11 Months agoDeep dive into healthcare collaborations between India and Sweden, in our run up to #IndiaInStockholm.
Indian health care is witnessing a new wave of opportunity and is expected by 2020 to become one of the top three health care markets, in terms of incremental growth. The industry, which was valued at USD 73.92 billion in 2011, is predicted to grow at a Compound Annual Growth Rate (CAGR) of 16% to reach USD 280 billion by 2020.1 In the next decade, with growing awareness among consumers and demand for better facilities, the country’s second-largest service sector employer is on the cusp of a major transformation.2
The private sector has emerged as a strong force to aid in the growth of this sunrise sector. In India, private health care constitutes 70% of the country’s total health expenditure.3 Secondly, the per capita health care expenditure has surged at a rapid pace - from USD 64.92 in 2012 to USD 74.99 in 2014 at a CAGR of 7.48% during 2012-14.4 In the Union Budget 2017–18, the overall health budget increased from USD 5.96 billion) (1.97% of total Union Budget) to USD 7.3 billion (2.27% of total Union Budget). The YoY increase amounted to 23%, the biggest hike for the sector in a country where public health expenditure is currently at just ~ 1% of the Gross Domestic Product (GDP).
The demand for health care is predicted to grow at a rapid pace to fulfil the needs of a growing population. Statistics by United Nations reveal that India’s population is set to touch 1.45 billion by 2028, making it the world’s most populous nation5. With socio-economic changes such as rapid urbanisation, demographic and lifestyle changes, there is greater incidence of lifestyle-related (Non-Communicable) diseases such as Cardio Vascular Diseases (CVDs), chronic respiratory diseases, cancer and diabetes. CVDs are the major cause of mortality globally as well as in India (accounting for about a fourth of the deaths in India). This is where specialised health care steps in. Income levels are on the rise along with public health care spending and public health care financing, which indicates an incremental growth in the sector in the coming years.
In fact, greater penetration of health insurance has led to a rise in health care spending. Health insurance grew at 21.7% during 2015-16, while health care insurance premium stood at USD 3.8 billion during the same period.6 These figures are also likely to rise further with a constantly evolving and growing mobile technology infrastructure in the country. With better access to internet, mobile health initiatives are likely to empower communities and enhance awareness about health services in the country. A case in point is Cycle Tel Humsafar, an SMS-based mobile service designed for women to help them plan their family in a better manner. Currently, there are several mobile health initiatives functional in the country to spread awareness about family planning and other health concerns. The other popular initiatives include m- Cessation, m-Diabetes and TB Missed call initiative.7
Another emerging vertical is tele-medicine, which is remote diagnosis and treatment of patients through telecommunication and information technology. As of 2016, the tele-medicine market stood at USD 15 million and is expected to rise at a CAGR of 20% during FY 2016-20 to reach USD 32 million by 2020.8 Tele-medicine is an effective solution to bridge the urban-rural divide and reach the remotest parts of the country through high-speed internet connectivity. This proposition has been attractive for many foreign players planning to invest and set up their operations in India.
There has been strong policy support that is crucial for the development of the healthcare sector. The National Health Policy 2017 aims to attain the highest level of health and well-being for everyone across ages, through preventive and promotive health care. This would be achieved through increasing access, improving quality and lowering the cost of healthcare delivery. This policy looks at problems and solutions holistically in sync with the private sector. In order to provide access and financial protection at secondary and tertiary care levels, the policy proposes free drugs, free diagnostics and free emergency care services in all public hospitals. Furthermore, the Policy proposes raising public health expenditure to 2.5% of the Gross Domestic Product (GDP) in a time bound manne by 2025.9
Additionally, the Policy affirms commitment to pre-emptive care to achieve optimum levels of child and adolescent health. It envisages school health programmes as a major focus area.10
Synergy with Sweden
Sweden’s public health care system is primarily government-funded and decentralised, and is financed through taxes levied by county councils and municipalities. It is an important factor for making life easier for people in Sweden. India is trying to replicate the Swedish model, especially through the use of technology such as e-health initiatives and telemedicine, to overcome challenges.
Sweden’s assistance to India in the sphere of health care dates back to the 1960s, when aid was primarily provided for the India Population Project (IPP). Initially, the assistance provided was minimal, but later by the 1970s, the aid increased dramatically and health facilities were strengthened - there was a provision of testing facilities in more than 1,500 health care facilities. Later, from 1978, assistance was provided by Sweden in three National Programs on Malaria, Leprosy and TB control.11 Furthermore, Sweden and India signed a Memorandum of Understanding (MoU) in 2009 to promote bilateral cooperation in the area of public health.12 There have been a number of collaborations between Indian and Swedish companies to reduce maternal, neonatal and child mortality in India. For instance, Karolinska Institute partnered with Action Research and Training for Health and the Government of Rajasthan on medical abortion.13 Similarly, in the area of adolescent reproductive health, collaboration between Lund University, National Institute of Health and Family Welfare and MAMTA Health Institute for Mother and Child14 has resulted in the provision of youth-friendly clinics in public health care facilities in a number of states. A Memorandum of Intent was signed between Swedish Institute for Communicable Disease Control and the Indian National Centre for Disease Control to promote cooperation between antibiotic resistance.15
Taking this forward, the Swedish Lifesciences and Healthcare Platform was established to facilitate dialogue and exchange of ideas within the Swedish model of healthcare and best practices in India. It is the key interface between various private and public stakeholders in the Swedish and Indian healthcare system. The structure of the system is a nexus between government, academia and private enterprises.
Potential synergies between India and Sweden could be developed due to India’s cost of production being drastically lower (60%) than US and other European countries.16 Using India as a manufacturing base, companies in the health care sector can diversify further and explore new avenues.
Collaboration in Pharmaceuticals
Pharmaceuticals is one of the focus sectors identified under the government’s ‘Make in India’ initiative. The Indian pharmaceutical industry registered a growth of 15.1% from USD 27.3 billion in the Financial Year (FY) 2014-15 to USD 31.5 billion in FY 2015-16.17 Much of this growth was attributed to rapid increase in exports – the country is the largest supplier of cost-effective generic medicines to the world, accounting for 20% of global exports in terms of volume. With the government’s thrust towards manufacturing under the ‘Make in India’ initiative, the industry recorded a 9.7% increase in exports in FY 2015-16.18
To realise the vision of making India the largest global provider of quality medicines and encourage innovation, the Department of Pharmaceuticals under the Ministry of Chemicals and Fertilizers launched the Cluster Development Programme for Pharma Sector (CDP-PS) in December 2015.19 This Scheme is based on a public-private partnership model, which will have a one-time grant aid which will be realised in different phases for the creation of infrastructure at Common Facility Centres (CFCs), including common testing facilities, waste disposal system and training centres.
Indian pharmaceuticals and biotechnology companies like Biocon20 , Kemwell21 , SunPharma22 and CadilaPharma23 have formed collaborative relations in Sweden. Another significant example is that of Swedish generic medicine maker Meda, who entered into collaboration with Cipla, a leading Indian pharmaceutical company.24 Through this collaboration, there will cooperation of product development on Dymista. Cipla’s responsibilities will include formulation, while Meda will work on clinical development, registration, marketing and sales.25 With an increasing number of opportunities in health care and pharma and the thrust on ‘Make in India’, synergies between India and Sweden are likely to strengthen and reach newer heights
1 http://economictimes.indiatimes.com/industry/healthcare/biotech/healthcare/indian-healthcare-sector-to-grow- to-280- billion-by- 2020-report/articleshow/48742696.cms
12 http://www.swedenabroad.com/en-GB/Embassies/New- Delhi/Business/Memoranda-of-Understanding-between-Sweden-and-India--sys/
17 Make in India Pharmaceuticals Achievement Report