Aum Sri Sai Ram

India’s 1st Integrated Medical Devices Manufacturing Park

Medical Device Market Size – India

2.0 2.5

2.8 3.2 3.2 3.4

3.9

4.5

5.2

6.1

7.0

8.2

0

1

2

3

4

5

6

7

8

9

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

USD

bn

Indian Medical Device Market

CAGR - 16%

Figure : Indian Medical Device Industry Market Size

• The Indian medical device market has grown from USD 2.02

bn (INR 13,130 Crores) in 2009 to USD 3.9 bn (INR 25,259 Crores) in 2015 at CAGR of 15.8%. This accounts for approximately 1.7% of the global medical device market in 2015

• The Indian Medical Device market contributes to 4% of the Indian healthcare market which is pegged at USD 96.7 bn (INR 6.29 Lakh Crores), in 2015

• The industry estimate suggests that the Indian medical

device market will grow to USD 8.16 bn (INR 53,053

crore) in 2020 at CAGR of 16%

• India is one of the top 20 global medical device markets and the 4th largest medical device market in Asia.

Medical Device Segments – India Diagnostic imaging is the largest segment within Indian medical device market in 2015. It constitutes USD 1.18 bn (INR 7,650 crores)3 in 2015 and will grow to USD 2.47 bn (INR 15,561 Crores) in 2020.

• Others and IV diagnostics comprise largely of electrical and

electronic devices. The others category (patient monitors, ECG machine, Defib, etc) is estimated at USD 0.94 Bn (INR 5,922 Crores) in 2015 and will grow to USD 1.98 Bn (12,880 Crores) in 2020. Similarly, the IV diagnostics market constituted of USD 0.39 bn (INR 2,550 crores) in 2015 and will reach USD 0.82 bn (INR 5,356 Crores) in 2020

• Similarly, Orthopedics & Prosthetics and Consumables will grow

from a cumulative USD 0.90 bn (INR 5,850 crores) in 2015 to USD 1.88 bn (INR 12,220 crores) in 2020.

• Dental products and Patient Aids will grow from a cumulative USD 0.47 bn (INR 2,961 Crores) in 2015 to USD 1.1 bn (INR6,930Crores) in 2020.

1.18

2.47 0.63

1.31

0.39

0.82

0.35

0.75

0.27

0.57

0.12

0.26

0.94

1.98

0

2

4

6

8

10

2015 2020

USD

bn

Segment Wise Market Share of Medical Devices

Others (like PatientMonitor, ECG,Oxygenators etc.)

Dental Products

Orthos and Prosthetics

Patient Aids

IV Diagnostics

Consumables

Diagnostic Imaging

3.89

8.16

Figure : Segment-wise Market Share

Key Segment Sub-segment % of Import

dependency

Share of the overall

Medical Device

market

Overall attractiveness for Indian

Manufacturers to invest in this

segment

Consumables Cardiac Catheter, Other needle, Syringe, Lab reagent,

Suture, Strips & cartridge, Dialysers and Filters, cannula

35% 16% High

Dental Product Dental Implant, Artificial teeth, Dental instruments 60% 3% Medium

Diagnostic Imaging X-Ray tubes, USG Probe, Radiation beam delivery

system, Radiation generator unit, CT Scan, MRI, PET

Scan, ALPHA, BTA/GMA Radiation for other use in

radiography equipment

52% 30% Very High

IV Diagnostics Lab reagent & accessories 67% 10% High

Orthopaedic &

Prosthetics

Artificial joints & joint implants 62% 8% High

Others Artificial dialysis apparatus & haemodialyser,

defibrillator, Lithotripsy equipment ,ECHO,EEG, ECG,

anesthesia equipments, Laparoscope, endoscope

83% 24% Very High

Patient Aids Pacemaker, Hearing aid, Cochlear implant, Stents 50% 9% Medium

High Potential Segments in India

Table : High Potential Segments in India

Foreign Direct Investment and Other Investment in Indian Medical Device Sector

Foreign Direct Investment in the Last 5 years

FDI in medical devices has grown by 25.4 per cent

from USD 131.4 mn in FY12 to USD 164.7 mn in FY16.

In January 2015, Government of India modified the

FDI regulations allowing 100 per cent FDI under

automatic route in Greenfield and brownfield

projects in medical device sector.

USA, Europe and Japan are the key source countries

for FDI in medical devices.

The equipment and instruments, consumables and

implants segments have attracted the most FDI.

131.4

83.0

173.5

154.5 164.7

0

20

40

60

80

100

120

140

160

180

200

2011-12 2012-13 2013-14 2014-15 2015-16

USD

Million

FDI Investments

Figure : FDI Investments in the Indian Medical Device Sector

Source: Department Of Industrial Policy &

Promotion, GoI,

Merger and Acquisition, Venture Capital and Private Equity Investment in Medical Device • The Indian medical device sector has received an investment of USD 505 mn from 27 M&A transactions and around

43 venture capital/ private equity investment in last five years.

• The Equipment and Instruments and Consumables segments attracted the majority of M&A and PE investments.

Year Merger and Acquisition

(USD mn)

PE/ VC/ Angel Funding

(USD mn)

2010 No. of deals 7 3

Value 90.6 14.7

2011 No. of deals 5 2

Value 0.9 4.5

2012 No. of deals 8 14

Value 26.6 162.2

2013 No. of deals 4 13

Value 40.2 125.0

2014 No. of deals 2 9

Value 4.9 27.9

2015 No. of deals 1 2

Value NA 7.5

Total No. of deals 27 43

Value 163.2 341.8 Table : Deals in medical device sector in India Source: VCCEdge, 2016

Bright spots in medical device policy landscape

Medical Devices reform task force- 2014/15

Inverted Duty Correction for spares/components -2016

Medical Devices Rules, 2017

Preferential Procurement of domestically manufactured good, GFR-2017

Medical Devices R & D priority & market access think tank- 2017

Code for Marketing Practices- under final stages of formulation

Medical Devices Promotion Council- Advance stages of planning

Promotion of organized infrastructure support- AMTZ 2016-17 onwards

AMTZ - Manufacturing Units

I n d i a ’ s 1 s t I n t e g r a t e d M e d i c a l D e v i c e s M a n u f a c t u r i n g P a r k

Size 10,000 sft 20,000 sft 40,000 sft

Booking fee (refundable) USD/$

100 200 400

Development fee (USD/$ once for 33 years)

37, 500

75, 000 150, 000

1 Cent/SFT/month

Monthly fees USD/$

600 1200 2400 0.45 Cents/SFT/Month

Visakhapatnam- the port city

I n d i a ’ s 1 s t I n t e g r a t e d M e d i c a l D e v i c e s M a n u f a c t u r i n g P a r k

Un-Common Scientific Facilities

AMTZ Centre for Moulding

Component/PCB Testing &

Manufacturing

Centre for 3D Printing

Gamma Irradiation

Facility

Biomaterial Testing Lab

Centre for MedTech

Innovation & Rapid

Prototyping

Centre for Sterilization &

Toxicity

EMI/EMC

Centre for Radiation

Testing

I n d i a ’ s 1 s t I n t e g r a t e d M e d i c a l D e v i c e s M a n u f a c t u r i n g P a r k

Business Promotion Facilities

AMTZ Import-Export

Promotion

Regulatory Office

Exhibition Halls

Convention Centres

Banks

Auditoriums

Technical, HR & Financial

Support

Warehouse

Transport & Support Services

I n d i a ’ s 1 s t I n t e g r a t e d M e d i c a l D e v i c e s M a n u f a c t u r i n g P a r k

Benefits for Manufacturers Lower Cost for

Testing Services Infra

Development

Lower CapEx for

Manufacturers

Regulators & Export

Facilitation

Promotional activities

through Expo & Convention

Centre

Finance & Technology

Transfer Services

20% space saving due to

centralized Warehousing

Preferential Market Access

I n d i a ’ s 1 s t I n t e g r a t e d M e d i c a l D e v i c e s M a n u f a c t u r i n g P a r k

The Grand Beginning…

I n d i a ’ s 1 s t I n t e g r a t e d M e d i c a l D e v i c e s M a n u f a c t u r i n g P a r k

Operational Efficiencies

A 2.5 Times value improved built- up

facility

Affordable scientific labs at subsidized

testing rates

Inverted duty structure corrected

Ease of operations

Preferential lending rates

Reduced transportation cost

Warehousing with cold chain on usage

basis

Connected to markets & medical convention centre

Local availability of raw material & port

connectivity

I n d i a ’ s 1 s t I n t e g r a t e d M e d i c a l D e v i c e s M a n u f a c t u r i n g P a r k

Incentives & Positives

Quality Certification

50% subsidy on the expenses incurred for quality certification limited to Rs 4 Lakh / 6,400 USD (Conformity European (CE),

100% subsidy for IC-MED certification by Quality Council of India, supported by AMTZ

Green Production Measures

•25% subsidy on cleaner / greener production measures limited to Rs 10 Lakh / 16,000 USD

Skill Up-gradation & Training

•50% reimbursement of the cost incurred subject to a maximum of Rs.10,000 (USD150) per employee to the companies for providing skill gap trainings to the engineers of AP domicile

Micro, Small and Medium Scale Enterprises

20% Investment Subsidy limited to Rs 20 lakh / 32,000 USD for MSME and additional 5% investment subsidy for Women Entrepreneurs

Preferential Market Access

The policy of GoI on preferential market access for domestically manufactured electronics products/ other products

I n d i a ’ s 1 s t I n t e g r a t e d M e d i c a l D e v i c e s M a n u f a c t u r i n g P a r k

Tax benefit & depreciation

Eligible for 15 per cent of higher additional depreciation making it 65% and 15 per cent of investment allowance on the cost of plant and machinery

Power Subsidy

50% to micro, 40% to small & 25% to medium & 10% to large-scale industry limited to Rs 50 lakh / 80,000 USD for a period of 5 years from the date of commencement of commercial operations.

Exemption of Electricity Duty for new electronic hardware units, after coming into commercial operations entitled for 100% exemption on Electricity duty for a period of 5 years

Patent Filing Cost

The cost of filing patents will be reimbursed to the companies having their headquarters in Andhra Pradesh, subject to a limit of Rs 5 Lakh / 8,000 USD per domestic patent awarded and Rs 10 Lakh / 16,000 USD per international patent awarded

Incentives & Positives

I n d i a ’ s 1 s t I n t e g r a t e d M e d i c a l D e v i c e s M a n u f a c t u r i n g P a r k

AVISHCAR Advance Identification Of Scientific Technology & Commissioning Roadmap

Advance Purchase/use agreement for high value medical technology

products with exclusivity

Ministry of Electronics

AMTZ DME

I n d i a ’ s 1 s t I n t e g r a t e d M e d i c a l D e v i c e s M a n u f a c t u r i n g P a r k

Ranked best Investment Destination in India by World Bank & DIPP, Govt. of India