MedPlus Health Services Pvt. Ltd which introduced a hub and spoke model of pharmacy linked diagnostic sample collection centre has now slated for a Rs 20 crore investment for expanding its laboratory business.

Its subsidiary MedPlus Labs Pvt. Ltd. has already opened a state-of-the-art Clinical Reference Laboratory (CRL) at Hyderabad which is expecting its NABL certification within six months. The Rs 20 crore is being utilized to open the five Regional Diagnostic Labs (RDLs) at Bangalore, Chennai, Pune, Vijayawada and Vizag.

In Karnataka, alone there will be around nine RDLs beginning with Bangalore and the remaining will be spread across the State's 27 districts.

The company, which started operations two years ago has a chain of 400 pharmacies across the country and holds a 30 per cent market share.

Currently, 50 percent of its pharmacy outlets at Hyderabad are offering lab collection centre services. The integration of RDLs with pharmacy chain across India is a unique model designed for better customer access. The diagnostic samples received at MedPlus pharmacies network will be processed at the RDL with the CRL chipping in support for special samples. Over the next 6-8 months, 50 RDLs will be operational.

There is a huge scope for growth of diagnostic centres in the country which is valued at Rs 500 crore and registering a 25 per cent growth rate generated from 40,000 labs. The lab boom is resulting largely because of venture capitalists' assistance to the sector. MedPlus is being supported partly by its promoters and to a considerable extent by Hyderabad-based iLabs, a private equity fund promoted by Srini Raju.

While the CRL can offer over 95 per cent of the tests, the pharmacy-lab linked collection centres can carry out routine tests. The RDLs will be a combination of routine and immunoassays. An investment of 4 crore went in for the CRL and to set up each RDL is between Rs 50 lakh to Rs 1 crore equipped with advanced automation and quality management systems like the Dimension Xpand series of Dade Behring and Bayer Advia Centaur immunoassay platform now a part of Siemens Healthcare Diagnostics.

In Karnataka, MedPlus has opened up 117 pharmacies, of which 80 are in Bangalore, a few more are coming up in Mangalore, Gulbarga, Hubli and Raichur. Efforts are on to offer lab collection centres here. The network of collection centres will offer the highest standardization, accuracy, faster turnaround, convenience and economies of scale, Dr Surendra Mantena, COO, Integrated Health Centre, MedPlus told Pharmabiz.

A visible trend in the diagnostic market is that healthcare practice is towards symptomatic investigation model. Going by the expansions initiated by MedPlus it will look at a 1,000 pharmacies across India by the year-end. It will consolidate its presence both in the pharmacy retail and its diagnostic labs before it looks at offering its expertise to the clinical trial sector to undertake only tests. Plans are also underway to include radiology services at a later stage, informed Dr Mantena.

The expansion of centres will see massive hiring by MedPlus for both pharmacy and labs. Right now 2,000 are employed at its retail pharmacies alone. The CRL has strength of 50 and 30 people at its 5 RDL centres. By the end of the fiscal, there will be around 700 personnel for the diagnostic services, he added.