 Healthcare

 Pharma & Biotechnology

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Lakshmi Narayana – 08032E0014
 Indian Healthcare : The Changing Scenario

Current Healthcare Landscape

 Indian Healthcare : The Changing Scenario

INDIA SPENDS US $ 22.7 BILLION ON HEALTHCARE

5.2% of
GDP
22.7

3.7 19

Total Pharma Healthcare

Healthcare market* delivery
Market market

*
 Indian Healthcare : The Changing Scenario

THE HEALTHCARE DELIVERY SECTOR PLAYS AN

IMPORTANT ROLE IN THE ECONOMY TODAY
Sector Direct employment Revenues/GDP

Million, 2008-2009 Per cent, 2008-2009

Healthcare 4.0 5.2

Education 5.3 4.8

Healthcare is the
Retail banking 1.0 3.5 largest service
industry in terms
Power 1.2 3.0 of revenues and
the second
largest after
Railways 1.6 1.8 education in
terms of
Telecom 0.8 1.4 employment

Hotels, restaurants 1.7 0.9

IT 0.4 1.7

By 2012, the sector could account for 7 to 8 per cent of GDP and provide
direct and indirect employment of 9 million
 Indian Healthcare : The Changing Scenario

IN TERMS OF DELIVERY, PRIVATE PROVIDERS CAPTURE 63%

0F THE US $ 19 BILLION SPEND

Healthcare provision, 2009

Per cent of total spending

100% = US $ 19 billion

Government and public

Private providers
employers*
(individual, charitable
and for-profit)
37
63

* Including government spend (20%), public employers’ spend (11%) and out-of-pocket spend at government providers (6%)
Source: McKinsey analysis
 Indian Healthcare : The Changing Scenario

INDIA: AN EMERGING HEALTHCARE HUB

 INDIAN HEALTHCARE CAPABILITY
FACT#1: Proven Indian healthcare system

 Over 60,000 cardiac surgeries done

per year with out comes at par with
international standards

 Multi organ transplants like Renal,

Liver, Heart, Bone Marrow
Transplants, are successfully
performed at one tenth the cost.

 Patients from over 55 countries

treated at Indian Hospitals.
INDIA HAS THE OPPOURTUNITY TO PROVIDE THE BEST OF
THE WEST & EASTERN HEALTCARE SYSTEMS
Indian Systems Of Medicine “ Staging a Comeback”

 Ayurveda recognized as an official

healthcare system in Hungary.
India’s Gift to the World
 Doctors in the west are
increasingly prescribing Indian Ayurveda
Systems of Medicine
Yoga
 More than 70% of the American
population prefer a natural Siddha
approach to health

 Americans are said to spend

around $25bn on non-
traditional medical therapies
and products *

Source : Los Angeles Times

* Economic times dated 25th July 2003
 HEALTHCARE….THE SUNRISE INDUSTRY

“Physicians, Nurses, Medical Technicians and Other Scientific Occupations

will Become Growth Industries to Rival the IT Sector within the Next
Decade”

- India Vision 2020 Report

 Indian Healthcare : The Changing Scenario

Cost Advantage
PROCEDURE COST (US$)

US
US THAILAND
THAILAND INDIA UK

Heart Surgery 40,000 7,500 6,000 23,000

Bone Marrow Transplant 2,50,000 ------- 26,000 1,50,000

Liver Transplant 3,00,000 ------- 69,000 2,00,000

Knee Replacement 20,000 8,000 6,000 12,000

Cosmetic Surgery 20,000 3,500 2,000 10,000

 Indian Healthcare : The Changing Scenario

HUGE GROWTH POTENTIAL – TO GROW BETWEEN

US $ 43 – US $ 60 BILLION IN 2012
60.0
US $ IN BILLION at 2000-2001 prices
ESTIMATE
51.0 17.0
43 8.0
8.0

19 43.0
Government 43.0
spending 3.76 35.0
Private
spending
15.24

2001 2012 2012 2012

Scenario 1: Scenario 2: Scenario 3:
Baseline Baseline with Baseline with
increase in insurance in insurance and
private spend middle class high
government
spending
Key Government
Spending 1% GDP 1% GDP 2% GDP
Assumption
* With 6% GDP real growth per year
 Indian Healthcare : The Changing Scenario

INDIA OFFERS HUGE POTENTIAL FOR INVESTMENTS IN

HEALTHCARE OVER THE NEXT 10 YEARS

Investment requirements in India (Estimates)

US $ in Billion Next 10 years

Healthcare 22-31

Investment needs
of the healthcare
Power** 95-126 sector are
comparable to
other infrastructure
sectors
Telecom**
40-51

Roads** 24-33

mputed by sling 2002-06 estimates fromkesh Mohan committee report by a factor of 1.5-2.0
 INDIA IN THE NEW KNOWLEDGE ECONOMY

India’s Growth Sectors -

Pharmaceuticals & Biotech
 The Indian Pharmaceutical Industry
has practically achieved
Self sufficiency
&
Global recognition
as a
Low cost producer
of
High-quality bulk drugs & formulations
 KEY ACHIEVEMENTS

India has the 2nd highest India’s huge population and

number of qualified doctors in the prevalence of a wide
the world. Of every six medical spectrum of disease conditions
doctors in the US, one is offer a wide patient-resource
Indian for clinical trials

While clinical trials cost

approximately $300 to 350
million in US, they cost only
about $25 million in India
Indian companies are offering
Investigational New Drug custom synthesis services at 30-
stage costs about $100 to 150 50% cost savings compared to
million in US, but costs only global costs
around $10 to 15 million in 700,000 science and
India engineering graduates &
1500 PhDs qualify
annually. Over 15,000
scientists
 CHANGING FACE OF INDIAN PHARMA

Players thinking Players thinking

local global

Indian pharma companies filed the Export revenues now contribute

largest number of Drug Master Files over half the total revenues for the
(DMFs) for APIs and 23% of ANDAs Indian pharma majors
with the USFDA during 2009

Top 5 Companies Sales & Export Revenues

Rank Company Sales ($ mn) Exports ($ mn) Exports %

1 Ranbaxy 969 736 76%
2 Cipla 400 163 41%
3 Dr.Reddy's Lab 336 212 63%
4 Aurobindo Pharma 264 128 48%
5 Lupin 210 92 44%
Source: Company reports

Ranbaxy acquired RPG Aventis, Pharmaceutical exports increased at

France; Wockhardt acquired CP a CAGR of 23% during FY1995-
Pharmaceuticals, UK; Zydus Cadila FY2009
acquired Alpharma, France
 CHANGING
CHANGINGFACE OF INDIAN
FACE OF INDIANPHARMA
PHARMA

MNC-Domestic MNC-Domestic
Competition Collaboration

Co-marketing New Drug Research

Glaxo-Cipla, Glaxo SmithKline's recent

Wockhardt-Bayer, R&D alliance with Ranbaxy
Ranbaxy-Knoll tie-ups Laboratories

Pharma - IT Clinical Trials

COLLABORATION
Novartis processes drug safety Novartis, Astra Zeneca and Eli
data and is designing clinical Lilly making India a global
development software hub for clinical trials

In-licensing Local research

Ranbaxy licensing agreement Astra Zeneca’s $40 million

with KSB, UK for marketing R&D facility in Bangalore for
TransMID TB drug discovery

Source: Media Reports, E&Y

 INDIA IN THE NEW KNOWLEDGE ECONOMY

BIOTECHNOLOGY
 Market - A Consistent Uptrend

25% growth in investment

2008-2010 70% growth in employment

74% growth in R&D

manpower

USD 5 billion annual

revenues
2012
1 million skilled jobs

10% of global industry

Source: Confederation of Indian Industry (CII)
 GOINGSOURCE
GLOBAL IN BIOTECH
FROM INDIA

Shantha Biotech-
SHANVAC-B meets
40% of the global Clinton Foundation
India’s first genetically demand of Hepatitis sourcing HIV treatment
engineered vaccine B vaccine.  
from four firms - three
costs less than half the of which are from India
price of competing
vaccines
India: largest producer
of Measles & DTP
Biogenerics - vaccines. Vaccine
exports to over 130 Biocon was the first
$25 billion biological
countries enzyme company globally
products going off patent to receive ISO certification
in 2009. Indian in 1993
companies strong in Bio Agri -
biogenerics India (2nd largest
producer of food) offers
significant opportunities
to source products

One out of every two children in the world

is immunized by a vaccine made in India

Source: Newspaper Reports

 The India Advantage

Excellent network Well-developed

of research laboratories base industries

Rich biodiversity Extensive clinical trials

opportunities

Trained manpower
and knowledge base
THANK YOU