Several international medical devices companies who had invested in China have been asked by their governments to consider India for manufacturing. This is a good opportunity for India to become the next big contract manufacturing hub.
But the real opportunity is when the global companies incubate innovation in India, said Satyendra Johari, founder & chairman, Johari Digital Healthcare. If India is not able to generate intellectual property, then it will risk losing the contract manufacturing opportunity, he added.
Many start-ups are already working on artificial intelligence, Internet of Things and robotic-based devices. Even 3-D printing is useful to make components in small volumes. The design and development of devices by start-ups using advanced technology can be leveraged by the large medical equipment manufacturers.
After the government’s call for Make in India, AtmaNirbhar Bharat’, and PLI (productivity linked incentive) schemes to accelerate local manufacturing, a lot of companies are looking to set up facilities. We need to build the right infrastructure, deploy funding options and encourage collaboration between industry-academia to develop novel devices for global markets.
The government needs to come out with a Regulatory Certification System to ensure high quality products are manufactured. Home and personal healthcare devices like the pulse oximetry, ventilators, oxygen generators, etc are in great demand, Johari told. This pandemic has certainly seen a rise in demand for medical equipment and devices. Companies with a track record of quality and zero-defects have benefited. A SWOT analysis would be:
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Strengths: Large Human Resource, IT solutions available domestically. Weakness: Low spend on R&D, lack of infrastructure.
Opportunity: High market demand for medical devices and focus shifting from China to other countries.
Threat: Malaysia, Thailand, Korea, Taiwan, Vietnam provide low-cost and high-quality in a short span of time as they have a ready infrastructure.
The disadvantage for the medical equipment industry is the high cost of manufacturing, quality standards and ensuring zero defects. Any sector needs to be cost-competitive to succeed in the long-term, he said. However, India has the advantage of qualified human resources of which many are well placed in global companies abroad. Union government’s ‘Skill India’ also focuses on grooming the right industry-ready talent, he said.
Being first Indian company with MDSAP certification in the electro-medical field, Johari Digital Healthcare was able to tap the export market with huge clientele in the US and others parts of the world. However, its presence in India was limited and this is where he calls for the Regulatory Certification System to endorse quality standards.
Investment in R&D and innovation, quality testing labs, favourable import and customs duties rates will help the growth of this space. The pandemic driven global lockdown in March affected our performance for three months because shortage of resources, slowdown in customer movement, and absence of logistics. But now, sales are picking up and we are developing new products. While many countries have tried to ease shortages by importing equipment, GlobalData says the domestic manufacturing of many devices has increased during the crisis, Johari said.