awareness, access, adoption, and affordability for medical devices in India. Certainly, major changes are needed in the sector.