GE Healthcare, part of the $17-billion healthcare business of the General Electric Company, believes in the intrinsic knowledge pool available in India.
GE Healthcare, part of the $17-billion healthcare business of the General Electric Company, believes in the intrinsic knowledge pool available in India. The company’s John F Welch Technology Centre and manufacturing facility in Bangalore, with team of 1,100 engineers, has become its largest R&D centre outside the US. GE Healthcare’s India sales and exports turnover touches $500 million. In the country, the company’s focus has been on manufacturing indigenously products designed for the Indian market. This, the company feels, makes its price points affordable and healthcare accessible to the general population. On the sidelines of its Second Early Health Summit in Bangalore, V Raja, president and CEO, GE Healthcare South Asia, spoke to DNA Money’s Archana Shukla about the company’s initiatives and plans. Excerpts…
How do you see the South Asia healthcare market growing?
Organic growth will be fuelled by 4-5 key drivers. The first is lifestyle diseases on which people are spending a lot now. Second, the government plans to increase spend on healthcare to 2% of the GDP. So lots of procurement will come from the government. Increased corporatisation of hospitals, which is moving to tier-II and III towns, and medical tourism, a focus for many hospitals, are also driving investments.
How has GE Healthcare’s growth been?
In the past 3-4 years, we have seen a growth of 20% organically and expect it to be 15-20% going forward. Our focus will be on manufacturing more products specifically for the Indian market. This, we think, will not only drive organic growth, but also help create a market for growth. A product like our battery-operated electrocardiogram (ECG) creates a market for itself. Public private partnership (PPP) is another model that we can pursue.
What is on your agenda for rural market growth?
Keep the customers’ specific needs in mind and device reasonably-priced products. We have the bandwidth, the capability, engineering strength and investments for this and there is a large population that needs this healthcare but has no access.
What initiatives have you taken in this field?
We are trying to do things differently and reach out to patients differently. So, we have tied up with Manipal Heart Institute to create a mobile cardiac screening programme to take early detection closer to patients. We have partnered with Grameen Health, an affiliate of Grameen Bank, the pioneering micro-financing organisation in Bangladesh, to jointly evaluate ways to improve its existing healthcare delivery systems in rural Bangladesh. Besides, we are creating India’s first mobile cardiac treatment facility in partnership with Vivus group of hospitals. With NICE Foundation, an NGO with the largest neonatal hospital in India, we are looking at catering to mother and infant care.
What is the status of your ‘In India, For India’ project? It was facing problems...
We have re-launched those products in India after redesigning them based on customer feedback. Our vision in the next five years is that at least 25% of the products we sell in the country are made in India from 8-10% now. These will be made at our Bangalore facility.
What’s your approach on PPP?
The government will outsource radiology work to us where it will give us land as we will bring all the technology, services and service providers. It’s a win-win for all. Government gets healthcare services for all, service providers get a captive place to operate and for us it helps to sell volumes.
Where does India stand in GE Healthcare’s future R&D?
A lot of hardware, algorithms, workstations on which our technology works is made at the Bangalore facility. We will continue to do so. This year we will have at least two new X-ray, three maternity care, two ECG and two USG products. These will be focused at the Indian market. We will also look at mother and infant care products at our expanded facility in Bangalore.
Regulatory changes are expected in medical devices categorisation. Your comments…
I welcome them, mainly because when it comes to healthcare, the technology has to be consistent and standard and this requires regulation. We feel regulation will help thwart spurious manufacturers, fly-by-night operators and those who dump products from other countries.
How do you hold on to your market share in these competitive times?
We will not cut prices to chase market share. If the price points don’t suit us, we exit that market. As a company, we spend over $1 billion (6% of our revenues) on R&D. Different markets have different capabilities, but that doesn’t mean we sell at a price that doesn’t suit us.
How do you manage costs and margins when you export?
When we manufacture for a country, it is on specifications and sold on cost pricing. For other markets, we export at a cost plus transfer pricing and then sell it at that country’s market rates. I won’t sell a product from India in the US at the same rate.
s_archana23@dnaindia.net
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