MedTech innovation requires physicians, engineers, product designers, and business experts to work with each other.
By Siraj Dhanani
The global MedTech industry is mostly dominated by Western firms which develop novel technologies and products through substantial investments in R&D. These novel technologies and innovative products are primarily designed for their home markets (i.e. Western markets) but are marketed globally, including in developing countries like India. While such products address many critical needs in these markets, they are not designed to optimally and affordably serve the emerging economies. Moreover, there are several unmet needs seen in India and other developing countries that Western technologies do not currently solve. This creates the demand for home-grown MedTech companies that can invest in R&D and come up with novel products that effectively address these “emerging market” needs.
The MedTech market in emerging economies (including China) is approximately worth $100 billion today and is expected to reach $200 billion by 2025. This large and fast-growing market presents a huge opportunity for innovation that specifically targets critical needs seen in these markets. Such needs are not met or only sub-optimally met with Western products, and thereby require “local innovation” to create technologies and products. In fact, local innovation can make an outsized impact on healthcare, especially, when it comes to reducing the number of cases of preventable diseases and deaths. This, in turn, can be a profitable industry.
India, as a key emerging economy and the world’s 3rd largest start-up ecosystem, is ideally positioned to be the leader of MedTech innovation for emerging economies. With a wide range of healthcare ecosystems with different unmet needs, the country displays extreme price sensitivity and endemic skill and infrastructure gaps. Therefore, problems identified in India are likely to be present in other emerging economies, and solutions that are effective and affordable in India are likely to be so in these markets as well.
MedTech innovation requires physicians, engineers, product designers, and business experts to work with each other in identifying critical problems and developing products to solve these problems. India also has a large talent pool – a pre-requisite for a building a successful MedTech ecosystem. Global MedTech players are already making large investments in R&D in India, giving it access to trained and experienced researchers who can move into indigenous MedTech innovation. Additionally, India has a thriving funding ecosystem (with VC and PE funds); albeit one that mostly focuses on consumer tech start-ups.
Most importantly, Indians have a culture of innovating locally (jugaad) and responding creatively to extreme resource scarcity. This positions us well for frugal, yet high-quality innovation which is critical for sectors like MedTech. These advantages along with right policy measures and funding support should propel India to be the MedTech innovation hub for emerging markets.
For example, public health institutions are hindered in procuring innovative, proprietary, Made in India, products given that procurement is typically done through tendering. Tendering, which requires bids from multiple suppliers of the same product, does not work for single-manufacturer, innovative products. This has to be fixed urgently, as the Indian public health system should be the first users of Indian innovation if other emerging markets are to take up Indian devices and technologies.
India has critical components that enable MedTech innovation for critical unmet needs. These advantages can make India the hub of MedTech innovation for emerging markets.
For this to happen, a number of other elements are also important- not least of which is the public healthcare system, which can become the first adopter of indigenous, novel, technologies.
Along with this, deeper pools of patient venture capital, and shared public facilities for MedTech R&D and prototyping, are other key elements to creating a vibrant, innovation-led MedTech industry. This is an opportunity we must grasp with both hands, to not only solve critical healthcare challenges bedevilling India but to also become the leader in MedTech innovation for emerging markets in 10 years.
(The author is CEO, Co-founder, InnAccel Technologies. Views expressed in this column are the author’s own.)