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Excise blues plague medical technology industry

The government is dragging its feet on implementing low-cost substitutes for expensive diagnostic equipment, reports Suprotip Ghosh.

business Updated: Sep 23, 2007 23:35 IST
Suprotip Ghosh
Suprotip Ghosh
Hindustan Times

Imagine a Rs 4-crore magnetic resonance imaging (MRI) machine available in the market for one-fourth of the price, and a Rs- 4,000 glucometer available at Rs 1000. Sounds impossible? Well, the situation is likely to remain so.

The government is dragging its feet on implementing low-cost substitutes for expensive diagnostic equipment. This is hampering low-cost diagnosis in the country, according to the Association of Medical Devices and Diagnostic Suppliers of India (AMDSI).

According to doctors, an average CT scan machine could cost anything between Rs 50 lakh and a whopping Rs 4 crore, and could take years to break even. Most other similar machines like artificial heart and dialysis machines could cost even more.

The charge is passed on to the patient, and that is where a generic machine could cut the costs down, G S K Velu, president, AMDSI, told Hindustan Times.

“The patient is most important. We do loads of research before a machine is bought,” S R Raina, urologist attached with Jaslok, a multi-speciality hospital in Mumbai, said. “Cost is a factor, and you cannot replace a machine just because a new one is available,” he added.

Generic, or low-cost machines manufactured in India could cut costs by up to 75 per cent, Velu said. A glucometer, used to measure glucose levels in blood for diabetics, is available right now for Rs 4,000. It uses special strips to indicate glucose levels, which could cost up to Rs 20 each.

“Medical devices do not fall into any category of instruments. We have to pay excise duty of 16 per cent on each piece manufactured in the country, besides sales tax. Imports cost far less sometimes,” Velu added.

Most diabetics have to use the device life-long, which is usually a costly affair. A generic, Indian-made device could bring the cost down to Rs 1,000, Velu argued.

Medical devices range from sophisticated imaging machines to detect tumours and other anomalies to x-ray machines.

First Published: Sep 23, 2007 23:31 IST