Healthcare Market 2020
Brief Overview
The Indian healthcare industry is expected to reach US$ 79 billion in 2012 and US$ 280 billion by 2020, on the back of increasing demand for specialised and quality healthcare facilities. Further, the hospital services market, which represents one of the most important segment of the Indian healthcare industry, is expected to be worth US$ 81.2 billion by 2015. Meanwhile, the Indian pharmaceutical market is expected to grow at a compound annual growth rate (CAGR) of 15.3 per cent during 2011-12 to 2013-14, as per Barclays Capital Equity Research report on India Healthcare & Pharmaceuticals. Market Size

As per the estimations by RNCOS’s research report titled, ‘The Indian diagnostic services market,’ the sector will grow at the compound annual rate of around 26 per cent during 2012-2015, on back of huge investments, fast expansion into tier II and tier III cities, and strong Government support strengthening the healthcare infrastructure in India. Trends and Investments

The hospital and diagnostic centre in India has attracted foreign direct investment (FDI) worth US$ 1.40 billion, while drugs & pharmaceutical and medical & surgical appliances industry registered FDI worth US$ 9.66 billion and US$ 523.54 million, respectively during April 2000 to June 2012, according to data provided by Department of Industrial Policy and Promotion (DIPP). Some of the major investments in the sector include:

* German manufacturing company Carl Zeiss has established a research and development (R&D) unit and two manufacturing facilities in Electronics City in Bengaluru * The Kerala Institute of Medical Sciences (KIMS) Group has expanded its overseas operations, with the Royal Bahrain Hospital (RBH). KIMS-RBH is Bahrain's first custom-built hospital in the private sector, and it had Bahrain's first operational sleep lab, advanced laser technology for cosmetic surgery, and foetal medicine treatment facilities, among others * American Oncology Institute (AOI, US) and Cyberabad Citizens Health Services, have invested Rs 220 crore (US$ 40.37 million) to set up a cancer institute in Hyderabad. The market is projected to grow to Rs 5,000 crore (US$ 917.43 million) by 2016, as per the Clearstate data * Piramal Enterprises has been investing in German molecular imaging technology. Piramal sees revenue potential of US$ 1.5 billion from its florbetaben molecule technology * Japan's diversified trading company Mitsui & Co is buying an additional 25 per cent stake in active pharmaceutical ingredient (API) maker Arch Pharmalabs for Rs 372 crore (US$ 68.25 million), a move that will raise its shareholding in the Mumbai-based privately-held company to 30 per cent. * DM Healthcare, a leading healthcare conglomerate in India and West Asia, has announced an investment of over Rs 2,150 crore (US$ 394.50 million) in Kerala. The company is in the process of developing an array of healthcare facilities in various locations in the State and most of these projects are expected to operational in the next five years * Vaccine producer Panacea Biotec has partnered with US-based Osmotica Pharmaceutical to sell 18 products including liposomes, modified release oral dosage forms and depot injections in the US over next 10 years * Mumbai-based Piramal Healthcare is in talks with the Chandigarh-headquartered Ind-Swift Laboratories to acquire its contract research and manufacturing business and many of its facilities approved by the US Food and Drugs Administration (USFDA) * KEF Company plans to invest Rs 1,600 crore (US$ 293.57 million) in Kerala. The project includes a luxury hotel, integrated manufacturing facilities and a super specialty hospital in Kozhikode * Strides Arcolab's wholly owned subsidiary Onco Therapies has received final ANDA approval for Vinorelbine injection. The drug is used to treat different types of cancer as it is a chemotherapy drug that slows cancer cell growth Medical Tourism

India is the most competitive destination with advantages of lower cost and sophisticated treatments, highlighted the RNCOS report titled ‘Indian Healthcare - New Avenues for Growth’. The report further elaborates that several key trends are backing the growth of India’s healthcare sector. Of these, medical city is relatively a new concept that offers immense growth opportunities. The upsurge in medical tourism is encouraging hospitals and hoteliers to strike alliances with each other. The market size of medical tourism in India is growing at over 25 per cent annually at over US$ 2.5 billion, as per industry estimates. Furthermore, this segment's growing business potential has prompted ITC Group to set up Fortune Park Lake City business hotel at the Jupiter LifeLine Hospitals complex in Thane, near Mumbai, to serve medical tourists. Government Initiatives

The Government has decided to increase health expenditure to 2.5 per cent of the gross domestic product (GDP) by the end of the Twelfth Five Year Plan (2012-17) from the current 1.4 per cent. Furthermore, a number of initiatives that have been proposed and taken up by the Government of India (GoI) for enhancement of the healthcare sector are: * 100 per cent FDI is permitted for health and medical services under the automatic route * Allocation for National Rural Health Mission (NRHM) has proposed to be increased from Rs 18,115 crore (US$ 3.32 billion)...

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