Medical Device Industry and its impact on Healthcare Sector of India for FY2014 along with Current Scenario of Global, US, EU and Indian Medical device market.

1. A HEALTHCARE SECTOR ANALYSIS 2014

2.  Healthcare Sector in India
 What Is Medical Device?
 Major Difference Between Drug & Device
 Device Classification
 Global Scenario Of Medical Device Market
 US Medical Device Market
 Indian Medical Devices Market
 Regulation Of Medical Devices
 Current Scenario of Medical Device Industry in India
 SWOT Analysis
 Conclusion

3. REPORT: 2013
2014: USD 103.9
(72% IPD & 28% OPD)
Sources: Business Standard, Wikipedia.org, IIMjobs.com, Data.worldbank.org
(US: USD 8895)
(GLOBAL AVR-2.9) (WHO STIPULATION- 1:1000)
(4% of GDP: 2012-13)
~ 4%

4. REPORT: 2013
SHARES OF HEALTHCARE EXPENDITURE
71%
9%
13%
4%
3%
HOSPITALS
CAGR>11% (2013-17)
PHARMACEUTICALS
CAGR>12% (2012-20)
MEDICAL DEVICES AND SUPPLIES
CAGR>15% (2012-16)
MEDICAL INSURANCE
CAGR>20% (2008-13)
DIAGNOSTICS
Sources: Business Standard, Hospital Market India by Research on India

5. 9%
 A medical device is an instrument, apparatus, implant, in
vitro reagent, or similar or related article that is used to
diagnose, prevent, or treat disease or other conditions,
and does not achieve its purposes through chemical
action within or on the body (which would make it
a drug).
Source: Wikipedia.org

6.  A medical device is defined according to Schedule M-III
creates a specific definition of medical devices as separate
from drugs.
 Unlike a drug, a medical device is defined as a medical tool
"which does not achieve its primary intended action in or
on the human body by pharmacological, immunological
or metabolic means.”
 Medicinal products covered by the Drugs and Cosmetics
Act will not fall under Schedule M-III.
 If there is any uncertainty about whether the product falls
under the drug or medical device category of the DCA
under this schedule, regulators will consider the principal
mode of action of the product.
Source: Wikipedia.org

7.  DRUG  DEVICE
 Based on Chemistry &
Pharmacology
 Safety and Efficacy
 Clinical Trials
 Local and Systemic
Toxicity
 Long Product Life Cycle
 Drug Interactions
 Large Population
 Based on Engineering
 Safety and Performance
 Clinical Evaluation
 Biocompatibility
 Short Product life Cycle
 Device Malfunction
 Limited Population

8.  Medical Devices in India are classified as per their risk levels
and intended use and are divided into different classes
 Classification is carried out in accordance with Annexure IX of
Schedule M‐III provided by The Drugs Technical Advisory
Board (DTAB)

9.  The global medical device market was worth USD 298 Billion in
2013, which experienced significant growth over the last few years
and is expected to continue, reaching approximately USD 440.5
billion in 2018 with a CAGR of 7.5%
 The five largest global markets for medical devices are U.S.,
Japan, Germany, France, and Italy. They account for 13.1% of
global population and 76% of global medical device use.
 Conversely, the five most popular countries in the world China,
India, Indonesia, Brazil and Pakistan account for nearly half of the
global population, But they account for only 4.4 per cent of global
medical device use.
 US is a global player in the global medical device industry with
nearly 50% shares by sales and nearly 20% of the market shares
by production .
Source: Global Marketing Emergo Group Inc.

10. Source: ESPICOM, AMMI ANALYSIS
 USD 298 Billion (2013)

11. 17%
32% CONSUMABLES
31%
12%
8%
DIAGNOSTIC APPRATUS
ORTHOPAEDIC PRODUCTS
DENTAL PRODUCTS
OTHER EQUIPMENTS
Source: Global Marketing Emergo Group Inc.

12. Company Revenue (in billions)
1. Johnson & Johnson $28.6
2.Siemens Healthcare $18.7
3.General Electronics $18.3
4.Medtronic $16.7
5.Baxter International $14.3
6.Philips Healthcare $13.5
7.Novartis AG $10.4
8.Cardinal Health Inc. $10.1
9.Stryker Corp. $8.8
10.Becton Dickinson & Co. $7.9
Source: www.mddionline.com

13. Source: IMAP 2012

14.  The U.S. medical device industry, which is valued at more than
$60 billion, is the world’s largest and accounts for nearly 20
percent of the $350 billion global industry, by production
 The United States is the world’s largest medical device market,
accounting for nearly 45 percent of the $293 billion global market
by sales
 In 2013, the United States spent over 18 percent of its GDP on
healthcare more than any other country
 Domestic Consumption = 40%
 17 Biggest companies account for 65% of the total revenue
 More than 6000 medical device manufacturers
 Cardio vascular products form the single largest sector
 LATEST ISSUE:2.3% medical device tax on US sales/turnover
for medical device companies.
Source: U.S. International Trade Commission

15. EXPORT OF MEDICAL DEVICES INNOVATIONS OF MEDICAL DEVICES
Source: GTIS DATABASE 2012

16.  ETHICON-Women's
Health & Urology, provides a range of
GYNECARE products and solutions for gynecologic surgery
for abnormal uterine bleeding, adhesion prevention, pelvic
floor repair and incontinence. e.g. GynECARETVT
 CARDIOVASCULAR CARE-Cardiovascular
Care has been a pioneer in circulatory disease
management and the worldwide leader in the science behind
the diagnosis and treatment of cardiac arrhythmias. E.g.
RADIALSOURCE™
 DePuy-
DePuy Joints has products ranging from innovative
orthopedic implants for hip, knee and shoulder replacement to
high technology equipment for computer navigated
surgery. e.g. PFC SIGMA Fixed Bearing Knee System, Delta
Motion.

17.  ETHICON ENDO-SURGERY-Markets
advanced medical devices for surgical procedures
that transform patient care by enabling improved patient
outcomes through early detection and treatment, reduced
pain and anxiety and quicker return to normal activity e.g.
ENDOPATH®
 LIFESCAN-LifeScan
is dedicated to improve the quality of life of
people with diabetes by developing, manufacturing and
marketing a wide range of blood glucose monitoring
systems and software for use by people with diabetes and
by Healthcare providers. E.G. OneTouch®

19.  India’s medical device market is currently the fourth largest
market in Asia with 700 medical device makers, and ranks among
the top 20 in the world
 Currently valued at $ 4.4 billion, the Indian medical device and
equipment market is expected to grow to around $ 5.8 billion by
2014 and $ 7.8 billion by 2016, growing at a CAGR of 15.5 per
cent (~2% of the Global MDI)
 The Indian medical devices industry forms a very small part of the
total manufacturing industry accounting for only 0.2 percent of all
certified facilities
 It is accounting for around 9% of shares in the Indian healthcare
sector, while the Indian Pharmaceutical industry is having 13%
shares in the total healthcare sector of India.

20. IMPORT DOMESTIC PRODUCTION
72%
Source: RNCOS 2012
28%
20.04 GERMANY
18.71 CHINA
17.48 US
10.07 UK
7.25 JAPAN
26.25 OTHERS

21. 19%
MEDICAL AND DIAGNOSTIC EQUIPMENTS
MEDICAL IMPLANTS
MEDICSL DISPOSABLES AND SUPPLIES
Source: RNCOS
56%
25%

22. Source: IMAP 2012

23.  Expansion of hospital sector
 Increase in outsourcing
 Rising prevalence of lifestyle diseases
 Increase in medical tourism
 Spread of telemedicine
 Ageing population
 Over reliance on imports
 Lack of access to technology
 Regulatory system
 Access to capital

24. 1)
• A strong engineering and information technology industry are
considered to be backbones for the medical technology industry. In
spite of India’s well acknowledged capabilities and global
recognition in these areas, 72 percent of medical devices used in our
country continue to be imported.
2)
• Government appears to have failed to notice that a strong domestic
medical technology industry is vital for meeting its long term needs
of cost effective and sustainable health care needs of the Indian
population across demographics.
3)
• Despite a relatively non conducive manufacturing environment,
several domestic companies have come up in areas such as cardiac
implants, intraocular lenses, orthopedic implants and medical
disposables and have benchmarked themselves to International
norms.

25. 1. 3 M Healthcare
2. India Medtronic
3. Johnson & Johnson
4. Becton Dickinson
5. Abbott Vascular
6. Bausch & Lomb
7. Baxter
8. Zimmer India
9. Edwards Life Sciences
10. St. Jude Medical
11. Stryker
12. Boston Scientific
13. BPL Healthcare India
14. Sushrut Surgicals
15. Trivitron Diagnostics
16. Accurex Biomedical
17. Biopore Surgicals
18. Endomed Technologies
19. Forus Health
20. HD Medical Services
21. Eastern Medikit
22. Harsoria health care
23. Nidhi Meditech System
24. GE Healthcare
25. Philips Medical
26. Wipro Technologies
27. HCL Technologies

26. Source: IMAP 2012

27.  Trauma-
Bone Plates & Bone Screws
 Intramedullary Nailing-
ADLER Atlas Nailing System
 Spine-
OneLock™,
a breakthrough in Spine Technology

28.  "NIDHILITH" is a intra corporeal pneumatic stone fragmentation device which
fragments the stones in the kidneys, ureters and bladder by direct contact lithotripsy,
under the direct vision endoscopic treatment. This versatile, still simple and users
friendly device proved to provide a most sophisticated and economical method to
achieve the intra corporeal pneumatic lithotripsy.
 NIDHI-Uroflow is a fully automatic microprocessor based device with digitally
controlled dip-stick type flow transducer. It is designed to monitor the urinary volume
and flow rate within a urine collection beaker during micturation. NIDHI-UROFLOW
system is quite expedient for very practical day to day flow study.

29.  Currently, medical devices are regulated as drugs by the
drug controller general of India (DCGI) of the Central
Drugs Standard Control Organization (CDSCO).
 The lack of a drug/device distinction has created
difficulties for foreign companies in the medical device
market.
 There is no single list of regulated devices with different
regulations for different devices, and some devices are
not regulated at all.
 In certain cases, product registration and manufacturing
standards intended for drugs are applied to the
manufacture of devices.

30.  The central licensing approval authority (CLAA), a
branch of the CDSCO, will serve as the main regulatory
body for medical devices.
 All medical devices will undergo conformity assessment
procedures to ensure compliance with quality and safety
standards before they are allowed to the Indian market.
 The CLAA will adopt the regulatory standards of the
Bureau of Indian Standards (BIS) and International
Organization for Standardization (ISO) specifications
for quality management systems.

31.  For Class A devices, manufacturers may perform their own
conformity assessment procedures. However, for Class B, C
and D devices, the CLAA, in consultation with the BIS, will
publish a list of notified bodies authorized to perform
conformity assessment.
 All medical devices imported into India are covered by
Schedule M-III and will be subject to its guidelines
 Imported medical devices that already have been approved
in the United States and/or European Union, or that have
been deemed equivalent to a CE Mark and FDA-approved
device, will be allowed on the Indian market without
undergoing separate conformity assessment procedures.

32.  The classification of medical devices according to 21 CFR 860
which is a part of the Medical Device Amendments of 1976 and
the Safe Medical Devices Act of 1990.
 Class I: General controls:
Eg: Elastic Bandages, Examination Gloves
 Class II: General controls with special controls:
Eg: Infusion Pumps, And Surgical Drapes
 Class III: General controls and premarket approval:
Eg: Implantable Pacemaker, Pulse Generators, HIV Diagnostic
Tests, Automated External Defibrillators, and Heart Valves .
Source: Wikipedia.org

33.  The classification of medical devices in the EU is outlined in
Annex IX of the Council Directive 93/42/EEC. There are
basically 4 classes, ranging from low risk to high risk.
 Class I (including Is & Im)
 Class IIa
 Class IIb
 Class III
 Class Is, Im, IIa, IIb or III, it must be verified by a Certificate of
Conformity issued by a Notified Body.
 Certified medical devices should have the CE mark on the
packaging, insert leaflets, etc.
Source: Wikipedia.org

34.  The Maharashtra Food and Drug Administration (FDA) has suggested, to
the Drug Controller General of India (DCGI) and the National
Pharmaceutical Pricing Authority (NPPA) that medical devices should be
brought under the Drug Price Control Order (DPCO), to make them
affordable to patients.
 Medical devices are notified as drugs under the Drugs and Cosmetics Act,
1940 but are not included under the DPCO. Therefore, the prices of medical
devices cannot be monitored or controlled.
 The recommendation comes in the wake of studies conducted by the FDA
which has revealed that manufacturers in connivance with importers,
distributors, and hospitals are fixing the MRP of medical devices arbitrarily.
The study observed that the MRP of a product was set high and the patients
had no bargaining options.
 The drug authority believes that under the new DPCO regime, the prices of
these products could be monitored and would also help curb profiteering.
Source: biospectrumindia.com

35.  The government is likely to soon permit 100% FDI in brownfield medical devices and equipment
manufacturing projects through the automatic route.
 Currently, 100% FDI is allowed in the pharmaceutical sector (including medical devices) in greenfield
projects through automatic route, while Foreign Investment Promotion Board (FIPB) approval is needed
for brownfield investments.
 Significantly, of the $5-6 billion-worth medical devices, equipments and technology market in India,
72% is catered to by imports. The government wants to reduce dependence on such imports through
incentives to increase domestic manufacturing. “Foreign investors know that with labour costs in China
going up, it will be cheaper to manufacture medical devices in India and make it a hub for exports to
other parts of South Asia,”
 Discussions are on between the ministries of health and commerce on the treatment and regulation of
medical devices under the Drugs and Cosmetics (Amendment) Bill. Once the health ministry comes out
with a negative list of medical devices/equipments/technology that needs to be controlled (via FIPB
approval in brownfield investments), the remaining items can then take advantage of the proposed FDI
norms, they added. Pending parliamentary approval to the Bill, the commerce ministry wants the health
ministry to find a via media – through notification or guidelines – to ensure separate treatment for FDI in
brownfield medical devices/equipment projects.
Source: Business Standard

36.  P A Francis
Wednesday, October 08, 2014, 08:00 Hrs [IST]Last week the Union health ministry came out with a notification making labelling
of medical devices mandatory in the country by amending the Drugs & Cosmetics Rules. Although labels of some of these critical
products do contain a few details, many key information is not printed on the packs. With this notification, the labels on the
devices should carry proper name of the medical device, the details necessary for the user to identify the device and its use and the
name and address of the manufacturer. The label should disclose the net quantity in terms of weight, measure, volume, number of
units and the dates of manufacture and expiry. In case of sterile devices the date of sterilisation and details of materials used for the
making such devices should be printed on the label. The label should also mention a distinctive batch number or lot number of the
product besides the manufacturing license number.
It seems that the key objective of making labelling mandatory for medical devices with all the necessary details is to bring the
medical devices sector under the regulatory control of the government. The only regulatory intervention the government did so far
was to place 14 medical devices under Drugs & Cosmetics Act. As this sector remained largely outside the purview of any
comprehensive law, there has been several unfair practices in producing and marketing of medical devices in the country. The
medical devices sector in India is still at a nascent stage with more than 60 per cent of India’s requirement of medical devices and
equipments are being imported as the domestic production is restricted to low technology and disposable items. Whereas the
demand for these life saving products has been growing over the years with a sharp rise in the life style diseases in the country.
Medical devices are life saving products and have to be produced with quality materials as per good manufacturing practices
(GMP) and under all the necessary rules. But, most of the units engaged in the manufacture of medical devices are small and do
not follow GMP voluntarily and there are no specified standards for the materials used. Quality, safety and fair pricing are three
factors that determine the growth of any industry. What has been done by the government last week is not just enough to have a
proper regulatory control on this sector. Apart from laying down standard norms for the materials used for making devices, a
system of price control on these products is extremely necessary. Currently huge profits are made on most of the life saving
devices by the traders, hospital managements and the doctors. As the patients have no say in deciding whether to use a device and
what brand of device to be used, they are subjected to overcharging. This needs to be urgently checked by fixing a system of fair
pricing medical devices as in the case of pharmaceutical products.
Source: Business Standard

37. STRENGTHS
Huge market
Growing private hospital sector
WEAKNESSES
Low per capita expenditure
Developing government policies and infrastructure
Untapped rural markets
Excessive dependency on imports
Support system from R & D not available
OPPORTUNITIES
Overseas companies investing in India
Increasing Joint ventures and agreements
Regulations to improve market for domestic
manufacturers
THREATS
Existing regulation policies
Unorganized market
SWOT
Lack of regulations in Medical disposables and
surgical items leading to spurious products

38.  Medical technology (Medtech) companies are
accelerating their investments in emerging markets,
and India is a prime target because of its large
population, growing middle class, and improving
healthcare infrastructure. To date, most Medtech
multinationals have pursued a conservative business
strategy and operating model in India, focused on
delivering their existing offerings to the premium
segments of the market. But the playing field is
becoming far more competitive, and companies in
search of growth need to move beyond the traditional
model.

39. For Further Assistance, Please Contact on Social Networking Sites >>

40. Presented by:
VIKAS SONI
Management Scholar,
Pharmaceutical Management.
NIPER, Mohali, Punjab, India.
Vikas.niper2014@gmail.com
http://in.linkedin.com/in/vikassoni11/
https://www.facebook.com/Vickysoni11