How has the business fared for Healthium Medtech in the last year, in the light of Covid-19 led disruptions in hospital operations? Many surgeries were postponed or cancelled due to fear amongst patients?

The healthcare industry has been at the forefront of the battle against Covid-19. The medtech and diagnostics industries have also risen to the occasion and stepped up to support the healthcare practitioners (HCPs) in every way possible. While ensuring immediate help and response to hospitals, Healthium also looked at ways to de-risk business in the wake of fall in elective surgeries and footfalls at hospitals. Here are 3 critical measures:

1. Swiftly supporting hospitals with uninterrupted supplies of essential medical devices even during lockdowns. Healthium reacted swiftly by ramping up production of essential medical devices and kept our manufacturing facilities open with due permission and precautions, despite the lockdown, to ensure uninterrupted supply to hospitals. We were aware that childbirth and emergency surgeries like cardio-vascular surgeries would continue despite the pandemic and hence ensured that critical products were in enough supply. We fast-tracked production schedules and expanded our supply chain to support quicker deliveries. Our state of preparedness also included the foresight to stock raw materials, and maintain inventory at stock points and distribution centres nationally for easy deliveries.

2. Periodically launching new products, embellishing our portfolio and also launching an infection prevention range: We also launched new products like India’s 1^st domestically manufactured anti-microbial gloves that which enhance patient and surgeon safety by preventing the spread of infections through a non-leaching antimicrobial technology and with the acquisition of CareNow, we also added a whole infection prevention range to our product portfolio. This enabled us to fulfil the market need for infection prevention. We also launched a slew of new products like the potent pending ligating clip and laser-welded steel sutures to embellish our portfolio.

3. Focus on Tier 2, 3, 4 markets: While the pandemic created a large drop in footfalls in larger cities, in Tier 2, 3, 4 cities the impact was less noticeable and hospitals continued BAU. By creating access to our sales network in 90% of districts in India with secondary healthcare facilities, we diversified risk through a strong presence in smaller towns as well and reached out to 18,000 hospitals pan India as of 31^st March, 2021.

These measures along with new acquisitions have helped us demonstrate a strong financial performance with accelerated growth, despite the negative effects of the Covid-19 pandemic on the overall economy, and particularly on surgical volumes.

Your company is primarily focused on products used in surgical, post-surgical and chronic care. Is there any move to diversify further into other areas?

It is our vision to deliver “Access to precision medtech for every patient, globally.” We operate across four key areas focusing on advanced surgery, wound care, urology and arthroscopy, encompassing 52,000 SKUs across different products.These cover surgical, post-surgical and chronic care and we are keen to add to our portfolio along with our focus areas and similar adjacencies rather than diversify, as these already cover a major part of the patient journey.

We have however been launching products at a sturdy pace in these focus areas and adjacencies, to serve customer needs better and to fill in need gaps.

With the management of nosocomial infections and hospital-acquired infections (HAI) becoming an important agenda for providers during the pandemic, we have added a range of anti-microbial and infection prevention products through the acquisition of CareNow that include disinfectants like OT wipes, sanitisers, surface disinfectants and hospital products like bath wipes and disposable garments for caregivers.This adds to our range of advanced surgery products that strengthen our portfolio not just in the operation theatre but also in pre and post-surgical care.

We have also launched TRUSHIELD NXT last year, a patented wound dressing with DTAC technology that combines a 3-D hydro cellular substrate and patented infection prevention technology offering 360-degree wound protection. Its patented technology continuously inhibits pathogenic growth with a unique non-leaching and non-depleting kill mechanism. It has patents in the US, Europe and India. This successfully marks our foray into the wound care segment.

Healthium continues to invest heavily in R&D and new product development. Our arthroscopy range for shoulder and knee interventions has several patented products that have been indigenously made.

We have also invested in process improvements, and are the first medical technology company in India to use a laser drilling process in needle manufacturing, which enables us to produce smaller needles with precise dimensions and consistent quality.

We have also entered into multiple partnerships with academia and surgeons, start-up organizations and advisory boards of speciality organizations/clinics in India to generate feedback and address the gaps in the market. From a medtech perspective, we will continue to create new products that bring technology, infection control and design patents to the fore.

In 2021, Healthium Medtech acquired three companies, one in the UK and two in India. How has the integration panned out?

At Healthium, we constantly looking at ways to serve our customers with a more embellished portfolio and to expand distribution into new markets by introducing new products in our focus areas and in adjacent areas.

The acquisition of VitalCare in UK has helped us not only expand our urology range in Europe and the U.S but also strengthen our R & D capabilities with the addition of its US FDA registered facility in China.

AbGel gelatin sponge, trusted for 4 decades by surgeons has helped us strengthen our portfolio of hemostats and add a well-established brand to our portfolio.

CareNow with several patented products and its infection prevention range has added a slew of products to our advanced surgery portfolio and another US FDA registered facility to our manufacturing capabilities.

Each of the acquisitions has enabled us to add products to our portfolio and further deepen our customer relationships.

With these strategic acquisitions, we look forward to combining Healthium’s R&D and manufacturing capabilities with the talent and expertise of the incumbent companies to offer wider choices to our customers and deliver better standards in patient care worldwide.

Any plans for further acquisitions?

In line with our past practice, we continue to leverage our global platform, add new products and specialities, acquire new technologies and expand our geographic presence through acquisitions to realize cost and revenue synergies. We maintain a dialogue with various potential market participants and intermediaries, to identify and evaluate businesses that would be a good and a strategic fit with our business.

Various state governments have lined up incentives for Medtech companies and even the government has come out with a PLI scheme for Medtech. Are you participating in it?

Broadly, the Production Linked Incentives (PLI) Scheme for manufacturing medical devices proposes a financial incentive to boost domestic manufacturing and attract large investment in medical devices segments such as cancer care devices, radiology and imaging devices, anaesthetics devices and implants. The government of India has introduced the PLI scheme to enhance and support the country’s manufacturing prowess in terms of medical equipment and encourage the adoption of technological developments.

The PLI scheme does not cover surgical consumables currently and so we have been unable to participate.

What are your expansion plans especially in regulated markets such as the US?

We export our range of products to over 80 countries already and have 4 US FDA registered facilities manufacturing to global standards. We continually maintain a dialogue with various potential market participants and intermediaries, to identify and evaluate businesses that would be a good and strategic fit with our business.

India is dependent on imports in the Medtech sector. What’s your suggestion to reduce that dependency? Is there any policy intervention that’s required?

The medical devices industry is an integral part of the healthcare ecosystem and has been recognized for its role in managing the pandemic by creating affordable solutions in scale, within a short period. However, the industry is still highly import-dependent and high quality and affordable medical devices for patients, remain a gap. Today, import duties on certain medical devices are lower than those of the raw materials used to make them. This makes it more attractive to import the finished product rather than to manufacture it locally, forming a significant barrier for homegrown businesses.

The Government of India has recognized medical devices as a sunrise sector under the ‘Make in India’ campaign promoting domestic manufacturing and reducing the dependency on imports. Consumables and disposables today form the largest export category, accounting for 47% of exports as per the Engineering Export Promotion Council of India.

Promoting local manufacturing of high-end medical devices in scale and quality will attract investments in the sector. The spirit of Atmanirbhar Bharat has spawned medical devices and med-tech companies in India, which have emerged as global leaders, pioneers and innovators.

There is a need to increase the export incentives slabs under the newly introduced Remission of Duties and Taxes on Export Products Scheme (RoDTEP), rationalise Custom Duties, roll back Health Cess on imports of medtech products and amendment of SEZ Act to allow SEZ medtech manufacturers to sell their produce in the domestic market.

Strategic investments and partnerships with Medtech Parks that have already been commissioned. These measures will go a long way to ensure that there is a further boost in domestic R&D ecosystem that will provide world-class quality products for domestic and international use.

The critical success factors for medical device companies can be outlined as:

a)      High quality standards on devices as these products play a vital role in surgical outcomes

b)      Cost-effectiveness due to global focus on rationalizing cost and expanding access to healthcare.

c)      Strong distribution channel across geographies effectively reaching out to a fragmented buyer universe.

d)      Intellectual property and new product development engine.