Outlook of Healthcare Sector In India
In India, there are large pool of well-trained medical professionals which is India's competitive advantage
Analysis of Healthcare sector in India and its future?
In India Healthcare industry is growing at a tremendous pace due to its strengthening coverage, services and increasing expenditure by public as well private players. Healthcare sector comprises hospitals, medical devices, clinical trials, outsourcing, telemedicine, medical tourism, health insurance and medical equipment. Both in terms of revenue & employment this sector has become one of India's largest sectors. Government of India is also emphasising on the e-health initiatives. In this sector to drive growth and gain new markets, Indian companies are entering into merger & acquisitions with domestic and foreign companies.
In India, this sector is experiencing a new wave of opportunity.
In India healthcare system is categorized in two following components:
Public and Private.
- Public healthcare system focuses on providing basic healthcare facilities in rural areasin the form of primary healthcare centers (PHCs). Public healthcare system comprises limited secondary and tertiary care institutions in key cities.
- Whereas in case of private healthcare sector it provides majority of secondary, tertiary and quaternary care institutions with a major concentration in metros, tier I and tier II cities.
In India there are large pool of well-trained medical professionals which is India's competitive advantage. In comparison to Asian and Western countries, India is cost competitive. For example in India cost of surgery is about one-tenth of the cost in the US or Western Europe.
In India, there is a significant scope for enhancing healthcare sector considering that healthcare spending as a percentage of Gross Domestic Product (GDP) is rising. Rural India is considered as a potential demand source and it accounts for over 70 per cent of the population. In India medical tourist arrival is also increased. Healthcare Information technology is also expected to grow. More than 80 per cent of the antiretroviral drugs are supplied by Indian pharmaceutical firms which is used globally to combat AIDS (Acquired Immuno Deficiency Syndrome). India is also experiencing tremendous growth in medical tourism.
In India, business related to drugs & cosmetics has become an evergreen business with the tremendous growth of the healthcare sector.Under this sort of business there is a requirement of minimum capital investment and space. They are usually setup under a proprietorship or partnership, but it is always advisable to set up a drug related business as LLP or private limited company as it will ensure that business is transferable and promoter’s liability is limited. Outside India export of medicines is highly regulated. Without a valid medical prescription, schedule H & X drugs cannot be sold to customer under any circumstances. Drugs cannot be sold to a minor and delivery charges are not charged unless agreed by the customer at the time of checkout.
In India it is mandatory to obtain Drug Licenseto start a business of Drugs & Cosmetics. Drugs & Cosmetics Act, 1940 contains the provisions related to drug license and it extends to the whole of India. Drug Control Department is a regulatory authority which regulates the manufacture of medicines & cosmetics, storage, distribution and sale of medicines. In the year 1964 Drugs & Cosmetics act was amended for the purpose of including Ayurvedic& Unani drugs.
Feature of Drug license
- Mandatory to start drugs & cosmetics business;
- For sale of medicines & cosmetics, Drug license can be granted in commercial premises.
- Pharmacy business need to comply with the conditions of license;
- Drug license shall be displayed at the prominent place of premises.
An application is required to be submitted by the applicant with the drug controller for obtaining the drug license. As per the guidelines of the drug & cosmetic rule, an application must contain correct information along with the necessary documents.Applicant should contact with the duty officer at mail receipt counter of Drug Control Department for any guidance or information before applying for obtaining drug license. Two type of license are issued by drug control organizationout of which one is Retail Drug License (RDL) to run a chemist shop, and it is issued to only those persons who possess degree or diploma in pharmacy from a recognized university on the payment of the requisite fees and other is Wholesale Drug License (WDL) which is issued to a person who is engaged in the business of wholesale of drugs and medicines.
Further Classification of Drug License
- Manufacturing License
- Sale License
- Loan License
Requirement for Drug License
- Technical Staff
According to data released by the Department of Industrial Policy and Promotion (DIPP), in Indian Healthcare sector hospital and diagnostic centres attracted Foreign Direct Investment (FDI) of worth US$ 4.34 billionbetween April 2000 and March 2017.
Here are the following initiatives taken by the Government of India to promote Indian healthcare industry:
- For improving healthcare delivery, Government of India's think-tank, Niti Aayog, has entered into a partnership with the state governments of Uttar Pradesh, Assam and Karnataka. In the year 2017-2018 overall health budget increased from INR 39,879 crore (US$ 5.96 billion) (1.97% of total Union Budget) to INR 48,878 crore (US$ 7.3 billion) (2.27% of total Union Budget) in Union Budget.
Following announcements made by Government of India in the Union Budget 2017-18:
- To encourage local manufacturing and improving affordability for patients, Government of India has harmonise policies and rules for the medical devices industry.
- To promote generics and reduce the cost of medicines,modified the Drugs and Cosmetics Act.
- Set up All India Institute of Medical Sciences (AIIMS) in Gujarat and Jharkhand.
- In Indian villages,convert 1.5 lakh sub centres to health and wellness centres.
- For key health indicators set short and medium term targets and bring down the Maternal Mortality Rate to 100 by 2018-2020 and Infant Mortality Rate to 28 by 2019.
- Prepare action plans to eliminate Kala Azar and Filariasis and leprosy and tuberculosis.
- To provide the policy framework for achieving universal health and for providing quality health services at affordable cost, the Union Cabinet, Government of India, has approved the National Health Policy 2017.
- For innovation in medical research, Government of India plans to set up a single window approval system in order to grant permission within 30 days from the date of application to Indian innovation projects who have applied for global patent.
- To turn India into a global hub for knowledge, research, practice and developmental projects on traditional medicines AYUSH Ministry is working with various agencies, institutions and Ayurveda researchers and practitioners across the globe.
- Atal-Amrit Abhiyan health insurance scheme launched by the Government of Assam which would offer comprehensive coverage for six disease groups to below-poverty line (BPL) and above-poverty line (APL) families with annual income below Rs 500,000 (US$ 7,500).
- The Government of India and the Government of the State of Nagaland signed financing agreement and project agreement respectively with The World Bank for the ‘Nagaland Health Project’ which aims to improve health services and increase their utilisation by communities in targeted locations in the state.