‘There needs to be tax support, subsidies and incentives to support specific device manufacturing areas and creation of SEZs’

The PM’s agenda should focus on several aspects such as:

Medical devices and disposables

Medical devices and disposables are critical for any hospital, primarily because of the financials, since medical devices are reflected as assets in the balance sheet and disposables appear as consumables in the income statement.

Medical devices are a Capex item and will undergo depreciation within 6-7 years, after which fresh funds will need to be allocated for replacement. On the other hand, disposables have a direct impact on EBITDA, since they can be as high as 20-25 per cent of the revenue, depending on the type of hospital. For example, in high-end orthopaedic or cardiac procedures, the cost of disposables due to prosthesis or drug eluting stents (as a ratio to revenue) can be in range of 20 – 25 per cent, while for a basic secondary hospital, the cost could be low as 15 per cent.

Disposables are one of the areas where import substitution may be worth considering. This will need an ecosystem where private and public hospitals work on the same platform to promote the concept of ‘knowledge exchange.’ Through this, one can expect more interaction between the clinical team end users and industry that can look into the ways of importing substitutes and reducing costs without compromising on quality.

One of the bigger challenges that Indian manufacturers face in the field is effective marketing budgets. This issue needs to be resolved with innovative strategies and in this regard, there are lessons to be learned from international players in the sector.

India has a strong base in Engineering and R&D across industries, not to mention some of the best atomic and space researches. Under the circumstances, our inability to promote the indigenisation of medical devices is surprising, especially in the capital intensive fields like radiotherapy and medical imaging.

To strengthen the delivery side, what is needed is a consortium of like-minded people – hospital players, insurance players and department of science and technology. The government and some industry organisations should take the initiative to create a series of workshop which could help develop a policy document. There needs to be tax support, subsidies and incentives to support specific device manufacturing areas and creation of SEZs or in this case, innovation hubs.

One of the most successful transfer of technology to domestic industry in India was by ISRO, when the first successful satellite launch vehicle- SLV-III was manufactured under Dr Kalam’s leadership at the Vikram Sarabhai Space Center, Thiruvananthapuram. He had ensured that the component technologies for the following series of satellite launch vehicles were transferred to the industry. Why can’t the medical device industry follow the example of the nuclear and space sectors? All it needs is concerted effort from various interested quarters.

Healthcare manpower resource

Unfortunately, the pipeline for creating medical manpower, whether it is doctors, paramedical staff or nurses, has not kept pace with the industry requirement and serious challenges are foreseen in this area. As a result, healthcare manpower resource constraint is going to be the biggest challenge in Indian healthcare.

The Medical Council of India has followed the pyramid approach for training doctors in the country. Every year, a large number of under graduates don’t have an access to post graduate training due to shortage of seats and teaching facility. This has created a large pool of skilled yet underutilised undergrad doctors suffering skill degradation. If we have to utilise precious resources and their talent, this pyramid based structure has to be reconsidered. There has to be reformation in policies and procedures right from the regulatory requirements for land, bed capacity etc, to build medical colleges for undergraduate and post graduate programmes. For the present, we could utilise the large amount of district hospitals across the country where beds are available. An efficient PPP model, where a private medical college could be associated with a public facility could help resolve this issue thus using innovative ways of utilising our resources.

The other area of concern is the absence of standardised national training system. We need to have a national standard for training doctors to remove the skewed training in sub specialties among medical colleges in India. A national standard in training of doctors, nurses and paramedical staff, is the only way to help overcome this situation.

An interesting observation here is, that doctors of Indian origin who are trained overseas, are not welcome to join as professors or faculties in our medical colleges. This needs to change. If these precious resources are ready to give time, we should welcome them with open arms. These type of myopic approaches need to be removed for us to move forward and be able to utilise our existing advantages to the maximum.

There is also an opportunity to develop the concept of physician assistants in India. This would be an ideal way of mitigating the challenge of the supply chain of doctors. In countries like the US and China, where these models have worked wonders, we could also train physician assistants to take the place of doctors wherever possible, to reduce costs. This would be a very useful approach for treatment in non-critical areas of medicine and healthcare.

At the end of the day, we need to accept the fact that the so called brain drain from India is only partly for money. There are enough opportunities for high incomes in India for talented doctors. Why we lose them to foreign practices is the lack of an ecosystem that allows them to engage in a complete practice. Medical profession is not only about clinical practice; research and academic work complete the triad, but most medical colleges in India do not provide this environment, and only a handful of public and private sector institutions do. We need more colleges, hospitals and institutions that can provide this ecosystem to our doctors. Perhaps that will solve a lot of our problems. At the same time, research and product development in healthcare will also benefit from this initiative.

– Dr Harish Pillai, CEO, Aster Medcity