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Main Story
Healthcare Comes Home
The home healthcare market potential in India is as vast
as this country. But so are the problems. So what is making international companies
rush to India, finds out Sonal Vij
 Growing
at a rate of 15 per cent, globally, home healthcare market is one of the fastest
growing markets. Current estimates put the global value of the home healthcare
market at $140 billion. The Indian home-healthcare market, which stands at $
1.5 billion, is also waking up to the market opportunities with MNCs foraying
the nascent market.
Explaining the growth in the Indian home-healthcare market, Pradip Kanakia,
National Head of Markets and a member of KPMG India Leadership Team remarks,
"The home healthcare industry in India consists of around 5,000 small and
large organisations, largely unorganised which together generates." Expectations
are that home-healthcare spending will eventually overtake prescription drug
growth.
Home Healthcare in India
This segment includes monitoring devices, therapeutic devices,
interventional devices and home services. Interventional devices include drug
delivery mechanisms, for instance, those used by diabetics. Home services include
in-house nurse care and also other state-of-art technologies. The monitoring
devices ranges from the ubiquitous thermometers to devices capable of monitoring
vital parameters of an individual such as ECG, Heart Rate, SpO2 and so on.
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A range of home healthcare products from Philips Healthcare |
The Players
Companies like Phiilips and GE are entering the market with sleep care and home
respiratory care solutions. Sleep apnoea, a common disorder with around 35-40
million people in India suffering from it, is a commonly targeted disease for
this segment.
A variety of home healthcare services are offered at home by Metropolis Health
Services, Medinova, Apollo Hospital Dr Lal Path Labs and Religare, who offer
a wide range of tests at the doorstep- X-rays, ultrasound and ECG besides an
array of pathological tests. Reportedly, at Metropolis Health Service (which
currently provides services in Chennai, Bangalore, Kochi and Delhi) at present,
150-200 home visits are conducted per day compared to just a handful of tests
a year ago. Reportedly, more than 10 per cent of the 6,000 patients in Dr Lal
Path Labs go for healthcare at home.
Philips has changed its brand image from being a company in lighting to a 'health
and well being' company. It acquired Resperonics in 2008 and launched it in
March, this year. India was the first country (after US) where Philips Respironics
portfolio was launched. Clearly, it indicates the company's focus to build market
leadership positions in high-growth emerging markets like India. Philips plans
to garner a market share of 40 per cent in this largely untapped home healthcare
market by 2013.
"We should be careful and very clear in our inputs. For Indian market,
we are entering with Respironics and that's our only offering to the home healthcare
as of now," informs S Bhaskaran, Senior Director - Healthcare, Philips
Innovation Campus.
From a strategic point of view, Anjan Bose, Senior Director and Business Head,
Healthcare, Philips India says, "India is Introduction of the Philips Respironics
product portfolio will significantly drive growth for Philips Healthcare in
India both in the hospital and in the home segment." However, Philips plans
to test the waters and expand their portfolio. Bose adds, "Our heritage
in understanding how consumers think is combined with our deep clinical knowledge,
putting us in a unique position to help address the modern day challenges of
the Indian healthcare markets via groundbreaking ways." Presently, the
company has a greater portfolio in healthcare in the US and Europe.
Globally, GE Healthcare has recently entered into alliances and made several
acquisitions to strengthen their position in this area. GE Healthcare already
has a strategic relationship with Living Independently Group, a provider of
Quiet Care passive monitoring systems used to assist in the care of seniors.
In March 2008, GE Healthcare acquired VersaMed Corporation, a provider of portable
critical care ventilators for respiratory care, which can be used in the home
setting. In October 2008, GE Healthcare acquired Vital Signs Inc, a provider
of products for home respiratory care, particularly in the management of sleep
apnea.
From a strategic point of view, S Ganesh Prasad, Director, Clinical Systems,
GE Healthcare, South Asia explains, "Home-health is a key business focus
for GE Healthcare. GE's strategy is to invest in high-growth businesses with
huge global potential. Demographic changes present enormous healthcare challenges
in the management of chronic diseases." In November 2008, GE announced
it was leading a $ 5M three year home health research consortium funded by the
Hungarian Government. "The acquisitions have helped us make a beginning
in home health in India," adds Prasad.
To target patients suffering with sleeping disorders, GE has launched its CPAP
employed in iSleep solutions through its acquisition of Vital Signs Inc, a Swedish
company. iSleep is portable, intuitive and designed for home use. The Vivo series
of electronic ventilation is also available. However, Quiet Care (home-monitoring
solution) will be available in the future (no time-frame) Both iSleep and Vivo
solutions are developed and produced in Sweden by Breas Medical AB.
In India, Johnson & Johnson Limited sells the One Touch range of blood glucose
monitoring systems from Lifescan Inc, a Johnson & Johnson Company. The meters,
strips, lancet devices and software that it sells here are simple and convenient
systems are designed for individual patient needs, to complement different lifestyles.
Roche Diagnostics Accu-Chek is also one of the Blood Glucose Monitoring systems
with its flagship brand Accu-Chek Active. Rouche also markets Accu-Chek Integra
- the fully integrated Blood Glucose monitor with the unique benefit of No strip
handling and No manual coding, Accu-Chek Sensor driven by BioSensor technology
for use in hospital & Nursing home for Point of Care testing, Micral test
: Urine strips to detect microalbuminuria and Accu-Chek Softclix lancing device
& Lancets with patented Clixmotion technology for virtually pain free sampling
and Accu-Chek Spirit Insulin delivery system.
Says Vivek Kamath, Business Head - Diabetes Care, Roche Diagnostics India, "Currently
the market is in a state of dynamic flux, and we see tremendous market potential
in this domain. The blood glucose monitoring system category has grown 18-20
per cent in the recent past, but, we foresee a series of growth drivers which
will accelerate this market growth."
Biotronik Medical Devices India Private Limited, a subsidiary of Biotronik GmbH
& Co KG Germany, a manufacturer of implantable cardiac devices, and pioneer
in wireless remote monitoring technology, announced the India launch of the
Biotronik Innovation Forum & New Home Monitoring services. "Biotronik
Home Monitoring is available across the entire product portfolio of pacemakers,
ICDs and cardiac resynchronisation therapy (CRT) devices allowing physicians
to remotely monitor their patients' clinical and device status at any time and
from anywhere in the world," said Gunnar Wochnowski, Vice President, Biotronik
- Asia Pacific.
Using an intuitive, red-yellow-coded traffic light concept, daily as well as
trend patient and device information is automatically evaluated and prioritised
through the intelligent traffic light system and conveniently presented in the
CardioReport. This status summary on the home monitoring secure website enables
physicians to quickly review the most important information at a glance.
Not Getting Any Younger
 "China
and India have largest and second largest number of elderly people in absolute
numbers"
- Anjan Bose
Senior Director & Business
Head - Healthcare
Philips Electronics India
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 "Currently
the market is in a state of dynamic flux, and we see tremendous market potential
in this domain"
- Vivek Kamath
Business Head
Diabetes Care
Roche Diagnostics India
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Normally, we always think India as a 'young' country, but
a reality check proves that India has an equal number of elderly citizens. According
to a UN report, by the year 2025, India is expected to have 177 million elderly.
According to Bhaskaran of Philips, "It is incorrect to think of this as
a western country phenomenon. China and India already have the largest and second
largest number of elderly people in absolute numbers." Hence, with the
baby boomer generation becoming senior citizens, the demand for home-healthcare
is on the rise.
Today, older people are also becoming increasingly more active
in managing their own health and wellness. Looking forward, seniors of the future
will be empowered, technologically-savvy healthcare consumers playing an active
role in the management of their healthcare. They will increasingly want and
expect their doctor's care at home and on the go. Explains Bose, "Cost
and quality coupled with the ever larger aging population are fundamental issues
and will certainly determine how healthcare is managed in the future. These
societal trends are already leading to a 'computerisation' of healthcare in
which individuals take health management into their own hands and where quality
of healthcare is associated with personal choice."
Also, the number of people suffering from lifestyle diseases
or chronic diseases which requires long term care is on the rise. Advancements
in technology and medicine are not only enabling people to live longer lives,
they are enabling people to do so while remaining healthier.
Homely Matters
Another reason for the growing potential in this segment
is because a large number of patients who are chronically ill and need constant
hospitalisation, prefer the home-healthcare mode in order to save hospital costs.
Moreover, patients find it inconvenient to travel long distances to get hospital
treatment. Considering the fact that Indians give prime importance to family,
many patients prefer spending time at home either as post-operative care or
in case of chronic illnesses. Thus, more and more patients want to adopt these
new products in their routine lives. Elaborates Animesh Kumar, Managing Consultant,
Healthcare Consulting, Datamonitor, India, "With the growing population
and increase in the working population, we can safely say that these numbers
are only going to increase. There is a huge need for such products/ services
but there are not many players in the market. Hence, for any new entrant, the
conditions cannot be any better. The market presents huge opportunities which
can be tapped with the right product and promotions strategy." Hence, the
demand and supply gap are favourable for any new player to enter this segment
of healthcare.
Growth Opportunities
Though the home healthcare market is still in its infancy, the industry is poised
to double every year going forward. "Today in India, many chronic diseases
or injury conditions require long-term medical support and hospitalisation.
As the percentage of these patients in the country increase the opportunity
for home healthcare services is bright," says Kanakia. Also, many international
players are targeting this segment of healthcare. According to industry buzz,
a leading Japanese home-healthcare company will soon enter India in a big way.
More and more hospitals are beginning to recognise the utility of home-health
solutions. They can now provide support to critical patients who need immediate
attention by allowing patients who can continue care through home health situations.
They can free up more ICU beds and medical ventilators. People are finding comfort
in home care for problems like ventilation support sleep apnoea etc. While demand
of beds can clearly drive this, comfort of getting support at home through easy
to use technologies.
The growth story is linked with awareness drives. To spread the awareness and
tap the market, the companies must run awareness programmes targeting both patients
as well as general practitioners. A Vaidheesh, Managing Director, Johnson &
Johnson Medical India, a Division of Johnson & Johnson Limited exemplifies,
"The situation here is precarious. There are 40 million diabetics but it's
estimated that around 25 billion don't know that they have diabetes. Worse still,
those who know don't want to measure and maintain their blood glucose levels
though there are meters available in the market. They buy the meter but don't
use them, follow the regimen or protocol."
To target the right audience, it is important for companies to design strategies
so that the product reaches the right audience. "If they effectively communicate
the benefits (possibility of regular monitoring, greater prevention, higher
convenience, cost-effectiveness, lesser chances of getting hospital-acquired
infections, etc), they will be able to create value in the minds of the customers,"
informs Kumar.
Decent ROI
Cardio Messenger from Biotronik Medical Devices |
Leaving aside the demand and socio-economic factors, what
attracts companies is the fact that home-healthcare is not largely capital driven
and plus it enjoys higher ROI as compared to the hospitals. This model is not
hospital centric very patient centric. Instead of selling the equipment, companies
find it more profitable to give it on lease. Kanakia agrees, "In home-healthcare,
capital costs are largely negated as there aren't any land and structural cost
unlike the corporate hospitals which are highly capex driven and incur huge
cost on land, building and medical equipment. It is not unusual to expect a
ROI in the range of 25-30 per cent."
"One of the main source of revenue for manufacturing companies is generated
by renting out this equipment. There is no third party who rents out the equipment,
the companies provide them directly on rent, again saving costs" adds Singh.
Adds Dr Rakesh Kapoor, Manager- Business Advisory Services, Ernst and Young,
"Product costs in comparison to marketing and distribution costs are of
lesser significance in home healthcare." Also, compared to hospitals, there
are no recurring expenditures.
With acute shortage of hospital beds, patients want alternative sources. Hence,
again home healthcare is the best option they seem to consider. From the hospital's
perspective, home healthcare is a positive trend as it leads to better utilisation
of beds. It also brings cost efficiency to the hospitals as well as helps decrease
hospital acquired infections. Looking at these factors, more and more companies
are entering this market.
Challenges
 "The
home healthcare industry in India consists of around 5,000 small and large
organisations, which are largely unorganised"
- Pradip Kanakia
National Head-Markets
Member-KPMG India Leadership
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 "There
is a huge need for home-healthcare products / services, but there are not
many players in the market
- Animesh Kumar
Managing Consultant
Healthcare Consulting
Datamonitor, India
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Not everything is that rosy in India. There are many factors
and roadblocks that slowdown the success of this concept in India.
High-Costs: Affordability is a major issue as not
everyone can afford the products and services. These players will have to manufacture
low cost products for the bottom of the pyramid population. Now, that healthcare
is not restricted to tier I cities, products have to be manufactured for the
population in rural India. To manufacture cost-effective products, many indigenous
manufacturers are likely to enter this section of healthcare.
Fears and Apprehensions: The existing mindset among
the patient population is another major challenge that the companies will have
to tackle. "Patients are usually apprehensive about home healthcare and
using devices at home," opines Shares Dr Navneet Singh, Consultant- Pulmonology-Thoracic
Surgery and Medical Intensive Care, Fortis Flt Lt Ranjan Dhall Hospital.
Patients also doubt the accuracy of the results. They also
fear survival of the patient once taken home. "Also, patients largely prefer
to get treated in a hospital where they get comprehensive care under one roof,"
opines Kanakia.
Limited Distribution: The major chunk of costs goes
in distribution. Distribution is a challenge. Right now, the distribution is
limited to hospitals. Thus the distribution channel needs to be focussed. "We
may need an entirely new way of reaching the technology to patients and we are
working on an expanded dealer channel," remarks Prasad.
Unorganised Market: The sector is largely unorganised.
Apart from a few organised players like Philips Healthcare, Metropolis Health
Services, Religare GE, Medinova, Apollo Hospitals, Dr Lal's Pathlabs, the sector
is largely unorganised. "The sector is characterised by fragmentation as
the top 100 companies (by size) hold less than 20 percent share of the market,"
remarks Kanakia. This less market share can be attributed to the fact that largely,
the chronically ill patients who require long hospitalisation only prefer home
healthcare mode. Kanakia adds that most of the large hospitals chains in India
are yet to adopt the home healthcare facility.
Awareness: The biggest challenge is lack of awareness.
Not many people in India know about the products/services and hence the market
is largely restricted to the metros and other tier I cities in India.
But argues Prasad from GE that tier II cities are picking up, "We have
nearly 3,000 patients using sleep apnoea solutions in India today. Nearly as
many people are using home ventilators for long-term life support at home. It
is not limited to big cities. We see patients using solutions like this in smaller
towns as well," says Prasad.
Apart from the lack of awareness about the products, the companies in the home
healthcare segment also have to deal with the lack of awareness among patients
regarding their own medical conditions. For example, millions of people suffer
from Obstructive Sleep Apnoea in India, however only a small chunk is diagnosed.
Into the Future
Many analysts believe that from a technological perspective, the players which
can explore this market are J&J, Siemens, Sony, Samsung and LG. However,
it is also projected these companies which are technologically advanced can
face competition from FMCG companies, who, can outsource the technologies and
produce the same product at a much cheaper cost. Also, it would be a smarter
strategy to target distribution at retail pharmacy stores. An analyst remarks,
"Right now, most companies are supplying these products in hospitals. Instead,
they should target the supply in pharmacy retail stores." Since distribution
is a key challenge, pharmacy companies who enter this segment of healthcare
have a greater chance of success. These companies have a much-more wider established
chain of retail pharmacy stores.
The opportunities are definitely not limited to tier 1 cities. As one observes
that there is a greater need for healthcare services in tier II and III cities,
the healthcare players cannot ignore the vast numbers waiting to be tapped.
Moreover, there is a greater chance of renting out these equipment in the rural
areas where affordability and accessibility is a major issue. "While most
providers are presently targeting the metros and tier I cities, there lies an
equally great potential in rural areas too since they have low access to healthcare
services and trained specialists," shares Kanakia.
With so many challenges to tackle, but an optimistic drive to survive, home
healthcare market in India is here to stay. But how long will this industry
take to pick up speed and enter into the fast gear mode, only time can tell.
Market pundits have to wait and watch. But if a company like Philips chooses
India from the entire world to be its launchpad for a product in home healthcare,
the message is loud and clear - India is in the radar of home healthcare leaders.
sonal.vij@expressindia.com
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