Exclusive: After Survey Flags 2,800% Pharma Profit, Tukaram Mundhe Calls For Transparency

There is a 2800 per cent profit in the price of an IV set at which manufacturers sell to hospitals and the Maximum Retail Price and that indicates a need for a relook into the pricing and profit issues, Maharashtra FDA Commissioner Tukaram Mundhe told NDTV in an exclusive interview today. 

Following a market survey by the Maharashtra State Price Monitoring Resource Unit under the state FDA to assess pricing patterns of medical devices sold in retail and trade markets, Mundhe has written to the National Pharma Pricing Authority under the Department of Pharmaceuticals, asking for intervention.

While pharma or any other industry will not work to incur losses, he said there needs to be transparency. "A trade margin of 2800 per cent is by any terms not acceptable, either as a consumer or as a hospital or as a regulator," he told NDTV. 

The government's focus on the subject can ensure a "win-win situation" for all stakeholders, he said. This will be done according to the laid down process and consultation with the industry.

It needs to be seen "what they are expecting, how much input is there, how much profit margin they are looking at and at the same time as a regulator, the pricing authority, government will look into what is the margin that should be allowed," he said. 

"Basically there has to be a fair trade, fair margin of profit. But it cannot be opaque. It cannot be unacceptable to the consumers, to the regulators and of course it cannot be acceptable to the manufacturers as well. Because they have to run business. They have to have profit. But it has to be fair, transparent and ethical," he added.

Read: Rs 11 IV Set Sold For Rs 325: Tukaram Mundhe Asks Centre To Intervene

The survey found significant disparities between procurement costs and printed maximum retail prices (MRPs) across several categories of medical devices used in inpatient departments (IPDs). 

The Maharashtra survey examined IV sets, syringes, nebuliser oxygen mask, and miscellaneous devices and found mark-ups of up to 29 times the procurement cost on essential inpatient medical devices.

For example, The 'Medifusion IV set' by Mediplus Haryana had a purchase price of Rs 11.05 and an MRP of Rs 325 -- adding up to profits to the tune of 2,841 per cent. Another manufacturer, Lyvofusion, showed margins of 2,091 per cent.

A standard 10 ml syringe manufactured by Lifelong Meditech in Delhi was being sold for Rs 57.2 against a purchase price of Rs 6.75.

An adult nebuliser mask kit manufactured by Vinjoh Healthcare is priced at Rs 45 but was sold to patients for Rs 652.