Global medtech players welcome budget 2018, expected better deal for sector

New Delhi: The global medical technology players have welcomed the focus on public healthcare in the budget 2018. However, at the same time, they believe it could have been better if incentives had been provided to the sector to boost the penetration into lower sections of society.

“We have just learnt that the custom duties on medical devices have been increased. It is surprising that on one hand government is giving healthcare relief to the common man on the other it is reducing the extent of this relief by increasing custom duties on a category where 70 percent of the products are still imported,” mentioned Mr Pavan Choudary, Chairman and Director General, Medical Technology Association of India (MTaI).

The AdvaMed (Advanced Medical Technology Association) in its statement said that it is encouraged with the Union Budget’s focus on healthcare and the government’s continued commitment toward achieving the long-term goal of universal health coverage.

As per AdvaMed, the launch of the flagship health protection scheme is a step in the right direction to improve people’s ability to pay. The government’s recognition of the need to strengthen healthcare infrastructure for building capacity is also showcased in their move to allocate a fund of INR 1200 crore for creation of 1.5 lakh health and wellness centers as envisioned in NHP 2017 to provide comprehensive healthcare for NCDs, maternal and child health services. Investment in healthcare education by building one medical college for every three parliamentary constituencies is also a welcome step.

While the budget this year has exhibited many positives, said the AdvaMed, it added that the industry continues to urge the government of India to promote an enabling environment for the medical devices sector that is conducive to innovation, patient access and patient choice. “In this context, we request for a re-look at the ongoing medical device pricing discussion through immediate consideration of Trade Margin Rationalization proposal in line with the Department of Pharma report and more scientific approaches that facilitate differential pricing for innovative medical technologies,” the association stated further.

“This will be symbiotic to the healthcare ecosystem that is better equipped to address the needs of Indian patients through improved access to an array of medical innovations and solutions,” concluded the statement from AdvaMed.

As per Mr Sanjay Bhutani, Managing Director, Bausch and Lomb, India, “The Budget 2018 has been presented in the backdrop of economic growth expectations in the region of 8 percent in near future and a target to reduce fiscal deficit. The Budget has done well on directing the government’s priority to two important sectors for the economy, Agriculture and Health. The proposal to provide insurance cover of Rs.5 lacs to about 100m families and establishing 24 new medical colleges is in right direction to provide quality healthcare services to economically weaker sections of society.”

Mr Bhutani believes that the proposal to reduce the tax rate of 25 percent for companies with revenues of Rs 250 crores is welcome as this is a step in direction to reduce direct tax rates to make this comparable to competing economies. “That said, there is very little done in this budget to improve disposable income for the middle and salaried class,” he added. “Overall, we would rate the budget as a mixed budget that aims to improve quality of life for weaker sections, however, increase in cess & introduction of Long Term Capital Gain would impact consumption.”

According to Mr Ravi Dawar, Director-Finance, BD-India, “The budget is certainly promising for the healthcare sector. BD as an organization is committed to advancing the world of health in the country by improving delivery of care and we believe that the budget would benefit the citizens and the recommendations are certainly steps taken in the right direction. Since we are closely working towards eliminating the threat of tuberculosis (TB) in the country, we are extremely happy with the government’s plan to allocate Rs 600 crore for providing nutritional support to TB patients.”

Mr Davar said that the budget is also clearly driving the stated objective of the government to provide Universal Healthcare through its National Health Protection Scheme. “The scheme proposes to provide hospitalization cover of Rs 5 lakhs to Rs 10 crore to poor families which roughly translates to around 50 crore people getting hospitalization cover. This is a good step as it will make healthcare affordable to approximately 40 percent of the population. Further, BD also lauds the government’s measures to make healthcare more accessible and upgrading healthcare practices in India through the setting up of 24 medical hospitals and colleges. I believe that overall the budget is good news for the healthcare sector and would create an increased demand for healthcare products and services,” he added.