Medical Devices Industry Analysis

Under the medical devices and IVD regulations, the Health Ministry of India has divided medical devices into the following four categories: Class A - Low risk devices including surgical dressings, umbilical occlusion devices, bolster sutures, alcohol swabs, nasopharyngeal catheters and Y-connectors; Class B - Low-moderate risk devices including endoscopic forceps, vial adapters, suction cups and catheters, Sengstaken-Blakemore tube, feeding tubes and gastrointestinal tubes; Class C - Moderate-high risk devices including anaesthesia conduction filter, introducer sheath, microcatheter, imaging catheter colonic stents and pancreatic instruments; and Class D - High risk devices such as coronary stents, cardiac catherisation kits, cardiovascular, intravascular diagnostic catheters and occlusion catheters

In India is among the top 20 markets for medical devices worldwide. The market is expected to increase at a 37% CAGR to reach US$ 50 billion in 2025, from Rs. 75,611 crore (US$ 10.36 billion) in 2020. Rising number of medical facilities and introduction of the Medical Devices (Amendment) Rules 2020 will boost the demand for medical devices in the market.

The FY22 medical devices market is expected to reach US$ 11.86 billion.

The Indian market for medical equipment is predicted to increase from an estimated Rs. 75,611 crore (US$ 10.36 billion) in FY20 to ~US$ 50 billion by 2025.

Between 2020 and 2025, diagnostic imaging is likely to expand at a CAGR of 13.5%.

India has approved 100% FDIs—under the automatic route for both brownfield and greenfield setups in the sector. This is expected to boost the industry. Strong FDI inflow also reflects confidence among global players on the Indian medical devices market. Over the last five years (2015-20), India received US$ 600 million with key investments from countries such as Singapore, the US, Europe and Japan. Categories such as equipment & instruments and consumables & implants have attracted the most FDIs. FDI inflow in the medical and surgical appliances sector stood at US$ 2.23 billion between April 2000 and June 2021.

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-FY28.

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 are expected to boost domestic manufacturing in the country.

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 (self-reliance) mission.

The company further plans to achieve annual capacity of 3.5 billion syringes by March 2022.

In July 2021, the government announced to build medical park in Uttar Pradesh, which is expected to generate an estimated Rs. 500 crore (US$ 67.13 million) business in the state.

In May 2021, with joint efforts of the Defence Research and Development Organisation and Dr. Reddy's Laboratories an anti-COVID-19 drug called 2-deoxy-D-glucose (2-DG) is being developed. This drug is likely to expedite recovery.

The government also approved applications for nine eligible projects that are expected to lead to a total committed investment of ~Rs. 729.63 crore (US$ 100.01 million) by the companies (e.g., Siemens Healthcare Private Limited, Allengers Medical Systems Limited (AMSL), Allengers OEM Private Limited (AOPL), Wipro GE Healthcare Private Limited, Nipro India Corporation Private Limited, Sahajanand Medical Technologies Private Limited, Innvolution Healthcare Private Limited, Integris Health Private Limited) and generate ~2,304 jobs.

In September 2021, the Ministry of Health and Family Welfare, stated that the government has decided to form a committee to prepare the ‘New Drugs, Cosmetics and Medical Devices Bill’ to frame new drugs, cosmetics and medical devices.

In February 2021, Siemens Healthineers introduced Corindus, a robotic system, to drive cardiovascular interventions with robotic assistance in India.

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 the construction of a medical devices park near the Noida International Airport at Jewar in Sector 28.

In September 2021, the government announced a scheme worth Rs. 400 crore (US$ 53.95 million) to promote medical device parks, until FY25. The scheme is expected to reduce the cost of manufacturing medical equipment, making it more affordable in the domestic market.

In September 2021, Sahajanand Medical Tech filed its Draft Red Herring Prospectus (DRHP) with SEBI for its Initial Public Offering (IPO) worth Rs. 1,500 crore (US$ 202.31 million).

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 February 2021, Punjab’s Industry and Commerce Minister Mr. Sunder Sham Arora announced that a park for medical devices was proposed in Rajpura, Punjab, across an area of 210 acres, with an estimated project cost of ~ Rs. 180 crore (US$ 24.67 million).

The Medical Devices Virtual Expo 2021 will showcase Indian products and enable direct interaction between Indian suppliers and buyers/importers from participating countries. Also, 300 foreign buyers from the healthcare sector are expected to participate in this event.

To expand the primary healthcare Industry and clinical centers in the country, in July 2021, the government of Uttar Pradesh announced to introduce automatic medicine dispensing machine. The state health department has been initiated to design an action plan and install ‘Health ATMs’ walk-in medical kiosks with combined medical devices for fundamentals, basic laboratory testing, emergency offerings, cardiology, neurology, pulmonary testing, gynaecology, etc., operated by a medical assistant in all 75 districts of Uttar Pradesh.

In June 2021, Skanray Technologies filed its draft red herring prospectus (DRHP) with SEBI for its initial public offering (IPO) worth Rs. 400 crore (US$ 53.70 million). The IPO is expected to include sale of secondary share, wherein its promoters and Ascent Capital (an existing private equity investor) are expected to sell a part of their stake.

In March 2021, Transasia Bio-Medical Ltd., a Mumbai-based in-vitro diagnostic company, announced plans to invest Rs. 150 crore ($21 million) to set up a manufacturing unit at the Medical Devices Park in Sultanpur, Telangana. The company plans to manufacture state-of-the-art high-technology analysers in the unit to address biochemistry, immunology, hematology, molecular testing in addition to COVID-19, HIV, dengue, and TB testing for domestic and export markets.

On March 25, 2021, the Department of Pharmaceuticals (DoP) 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 order to expedite the clearance of medical devices such as nebulisers, oxygen concentrators and oxygen cannisters in April 2021, the government made it easier to import critical medical devices by easing the requirements for clearance under the Legal Metrology Act (Packaging Rules 2011).