Hospitals Allowed To Add Trade Margins On Orthopaedic Knee Implants

Mumbai, 31 Aug 2019:

The National Pharmaceutical Pricing Authority (NPPA) has clarified that hospitals, nursing homes and clinics are allowed to add trade margins on orthopaedic knee implants as per the rates prescribed in the notification dated August 16, 2017.

This comes in the wake of NPPA observation that certain Third Party Administrators (TPAs) are not allowing trade margins to hospitals, nursing homes and clinics on orthopaedic knee implants as per the rates prescribed in the notification.

The national drug pricing regulator had also recently notified that ceiling price of orthopaedic knee implants should not be increased beyond 10 per cent in a given year. Orthopaedic knee implants were brought under price control two years ago to make it affordable to the common man.

This was in continuation to the notifications issued by NPPA dated August 16, 2017 and dated August 13, 2018 regarding fixation of ceiling price of orthopaedic knee implants issued under Para 19 of the Drug Price Control Order (DPCO-2013).

As per the notification, NPPA stated that ceiling price of orthopaedic knee implants will be monitored as per the provisions of Paragraph 20(1) of the DPCO- 2013. This will be applicable for a period of one year from August 16, 2019 till August 15, 2020 unless revised by another notification.

NPPA notification has categorised knee implants into two major categories -primary knee replacement systems and revision knee replacement systems. In each category, there are four sub-categories - femoral component, tibial component or tibial tray, articulating surface or insert and patella.

Under four sub-categories, there are super-sub-categories distinguishable on the basis of feature or material such as titanium alloy, oxidized zirconium, Hi-flex, cobalt chromium, polyethene etc. The ceiling prices have been prescribed for the super-sub-categories.

New ceiling price and MRP of cobalt chromium, which is most widely used knee implant has seen a reduction of 65 per cent from Rs. 1,58,324 to Rs.54,720. Special metal like titanium & oxidized zirconium has seen a reduction of 69 per cent from Rs. 2,49,251 to Rs. 76,600.

High flexibility implant has seen a reduction of 69 per cent from Rs. 1,81,728 to Rs. 56,490 and revision implants has seen a reduction of 59% from Rs.2,76,869 to Rs. 1,13,950. Pharmabiz