 "We have to invest in social infrastructure: Krishna Kumar")
The current President of Philips Healthcare India –A Krishna Kumar speaks to Reghu Balakrishnan on the challenges in the diagnostics industry in India and how the company plans to make diagnosis affordable for Indian patients. Excerpts:
Though healthcare industry is growing fast, people remain suspicious on MRI or whole body scanning. Why?
It is normal human tendency to be suspicious of what one doesn’t fully understand. But, when it comes to medicine, accurate diagnosis is the key to quick and accurate treatment. If you look at cancer for example, India has 315 cancer centres, but you only have 75 PET /CT scanners that are critical for diagnosing cancer.
At the rest of thecenters, the treatment is happening blindly without knowing where the tumour actually is, and hence they are radiating the tumour. In such a case, a patient could feel that this test is unnecessary because the treatment is inaccurate. But it cannot be denied that better diagnosis means better therapy. In India, the challenge is that we do not have enough quality diagnostics for good therapy to be practiced in the country.
Affordability is also a main concern in healthcare
That’s correct. Affordability is an issue, but that is why you need aggregators like National & Rural Health Mission etc. The government has a big role to play in the rural sector and also tier III cities. In India, in the future, no single stakeholder whether private hospitals or government will be able to solve this problem of healthcare challenges alone.
Are Indian patients given proper diagnosis currently? What’s the situation?
The State of Punjab has so many cancer patients that there is a train called the Cancer Train by the locals which takes people from Bhatinda to Bikaner to get themselves diagnosed and treated for cancer. If you come to Rajasthan, the entire state of Rajasthan has two cancer centres and the rest of the patients all travel to Delhi for cancer treatment.
Believe it or not, every year 1.2 million new cases of cancer get detected. The rest of the patientsdonot getdetected on time. About 70% of the cancer patients in India die within the first year of diagnosis.
Heart disease is the second biggest killer in the country after cancer. We have 60 million people with heart disease in the country and that number is growing and currently we only see 2 million people getting an angiography in a year.
Most of our focus in this country has been on growing core infrastructure like roads, ports, airports etc. but not social infrastructure which is education and health - we have to invest in social infrastructure and not just core infrastructure.
We have to grow by contributing to solve the key healthcare challenges that exist in the country. At Philips we have taken up two key challenges –one is to provide access to proper medical facilities and the other is to make the facilities affordable.
Potential in Indian healthcare industry as far as medical devices are concerned?
In India, 4,50,000 hospital beds have been added in the last 5 years and we now have 1.6 million beds and 5,000 diagnostic centers in the country. Over the next 5 years, 6,00,000 beds will get added through the addition of 6,000 hospitals.
This is a very disappointing number if we look at it from a global standpoint. Currently, there are 1.3 beds per 1000 patients in India, while the global average is 4 beds per 1,000. We are well below not only the global average, but also below other emerging markets like China, Indonesia, SriLanka, Africa etc.
Keeping this is mind, and with that much expansion to happen, medical technology providers now need to become true technology partners for the entire hospital and not just equipment sellers.
How capable is Philips to tap the said windfall in India?
If a company has a single product line, it becomes difficult to be competitive. Hospitals prefer to have a single partner because it makes is simpler to train doctors and nurses on a similar interface. The more the doctors and nurses are familiar with technology, the safer it is for patients.
There are a lot of advantages of having a single technology partner for the entire suite because ‘islands of information’ become a big challenge. Given the kind of dynamics of the healthcare business,it is imperative to have near zero downtime.
Therefore it is critical to have a great service network, huge amount of medical innovation, great clinical expertise, physics and great electronic expertise apart from mechanical expertise. And this where we have the upper hand over our competitors.
How does the company create awareness and affordability?
We design and build systems in India with engineers who know the challenge of affordability and other environmental challenges. And this is why today we have 5 R&D sites across the country with the biggest one being in Bangalore, so we can design and develop the best possible solutions.
The second important tool is to have local manufacturing. In October 2011, we inaugurated our 1st green field manufacturing facility in Chakan, near Pune. This facility is 1 of the only 6 manufacturing centers globally called Philips Centre of Excellence.
How much investment went into the Chakan facility?
In Chakan the facility is spread over 10 acres and is expandable going forward. It’s a state of the art center with a 700 member team and state of the art technology for manufacturing Cath labs. In R&D alone in last 2 years we have invested $50 million plus a big investment in manufacturing and there will be a significant investment in manufacturing in next 5 years in the country and building the whole service network.
About Philips’ innovation and product launches in medical devices space
We have launched 33 entirely new products in the last 2 years and, new in this case, does not refer to just different sizes of the same product. These are entirely new ultra sound machines , MR products, scanners etc. 33 products in 2 years means more than one product every month, which is a phenomenal pace of innovation. This requires tremendous R&D and innovation as well as commitment.
Which are the areas of expertise for Philips Healthcare in India?
We currently play in 5 verticals of healthcare - Radiology- such as MR, CT scans, X-Ray, essentially all imaging equipment. The second category is Cardiology - ECG, stress echo cardiography, Ultra Sound machines,Cathlab etc. In oncology, we make head CT scanner, PET /CT scanners, gamma cameras, mammography equipment.
In Critical Care, we equip ambulances with AED, ventilators, ECG and so on. The fifth and final vertical that we are present in is Respiratory Care which deals with most of the respiratory illnesses, a big problem in India and many countries.
Is the healthcare expenditure per capita growing in India?
It is certainly growing, but we are starting from the lowest base in the world. We have the lowest per capita expenditure in the world; not just in technology, but also in Pharma. Per capita pharma expenditure in India, for example, is $8 per person per year in India, compared to $800 in the US.