From the Desk of 'Fortune tellers of the Healthcare Market' - India in 2018

Dr. Siddharth Dutta, Associate Vice President Consulting, Markets and Markets Headquartered in Pune, Markets and Markets is a global market research and consulting company offering services in the areas of Market Research & Management Consulting, Market Forecasts & Reports, BI, Custom Research Services, and many others.

As per J P Morgan, India may report a7.5 percent GDP growth in 2018, but there are issues of management, corruption, accountability, ethics and many more. Healthcare is still way down the political agenda and Indians live every day with horrors of hospital care and hopes of improvement. Government investment in public health has been abysmally low. India spends about 4.7 percent of its GDP on public health.

With World bank and other global bodies investing so much hope on India’s growth, can we really project this nation as ‘Beacon of Hope for the world’ or will it remain a ‘Rich nation with many poor people’ in 2018. Based on some recent developments in 2017, we would like to touch the hope and hypes of the healthcare market and how these changes will impact the stakeholders and industry in general.

Advanced Cancer Care Clinics Expected to Rise
2018 will witness some seasoned players stronger in specialty services market. Amongst key player Fortis Group (Mohali) is expected to focus more on quality care in the Onco centres, high ended mother and child care, while one of its peers Apollo Hospital Group is expected to introduce a state of the art advanced cancer treatment facility from Chennai. The facility is expected to be South East Asia’s first Proton Beam Therapy centre and that will make India one of the few nations in the world to offer such advanced treatment in advanced cancer. This will save hundreds of dollars spent of Cancer treatment in U.S. and other advanced nations and will give the same access to cancer patients in India and South-East Asia.

Bad Times Ahead for Commercial Stem Cell Banking Centres
As per the NGSR 2017, stem cell therapy will be restricted to BMT (Bone marrow transplantation) /HSCT (hematopoietic stem cell transplantation) and besides these, treatment for any other conditions shall be considered unethical and a malpractice. This will directly impact the
various hospitals and clinics which claim to commercially offer stem cell therapy as a cure for any disease.

Due to NGSR 2017, the Government of India has put a temporary restriction on commercial banking of stem cell derived from biological materials such as cord tissue, placenta, tooth extract and menstrual blood due to the absence of scientific evidence about its benefits. Although this look temporary in 2018, it may have a long-term impact on the stem cell banking industry and companies such as Lifecell, ReeLabs, Cordlife, Crysave, Cryoviva, and many others, may get hit in the coming days.

Cost optimization will remain the prime focus for the healthcare services industry and new business models will be tried & tested in 2018

Expansion of Hospital Groups continues in 2018 however the focus moves to regional monopoly and experimentation with business model to optimize investment. One of the key players in north, Cygnus Group of Hospitals, is expected to continue with their expansion plans and penetrate tier-II and III towns in Punjab, Haryana and Rajasthan. The hospital is built around ‘An Asset Light Model’ where the company does not own the land or building where the hospital is located. However, the company leases out the assets created by third party and convert them into super speciality hospitals and offers secondary and tertiary care.

On the other hand, seasoned players such as Apollo Hospital group (after attaining regional monopoly) are now focussing on speciality care monopoly. The company is expected to increase ~2000 beds for cardiology and oncology care and penetrate into cities where it does not have its presence. In 2017, the company has already opened it’s Apollo Memory and Apollo Headache and Migraine clinics in Chennai to create regional monopoly in the neuro care market. Another key service provider Gleneagles is expected to move to other region. After establishing its brand in Hyderabad, Bengaluru, Mumbai and Chennai, Gleneagles Global Hospital is expected to focus on the Delhi NCR market in 2018. While groups like Apollo is focusing on Oncology, Cardiology and Neurology, Gleneagles Global Hospital is focusing on multi-organ transplant and quaternary care in Tier I cities in India. In a way 2018 will see more players creating their niche market for offer super-speciality care.

With An Eye on 'Cost Optimisation', Eye Clinics Expand Pan India
In 2017, the Indian eye care market was worth $1.5 - 2 Billion and dominated by players such as Vasan Eye care, Maxivision, ASG, Centre for Sight, Eye-Q, Narayan Netralaya and more. Chennai based Dr. Agarwal's Group of Eye Hospitals, one of the pioneers in exclusive eye care in the country is building its business model on a time tested ‘Hub and Spoke model’ and plans to expand pan India and move out of their comfort market in South India. The chain is expected to set up their new clinics in Kerala, Maharashtra, Gujarat and West Bengal. The model built by Dr. Agarwal's group is cost effective and ensure quick break even i.e. Each of the hospital unit needs an initial investment of $2 Million and the infrastructure includes a staff of 20-25 which is capable of catering to approximately 100 patients in a day.

Final Words
Overall the health of the market shall remain stable with new players entering the market in Oncology, Neurology and Cardiology. Herbal segment will grow tremendously with non-Healthcare players entering the market in 2018 with their OTC products. Large hospital groups shall continue with their expansion plans while the smaller players will focus on niche service areas in 2018. Cost optimization will remain the prime focus for the healthcare services industry and new business models will be tried & tested in 2018.