The National Pharmaceutical Pricing Authority’s (NPPA) analysis has shown that needles and syringes are sold at a retail price which is as much as 655% more than the price at which the distributors purchase them.
The NPPA’s data comes nearly a month after the regulator slashed the prices of cardiac stents by up to 85%.
High markups on needles and syringes
NPPA analysed data from official sources, manufacturers and importers on the trade margins of these products. According to the report, the distributors pay Rs 14.92 for 50 ml hypodermic disposable needles, which are then sold for Rs 65.13. These needles are also the ones to be marked up the most, with 270% trade margin on an average.
The maximum trade margin in case of insulin syringes with needles was at 400%. Depending on the type of syringe, the maximum trade margins may vary between 214% and 1,251%. Whereas the maximum trade margin in disposable hypodermic needles varied from 57% to 789%.
NPPA, in its investigation, had found that Fortis Hospital, Gurugram had charged the parents of a seven-year-old girl who was suffering from dengue a whopping 1,700% markup on medical equipment and drugs in September.
In December last year, syringe and needle makers decided to cap trade margins at 75% after the NPPA found that the companies were charging excessively high prices for drugs and disposables.
High mark ups due to distortion in market
The reason for the high markups is credited to the distortion in markets that occurred few years back. Pavan Choudhary, president of the Medical Technology Association of India, told PTI, “The reason for these markups is that the market got distorted some years ago.Most companies could not sustain without following this trend of high trade margins.”
Commenting on the issue, Rajiv Nath, President, All India Syringes & Needle Manufacturers Association (AISNMA) said, “We have studied the trade margin report on syringes and needles by NPPA, and acknowledge the very high trade margins in this product range motivated by an unhealthy race to defend or attain hospital and retailer customers by luring them with higher trade margins than competing brands.”