Indian government slashes stent prices for employee surgeries

India's government made a drastic decision recently to cut its prices for drug-eluting stents used in employee surgeries, putting pressure on global stent makers seeking to do business as the company's health care expansion continues to surge.

The Times of India reports that the national government slashed its reimbursement price from 65,000 rupees per stent (just under $1,200) to 25,000 rupees ($460), whether or not they are made locally or imported. Bare metal stent costs are also taking a hit, restricted to 10,000 rupees ($184) each.

On the one hand, that gives local Indian manufacturers room to ramp up inexpensive stents under the new system, under which they can make a nice profit. But international companies ranging from Medtronic ($MDT) to Boston Scientific ($BSX), Abbott ($ABT) and more are turning to India as a major emerging market for growth, and the price restriction risks set up a major obstacle to their profit potential.

Providers in India appear to be equally concerned about the new limits, which also include drastically lower fixed prices for an entire angioplasty operation. Some told The Times of India that they'd struggle to provide services at the required cost, which also carries limits as to how many drug-eluting stents government employees can actually receive.

In the short term, patients who can afford the new policy will likely shoulder the extra cost. But it remains to be seen how the new restrictions will affect the overall stent market. Stay tuned.

- read the Times of India story

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