New-gen stents help domestic players gain market from foreign players

The Rs 2,500-crore cardiac stents market in India has seen some churn of late in terms of market share. Home-grown firms grew their market shares in the 600,000 cardiac stent market as the multinational companies (MNCs) shied away from introducing new generation stents in India after the price caps were implemented. 

The Indian cardiac stents market is clocking 5-6 per cent value growth annually, while the volumes are growing at 12-13 per cent. After the price caps were introduced in February 2017, home-grown players have launched their latest stents, while most MNCs have shied away from doing so. In fact, the market leader, US-based Abbott, withdrew its Xience Alpine stents from the Indian market, and did not introduce its Xience Sierra after the price cap. Boston Scientific also withdrew its high-end Synergy stents from the market. 

The market share of MNCs has fallen from 60 per cent about two years back to around 40 per cent now, the home-grown players have gained, claimed the domestic industry sources. 

Morgan Stanley- and Samara Capital-backed Sahajanand Medical Technologies (SMT) has introduced the Supralimus Grace in 2018 and is readying to launch its latest Supraflex Cruz in the Indian market. 

“We have not held back launching our new-generation stents as a result of price caps. If one is making improvements in the delivery system of the stent, the approval process by the government is faster now. One does not need to submit pre-clinical data. With low investment, if one is able to grow one’s sales by 20 per cent or so, then the investment is recovered,” said Ganesh Sabat, chief executive officer of SMT. 

He felt that by launching a new-generation stent backed with clinical data, it has become easier for domestic players to gain access to cardiologists and hospitals, and, in turn, gain market share. 

Companies like SMT have gone ahead and focused on generating data on their stents from global studies. The Supraflex Cruz has undergone multiple clinical studies — Sibi and Taxco OCT study apart from Talent Trial in Europe. The company recently completed Talent trial in Europe involving 23 centres in seven countries on 1,435 patients, which were published in the medical journal The Lancet. Supraflex also received the CE mark in July. CE Mark indicates that the product satisfies requirements of EU Directives. 

Indian players have augmented their research and development efforts in the recent years, felt the industry. Gurmit Singh Chugh, managing director, Translumina Therapeutics, claimed that as opposed to a research and development (R&D) spend of around 5 per cent of their turnover, the company’s R&D spend has increased to about 12-13 per cent of their revenues at present. 

In November last year, the company presented 10-year safety data for its drug eluting stents. The data presented showed numerically lower rates of stent thrombosis with Indian drug eluting stent (DES) Yukon Choice PC compared to American stents at a follow-up of 10 years. 

Earlier in August, private equity firm Everstone Capital picked up a minority stake in Translumina. Chugh said Indian players had managed to raise funds from PE firms off late. 

Queries sent to Abbott and Boston Scientific did not elicit any response. 

Industry players claim that at present SMT has around 22-23 per cent share of the market, close to the share of Abbott. Translumina has around 14-15 per cent share, while Gujarat-based Meril Life Sciences has around 12 per cent share. 

Meril has focused on bioresorbable vascular scaffold system (BVS) and has product MeRes100 (that resorbs naturally in the artery within a period of 2-3 years), which it is yet to launch in India. The company has been seeking differential pricing for its BVS from the Indian government as it feels it represents a different product category altogether 
as against conventional metallic stents. Several multinationals, too,  have sought differential pricing from the Indian government, which so far, has not been granted.

MNCs usually prefer to sell their stents in India through an elaborate distributor and stockist network.  In comparison, the Indian players mostly go directly to the hospitals, thereby reducing their channel costs. “Around 30 per cent of our sales would be through distributors, in comparison to over 90 per cent in case 
of MNCs,” said an industry insider. 

He added that globally, once a new-generation stent is introduced in a market, the older ones are usually withdrawn. In India and some other Asian countries, companies retain multiple brands. 

“Some of these MNCs are selling their new-generation stents in European markets, like Germany, at costs comparable to or even lower than India. It is only a matter of time before they bite the bullet and introduce their latest generation stents here as well,” he said on grounds of anonymity. The Indian market is slated to become an 800,000 —  one million cardiac stents market in the next two years or so, and would be comparable in size to China. With pricing pressure in their home markets, MNCs would have to focus on gaining share in the Indian market, the industry felt. 

The Advanced Medical Technology Association, an US trade lobby group, felt that price controls have led to drop in foreign direct investment in medical devices sector in India. 

Abby Pratt, vice-president (global strategy) at AdvaMed, said: “Use of price controls, as a policy, is not the right tool to achieve improved access to affordable health care. On the contrary, they disincentivise innovation, compromise patient safety and reduce investment in capacity building.”

She said that even after India allowed 100 per cent foreign direct investment (FDI) in the medical device sector through the automatic route in 2015, the industry still witnessed a decline in investments between 2016 and 2018 due to the systematic rollout of price controls. 

“There have been additional policy measures over the past three years that further discourage investments and growth, such as local content requirements and import duty hikes. AdvaMed is concerned that further unpredictability will lead major companies providing essential technologies to re-think their presence in India and choose to invest in more predictable markets. This, in turn, would negatively affect patients. Hence, we urge the government to consider a balanced policy that recognises product advances and will ensure Indian patients have access to life-saving and life-enhancing medical technology innovations available globally,” AdvaMed said.

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