Indian healthcare industry – an Overview
The healthcare Industry in India has made rapid progress in the last decade but still lags behind developed nations in terms of the quality and accessibility of medical services. Major issues that cause these lags include the large population, disparity in economic health, lack of proper medical equipment and trained human resource and, out-of-the-pocket medical care expenses. A market report recently released by Persistent Market Research reveals that the global market for medical imaging solutions is all set to grow at a CAGR of 5.6% by 2023, driven by the major developed economies of the U.S.A, Europe, and the Asia Pacific. Nevertheless, emerging economies of India, China, Indonesia, and Brazil are also showing a positive trend.
Medical imaging is the largest segment in Indian medical devices market, likely to earn revenues worth US$ 2.47 billion in 2020, according to an analysis done by Indian Brand Equity Foundation (IBEF), The Indian medical device industry acquired an independent status in 2014 under the “Make in India” initiative but progress has been slow. The largest medical equipment market in the country is the MRI segment, followed by the ultrasound and CT equipment market. With proper streamlining and focus, the industry has the potential to grow exponentially in the coming years, thanks to India’s rising population.
Medical imaging is emerging as the second-largest segment in the Indian medical devices market with over 30% market share. According to an analysis done by Indian Brand Equity Foundation (IBEF), medical imaging is the largest segment of Indian medical devices market, which alone is likely to earn revenues worth US$ 2.47 billion in 2020. Among other diagnostic solutions, mammography, digital radiology and PACS (Picture Archiving and Communication System) is also gaining prominence, albeit at a slow pace. PACS is the digital copy alternative for films but less than 5% of the hospitals that have access to the technology have given up using films. This shows that optimization and utilization of the technology is sorely lacking.
The Indian medical imaging equipment industry is the fourth largest market for medical devices in Asia, in terms of volume, but the ‘Make in India’ thrust has not seen much success. Reports suggest that much of the equipment being used for oncology, computerized axial tomography (CT or CAT) and magnetic resonance imaging (MRI) is imported – there are no Indian manufacturers at present – which is not conducive for the local supplier base while also hiking up the cost of the instruments. The resulting high cost makes it difficult for tier-2, and 3 cities to procure such equipment. This shows that there is, in fact, a strong industrial demand for sophisticated, flexible, portable, and high-speed medical imaging solutions in Indian hospitals, clinics, and laboratories.
The propelling factors that are leading to the positive growth of the medical imaging market in India are the increasing number of diagnostic procedures taking place, people’s awareness about the importance of early-stage diagnosis of diseases, availability of cost-effective medical imaging equipment, investments and funding for streamlining healthcare facilities and also, the low market penetration.
Challenges in the Indian Medical Industry
While the future of the Indian medical imaging industry is bright, a lot still remains to be done. In spite of the presence of strong private players and better government spending, many Indians still cannot access satisfactory healthcare till now. The reasons for this vary according to the population demographic but it is seen that the major issue is the lack of penetration of efficient imaging devices in regions other than the metro and tier-1 cities.
While satisfactory healthcare could mean different things based on the person’s economic finesse, a regulatory body’s certification would ensure that individuals receive the best-possible medical care without worrying about the hospital or the doctor. However, many a times, laymen do not understand exact certifications and given India’s demographic differences, some patients may be looking for affordable healthcare while others for premium. When it comes to regulations, all of these requirements should be on the same platter. It is imperative that same parameters of performance be used to ensure that the government’s Ayushman Bharat Yojana is a success.
Thanks to the government’s push on “healthcare for all” under the scheme, many rural regions now have access to basic diagnostic devices, given that the ambitious Ayushman Bharat Yojana has benefitted nearly 47 lakh Indians in its first year, with free treatment worth nearly Rs 7,500 crores availed by patients; according to a press release issued by the National Health Authority. However, the technologically-advanced implements are still not available for the rural population due to the prohibitive expenditure involved. The per capita Indian medical device spending of USD 3, compared to USD 7 in China and USD 42 in Russia, is significantly low. Further, there is a severe lack of doctors and equipment operators or technicians and this is one of the reasons why such regions are not able to use even the equipment they have. Despite having great potential, untrained and unemployable workforce in the medical sector is an issue. In several provinces, medical equipmentis available but is underutilised because of the absence of doctors or trained technicians.
These issues mean that early diagnosis is almost unheard of in rural or tier-2 or 3 areas. There are almost no screening centres and this means that diseases are diagnosed only at a much later stage, leading to higher expenditure and unnecessary loss of life.
There is also a lack of Innovation and customizing in the Indian landscape, resulting in fewer options available to patients. This is exacerbated by the inadequate regulatory system wherein the non-alignment with global standards and lack of quality product testing infrastructure hinders sectoral progress. The lack of proper ecosystem leads to uncertain regulations and a fragmented pricing environment. Further, the medical imaging industry is not digitally savvy when compared to developed nations and all these issues compound to lower the scope of early detection of diseases in the population.
Growth Drivers which can boost the sector
The government’s emphasis on the sector, wherein medical devices were classified as one of the top priority sectors in “Make in India” campaign has aided development. However, while the government funding has risen, it is still insufficient to cover the population of the country and requires augmentation through possible public private partnership projects in healthcare. Advanced medical imaging techniques are available with global companies which could partner with the government for filling the gaps in healthcare. It will be more economical and will also boost the “Make in India” movement, with technology companies being the backbone.
Further, stronger regulations and hiring of skilled medical professions who are aware of latest worldwide technologies is a must. Technology companies need to collaborate with service givers on the training and application side. The Centre needs to incentivise doctors to work in tier-2, 3 cities and rural regions to ensure that best-possible healthcare is provided.
Digitization would enable quicker and more efficient dissemination of services, leading to early detection of life-threatening diseases and bringing down the amount of insurance being doled out. We also need a rise in awareness with increased media reach and coverage.
Healthcare in India is at a crossroads and needs various modifications, both in terms of technology and regulations. The industry requires stringent new policies and investments to fuel the development of the sector. All the stakeholders need to focus on where we are going wrong and how we can ensure better healthcare. It should be ensured that affordable healthcare does not translate to low-quality products and solutions being adopted. The manufacturing of Indian medical devices should follow the trajectory of developed nations while focusing on the growth rate of middle and lower classes as the real India lies there.
(Disclaimer: Writer is Rajiv Bhalla, Managing Director, Barco India. Views expressed are a personal opinion.)