What is the regulatory environment for medical devices in India as per 'New Medical Devices Rules'?

1. What is the regulatory environment for medical devices in India as per 'New Medical Devices Rules'?

The Ministry of Health and Family Welfare published the 2017 Medical Devices Regulations, which are in line with the framework of the Global Harmonization Task Force (GHTF). The rules are valid as of 1 January 2018. The rules were drawn up with the purpose of separating medical devices from pharmaceuticals for enhanced and well-defined supervision. The following are the main highlights of the rules:

1) The redefinition of 'medical equipment' makes it easier to understand and more detailed.

2) Introduction of a method of risk-based classification for class-wise control.

3) Single window clearance (online portal) for import, processing, sale or distribution and clinical investigation applications.

4) Creation of product specifications for compliance with medical devices.

5) Rationalization of the timelines for obtaining the requisite license for the selling of medical devices.

6) The incorporation into a single license of the registration certificate and the import license.

7) A new regulatory structure for medical devices clinical investigations.

2. What are the requirements to be a registered Notified body?

The requirements are laid down in Part I of the Third Schedule of Medical Devices Rules, 2017.

3. What is the process for classification verification with CDSCO or notified body prior to submission?

The Central Licensing Authority shall, on the basis of its intended usage and other criteria stated in the First Schedule, identify the medical devices referred to in Rule 2. The Class Wise List of Medical Devices shall be published on the website of the Central Standard Drug Control Organization (CDSCO) on the basis of the classification referred to in sub-rule (3): provided that the Central Licensing Authority may, from time to time, add to or remove such a list of medical devices or change the class of any medical device. The list of classified medical devices has already been displayed by CDSCO, and is complex in nature.

4. What are the changes that require an applicant to make a fresh Registration?

A new registration is required for the following changes: 1) Any change to the manufacturer (legal / actual) such as change of constitution, change of name, change of address, etc. 2) Any change to the importer / Indian agent such as change of constitution, change of name, etc.

5. How are IVDs classified in India under Medical Device Rules, 2017? Who will have the responsibility of doing Classification of IVD as per Class A/B/C/D?

Under Chapter II, Rule 4, Sub-rule 

(2) of the Medical Device Regulations, 2017, IVDs are categorized into the following classes on the basis of the criteria defined in Part II of the First Schedule, namely: 

I Low risk-Class A, 

(ii) Low moderate risk- Class B.

 (iii) Class C Moderate High Risk. 

(iv) Elevated risk-Class D. Reference Rule 4 

(3): This rule states that medical devices are classified by the Central Licensing Authority.

6. How much FDI is permitted under the medical devices sector?

100% FDI is permitted under the medical devices sector through an automatic route.

7. If a company misses a threshold (investment / incremental sale) in one year but compensates for that in the next year by having met the total cumulative figure – Then will the company be eligible for the missed incentive?

In the event that the applicant does not meet the minimum threshold requirements for any given year, the applicant is not eligible for the disbursement of the reward for that specific year. However, during the tenure of the programme, the applicant would not be prohibited from claiming benefits for subsequent years, provided that the eligibility conditions for those subsequent years are met.

8. Is assembly of products considered to be ‘Manufacturing’ under the scheme?

All activities applicable under the Central Goods and Service Tax 2017 definition of 'Manufacturing' will be eligible under the PLI scheme for incentives

9. What are the eligible Investments that will be calculated for the threshold Investment?

Expenditure incurred on new plants, machinery , equipment and associated utilities Qualifying investment includes expenditure on new plants, machinery , equipment and associated utilities, as well as machines, dies, moulds, jigs, fixtures (including parts , accessories, components and spare parts thereof) of the same, used in the threshold investment calculations. Expenditure on new research and development (R&D) Qualifying investment encompasses R&D and product development related capital expenditure.

Segments of Goal. Transfer of Technology Expenditure (To the Agreements Eligible investment includes the cost of technology and initial procurement of technology related to manufacture products covered by Target Segments. Associated Utilities As described in the scheme guideline, expenditure incurred on associated utilities shall be considered as an investment to assess eligibility under the Scheme.

10. Will used machinery be allowed under the calculated Investment under the threshold Investment?

Used / Refurbished machinery will not be counted in the investment calculation under the threshold.

11. How are the applications for the scheme to be submitted?

All applications can be submitted through the Project Management Agency (PMA) managed online portal. If the portal is not available, applications can be sent to the PMA in physical form. The online portal's URL will be made available on the DoP website.

12. How will the incentive be calculated?

The reward available to the applicant selected shall be determined as follows: Net Incremental Sales of Eligible Product(s) x Reward Rate Where: Eligible Product(s) means the items referred to in the letter of approval. Incremental sales shall be the net sales turnover of the eligible product(s) for the year covered by the demand for disbursement of the reward minus the net sales turnover for the base year of the eligible product(s). If the sales of the qualifying product(s) are returned, the gross sales turnover shall be decreased by the amount equivalent to the sales return. If the corresponding sales have been considered for the earlier period for the collection of claims, the return on sales shall be adjusted to Total Sales Turnover for the period for which the actual return on sales takes place. Incentive rate: 5 percent

13. What is the evaluation Criteria for selection of a company under the PLI Scheme?

A business will earn a score based on five factors, including production turnover, current patent / technology transfer, current ISO 13485, average R&D costs, and regulatory approval. Based on the ranking, applicants will be selected.

14. Will exports be counted in the Incremental sale calculation?

Exports of the Eligible Product(s) stated in the approval letter will be counted in the Incremental sale calculation.

15. Will Brownfield projects be eligible under the scheme?

No, only Greenfield as per the scheme definition is eligible for the Production Linked Incentive scheme for Medical Devices.

16. Can an Applicant apply for incentives under the scheme in multiple target segments?

No limitation shall be imposed on any applicant applying for more than one goal segment. However, for each target category, the applicant is required to request a separate application along with the application fee and is required to meet the eligibility requirements of the Expenditure and Incremental Sales of Manufactured Products thresholds for each application separately.

17. Is the list of common facilities applicable in the scheme exhaustive?

The lists of common facilities/centers given in the list are indicative and states are encouraged to plan for facilities the implementing agency considers useful.

18. How will funds for the Medical Parks be disbursed?

Grant-in-aid shall be made available in four installments in the following manner: Installment Percentage of Funds Remarks / Prerequisites First 30 On the final approval of the project by the SSC and after the deposit of 30% of the SlA’s share of the cost of the project in the Trust and Retention Account (TRA) or Escrow or No Lien Account as the case may be, subject to the condition that all applicable environments are protected as necessary. Second 30 With the proportionate physical advancement of the Medical Device Park as per the DPR, 60 percent use of the first installment and after the proportionate expenditure was incurred by the SIA. Third, 30 100% usage of the first installment and at least 60% use of the second installment and after the SIA has incurred the proportionate physical advancement of the Medical Device Park as per the DPR after the proportionate expenditure. Fourth 30% The use of the second and third installments and SIA has mobilized and invested its entire share in proportion to the grant and completed the project in all respects.

19. Who will be responsible for Maintenance of Assets?

State Implementation Agency shall be responsible for Operation and Management of assets created under the Scheme.

20. Will grants be applicable for investment for construction of roads, buildings, etc.?

There is no grant for the construction of roads, compound walls and houses. However, as far as different scientific facilities / centers are concerned, 30 percent of the total cost of the respective facility / centre would be available for grant-in-aid to construct the building.

21. Who are all the responsible authorities for the Scheme?

Project Management Agency (PMA) The Department of Pharmaceuticals will appoint the Project Management Agency (PMA) to provide secretarial, administrative and implementation support to the DoP for the successful implementation of the scheme. The Technical Committee (TC) of the DoP and experts with expertise and experience in legislation, medical device production and medical device R&D will assist in the technical matters referred to by the DoP & SSC. State Implementing Agency (SIA) The State Implementing Agency (SIA) is the legal body formed by the Government of the State for the implementation of the Medical Device Park Project. Scheme Steering Committee (SSC): The Scheme Steering Committee (SSC) will approve plans under the Scheme. The Committee shall be composed of: Chairman, DoP-Chairperson Financial Advisor, DoP-Member Joint Secretary, Department of Environment, Forestry and Climate Change, Member Joint Secretary, Department of Industry and Internal Trade Promotion, Member Joint Secretary, Department of Health and Family Welfare, Member DCGI, Central Drug Quality Regulation Agency, Member Joint Secretary (Policy),

22. What is the evaluation Criteria for selection of state under the Parks Scheme?

A score based on 11 parameters will be given to the state. For benefits under the parks system, the top 4 states will be chosen. The parameters for assessment are: S. Oh, no. Parameters Limit Marks 1 Service fees 25 2 State Incentive Infrastructure 12 3 Park connectivity 12 4 Lease rate 10 5 Total area of the planned park 10 6 Uninterrupted 24 * 7 availability 7 7 Stamp fees and registration fees 5 8 Ease of doing business State rating 5 9 Availability of technical workers 5 10 Involvement of technology transfer institutes 5 11 Industrial networks.