Medical equipment companies make a beeline for India
NEW DELHI: In a bid to tap the booming healthcare market, global medical equipment manufacturers are now setting up plants in India. While companies such as Aloka Science and Humanity of Japan and Starkey of the US have recently set up their units, others like Philips Medical Equipment are scouting for partners.
Japanese ultrasound manufacturer Aloka has entered into a 60:40 joint venture with Chennai-based Trivitron. The joint venture will invest Rs 50 crore and manufacture 1,000 ultrasound equipment annually. Trivitron said it would soon form similar joint ventures with 3-4 more foreign companies to manufacture various medical equipment with an investment of Rs 250 crore in a medical equipment manufacturing park in Chennai.
In the past six months, Japanese opthalmist company Hoya, Nova India of Brazil and Chinese company Mind Ray have set up assembly units in India. Niche player Starkey, the No 1 hearing aid maker in the US, has also set up a manufacturing unit in India “As there is a good demand, companies can now break even in 2-3 years, compared with 8-10 years some years ago. It is now much more viable for companies to set up units in India,” said Starkey India managing director Rohit Misra. However, all these units will mostly manufacture low or middle level segment products and require relatively small investments.
Currently, India’s medical equipment market, including small devices, is estimated to be Rs 2,500 crore. It is growing at 10% but is expected to increase to 15-20% in the next couple of years. About 80-90% of the medical equipment used in the country are imported. Industry officials said once global companies started full-scale manufacturing in India, prices of medical products could fall 15-50%. Hospitals spend a large chunk of their investment in procuring equipment. In the case of top speciality hospitals, medical equipment account for as much as 35% of their total capital investment.
GE has a tie-up with Wipro, which manufactures diagnostic equipment in India. Philips Medical Equipment has said it is looking for suitable partner to start manufacturing in India. “The country has never seen such kind of growth. Companies, which want to cash in on the boom, would like to be close to the centre of action than just depend on imports. The country’s healthcare industry could see a boom similar to the one it is witnessing in the auto sector today,” said Philips Medical Equipment senior director (Indian Sub-continent) Anjan Bose.
US-based healthcare IT and technology provider PekinElmer Inc is also looking for partners to develop its products in India. “Besides the cost advantage, the Indian healthcare industry is a large market and has the right skill set. We plan to make India the centre of our exports to unregulated markets such as the Middle East, Asia and Africa,” said the company’s chairman and CEO, Gregory L Summe. However, he added that the company would develop its sophisticated equipment for regulated markets such as the US and the UK from its global centres.
Japanese ultrasound manufacturer Aloka has entered into a 60:40 joint venture with Chennai-based Trivitron. The joint venture will invest Rs 50 crore and manufacture 1,000 ultrasound equipment annually. Trivitron said it would soon form similar joint ventures with 3-4 more foreign companies to manufacture various medical equipment with an investment of Rs 250 crore in a medical equipment manufacturing park in Chennai.
In the past six months, Japanese opthalmist company Hoya, Nova India of Brazil and Chinese company Mind Ray have set up assembly units in India. Niche player Starkey, the No 1 hearing aid maker in the US, has also set up a manufacturing unit in India “As there is a good demand, companies can now break even in 2-3 years, compared with 8-10 years some years ago. It is now much more viable for companies to set up units in India,” said Starkey India managing director Rohit Misra. However, all these units will mostly manufacture low or middle level segment products and require relatively small investments.
Currently, India’s medical equipment market, including small devices, is estimated to be Rs 2,500 crore. It is growing at 10% but is expected to increase to 15-20% in the next couple of years. About 80-90% of the medical equipment used in the country are imported. Industry officials said once global companies started full-scale manufacturing in India, prices of medical products could fall 15-50%. Hospitals spend a large chunk of their investment in procuring equipment. In the case of top speciality hospitals, medical equipment account for as much as 35% of their total capital investment.
GE has a tie-up with Wipro, which manufactures diagnostic equipment in India. Philips Medical Equipment has said it is looking for suitable partner to start manufacturing in India. “The country has never seen such kind of growth. Companies, which want to cash in on the boom, would like to be close to the centre of action than just depend on imports. The country’s healthcare industry could see a boom similar to the one it is witnessing in the auto sector today,” said Philips Medical Equipment senior director (Indian Sub-continent) Anjan Bose.
US-based healthcare IT and technology provider PekinElmer Inc is also looking for partners to develop its products in India. “Besides the cost advantage, the Indian healthcare industry is a large market and has the right skill set. We plan to make India the centre of our exports to unregulated markets such as the Middle East, Asia and Africa,” said the company’s chairman and CEO, Gregory L Summe. However, he added that the company would develop its sophisticated equipment for regulated markets such as the US and the UK from its global centres.
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