 "Milan Rao")
Having invested $200 million cumulatively into healthcare in India so far, and launched 26 made in India products, GE Healthcare is betting big on telemedicine in India. The firm plans to launch 74 new products that are developed and manufactured in India by 2020 that would be affordable compared to the conventional products. In a candid chat with Sohini Das, Milan Rao, President and CEO, South Asia of GE Healthcare shares the future outlook and the challenges. Edited excerpts.
You have launched around 26 products under the Make in India banner. What is the plan going forward?
We recently launched the Revolution ACT, which is the first computed tomography system designed and developed by GE Healthcare in India, these ACTs are manufactured in India for India and the world. This has been developed with an investment of around $20 million with around 75 engineers working on the project and four years of R&D. The result is the Revolution ACT is 40 per cent more affordable compared to previous generation four slice CT systems. Not only that it is 52 per cent lighter, consumes 47 per cent less power, and 36 per cent low radiation compared to conventional systems. We have 400,000 square feet of manufacturing space in India and a team of 1600 scientists working on things specific to India and also for the globe. There is scope for future expansion, we have space available. The target is to have 100 such made in India products by 2020
What could be the tentative investment on developing these new products?
I would not want to put a figure to it. Each of the products can be dramatically different; there could be products that could be brought about with an investment of around a million dollars, but there could also be a product like a CT that will require $20 million. So, the budget changes depending on what are the products that are brought about at any given time. You could start at a million dollars of investment and it could go up to $18-20 million dollars per product. The cumulative investment that has been done in India so far is about $200 million for healthcare. In India you do not need to invest as much money to develop a product as in many geographies. We are working on six to seven products that can come up this year. Adding 74 products by 2020 is an ambitious target.
If you can mention some of the pathbreaking products that you have come up with in India?
Fundamentally, some of the cardiovascular range of products, the maternity and infant care products would be some. The Mac range of products like the Mac 400 (2007) is a battery operated portable ECG system at 70 per cent lower costs than imported similar quality products.The New Mac I, which has the potential to reduce ECG price to as low as Rs 9 and is priced at Rs 25, 000.Then there is the Tejas XR 2000, which is a first of its kind high frequency x-ray system that is upgradable to digital x-ray, and it costs one-third of an imported digital x-ray system. The Lullaby range of products, like the Lullaby Baby Warmer, which costs 70 per cent less compared to a similar quality imported product. Affordable care is the prime driver; and making sure that the ruggedness of the product is such that it is able to survive in tough Indian conditions. We work towards at least a 30 per cent cost saver for a product, because I believe that drives affordable care in India.
Affordable products would do wonders in the rural space. Are you seeing more traction from semi-urban and rural markets.
Let me put it this way, the real scenario is that rural goes to district, a district goes to a tier-II, which then goes to a tier-I or a metro. It is typically a three to four wrung process of referral, and thereby the tier II and the tier III become very important as they are the first cogs in this hierarchy of providing quality healthcare. If your ability to provide quality healthcare products at affordable levels at this tier-II & III levels that impacts the healthcare outcomes far greater than if you are able to provide it at a metropolitan level. There is a very palpable shift of dependency from metro or tier I areas to tier II and III. It used to be a majority from metros earlier, now we are probably balanced (in terms of share in sale).
Many states are coming up big on telemedicine. Are you planning to come up with products that would have such remote transmitting and archiving technology in-built?
Absolutely yes. There are two major things we are working towards. One is how do we make sure that the image storage systems are available to doctors even if they are not available at the location. Part of tele-radiology is the picture archival and communication system (PACS) and the radiology information system (RIS). We are moving towards storage on the cloud so that it becomes ubiquitous. The second part is when you have doctors, but they do not have proficiency to handle critical situations like trauma. The concept of a tele-ICU is that you have a central hospital which is connected to smaller hospitals which may be 200 kms away or so. We have a mechanism by which all the parameters of the patient within the ICU are transported to a remote location and high quality video imaging at the remote location. Therefore, a doctor sitting at a command center can view the parameters and view the patient, and two way communication can happen. We are piloting this in many locations.
What are the challenges to develop affordable and quality healthcare in India. Any plans for tele-medicine in line of PPPs?
We are already in talks with state governments for telemedicine projects, like a hub-and-spoke model, lets say a PPP for radiology, tele-radiology etc. We run such a project in Gujarat for the last five years and we are actively looking at expanding such collaborations.
We are talking a lot to the government now through forums, the medical device act itself needs change. One needs to create an ecosystem that would enable Make in India. There needs to be technology sops, R&D sops, motivation for people to manufacture in India, export promotion incentives, so that the companies get a supply chain. Something that has come up in the case of automobile industry, the ancillaries are here, as there has been a stimulus given to the entire industry. We export components and full scale systems to about 70 countries within the GE network. There is not anything specific that encourages people to set up R&D centers here.
