‘If a Maruti can reach more masses, why design a Mercedes?’

Medical technology major, GE Healthcare, recently invested $15 million for PET/CT system in India for early detection of cancer. This investment is the largest towards a single product line, says V Raja, president and CEO-South Asia, GE Healthcare, and will be utilised to design a technology that will help lower costs. In a conversation with Priyanka Golikeri, Raja speaks about India as a market for medical technology, why products should be localised for India, and how logistics hinders outreach of medical technology. Excerpts:

India’s healthcare segment is estimated to grow by 23% annually, to reach $77 billion in two years. What potential does it offer GE Healthcare?
The segment we function in—high end medical technology is growing at 15-16% every year. Here there is a huge disease burden. There is a deep appetite for embracing new technology that can help in early detection of cancer, heart diseases, etc. Also, physicians here are as good as anywhere.

But India is also a cost-sensitive market.
True. We have a strategy of localising products like maternal/infant care products, PET/CTs, etc. Firstly, we need to understand and arrive at a cost that people can afford, which at the same time keeps our customers (hospitals) happy, and us satisfied. If I manufacture in Mumbai, the cost would be lower than say the US. But if I go to a place like Mysore, the costs would fall further. Secondly, the products should be capable of working in environments which have frequent power failures. The chief focus would be delivering the same quality and clinical efficiency, no matter where it is manufactured. We can cut all fancy product features that don’t impact quality. If a Maruti can reach more masses, why design a Merc? We have to tailor products that would diagnose diseases earlier, at lower costs. Our target is 30-40% lower costs to increase access.

What is the penetration level of medical technology in India?
Poor. In 2000, the first PET scan (to map brain/heart, tumours) was launched in India. Today, there are about 50 PET/CTs which are used for detecting cancer, heart and in neurology. Compare this to Japan, which has a much smaller population but over 280 PET/CTs.

Why so low here? Cost factor?
Yes. There are other factors as well. For conducting PET/CTs, isotopes are needed, which are made in the cyclotron. Now cyclotrons are not available everywhere. If isotope has to be transported to Chennai (where there is no cyclotron), from Bangalore (which has a cyclotron) the logistics have to be worked out. If the patient who is fasting comes for a scan at 8:00 a m, then the isotope has to reach Chennai before that. We have to calculate time from the site to the airport, air time, and airport to hospital time as isotope quantity reduces by half every 110 minutes. Also, all airlines cannot carry isotopes; the pilots have to be certified to carry such radioactive material. But we are performing PET/CTs in Ahmedabad, Jaipur, Kolkata, Chennai, which don’t have cyclotrons. We want to introduce PET/CTs in 40 cities with population of over 1 million.

What kind of investment plan do you have for India?
Between $5-10 million annually, is what we intend to spend. We have spent over $50 million in the R&D centre in Bangalore, where we have 1200 people for the healthcare domain specifically. And every year 100-200 people would be taken in.