Patients with heart conditions, particularly blocked arteries, have to buy cardiac stents that can help save their lives at more than eight to 10 times the price at which the devices are manufactured. This is according to data that has recently been submitted by stent manufacturing companies to the National Pharmaceutical Pricing Authority, which is in the process of fixing a ceiling price for cardiac stents.

The cost of stents escalates in orders of magnitude at each step – from manufacturer or importer, to distributor, to hospital and finally to a patient. On January 16, the pharmaceutical authority made public the kind of profits that are accrued at each level of distribution.

As per the data submitted, the trade margin for drug eluting stents – stents that release drugs to keep treat damaged arteries – between a distributor and a patient can be as high as 892%. The highest profit margins are made by hospitals at up to 654%.

The prices of drug eluting stents, the most used type of stents, increases from Rs 40,820 at the time of manufacture or import to Rs 1,98,000 when sold by a hospital to a patient.

Landed cost is the cost at the time of manufacture or import.
Landed cost is the cost at the time of manufacture or import.

In December, the department of pharmaceuticals issued a notification bringing life-saving cardiac stents under the Drug Price Control Order thus capping the price of stents and making them more affordable. The NPPA has been in the process of fixing a ceiling price for cardiac stents for nearly a month. Unlike other drugs, cardiac stents are not available in the market, but only with cardiologists and hospitals.

The usual process of fixing a ceiling price involves taking an average of the maximum retail prices. This would not work for cardiac stents as the maximum retail prices are arbitrarily fixed based on distributer and hospital profit margins, the authority’s data shows.

Since then, the manufacturers, distributers, civil society and various other stakeholders submitted their views on how the price should be fixed. While the stent manufacturers are trying to persuade authorities to consider the price to a hospital – the highest price point – as the base price to fix the ceiling price, activists working towards increasing access to medicines are pushing for using lower parameters such as their manufacturing cost.

The authority is still seeking data from the stakeholders. They have approximately a month more to fix the price of the stent.