Becton Dickinson (BD), a medical manufacturing and equipment company with revenue in India of $ 75 million has been in the country for 12 years. The long years, marked by a strategic shift midway, have made the company fully clued in to the policy hurdles in health care in the country. With a new government about to come in, BD is actively lobbying with the ministries of finance, commerce, health and consumer affairs to introduce policies that will improve health care provisions to all sections of society, which, in turn, will enhance the business of medical equipment companies. In an interview, Ram Sharma, managing director, Becton Dickinson India, and Ajay Kumar, director human resources, speak with FE?s Malvika Chandan about how BD is growing its business in India.
BD was ranked 12th in India on the Hewitt best employer survey. What makes your company a favorable place to work?
Frankly speaking, it starts right from the time of recruitment. We follow two guiding principles when we look for new talent, one is that the candidate?s values should align with the organisation?s and two, we look at the kind of stretch a candidate demonstrates. These are integral part of being successful here and if we see this quality at the time of recruitment we know we have made a good hiring decision. This is why we ranked on Hewitt despite the healthcare sector struggling to attract and retain talent.
How is the BD setup in India?
BD has three lines of business, its medical business?from where it gets half its revenue?that includes surgicals, syringes and pharma systems. The pharma systems business was developed in 2004 from scratch, with just one business manager. Today, the business brings $10 million revenue to the company. We listened to our customers? demands for ?pre filled products? and went on to develop this offering in tieup with the top 15 pharma companies. Customer demand emanated from the fact that pre-filled products prevent health care associated infections.
The other half of our revenue comes from the biosciences and diagnostic businesses, which focus on research & development, specifically in areas such as ?pre-analytical systems? and diagnostics.
Was there a strategic shift in BD?s focus in India after it began operations here in 1996-97?
We faced hardships in the initial years. Prior to 1996, BD simply imported its products to India from the US and had no context about setting up units here and the infrastructure, regulatory and bureaucratic hurdles that will go with it. The result of the first five years of poor performance and financial results led to the parent company changing the entire leadership team in India. While external factors were not in our control, internally, the whole strategy in the initial years circled around pushing the company?s products?which backfired?instead of creating demand. The new team corrected this by spending time understanding customer needs and investing heavily in training and educating vendors about our products.
What is your assessment of the health care establishment in India?
There is a huge range of issues in health care in India. Private hospitals and nursing homes, because of their charges, are able to maintain good standards. But there is much to be desired in public hospitals. From our perspective, we are clear about the issues wherein we can be a part of the solution.
A WHO report, for instance, certifies that 62% injections in India are unsafe. In a country where there are 400 million ?blood draws? every year, this can lead to serious repercussions. Syringes need to be rendered unusable after one use. BD is working with primary health centres and district immunisation officers across the country to adopt ?AD syringes? which basically have a technology intervention that makes them unusable after one use.
Also, it is proven that patients are most vulnerable to infection because of ?pre-analytical errors? which in the case of blood draws is the period of collection and transportation. Here again we have been working with the government to adopt use of a ?vacutainer? instead of a syringe at its clinics. But to have the government accept this alternative has taken time. We had to provide empirical proof that it was a better alternative. So we provided it free to public hospitals and dispensaries in Rewari, Haryana, over three years, which provided for safer inoculations for 28 million people.
What are other implications you have in the external environment?
The CST phasing out being proposed by the government will help in streamlining our supply chain, which is currently very state-centric. We have 17 warehouses across the country primarily because we want to avoid the exorbitant ?entry tax? in states. With the proposal of phasing out CST we can consolidate our operations at much fewer warehouses using economies of scale to make it more efficient and cost effective. Other suggestions to the government we are working on include introduction of custom duty on medical devices brought into the country. Millions of medical devices such as stents are brought in and have no traceability to their origin. If something goes wrong with these devices, there is no accountability.