Healthcare sector may see further consolidation in 2019

Healthcare sector may see further consolidation in 2019 with tightening of regulatory environment set to make it difficult for small players to stay afloat in a highly competitive marketIndustry players also expect more partnerships in the new year between public and private sector in the healthcare space which they feel is underinvested Already Malaysias IHH Healthcare has scalped 311 per cent stake in Fortis for Rs 4000 crore after months of intense competition and is in process of taking another 26 per cent stake Besides KKRbacked hospital management firm Radiant Life Care has announced acquisition of a majority stake in Max Healthcare through a merger to create a combined entity valued at Rs 7242 croreWe have seen many mergers and acquisitions in this field and will probably see the consolidation of health care by a few large players like other fields in business Manipal Hospital Chairman H Sudarshan Ballal told PTIManipal Group backed by global investment firm TPG was also a contender for acquiring Fortis Ballal said demonetisation GST tightening of cash transactions and regulatory issues have certainly impacted some of the smaller establishments making them unviableAll in all as I see it the future healthcare will be a highvolume lowmargin venture inching towards universal health care with an active role played by the government It will also be a highly regulated accountable system and people and organisations that do not adapt to this new philosophy will perish he addedGiven these circumstances consolidation of health care by large chains and closure of some individualdriven smaller facilities is likely to happen Ballal saidThere were five contenders to invest in cashstrapped Fortis Manipal Group IHH Healthcare Berhad Chinese investor Fosun International Radiant Life which was backed by global private equity firm KKR and a consortium of Indian business families iquest the Munjals of Hero Enterprise and Burmans who own DaburThe deal between Radiant Life and Max will be carried out through a series of transactions and will see KKR becoming the majority shareholder while Radiant Life Care promoter Abhay Soi will lead the combined company as Chairman Max Healthcare promoters led by Analjit Singh will step downThe merged entity will operate over 3200 beds throughout 16 hospitals across India Wockhardt Hospitals MD Zahabiya Khorakiwala said that in the coming year more meaningful partnerships between public and private sector should be expected to ensure that the nearuniversal healthcare rolled out in the country becomes a ground realityApollo Hospitals Vice Chairperson Preetha Reddy said the country still remains underinvested in health infrastructure We have a scarcity of doctors and nurses and are vastly underinsured as a nation Other challenges that remain are access to primary and quality healthcare changing disease patterns GST and price regulations on treatments and medical devices which remain areas of debate and consensus building she said In pharmaceutical sector industry veterans expect a good recovery in the domestic marketWe expect a good recovery for the pharma sector in the domestic market The Indian pharma market growth is likely to be in double digits and we will see introduction of new products consistently Glenmark Pharmaceuticals Chairman and Managing Director Glenn Saldanha said The US generic drugs market is expected to remain challenging owing to increasing competitive intensity and price erosion he addedWe expect growth rates of generic drug companies in the US to remain under pressure However several leading Indian pharma companies have invested in developing specialty products and we will see some of these products getting commercialised which may help offset the sluggish growth in generics Saldanha saidMumbaibased company is also in process of making a transition into the specialty products segment in the US and will have some of its specialty products in dermatology and respiratory space in the market next year he added Another large pharma player in the generics segment Lupin is looking at complex generics biosimilars and specialty medicines to be the main drivers of growth going forwardIndustry body Organisation of Pharmaceutical Producers of India OPPI said it will continue to focus on four critical areas incliding creating a culture of quality and fostering an ecosystem that rewards innovation in 2019OPPI will continue to advocate for policies that accelerate access to new technologies by eliminating regulatory delays and roadblocks standing between patients and new medicines reduce costs by eliminating taxes and tariffs on lifesaving medicines and partner to improve health by identifying publicprivate partnership opportunities OPPI President A Vaidheesh saidThe segment also witnessed some large ticket acquisitions this year including Hyderabadbased Aurobindo Pharma buying the dermatology business and three manufacturing units of Sandoz the generics unit of Swiss drug maker Novartis for as much as USD 1 billion Advanced Medical Technology Association AdvaMed which represents medical devices segment said 2019 could be the most defining year for the industryWith healthcare at the forefront of policy making we are hopeful that this sector will receive its rightful place in the overall healthcare continuum it saidAdvaMed believes 2019 could be a game changer if the government accepts a scientific approach such as trade margin rationalisation from the first point of sale sale to distributor to address inefficiencies in the healthcare delivery system that burdens patients it addedCatch up on all the latest Crime National International and Hatke news here Also download the new midday Android and iOS apps to get latest updatesThis story has been sourced from a third party syndicated feed agencies Midday accepts no responsibility or liability for its dependability trustworthiness reliability and data of the text Midday managementmiddaycom reserves the sole 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