The Indian medical technology sector has the potential to touch $50 billion by 2025 if it continues to grow at 10-12 per cent annually. Globally, the medical technology market is expected to be $600 billion+ by 2025. India can capture 10 per cent of that share by 2025 if provided with adequate support and policy guidance, according to a CII and Boston Consulting Group (BCG) study.
Based on the findings of CII-BCG -Vision Document – 2025 which was unveiled recently in the Capital, it was concluded that the medical technology sector remains highly under–penetrated contributing 7 to 8 per cent of the healthcare spends as compared to pharmaceuticals at 18 per cent.
‘Vision Document – 2025’ prepared by CII and BCG on the medical technology sector also pinpointed that outdated and irrelevant laws like Drugs & Cosmetics Act pose major regulatory hurdles to the medical technology industry. Vision Document 2025 was unveiled by Union Health Secretary Lov Verma and Dr K Vijay Raghavan, secretary, Department of Biotechnology, on the occasion of CII-BCG MedTech event held in New Delhi recently.
Speaking on the sidelines of the 7th Medical Technology Conference following the unveiling ceremony, Amitabh Kant, secretary, Department of Industrial Policy & Promotion (DIPP), Government of India said, "Indian medical technology industry can touch more than $50 billion in the next decade if emphasis is given on local manufacturing with funding and incentives from industry and government.
As per the Vision Document, setting up the right manufacturing capabilities could spur an additional $20 billion manufacturing opportunity for the Indian medical technology space in addition to a $30 billion domestic market opportunity available today. "Therefore it is essential that the sector exploits the cost advantage it wants to compete with China for the global market,” adds Kant.
Lov Verma, Union Health Secretary, said, "The medical technology sector should also look at CSR initiatives at promoting sanitation like building toilets in schools”. While, Dr K Vijay Raghavan, secretary, Department of Biotechnology, Ministry of Science & Technology said that local innovation has to be promoted if the sector has to realise its true potential and that Government will have to play a leading, guiding role to ensure that.
CII Director General Chandrajit Banerjee, said, “CII is happy to acknowledge that medical technology sector is a sunrise sector. Elaborating on the theme of effective governance, Pavan Choudary, chairman, Medical Technology Division, CII said “Classification of medical devices as drugs pose a burden to the process of investment with fiscal policy obstacles and regulatory hurdles. It impacts FDI, technology transfer, local investment, manufacturing, operations, innovation and exports”.
“The Vision Document 2025 highlights the need for a dedicated, separate and globally harmonised regulation for medical devices”, added Himanshu Baid, co-chairman, CII Medical Equipment Division. Rahul Guha, partner and director, Boston Consulting Group (BCG) India remarked that there was lack of investment, lack of regulation, less priority of the government and this was therefore a vicious circle. “The innovations and the licenses is something that unfortunately is not going in tandem with each other,” Guha said.
According to the CII-BCG Vision Document, global medical technology market is expected to be $600 billion+ by 2025 and that India can capture 10 per cent of that share if provided with adequate support and policy guidance. To build up a roadmap for India to reach its full potential in medical technology, CII and BCG assembled a think tank of 40+ industry participants to brainstorm and determine the key levers required to be able to unlock the true potential of India. BCG held a set of workshops across Mumbai and Delhi to discuss and debate the right focus areas and develop a roadmap to unlock this potential.
Among the key recommendations proposed by the CII-BCG Report are need for a separate regulatory act for medical technology, need for manufacturing incentives (for example- tax support, low cost funding to spur investments), single–window clearance to ease the regulatory burden for the industry, creation of ‘National Innovation Policy’ to reward results in innovation, need for world-class manufacturing infrastructure, setting up of collaborative partnerships, investing in Capability Development and Training by setting up Centers of Excellence for medical technology training, global task force to promote India as a manufacturing and R&D hub globally, create industry sponsored programs between local and global industry on joint collaboration projects, industry academia collaboration and to facilitate Curriculum adaptation as well as cross-pollination of knowledge between students of Medical Technology and Business Management.