Association of Medical Devices and Suppliers of India (AMDSI) Formed To Represent Suppliers And Manufacturers Of Medical Technology (MT) 

The recently formed Association of Medical Devices and Suppliers of India (AMDSI) aims at encouraging the government to use medical technology (MT) in reaching the healthcare to the unreached.

Opines G S K Velu, president, AMDSI, "Medical technology industry is in a 'thirisangu' world. We neither come under information, communication technology nor pharma sector. We are not anything different from a drug industry. Why should we be treated differently?".

AMDSI, which represents suppliers and manufacturers of MT products, wants the government to support the MT industry as it did the pharma sector when it was in its infancy fifteen years back. "We formed the association mainly to represent the interests of the distributors and importers. We need to enlighten the government and policy makers when there are ambiguities and anomalies in the tariff structure," says R Kailasnath, treasurer. Giving more light on the tax anamolies Kailasanath says, "In tests, for instance, you can do a particular test using two or three different techniques. One technique manages to get duty free status while the other two do not." 

On the general plan of action, Velu says, "First, we want to obtain the industry status by emphasising that MT is very much part of the healthcare sector. The long term plan is to get the government support manufacturing by creating exclusive industrial parks for MT." AMDSI will also play a consultative role in policy making. It has a clear objective: the government should facilitate the foreign direct investment by making it mandatory for the multinational MT companies to setup a manufacturing facility. "They are running only trading operations in India." 

The association feels that the multinational companies should demonstrate their commitment by setting up manufacturing units here. "Most foreign diagnostic companies also have large pharmaceutical operations in India. Some foreign companies have set-up joint ventures and some have direct operations. But predominantly all prefer tapping the market through Indian companies," says Kailasnath. 

"There are very, very few manufacturing units in India set up by foreign companies or Indian companies to manufacture diagnostic equipment. Indigenous production is almost non-existent and its nowhere in the horizon." 

Since there is no incentive guaranteed by the government policies to safeguard the interest of the manufacturers, Velu says, the industry is reluctant to go ahead in manufacturing products in the higher value chain. Though, AMDSI is planning to become a member of the Confederation of Indian Industry (CII), which at presently has only a wing represented by few medical technology majors, it mainly "wants the voices of small and upcoming medical technology companies to be heard." 

Both the foreign manufacturers, who have their branches in India and local players are its members. 

"If you take the pharmaceutical industry, we are predominantly self sufficient. But in the case of diagnostic products, we are dependent heavily on the Western countries and Japan. Because the diagnostic instruments is a highly technology intensive. We are importing over 90 per cent of the instruments. Pharmaceuticals is research driven and diagnostic is technology driven," says Kailasnath.

Providing an outline of the industry, Velu says that MT in India is a Rs 5000 crore industry with around 500 players. However, it is dominated by multinationals with the Indian companies mainly into trading. The business of top 10 players alone accounts for 50 percent of the total market. 

There are just ten India based companies that are in the turnover category of 100 crore and above. According to him, the MT industry is in a similar stage what pharmaceutical industry was fifteen years back. Kailasnath feels that the overall size of the industry is difficult to quantify. "Worldwide they say that the diagnostic business is six per cent of the size of the pharmaceutical business." He says that increasing awareness of tests is one of the prime drivers of the boom in the diagnostic equipment business, a crucial and major part of MT.

"Tests for Hepatitis, HIV, thyroid harmone are common now-a-days. There are people who voluntarily go to a lab to bio-chemical and bio-medical tests; people are willing to go for annual check ups." 

Kailasnath believes that the opening up of insurance sector is also contributing to the growth and the doctors are increasingly going for more tests to adopt to the evidence-based medicinal practices." Velu says, "India, if a clear emphasis on the promotion of the industry is given to manufacturing, can become a quality and competitive manufacturer of medical technologies that would address the exact needs of the hospitals in India. 

This way, the Indian hospitals can avoid investing in foreign technologies that are expensive and not required. The technologies that are made keeping foreign healthcare systems in mind are dumped here. And since there are no Indian alternatives, the hospitals have no other option to invest in them unnecessarily and most hospitals for want of money are not able to upgrade themselves technology wise." 

He agrees that the Indian industry when encouraged to manufacture cannot provide cost-effective solutions overnight. However, he believes that down the line, when the Indian companies master the technology and get a critical mass for their products can surely deliver cost-effective solutions the way the Indian pharma companies are doing today. 

More than anything else, only India based companies can understand the Indian requirements well and can bring simple solutions that our hospitals are in dire need of. "Look at the pharma sector: it was completely dominated by multinational companies. However, today eight out of ten top pharma companies are Indian companies. 

Ten years down the line, the medical technologies industry can become a huge foreign exchange earner by way of exporting the indigenous products and also services, which include staffing of biomedical engineers, outsourcing of equipment customer care support, software, etc.

(Ref: http://www.expresspharmapulse.com/20040909/healthnews03.shtml)