Analysis of health care market in India
Health care companies servicing the health care market in India can be broadly classified into three categories; hospitals, health care insurance companies and pharmaceutical companies. In each of these categories of companies, there are specific companies that have established themselves as market leaders in the provision of health care services in India.
The specific leading hospital companies in India are Apollo Hospitals which operates a chain of hospitals in India’s major cities, Wockhardt Hospitals which also operates a chain of hospitals targeting high end clients and Fortis Health Care which also operates a chain of hospitals and medical clinics throughout India (India: Healthcare and Pharmaceuticals Report 2010).
The major companies that operate in the health insurance provision in India are TATA AIG, Bajaj Allianz and Max New York Life , all of which are partnerships of international health insurance companies and local Indian companies formed with the intend of provision of health care insurance. A local company, Reliance Company also holds a substantial share of the Indian health insurance market (India: Healthcare and Pharmaceuticals Report 2010).
In the pharmaceutical sector of the health care industry in India, numerous companies exist, spread all over the country. The largest of these companies that hold a substantial market share in the pharmaceutical sector are Ranbaxy Laboratories which is the leading pharmaceutical company in the country, Dr. Reddy’s Laboratories, Cipla Lupin pharmaceuticals, Sun pharmaceuticals, Nicholas Piramal, Orchid pharmaceuticals and Zydus Cadila pharmaceuticals all of which are indigenous Indian companies. International pharmaceutical companies that have a footing in India are GlaxoSmithKline of UK, Pfizer and Merck and Company, both of which are of United States (India: Healthcare and Pharmaceuticals Report 2010).
Success of the companies
According to the India Healthcare and Pharmaceuticals Report (2010), the above companies operating in healthcare industry in India are successful, recording impressive growth rates in the past few years despite the economic recession experienced in the recent past. This success can be attributed to the growing middle class in India which is able to afford health care services and thus presents an increasing demand for health care services. India has developed a reputation as a favorable destination for medical tourism and this partly contributes to the success of the companies in health care industry. Another reason for the success of Indian health care companies is the increased government spending in health care, which has grown to about 5% of the country’s gross domestic product.
There are many other companies servicing the Indian health care market spread all over the country and offering similar products as the more established companies (India: Healthcare and Pharmaceuticals Report 2010). Many of them are successful since the private sector controls about 75% of the health care industry and the market is far from saturation. The large population in the country unable to access health care services provided by the government contributes to the success of these companies. Increasing income levels in India’s middle class is also a factor contributing to the success of these companies.
Health care market in India: wide open
The health care market in India is wide open. Since the private sector accounts for about three quarters of the health care market in India, saturation of the market is yet to be reached due to the high population and poor penetration of government provided health care services.
An increasing middle class and a growing medical tourism present a market segment which has not been fully utilized and thus presents an enormous growth potential. According to the Economist’s Intelligence Unit Healthcare and Pharmaceutical report on India (2010), export of pharmaceuticals from India is also a sector which is yet to be exploited, and with the country providing cheaper alternatives of medical drugs, generics and biogenerics, the country offers a potentially high growth market for health care services for any new entrants into the market. It can thus be concluded that India presents a wide open market for health care services and products with a high potential for growth.
India: Healthcare and Pharmaceuticals Report. (2010). The Economist Intelligence Unit. Retrieved from http://viewswire.eiu.com/site_info.asp?info_name=eiu_Industry_Briefing_enhancements&page_title=Industry Briefing&rf=0