The $3 billion Indian medical device industry is developing a new headache. The American drug regulator, US Food and Drug Administration (USFDA), is developing a new set of guidelines that will set tougher scientific standards for data from tests on humans that makers of medical devices submit when seeking approval of their products. In all probability, the USFDA will urge medical device makers to use more sharply defined targets to measure the success of clinical trials. The agency may also urge medical device makers to more closely follow patients enrolled in such trials to determine whether the targets are met.

Although the impact of the American drug regulator?s hard stance will be felt more by established players like Johnson & Johnson, GE Healthcare, Siemens, Philips and Roche in the $250 billion global medical device market, Indian medical device makers will not remain immune from it and could see stumbling blocks in their growth path.

Things will obviously become tough for the domestic medical device makers on two counts, feels Dr Lal Pathlabs chairman and managing director Arvind Lal. First, Indian medical device makers are moving beyond developing syringes and appliances used in specialties such as ophthalmic and dental classes, to diagnostics, imaging and cardiovascular devices, surgical devices and orthopedic devices. Second, there is a significant clinical trial activity in medical devices in the country. Of nearly 450-500 medical device trials being conducted in different parts of the world in the past one year, 48 of these are being conducted in India.

?It is obvious that the hard stance taken by the American regulatory body will have a catalytic effect on other regulatory bodies globally. Therefore, the transformation of Indian medical device makers from merely making syringes to more complex medical devices, as well as the clinical trial activity happening in the country in medical devices will suffer a serious setback,? says Lal, who is also the vice-chairman of Association of Clinical Research Organisation (ACRO).

?In the wake of the US drug regulator hardening its stance, sales of ?Made in India? medical devices in the US market will become a major challenge, unless the domestic medical device makers are able to establish their quality standards,? says Hitesh Gajaria, executive-director, KPMG India.

In recent times, multinational medical device makers such as GE Healthcare, Siemens and Philips have intensified their operations in the country by undertaking research and development (R&D) on complex medical devices. Healthcare analysts opine that with less regulatory approvals being obtained from the developed markets in the US, Europe and Japan, global medical device makers? efforts to capitalise on India?s R&D capabilities could be impacted too. At the same time, Indian medical device players, who are eyeing international markets, will have to factor in the increased cost of acquisition and time to market due to the recent USFDA move, insists Muralidharan Nair, partner, life sciences advisory services, Ernst & Young.

At the epicentre of the American drug regulator?s proposed initiatives are two studies that found shortcomings in some high-risk cardiovascular devices related clinical trials accepted by the USFDA over the last decade. Such products include pacemakers, implanted defibrillators and the tiny tubes known as coronary stents, which are used to prop open clogged blood vessels.

Ironically, Indian medical device makers are focused on developing these products, besides other appliances. That?s not all. The domestic medical device industry is reeling under various challenges, which include lack of clarity in regulation for medical devices and lack of support from the government in terms of fiscal measures and infrastructure support. While certain medical devices are classified as drugs, and their regulation falls into the ambit of the Central Drugs Standard Control Organisation (CDSCO), a large proportion of the market still remains unregulated. The medical device industry should be treated as a separate industry from pharmaceuticals, which is regulated by various rules and regulations, Association of Indian Medical Device Industry (Aimed) officials inform.

In addition, a long standing demand of the medical device makers has been the setting up of an autonomous regulator under the ministry of health to govern the sector. At present, there are multiple agencies at the Centre and state level which result in a poor regulatory environment. Deliberations are underway for drafting a regulatory body, the Indian Medical Device Regulatory Authority, which is expected to be considered later this year.

A recent Frost & Sullivan-CII report says that factors such as low awareness, lack of adequate regulations, lack of medical insurance and low returns on investment have deterred medical practitioners from bringing quality and advanced medical technologies especially to rural areas. The heterogeneity of the Indian population makes a ?one-size-fits-all? approach challenging to implement, says the report.

The need of the hour, according to B Soma Raju, chairman and managing director of Care Hospitals, a chain of cardiology hospitals in west and south India, is convergence of all stakeholders?healthcare service providers, medical technology companies, central and state governments and insurance providers?and charter a road map for the medical device industry to grow as opposed to isolated approach. ?There is a dire need for regulations that can foster and facilitate growth of the industry,? says Raju.

Interestingly, the current focus by the medical device makers is ?Made in India and Made for India? products. Currently, over 70% of medical equipment is imported, from high-end medical resonance imaging (MRI) and computed axial tomography (CT) scanners, to basic equipments such as patient monitors. Increase in manufacturing of medical equipment in the country is widely expected to lower costs thus helping the end consumer. For instance, GE Healthcare is developing products in India, specific for the local market. ?These products are designed, developed and manufactured after studying specificIndianrequirements to create access to high-end technology affordably to masses for quality healthcare,? says V Raja, president and CEO, GE Healthcare South Asia.

A quick sampler from the GE Healthcare staple: Mac 400 is the first electrocardiogram (ECG) to be designed, developed and manufactured in India. It is a battery operated portable ECG system that can interpret ECG in English. It is an ideal screening tool for cardiac diseases whether you are in the remotest village or a top metro. Among others, Tejas DRF is the first digital x-ray system to be manufactured in India. It is about one-third of an imported digital x-ray system.

Apart from these, there are a series of ultrasound systems and baby-monitoring systems designed and manufactured in India. So is the case with X-rays. X-ray is the primary and most widely used diagnostic imaging tool, yet it is the most under-developed imaging specialty in India. Both developed and developing countries have phased out the out-dated 2-pulse x-ray technology, which are still extensively used in India. ?The new Tejas DR-F will cost 40% less than imported digital x-ray systems and will reduce the radiation significantly,? says Raja. ?This is in line with our vision of ?Early Health? and we will continuously endeavour to bring in affordable solutions to fill in the technology gap in India,? he adds.

When the likes of GE Healthcare, Philips and Siemens are looking to make India a hub for supplying cost-effective medical devices, it is time for all stakeholders in the Indian medical device industry to set their own house in order and bring in conducive environment for growth.

?Making local manufacturing an attractive proposition for multinational medical device makers is one option, which will not only help in developing local capabilities but also provide devices that are affordable by larger population at a lower cost,? summarises Nair.