healthcare industry india overview and city comparison

Hello

How you doing?

Healthcare Delivery Industry

in India

let’s talks about

Healthcare Delivery

is a fancy term for provision of healthcare

Healthcare Delivery

is a fancy term for provision of healthcare that includes:

Pharmacies

Hospitals/

ClinicsLabs

Healthcare Delivery

is a fancy term for provision of healthcare that includes:

Pharmacies

Hospitals/

ClinicsLabs

CONTENTS

Overview

City-wise comparison

Closing titles

References

OVERVIEW

FASTEST

one of the

22.8

34.2

37.6

41.4

45.5

50

79

2005 2006 2007 2008 2009 2010 2012e

growing sectors

Healthcare industry revenues in USD bn

DELIVERY

91% moolah raked in by

Contribution of various segments (%)

71

13 3

9 4 100

Hospitals Pharmaceuticals Diagnostics Medical suppliesand equipment

Medicalinsurance

Total

Healthcare Delivery

Technology

An industry driven by…

better technology that promotes minimally invasive surgeries and ambulatory servicecenters, both of which are encouraging demand while simultaneously resulting in bettersupply. Better technology also promotes telemedicine, which the government and MCITare pushing fore the rural population.

Technology

Investments

An industry driven by…

high investments. In 2010, the healthcare sector saw PE investments of USD 320.4bn.There were 57 Mergers & Acquisitions worth USD 6.2bn in the same year. One of thereasons for increasing investments in the sector is government encouragement…

Technology

Investments

Government

An industry driven by…

…in the form of reduced customs duty on life saving equipment, tax benefit for largehospitals, and allowance of 100% FDI in hospitals. The government is also increasing itsown spending and plans to spend 2.5% of GDP in the 12th 5-year plan.

Technology

Investments

Government

Growing

Demand

An industry driven by…

Growing demand is a result of various factors, including better healthcare awareness,increasing lifestyle related diseases, rising levels of disposable incomes and medical tourism.

MISERS!

but we spend like

USA

Brazil

China

Annual per capita spending on healthcare* (USD)

*by the government and private sector combined

India’s health expenditureper capita (USD)

22.1

54.2

20

30

40

50

60

'01 '02 '03 '04 '05 '06 '07 '08 '09 '10

MORE & MORE

and although we are spending

on healthcare every year…

14.2

2.1

7.8

17.1

27.7

6.5

2.1

Number of physicians per 10,000 population

Number of beds per 1000 population

3

1.7

1.2

3.9

5.6

0.9

LAG WOEFULLY

…in key indicators we

behind developed nations

Spending on healthcareas a percentage of GDP

2.7 3 2.7 2.8

4.8

2.9

5.5

1.91.7

3.3

7.7

1.3

GovtSpending

PrivateSpending

OPPORTUNITY

which creates a huge

for private players

Year after year, the government spendingfalls way short of requirement. This opensthe doors for private investors. As the graphreveals, private players spend more thantwice the amount spent by the government,every year.

CITY-WISE COMPARISONS

CITY-WISE COMPARISONS

I have compared data from four Indian metros: Ahmedabad (AHD), Chennai

(CHN), Kolkata (KOL) and Pune (PUN). The following type of hospitals have

not been considered:

1. Non-allopathic hospitals

2. Consultation clinics

3. Non-ophthalmology clinics with no beds

Data on cities acquired from RedSeer Consulting Pvt. Ltd., a research and

consulting firm in Bangalore.

JUST DANDY

urban India is doing

0.83

1.41

1.22

1.68

Global Avg

0.62

Indian sub-continent Avg

0.13

2.29

4.06

4.74 4.49

Global Avg

3.0

Indian Avg

0.9

Number of beds per 1,000 population

Number of OTs per 10,000 population

overall

VARIATION

but there is huge

5%

11%

18%

9%

1%

2%

3%

1%

31%

59%

60%

39%

63% 28% 19% 41%

Small Single Specialty

Small Multi Specialty

Large Single Specialty

Large Multi Specialty

across metros

Distribution of types of hospitals

VARIATION

but there is huge

across metros

3132

24

16

79

83

78

47

67

60

66

53

63

46

53

34

AHD CHN KOL PUN

Hospitals offering various facilities (%)

VARIATION

but there is huge

across metros

0

500

1000

1500

2000

2500

3000

3500

4000

4500

Rupees

200-500

500+

100-200

0-100

Average maximum bed prices by city and bed range

Total number

of beds

The size of the bubbles represents the totalnumber of beds present in a city in hospitalsin a certain bed range. The position of thebubbles represents the average maximumbed price for hospitals in that range.

VARIATION

but there is huge

across metros

Percentage of hospitals offering various specialties

42

35

20 20

31

71

65

40

46

51

75 76

6157

66

58 58

30

39

49

AHD CHN KOL PUN

CLOSING TITLES

CLOSING TITLES

Healthcare industry is one of the fastest growing sectors in India.

However, the gap between urban and rural India is vast. The biggest

private sector investments in the coming years are bound to happen in

Tier-II and Tier-III cities.

DISCLAIMER

This is an independent study performed by Sanket Baxi.

Data have been taken from various sources, including reports and

whitepapers by consulting firms (see references on next slide). These

firms are not affiliated with me, nor have any of them commissioned this

study.

The sources of data in this presentation may not necessarily subscribe to

any/all of the views in this presentation or agree with any/all of the data

mentioned and the inferences drawn from them.

References

Websites

www.ibef.org

www.indianhealthcare.in

www.irda.gov.in

http://economictimes.indiatimes.com/Starting_Up/Vaatsalyas_hub-and-

spoke_model_delivers_affordable_healthcare/articleshow/3169942.cms

Various media

Reports and Whitepapers

Hospital Sector Overview (whitepaper) – RedSeer Consulting

World Health Statistics 2012 – WHO

Indian Healthcare Industry: Sustainable Growth - Harneedi

Emerging Trends in Health Care, 2011 - KPMG

Improving Healthcare Delivery in India, 2009 - by Abhijit Banerjee and Esther Duflo

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