Advantage India
Increasing
Demand
* Rising number of medical facilities will boost the demand for medical devices in the market.
* Various government initiatives such as ‘Production Linked Incentive (PLI) Scheme for Medical Devices 2020’ and establishing medical parks will augment demand.
* The medical devices sector in India is projected to reach US$ 50 billion by 2025.
Opportunities
in Export
* The Indian medical device market is driven by 70-80% imports from countries such as the US, China and Germany.
* India and Russia have set the bilateral trade target at US$ 30 billion by 2025. Trade is expected to increase by an additional US$ 5 billion per annum, with opportunities in pharmaceuticals & medical devices, minerals, steel, and chemicals.
* Medical devices are a highly attractive export area for US firms.
Policy
Support
* In July 2022, the government tabled a draft for the new Drugs, Medical Devices and Cosmetics Bill 2022, to assure and offer thorough legal protections to ensure that the medical items sold in India are reliable, efficient, and up to required standards.
* In November 2021, the Indian Council of Medical Research (ICMR) collaborated with Indian Institutes of Technology (IITs) to establish ‘ICMR at IITs’ by setting up Centres of Excellence (CoE) for Make-in-India product development and commercialisation in the medical devices space.
Increasing
Investments
* This sector has attracted significant investments over the years.
* In FY20, foreign investments in the medical devices sector increased 98% YoY to Rs. 2,196 crore (US$ 301.01 million), as against Rs. 1,108 crore (US$ 151.87 million) in FY19.
* FDI inflow in the medical and surgical appliances sector stood at US$ 2.71 billion between April 2000-June 2022.
Introduction
The healthcare and medical device sectors in India have grown significantly in the last decade. A wide range of medical devices, from consumables to implantable medical devices, are produced in India. The majority of medical devices manufactured in India are disposables like catheters, perfusion sets, extension lines, cannulas, feeding tubes, needles, and syringes, as well as implants like cardiac stents, drug-eluting stents, intraocular lenses, and orthopaedic implants. The medical devices sector is highly capital intensive, and also requires continuous training of the healthcare system providers to adapt to new technologies.
However, there is still a huge gap in the current demand and supply of medical devices in India, as India has an overall 70-80% import dependency on medical devices. At present, many medical device manufacturers (domestic and international) are chasing this massive under penetration of medical devices in India as a significant growth opportunity.
The government has come up with multiple initiatives and policies to promote India’s medical device sector. It was recognised as a focus sector in 2014 by the government during the Make in India campaign.
Market Size
The medical devices sector in India comprises large multinationals, small and midsized companies.
As of 2020, the medical devices market is estimated to be at US$ 12 billion in India, and it is expected to grow at a CAGR of 15%, which is 2.5 times the global growth rate. India is the 4th largest Asian medical devices market after Japan, China, and South Korea, and among the top 20 medical devices markets globally.
Between 2020-25, the diagnostic imaging market is likely to expand at a CAGR of 13.5%.
Export of medical devices from India stood at US$ 2.53 billion in FY21, and are expected to rise to US$ 10 billion by 2025. To increase export of medical devices in the country, the Ministry of Health and Family Welfare (MOHFW) and Central Drugs Standard Control Organisation (CDSCO) implemented the following initiatives:
- Re-examination and implementation of Schedule MIII (a draft guidance on good manufacturing practices and facility requirements)
- System for export labelling
- Clinical evaluation and adverse reporting clarification
- State licencing authority to extend free sales certificate validity from 2 years to 5 years to allow exports
- Create a list of manufacturers with export licencing for easy access to regulatory authorities worldwide.
Investments
Some major investments and developments in the medical devices sector are as follows:
- BeatO, a supplier of diabetes treatment, has raised US$ 33 million in a Series B fundraising, which was headed by Lightrock India. HealthQuad and current investors Orios Venture Partners, Blume Ventures, and Leo Capital also participated.
- In August 2022, Wipro GE Healthcare announced that it had partnered with medical device maker Boston Scientific to offer comprehensive, cutting-edge cardiac interventional care solutions in India.
- FDI inflow in the medical and surgical appliances sector stood at US$ 2.71 billion between April 2000-June 2022.
- In July 2022, Godrej Appliances launched the new InsuliCool product range – Godrej InsuliCool and Godrej InsuliCool+, which are innovative cooling solutions especially designed for insulin storage, in order to address the challenge faced by diabetic patients with respect to insulin storage at recommended temperatures.
- In July 2022, the Rajiv Gandhi Cancer Institute and Research Center (RGCI) in New Delhi received its first-ever Made-in-India Surgical Robotic System, the SSI-Mantra, which was developed by med-tech startup SS Innovations.
- In July 2022, Ultrahuman announced its latest wearable: the Ultrahuman Ring, which can track users’ metabolism, measure movement, sleep and other body dynamics in real-time.
- Medtronic has launched a Surgical Robot Experience Center (SREC) in Gurugram, Haryana, the first of its kind in South Asia. The SREC will be focused on the education and training of surgeons in robot-assisted surgery.
- Indian Institute of Technology (IIT) Delhi has developed a national centre for medical technology development in an effort to help medical device startups produce their goods in a facility that has received ISO certification and secure the necessary certifications.
- In November 2021, Cipla launched ‘Spirofy’, India's first pneumotach based portable, wireless spirometer.
- In November 2021, Serene Envirotech Pvt. Ltd., a Mumbai-based start-up, launched a portable molecular hydrogen generating machine ‘udazH’ for personal use. The molecular hydrogen inhaler comes with a dual-use technology that lets two users simultaneuosly use the machine.
- In October 2021, Innovation Imaging Technologies Pvt. Ltd. (IITPL) established a ‘state-of-the-art’ facility in Bengaluru to manufacture 240 catheterisation laboratories in the next 12 months. Through this initiative, the company aims to strengthen the infrastructure to treat cardio-vascular diseases in the country.
- In October 2021, the HMD achieved a milestone by supplying 500 million 0.5 ml AD syringes to the government to accelerate the vaccination drive and contribute to India’s Atmanirbhar mission. The company further plans to achieve annual capacity of 3.5 billion syringes by March 2022.
- In September 2021, Medtronic India Private Limited collaborated with Stasis Health Private Limited to boost patient monitoring in India.
- In September 2021, Siemens Healthineers announced that molecular testing kits will be manufactured in its Vadodara unit in Gujarat.
- In September 2021, Siemens Healthineers extended its collaboration with SyntheticMR with a new licence agreement for distribution of the company’s (SyntheticMR) products.
Government Initiatives
The Government of India has commenced various initiatives to strengthen the medical devices sector, with emphasis on research and development (R&D) and 100% FDI for medical devices to boost the market.
- In September 2022, the government of India approved the setting up of an export promotion council for medical devices, under the Department of pharmaceuticals, with its headquarters in Noida.
- In August 2022, the Department of Pharmaceuticals greenlit the "Promotion of Medical Device Parks" programme from FY21-25 with a total financial investment of Rs. 400 crore (US$ 48.97 million), with a maximum support under the programme of Rs. 100 crore (US$ 12.24 million) for each Medical Device Park.
- In August 2022, the Department of Pharmaceuticals reconstituted the National Medical Devices Promotion Council (NMDPC) under the Chairmanship of the Secretary of the Department of Pharmaceuticals.
- In July 2022, the government tabled a draft for the new Drugs, Medical Devices and Cosmetics Bill 2022, to assure and offer thorough legal protections to ensure that the medical items sold in India are reliable, efficient, and up to required standards.
- In the Union Budget 2022-23, Rs. 86,200 crore (US$ 11.3 billion) was allocated as a budget for the pharmaceutical and healthcare sector.
- In October 2021, the government announced plan to draft a new drugs, cosmetics and medical devices bill to increase the acceptability of Indian medical devices in the global market.
- In October 2021, the government announced that 13 companies have been approved under the PLI scheme for medical devices, which is expected to boost domestic manufacturing in the country.
- In September 2021, the government sanctioned a proposal worth Rs. 5,000 crore (US$ 674.36 million) to build a medical devices park in Himachal Pradesh’s industrial township, Nalagarh, in the Solan district.
- In September 2021, the government approved a medical devices park in Oragadam (Tamil Nadu) that is expected to attract an estimated investment of Rs. 3,500 crore (US$ 472.05 million) and offer direct and indirect employment to ~10,000 people.
- In July 2021, the government announced that they would build a medical park in Uttar Pradesh, which is expected to generate an estimated Rs. 500 crore (US$ 67.13 million) business in the state.
- In June 2021, the Quality Council of India (QCI) and the Association of Indian Manufacturers of Medical Devices (AiMeD) launched the Indian Certification of Medical Devices (ICMED) 13485 Plus scheme to undertake verification of the quality, safety and efficacy of medical devices
- To boost domestic manufacturing of medical devices and attract huge investments in India, the department of pharmaceuticals launched a PLI scheme for domestic manufacturing of medical devices, with a total outlay of funds worth Rs. 3,420 crore (US$ 468.78 million) for the period FY21-28.
- The Medical Devices Virtual Expo 2021 showcased Indian products and enabled direct interaction between Indian suppliers and buyers/importers from participating countries; 300 foreign buyers from the healthcare sector participated in this event.
- In March 2021, the PLI Scheme for pharmaceuticals worth Rs. 15,000 crores (US$ 1.96 billion) was launched. This scheme aims to enhance India’s manufacturing capabilities by increasing investment and production in the pharmaceutical and medical devices sectors and contribute to the availability of a wider range of affordable medicines for consumers.
- On March 25, 2021, the Department of Pharmaceuticals released a revised notice on the Public Procurement Order (PPO), incorporating 19 medical devices in the revised guidelines of the PPO, which is expected to improve domestic medical devices manufacturing (and strengthen ‘Make in India’) and reduce import bills by ~Rs. 4,000 crore (US$ 538.62 million).
- In April 2021, in order to expedite the clearance of medical devices such as nebulisers, oxygen concentrators and oxygen cannisters, the government made it easier to import critical medical devices by easing the requirements for clearance under the Legal Metrology Act (Packaging Rules 2011).
Road Ahead
Policy makers in India will need to set out an action plan to reduce the country’s dependency on medical devices/technology imports. At present, NITI Aayog is reportedly drawing up a strategic road map for medical devices. Over the next few years, India might grow into a US$ 50 billion market for medical devices.
In BioAsia 2021, key stakeholders in the panel discussion on medical technologies predicted that India would become self-sufficient in domestic medical devices manufacturing by 2025-26. The panel observed that the government is taking supportive measures such as promoting indigenous manufacturing of high-tech medical devices, production-linked incentive schemes (PLIs) on medical devices, boosting new medical devices parks, etc. to boost the overall growth of the domestic medical devices market in India.
Medical device companies should develop India as a manufacturing hub for domestic and international markets, undertake India-based innovation in combination with indigenous manufacturing, collaborate across the Make in India and Innovate in India schemes, and produce low to medium technology products to cater to the underpenetrated domestic markets.
References: Government Websites, Press Releases, Media Reports, Deloitte Report
Note: Conversion rate used for November 2022 is Rs. 1 = US$ 0.012
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