CDSCO Order on Medical Devices: Understanding GST Rate Reductions and MRP Revisions

CDSCO's Order on Medical Devices

The Central Drugs Standard Control Organisation (CDSCO) has issued a significant order, allowing medical device manufacturers to revise their Maximum Retail Price (MRP) in light of a 5% GST rate reduction, down from the previous rate of 12%. This three-month window for compliance is aimed at both importers and local manufacturers of class C and D medical devices, which are considered moderate to high risk. These include essential products such as bone fixation implants, MRI machines, and importantly, pacemakers.

Implementation Challenges

While the CDSCO order facilitates price adjustments, industry insiders are expressing concerns regarding the practicality of stickering billions of products across the supply chain. Rajiv Nath, coordinator of the Association of Indian Medical Device Industry (AiMeD), highlights that the directive complicates existing inventory management practices. Small and medium-sized manufacturers, in particular, face immense hurdles in advertising and revising each product's price.

Alternative Solutions and Regulation Guidelines

Manufacturers are advocating for alternatives that would allow them to communicate revised prices via websites instead of physical alterations to product labels. Meanwhile, the National Pharmaceutical Pricing Authority (NPPA) is expected to release new guidelines next week to aid compliance with the reduced GST rates, addressing the pressing needs of the MedTech sector.