changing trends of surgery€¦ · medical treatment and surgery scenario in india conﬁdentiality...

Confidentiality Notice: This Business Plan is confidential and contains proprietary information and intellectual property of LI Consulting. Neither this Business Plan nor any of the information contained herein may be reproduced or disclosed under any circumstances without the express written permission of LI Consulting. © 2015 LI Consulting. All rights reserved.

Surgical tools market, India-2015

Changing trends of surgery


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Agenda

Indian Surgical devices market

Surgical Equipment: Technologies and Global Markets

Trend of surgeries in India

Growth aspects

Future of the surgical tools

Existing players in India


• Only 25% of India’s population has health insurance so most Indian patients pay for their healthcare, including surgery, out of their own

pockets – emphasizing the importance of surgical device value when developing new products for emerging markets. Indian hospitals

are generally overcrowded and understaffed, although rapid expansion is on the horizon to support the rapidly growing population. A

shortage of experienced surgeons, nurses and equipment technicians highlights the need for products that enable high throughput,

operational efficiency, and use by staff with a wide range of experience.

• Surgeons in India are rarely employed by a single hospital – they are consultants at multiple hospitals, bringing in their own patients

while hospitals provide the infrastructure and patient services. They usually rely on the surgical equipment available at the various

hospitals – and may need to switch between multiple types of equipment on a day-to-day basis.

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Medical treatment and surgery scenario in India


• The Indian medical device & equipment market was valued at $3.5 billion which now stands today at $5 billion. Out of this surgical device market

stands at $2.75 billion in 2015 growing at 15% a year, with more than 75% of high-value surgical devices imported.

• Private players in this industry have seen a sharp rise over the past couple of years, given the lack of regulatory restrictions; only 14 of the 2,000 odd

medical devices available in the domestic market have been notified under the Drugs and Cosmetics Act leading to the presence of a large

number of international players in the market. This has also been conducive for new entrants to enter the market.

• Medical products in India have not been given industry status by the Government of India and hence remain as an unregulated industry with a

large presence of local domestic players making the industry highly fragmented.

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Medical Consumables,

$1.3 bn (2013)

Bags

Textiles

Surgical sutures

Wound care

Needle/syringe etc.

Medical Devices & Equipment, $3.5bn (2013)

Digital

Surgical

Diagnostic

Others

Medical Implants,

$1.6 bn (2013)

Orthopedic/ Spine

Dental

Urology

Cardiac

Ophthalmology

Others

20%

55%

25%

BROAD CLASSIFICATION OF INDIAN MEDICAL PRODUCTS MARKET, 2013

Medical Consumables

Medical Devices andequipment

Medical Implants

Indian Medical products market

Confidentiality Notice: This Business Plan is confidential and contains proprietary information and intellectual property of LI Consulting. Neither this Business Plan nor any of the information contained herein may be reproduced or disclosed under any circumstances without the express written permission of LI Consulting. © 2015 LI Consulting. All rights reserved. 5

High

▫Surgica l

consumables

▫Needle

Syringe

Medium

▫Diagnostic ▫Healthcare

texti le

▫Other

important

▫Woundcare

Low

▫Braces

▫Bags

Low Medium HighMar

ket

Gro

wth

Market size (Volume)

Medical Consumables

• In the medical consumables segment, needles and syringes enjoy a large volume in the market and are expected to grow at a CAGR of 12-14% annually.

• This high demand is not only attributed to the disposable usage of syringes, but also to the growing disease rates of certain types of diseases like diabetes

High

▫ Surgica l

Devices

Medium

▫ Diagnostic

Devices

▫ Digi ta l

Devices

Low

▫ Scopes ▫ Other

important

Low Medium HighMar

ket

Gro

wth


High

▫ Orthopedic

▫ Cardiac

▫ Neurology

Medium

▫ Gastro-

entology

▫Opthalmology

Low

▫ Urology

▫ Other

important

▫ Denta l

Low Medium HighMar

ket

Gro

wth


Medical Devices and Equipment

• Medical devices and equipment largely include surgical, digital and diagnostic devices.

• India has seen a rapid rise in the demand for surgical devices and hence a massive adoption in surgical technology has been seen lately.

• Even small surgical devices such as knives, scalpel are becoming highly specialized in nature.

Medical Implants

• Certain surgical categories like Orthopaedics, Cardiology & Neurology are leaders in the medical implants category.

• Orthopaedic joint replacement surgeries are growing rapidly at 15-20% and hence there is more consumption of the implants for knee and hip replacement surgeries.

Note: Red color column signifies, the industry segment on the lower side either of the growth or size. Yellow cells signifies the segments on the middle side and similarly green cell signifies the industry segment on the highest growth and size.

Category Insights- Medical consumables/Devices & Equipment/Implants


• The market for surgical instruments in India is broad and highly fragmented consisting

of many existing manufacturers and suppliers and covering numerous instrument

types.

• There are two main segments in this market: handheld instruments (scissors, cutters,

blades, scalpels, graspers) and electrosurgical generators and accessories

(radiofrequency, monopolar and bipolar devices as well as advanced energy

devices).

The main characteristics and dynamics of the two segments are diverse with various

different players and behaviors.

• We are focusing here two main segments of surgical devices market.:

1. The handheld surgical instruments market which is estimated to be worth more

than USD $125 million and accounts for 40-45% of the market.

2. The electrosurgical segment being accounts slightly more than handheld

instruments i.e. 50-55% of the market. This is due to the fact that minimal invasive

surgeries are in trend these days.

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Note: Few major competitors are listed in slide no. 11 for the reference.

Deep Dive: Surgical instruments market

While local competitors dominate the mechanical handheld instruments segment, they face more competition from multinational medical

device companies in the electrosurgical instruments segment. Both segments are expected to exhibit moderate growth driven by the Indian

government’s plans to increase public health expenditure and healthcare provision, along with an upsurge in healthcare insurance.


• The global market for surgical equipment reached $4.1 billion in 2012. This is

expected to increase to $5 billion in 2013 and about$8.2 billion by the end of 2018,

with a compound annual growth rate (CAGR) of 10.3% for the five-year period, 2013

to 2018.

• In India, medical equipment is largely an import-dependent market: Imported

medical devices cater to around 70-75% of the domestic demand. The domestic

companies are largely engaged in manufacturing low-end products (like needles,

stents, syringes, scalpels etc.) for local and export market.

• Product differentiation in this market is extremely limited; hence, pricing and

branding remains the unique selling proposition. The market is packed with numerous

participants ranging from manufacturers of forceps to power tools and robotics.

• Today the healthcare industry is undergoing a sea change and to combat the rising

costs as well as to control infection there has been a growing trend of disposable

surgical instruments.

7

2.42.8

3.2 3.4

1

1.2

1.31.4

0.0

1.0

2.0

3.0

4.0

5.0

6.0

FY12 FY13 FY14 FY15 €

Do

llar

(mn

.)

MEDICAL DEVICES MARKET IN INDIA

Import ($mn) Domestic ($mn)

Surgical Equipment: Technologies and Global Markets

• Surgeons have the option to choose from plethora of disposable instruments to

reduce any kind of cross infection. The single use instruments are better than reusable instruments as they are infection free.

• Over the years, the disposable surgical instruments have addressed the need for minimally invasive surgery. Today such surgeries are the need of

the hour and are no longer exception. Therefore the attention to surgical instruments needs to be reevaluated. The surgeons are performing a

number of operations day-to-day and therefore less time is required for maintenance. The disposable surgical knives are the best way to

maintain cleanliness and sharpness of tools at all times.


• The major trend driving the growth of the minimally invasive device market is the

ever increasing demand minimally invasive procedures to be undertaken at medical

facilities, and the ultimate goal of having a better quality of patient life which can

be achieved when surgeries are performed using minimally invasive techniques.

• This escalation is developing the need to analyze, review and to forecast the growth

of the minimally invasive device market. Owing to the rapid evolution of market in

the use of technology, medical device companies which are able to launch new

innovative equipment will be awarded with huge benefits.

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$0.183 billion for year 2014

$0.276 billion by the end of 2019.

CAGR 8.5%

The India market for minimally invasive devices growth.

Trend of surgeries in India


According to the report, the India sterilizers and surgical, dental care, and equipment disinfectors market is projected to expand at a marked CAGR of

8.2% during the forecast period from 2014 to 2020. In 2013, the India sterilizers and surgical, dental care, and equipment disinfectors market was worth

129 million dollar and by 2020, the market is projected to be worth 0.21 billion dollar.

Also, if we see the rate of surgeries increased in India for past few years, it gives a clear idea of the scope of surgical tools business in India.

No. of surgeries happening in India per year (scope)

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India sees 10 time increase in bariatric surgeries in last decade: (OSSI Obesity and Metabolic Surgery Society of India)The number of bariatric surgeries performed in the country has increased almost ten times over the last decade with over 10,000 such surgeries performed in 2014.

Increasing no. of cardiac surgeriesThe first open heart surgery was performed in India in 1975. Today, cardiac hospitals in India perform over 100,000 open heart surgeries per year, one of the highest, worldwide. Additionally, it is estimated that in 2011 cardiology hospitals in India placed over 200,000 coronary stents by conducting over 120,000 coronary angioplasties.

Knee replacement surgeries high in IndiaThe total number of knee replacements performed each year, both total and partial, rose 30 per cent from 2004 to 2008. In that same period, there was a 61 percent increase in these surgeries among men and women between the ages of 45 and 64.Dr. Stulberg (joint replacement surgeon from USA) added that in 2012 in India, 80,000 knee replacements took place against the 50,000 in 2008.

Eye surgeries in India (mainly cataract surgeries)India is performing 6 million cataract surgeries every year and to minimize the existing backlog NPCB has targeted 7 million cataract surgeries for the current financial year (2011-12). To eliminate cataract blindness in India, an estimated 9 million good-quality cataract surgeries are needed every year during 2001−2005, increasing to over 14 million surgeries needed every year during 2016−2020 on persons most likely to go blind from cataract.

Growth aspects


• Future surgical tools should be designed to enable team-based surgery and reduce the physical and cognitive workload for all surgical staff.

– Devices that are easier to use

– Easier to learn how to use, will be deployed on a greater number of cases immediately after commissioning.

• Additionally, equipment that has applications for more than one surgical department will be used more and potentially allow hospitals to branch

out into more complex or specialized procedures – a goal that is integral to the growth plan of many hospitals in India.

• Also, since minimal invasive surgeries are in so much demand these days, there are great chances of robotic technology being applied to virtually

every surgery being performed by its open surgical and laparoscopic counterparts. But the growth will be apparently slower, the reason being

acquisition of robotic surgical skills involves undergoing either a fellowship program or working under a mentor with necessary skills, over a period of

time.

• The outcome of either of these is a very small fraction of super specialists reaching out to the billion population. However, this can be overcome

with time as more surgical platforms become installed including the teaching institutes. Also, cost will also be a critical point.

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Robotic surgery procedures using the da Vinci system

Future of the surgical tools


Major Private Players (Domestic)

Futura Surgicare Pvt. Ltd.

Centenial Surgical Sutures Ltd.

General Surgical Company (India) Pvt. Ltd.

Hindustan Syringes & Medical Devices Ltd.

Kehr Surgical Pvt. Ltd.

Lifeline Systems Pvt. Ltd.

Lotus Surgicals Pvt. Ltd.

MCo Hospital Aids Pvt. Ltd.

Siora Surgicals Pvt. Ltd.

Sterimed Medical Devices Pvt. Ltd.

Susruta Instruments Pvt. Ltd.

Major Private Companies (Foreign)

B. Braun Medical (India) Private Ltd.

Covidien Healthcare India Pvt. Ltd.

ERBE Medical India Pvt. Ltd.

Stryker India Pvt. Ltd.

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Existing players in Market

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