(Source: Venture Intelligence)
At the ICU of one of the largest hospital in Victoria, Australia a robot helps the oncologist treat cancer by precisely inserting a needle in the affected area to burn and freeze the patient’s tumor, a technique better known as ablation. The robot had a strip under his right arm mentioning “Made in India” which amazed the Australian oncologist. Yes, he read those words correctly and this is just an example of how India based organizations/start-ups are changing the face of healthcare and leaving their footprints across the globe. This state of the art, next-generation robotic healthcare device has been developed by Chennai-based start-up, Perfint Healthcare. This device provides clinicians the luxury to perform complex procedures with high degree of accuracy, minimal invasion and less side effects.
In 2012, the healthcare industry enjoyed great private equity and venture capital investments and trend is likely to continue for coming years. These funds play a pivotal role in backing up start-ups such as Perfint which are engaged in developing such cutting-edge technologies in areas such as medical devices, stem cells and next generation drugs. These breakthrough innovations are rapidly transforming India into a serious contributor to the medical technology market.
Aarin Capital, a private equity $100 million fund, is a front runner that invests in Life Sciences start-ups. Artiman, another US based venture capital firm, which manages a global corpus of $750 million (about Rs. 4100 crore) is adopting ‘deal creation’ model to find potential start-ups with proof of concept for their ideas. This model, where the capitalists throws a bait of idea and wait for interested candidates with a unique business model to make that idea viable, is doing very well in US and now is being adopted in India as well. Artiman, replicating this model, has done 3 major investments in healthcare sector in India across fields such as drug discovery, cancer diagnostics and imaging technology.
In 2011, for Indian start-ups, there were 38 deals worth $421 million in the Healthcare and Life Sciences sector whereas in 2012 this sector attracted $1.2 billion worth of investments from private equity and venture capital players. This emerging confidence of the investors is based on the fact that over the last decade more number of Indians are returning from the west, driving this surge of new startups in the Healthcare and Life Sciences sector. Also, the supply is on the lower side and the demand continues to rise.
The biggest challenge for such innovation-driven startups is to follow-on capital as it is still very risky for an investor to infuse money into such startups. However, these startups with their science and innovative products are also aiming to attract capital from global pharmaceutical companies. Stempeutics Research, a Bangalore based organization, achieved capital investment from Cipla for their research on stem cells.
Do you believe that Indian brain backed by appropriate money power can make a difference in the healthcare sector? What are major challenges that Indian startups can face in achieving this and how to overcome those?
By Dr Sumeet Kad
About the author
Marketing and Business strategy professional with considerable experience in marketing and consulting for MNCs and Fortune 500 clients in the Healthcare and Life Sciences industry Dr. Sumeet is an avid reader, social media evangelist and has authored various blogs on marketing, branding, healthcare and life-sciences and social media.