Healthcare Services – On Growth Track – Healthcare

Diagnostics is an important component of improved value chain in the Healthcare Sector, which enables accurate detection of health risks and diseases in earlier stages thereby improving treatment and disease management, while cutting subsequent health problems and their associated costs. With improving economic indicators for India, healthcare spend has also witnessed a rise. Though diagnostic tests comprise a very small percentage of the total medical expenditure, they account for 60-70% of all treatment decisions. Additionally, with the advent of molecular diagnostics, there is growing focus on diagnostics for early detection of diseases.Industry on a fast growth trackThe healthcare industry in India is growing at a rapid pace and it is poised to become one of the dominant participants of the Indian economy. According to a Yes Bank and ASSOCHAM report, the Indian health care industry is estimated to grow at 23% p.a. to USD 77 billion by 2012 from the current USD 35 billion. The sector has grown at the rate of 9.3% from the year 2000 to 2009.Of the sum, diagnostic and pathology services would account for USD 2.5 billion in 2012, more than double its estimated current size of USD1 billion. The growth in the segment is expected to be driven by the consolidation in the industry and increasing insurance penetration among the country’s population. Healthcare facilities, inclusive of public and private hospitals, the core sector, around which the healthcare sector is centered, would continue to contribute over 70% of the total sector and touch a figure of USD 54.7 billion by 2012 The diagnostics and pathology testing market in India represents one of the most lucrative markets in the world. The market has seen a robust growth in past few years.IVD and MolecularThe Indian In Vitro Diagnostic market is estimated to be USD 300 million as of 2008-09. The IVD market scenario has seen major development in the last 4-5 years and India should very soon catch up with the rest of the world. IVD revenue in India is primarily driven by labs contributing 65%, while hospitals contribute 35% share. The market is divided into Public & Private customers and the industry is made up of MNCs, Indian corporate and the unorganized players. Some of the big players are also entering the IVD businesses with emerging opportunities.Molecular diagnostic has been strongly developing during the past five years, with a growth rate of 15%. Molecular diagnostics or the analysis of DNA and RNA at the molecular level – is a fast-growing market, driven by the growing understanding of the human genome. Although a small part of the In-Vitro Diagnostics (IVD) market, molecular diagnostics market is one of the two growth drivers of the IVD industry. India has made major progress over the recent years in acquiring competence and credibility in using most sophisticated cutting edge biotechnology tools to understand disease pathogenesis at molecular level. Many institutes and universities have already extensive research exchange and international cooperation initiatives ongoing. Solid basic research is being carried out but there would be more need for applied research.Industry segmentsThe diagnostic and pathology market is around 2% of the overall healthcare market. The diagnostic market has been growing at 15-20% and by all indications shall continue to grow for another 10 years at this rate. The In Vitro-Diagnostic Market accounts for about 38% of the total global medical devices and diagnostic market. The Indian IVD market is estimated to be USD 330 million as of 2008-09. The IVD market scenario in India has seen substantial developments in the last 4-5 years and these changes shall continue for decades to come. In a very short time, India is poised to catch up with the global IVD market.