Health Care
Content
Industry Monitor Health Care
Vol. 1205
May 2012
CONTENTS
INDUSTRY AT A GLANCE ....................................................................................................2 KEY DEVELOPMENTS ..........................................................................................................3 Marketing and Investments .....................................................................................................3 Mergers, Acquisitions, and Agreements...................................................................................4 Others.....................................................................................................................................4 INDUSTRY STATISTICS .........................................................................................................5 PRODUCT FOCUS ...................................................................................................................7 Fertility Clinics ........................................................................................................................7 Introduction........................................................................................................................7 Diagnosis ............................................................................................................................7 India Experiences ARTs .....................................................................................................7 Outlook ..............................................................................................................................8 COMPANY SCAN.....................................................................................................................9 Poly Medicure Ltd...................................................................................................................9 Introduction........................................................................................................................9 Common Size Comparison ...............................................................................................10 Stock Market Performance................................................................................................11 Outlook ............................................................................................................................11 UPCOMING EVENTS ...........................................................................................................12
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Industry Monitor – Health Care
May 2012
INDUSTRY AT A GLANCE
MARKETING AND INVESTMENTS Harrington HealthCare introduces Strengthening Our Future campaign, USA GE Healthcare Initiates Evaluation Period for New Global Patient Safety Network, USA The Wellcome Trust Launches £200M Business to Invest in Healthcare and Life Sciences, UK €30m fund to invest in young Irish firms, Ireland Abu Dhabi to Host Global Healthcare Meet, UAE Vasan Healthcare receives $100m investment from Singapore’s GIC, India MERGERS, ACQUISITIONS, AND AGREEMENTS Sunpeaks Ventures Completes Acquisition of Healthcare Distribution Specialists LLC, USA GE Healthcare to acquire Xcellerex Inc., UK OTHERS Supreme Court to release audio in healthcare cases, USA
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Industry Monitor – Health Care
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KEY DEVELOPMENTS
Marketing and Investments
Americas USA: Harrington HealthCare introduces Strengthening Our Future campaign Harrington HealthCare System formally launched a fundraising campaign to rebuild the Emergency Department at its Webster campus, Harrington HealthCare at Hubbard. The $8.8m Strengthening Our Future campaign would enable Harrington HealthCare at Hubbard to continue to deliver the highest quality care to its patients. Harrington HealthCare System CEO announced at a Strengthening Our Future kick-off ceremony at Harrington HealthCare at Hubbard that Harrington has a $4m anonymous challenge match from a local donor. The campaign also received an additional $434,500 in donations and pledges from local individuals, businesses and five financial institutions -- Webster Five Foundation, Savers Bank, Southbridge Savings Bank, Hometown Bank, and a grant from TD Bank, which would partially fund donor management software. Combined with the anonymous match, the total amount pledged comes to $869,000. USA: GE Healthcare Initiates Evaluation Period for New Global Patient Safety Network GE Healthcare Performance Solutions, a unit of GE Healthcare, announced the launch of a 90-day evaluation for its Global Patient Safety Network (GPSN), an online community for hospitals to collaborate with peers around the world with the goal of improving patient safety. Following the recent initiative announced by the U.S. Department of Health and Human Services (HHS) to establish Hospital Engagement Networks (HENs), the GPSN will provide a resource for providers to meet the needs of HENs. The Global Patient Safety Network is an online patient safety community operated under the GE Patient Safety Organization (GE PSO) designed to help healthcare professionals connect locally and globally with their peers to enhance and empower existing efforts to improve patient safety. The 90-day evaluation offers hospitals the opportunity to collaborate with local and global peers and evaluate the GPSN without cost. Europe UK: The Wellcome Trust Launches £200M Business to Invest in Healthcare and Life Sciences The Wellcome Trust, a London, UK-based charitable foundation dedicated to achieving improvements in human and animal health, is launching a new business focused on investing in emerging businesses and technologies in the healthcare and life sciences sectors. The new firm, whose name will be announced shortly, will have an initial capital of £200m to back promising healthcare businesses, which will typically be at an early stage in their development with significant potential to grow. The business, which will take and retain ownership positions in these companies, will be led by Chairman Nigel Keen and CEO Martin Murphy. Ireland: €30m fund to invest in young Irish firms Minister for Jobs and Innovation Richard Bruton announced an investment of almost €30m in young and growing Irish healthcare companies. The investment is being made through a specialized US venture capital company which the Government persuaded to set up in Ireland, as part of the investment. Enterprise Ireland and the National Pension Reserve Fund are putting $37.5m (€30m) into a fund that invests in young companies in the life sciences and medical area. That money goes into a company called Sofinnova Ventures, a well-known American healthcare venture capital company, based in San Francisco in California. Sofinnova would set up in Ireland and will invest in Irish life science and healthcare companies. Healthcare is one of the few areas of the economy that has grown, even as the financial crisis has engulfed the country. Asia Pacific UAE: Abu Dhabi to Host Global Healthcare Meet Abu Dhabi in the United Arab Emirates (UAE) will host the 7th International Conference of Al Noor (ICAN) under the patronage of Nahyan Bin Mubarak Al Nahyan, minister for higher education and
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Industry Monitor – Health Care
May 2012
scientific research. The three-day conference titled "Tumors (Oncology) in Healthcare" is expected to be participated by over 350 physicians and technicians from various medical fields relevant to the diagnosis and treatment of tumours of all types from UAE and abroad. The conference will begin March 15. India: Vasan Healthcare receives $100m investment from Singapore’s GIC Vasan Healthcare, which runs a chain of eye and dental clinics, received a $100m funding from the Government of Singapore Investment Corporation (GIC). GIC picked up a minority stake in Vasan Healthcare and thus joined other private equity investors like Sequoia Capital and WestBridge Capital. Vasan Healthcare plans to use the fund to expand its network of 102 eye care hospitals and 14 dental treatment centres through a mix of organic as well as inorganic routes.
Mergers, Acquisitions, and Agreements
Americas USA: Sunpeaks Ventures Completes Acquisition of Healthcare Distribution Specialists LLC Sunpeaks Ventures, Inc. completed the acquisition of Healthcare Distribution Specialists LLC ("HDS"), a value-added distributor of hard-to-find and specialty drugs. In addition to its drug distribution business, HDS also owns and markets Clotamin®, a specialized over-the-counter multivitamin product designed exclusively for use by patients also on Warfarin®, a popular blood thinner that has a long list of known adverse drug and food interactions. Sunpeaks Ventures expects to gain significant traction going forward as the company works to grow awareness of Clotamin and expand role as special purchasing agent and procurement expediter for many distribution customers. In addition, the company is also pleased to announce the engagement of Anslow & Jaclin, LLP as its lead legal counsel. Anslow & Jaclin offers advice and counsel to diverse clients worldwide on unique and sophisticated corporate and securities transactions, reverse mergers, self-filings, PIPEs, corporate finance, and mergers and acquisitions. Europe UK: GE Healthcare to acquire Xcellerex Inc., GE Healthcare, a unit of GE announced today reached an agreement to acquire Xcellerex, Inc. a supplier of innovative manufacturing technologies for the fast-growing biopharmaceutical industry. The acquisition of Xcellerex will allow GE Healthcare to expand its offering of products and services for the manufacture of biopharmaceuticals such as recombinant proteins, antibodies and vaccines. The strong strategic fit between the two companies, combined with expanded capabilities in product development and marketing, will offer significant customer benefits. Xcellerex develops and produces turn-key biomanufacturing systems and production-scale bioreactors based around single-use components. The proprietary products offer significant advantages such as faster installation, lower capital investment, reduced risk of cross-contamination, and significantly increased flexibility compared with traditional manufacturing technologies. Xcellerex’s production-scale single-use bioreactor systems are complementary to GE Healthcare’s products and range of media for cell culture.
Others
Americas USA: Supreme Court to release audio in healthcare cases The U.S. Supreme Court said would release audio recordings and transcripts of oral arguments in the healthcare challenge immediately after the March 26-28 sessions, responding to what it called "extraordinary public interest." The court rejected a request, however, from C-SPAN, endorsed by some members of Congress, to allow video recordings of the arguments. The court long barred cameras from its white marble setting - a practice that has drawn criticism from Congress and media groups. Demand to see arguments in the trio of cases centering on the 2010 Obama-sponsored healthcare overhaul is high. The core of the dispute tests the constitutionality of a provision requiring most people in the United States to buy health insurance by 2014. The courtroom seats a maximum of 400 and most of those seats already are reserved for people associated with the cases or connected to the justices and other court officials.
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Industry Monitor – Health Care
May 2012
INDUSTRY STATISTICS
State-wise Funds Released under Supplementary Nutrition Programme (SNP) in India (Rs. in Billion) 2009-10 2010-11 Released Expenditure Released Expenditure Andhra Pradesh 3.13 5.23 1.60 0.00 Bihar 4.07 9.23 2.55 4.98 Chhattisgarh 0.75 2.13 0.73 1.66 Goa 0.04 0.09 0.04 0.06 Gujarat 0.87 1.85 0.95 1.26 Haryana 0.69 1.46 0.38 0.09 Himachal Pradesh 0.29 0.59 0.17 0.34 Jammu and Kashmir 0.17 0 0.19 0 Jharkhand 1.69 5.32 1.01 1.66 Karnataka 2.63 5.66 1.42 3.26 Kerala 0.75 1.58 0.41 0.73 Madhya Pradesh 2.23 5.20 3.21 5.86 Maharashtra 2.04 4.87 2.04 0 Orissa 1.40 3.22 1.81 3.78 Punjab 0.17 0.24 0.44 0.41 Rajasthan 1.10 3.05 1.07 2.62 Tamil Nadu 1.33 2.66 0.74 1.08 Uttar Pradesh 0.74 17.88 12.25 19.87 Uttarakhand 8.68 0.15 0.13 0.06 West Bengal 1.36 5.51 1.68 2.30 Andaman and Nicobar Islands 0.14 0.05 0.01 0.03 Chandigarh 0.02 0.02 0.01 0.01 Dadra and Nagar Haveli 0.00 0.01 0.01 0 Daman and Diu 0.01 0.01 0.00 0.00 Lakshadweep 0.00 0 0.00 Delhi 0.42 0.69 0.23 0.53 Puducherry 0.01 0.05 0.01 0.03 Arunachal Pradesh 0.09 0.10 0.12 0.28 Assam 1.77 2.99 1.55 1.79 Manipur 0.15 0.24 0.19 0.26 Meghalaya 0.53 0.70 0.28 0.45 Mizoram 0.20 0.25 0.10 0.24 Nagaland 0.27 0.33 0.21 0.21 Sikkim 0.08 0.06 0.03 0.04 Tripura 0.29 0.36 0.18 0.13 India 37.3 81.78 35.76 53.88
Source: India Stat; Cygnus Research
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Industry Monitor – Health Care
May 2012
38
Funds Released under SNP in India
Released (RHS)
37
Expenditure (LHS)
90
Rs bn
36
60
35 2009-10 2010-11
30
Source: India Stat; Cygnus Research
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Rs bn
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Industry Monitor – Health Care
May 2012
PRODUCT FOCUS
Fertility Clinics
Introduction
Fertility clinics are staffed medical clinics that assist couples, and sometimes individuals, who want to become parents but for medical reasons have been unable to achieve this goal through the natural course. Clinics apply a number of diagnosis tests and sometimes very advanced medical treatments to obtain the desired conceptions and pregnancies. Fertility clinics are staffed with highly trained personnel including Reproductive Endocrinologists, Embryologists, Sonographers, and Nurses. Additional specialists from Acupuncture, Hypnotherapy, and Nutrition may also be part of the team.
Diagnosis
In Fertility Clinics both men and women are diagnosed for fertility problems. Diagnosis showed that fertility problems arise 35% of the time from men, 35% from women, 20% from combined issues, and 10% from unexplained causes. For men, semen collection is a standard diagnostic test to ascertain problems with the semen quality. While women may undergo a multitude of tests including an ovulation analysis, x-ray of fallopian tubes and uterus, and laparoscopy. Feasibility of Treating Infertility with ARTs With the advancements in reproductive medicine and the experiences gained through the specialised infertility management clinics a wider range of diagnostic and treatment options become available to the infertile couple. In fact, it is now the issue of affordability which became a deciding factor for most infertile couples. Assisted Reproduction Techniques (ARTs) are proving increasingly effective for the management of many types of male infertility. In fact, the technique of ICSI almost replaced the other treatment modalities. Using this technique, one single spermatozoa recovered from the testes or epididymis, or picked up from the ejaculate of normal or deficient spermatogenesis and regardless of underlying path physiology, is adequate to fertilize the egg. ARTs also proved increasingly effective in treating many types of female infertility. IVF-ET was initially applied successfully in patients with fallopian tube block.
India Experiences ARTs
India is increasingly becoming a hot destination for ART like Intra Uterine Insemination (IUI), In-Vitro Fertilization (IVF), Intracytoplasmic Sperm Injection (ICSI), Percutaneous Epididymal Sperm Aspiration or Extraction and ICSI (PESA, MESA), Testicular Sperm Aspiration or Extraction and ICSI (TESA, TESE). In addition to Indian couples, most of the reputed infertility clinics are attending couples from developed countries and South East Asia. A study by the Confederation of Indian Industry (CII) on medical tourism estimates a business of US$2.3 billion by 2012. ART is one of the most sought after and revenue building services that India has to offer. The cost of IVF, ICSI is about one-fifth to one tenth of the cost as compared to the cost in western countries. People all over the world are choosing India for a number of reasons. The hospitals that offer the latest diagnostic and treatment facilities, availability of experienced and highly qualified doctors, favorable legal support, lower costs, availability of English speaking doctors and care takers are some of the aspects in its favor. Providers of ARTs conveniently used the need for a child, to project this technology as being pro women. Governed by the demand and supply, this field of infertility ‘treatment’ is generating profits through the sale of ARTs. The fertility market issues a price tag to reproductive tissues and then appropriates them in
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Industry Monitor – Health Care
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order to sell the unfulfilled dream to millions of people, under the rubric of ‘choice’ and ‘rights’. The process of reproduction is systematically pushed out of the personal domain into the commercial through these technologies. Developing countries and the comparatively poorer population within these countries increasingly emerged as ‘suppliers’ of cheap labour (womb) and services (both medical services and egg donation). In a globalised economy with uneven regulation across countries, couples manage to access the services either in their own countries or elsewhere. This led to the super-specialised phenomenon of reproductive tourism across the world. As part of this process, India is slowly turning into the surrogacy outsourcing capital of the world because of the lower costs involved, the lack of regulation in provision of ARTs, prohibition and unavailability of certain procedures in their own countries and minimum waiting periods. The ART industry in India remains, as of now, unchecked by any state rule or law. The lack of political will in regulating these technologies can be linked to the commercial gains being made by the state and the private entrepreneurs through the in-country rapid proliferation of clinics and the cross-country transactions for services, gametes and surrogates. Fertility Clinics Market in India Relaxed regulations and cheap costs made India a hotbed for In Vitro Fertilization (IVF). Couples looking to conceive through artificial means are coming from all over the globe to take advantage of these fertility services. The Indian Society for Assisted Reproduction (ISAR) claims that there are nearly 400 fertility clinics in the country. These were visited by 30,000 patients in the last year. According to some doctors, half of their patients come from overseas. Quality IVF procedures at a clinic in a major city like Mumbai cost about one-third of what they do in the US. Even after airfare, a couple stands to save thousands of dollars. The boom indicates the demand for egg donors, who could earn between US$200 and US$1000 per donation. Medical tourism, in general, is on the rise in India. Elective procedures cost a fraction of the US and Europe and most top Indian doctors who are trained in Western medical schools, are on par with the best American and European surgeons. Because of these factors, India expects medical tourism to account for US$2 billion in revenue by 2012. Medical tourism companies made significant profits from commercial surrogacy by using sophisticated Internet-based strategies to market comprehensive services to prospective fertility patients. Designed to bridge the distance between healthcare consumers in developed countries on the one hand and healthcare providers and surrogates in developing and transitional-economy countries on the other, these services depend on low prices and lack of regulation in India to keep costs and hassles to a minimum.
Outlook
Indian healthcare industry come a long way and witnessed a robust growth in the past few years on the back of increasing healthcare campaign, increasing medical insurance coverage, rising income levels and a rise in medical tourism. India still lags behind in health related infrastructure in the primary healthcare sector, when compared to other developing nations. Indian fertility clinics are increasingly popular in industrialized nations because of the relatively low cost. India is flexible country in terms of treatment and cost which makes it a unanimous destination. Apparently, more than 350 fertility clinics are currently operational in India. There are various reports about surrogacy and fertility regulations being introduced in the near future.
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Industry Monitor – Health Care
May 2012
COMPANY SCAN
Poly Medicure Ltd
Introduction
POLYMED was conceived and established by a group of engineers and technocrats dedicated to the idea of providing the benefits of modern healthcare to the mankind at affordable price. This unique philosophy is the driving force behind the company since its inception in 1995. Today the company has grown into one of the most dynamically versatile manufacturers of disposable healthcare products in the region with over 60 different products. Product Segment of company Infusion Therapy: Infusion therapy is a type of medical treatment in which medication is delivered directly into the body through a blood vessel, the spinal cord, or a muscle. The Infusion Therapy includes major safety products namely Cannulae, flow regulators, extension lines and burette set. Central Venous Access Catheters: A tube surgically placed into a blood vessel for the purpose of giving intravenous fluid and drugs. Major products include single lumen CVC, and catheter mount Anesthesia: Anesthesia is a pharmacologically induced reversible state of amnesia, analgesia, loss of responsiveness, loss of skeletal muscle reflexes and decreased stress response. Major products include Oxygen catheter, Nasocath and Nebulizer mask. Gastroenterology: The branch of medicine deals with the study of disorders affecting the stomach, intestines, and associated organs. Gastroenterologys product line includes Ryle’s tube, Levin’s tube and umbilical catheter. Company’s Performance at a Glance (Rs in m) Net Sales Operating Profit/Loss OPM NPM Depreciation Interest PAT
Source: BSE India; Cygnus Research
2010-11 1696.68 369.68 21.79 12.78 85.88 44.41 216.90
2009-10 1360.05 294.32 21.64 12.08 70.70 41.30 164.30
2008-09 1122.24 178.76 15.93 5.28 64.64 47.67 59.26
2007-08 883.82 177.10 20.04 8.96 55.59 38.28 79.15
Item Debt-Equity Ratio Long Term Debt-Equity Ratio Current Ratio OPM (%) NPM (%) ROCE (%) RONW (%)
Source: Company; Cygnus Research
2010-11
KEY RATIOS 2009-10 0.00 0.00 0.00 21.79 12.78 0.00 0.00
0.62 0.46 1.99 21.64 12.08 30.78 27.66
2008-09 0.78 0.57 1.86 15.93 5.28 29.64 12.78
2007-08 0.85 0.56 1.83 20.04 8.96 10.28 18.90
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Industry Monitor – Health Care
May 2012
Sales Other Income PBIDT Interest PBDT Depreciation PBT TAX PAT
Performance Analysis of Apollo Hospitals Quarterly Performance Financial Year Performance OND11 OND10 Var(%) 2010-11 2009-10 Var(%) 551.80 417.50 32.17 1696.68 1360.05 24.75 1.15 0.83 38.55 3.93 5.29 (25.71) 100.90 87.30 15.58 369.68 294.32 25.60 12.56 11.60 8.28 44.41 41.30 7.53 88.34 75.70 16.70 325.27 253.02 28.56 25.60 23.17 10.49 85.88 70.70 21.47 62.74 52.52 19.46 239.39 182.33 31.29 22.65 4.17 443.17 22.48 18.03 24.68 40.10 48.35 (17.06) 216.90 164.30 32.01
Source: BSE India; Cygnus Research
During the quarter OND11, the company’s sales increased by 32.17%, which was at Rs551.80m when compared to OND10. The other income of the company increased by 38.55%, which stood at 800 Rs1.15m compared to the OND10 of Rs0.83m. 2007-08 2008-09 2009-10 2010-11 Tax for the company increased sharply by 443.17% when compared to the OND10. Net Source: BSE India; Cygnus Research Profit decreased by 17.06% in OND11 as compared to OND10mainly because of higher tax payment by the company.
Common Size Comparison
When compared the Poly medicure ltd with its peers, the other income of the company is low at 0.23% when compared to its peers. The raw material cost is more for Poly medicure, which is 36.80%, where as Lotus registered 17.45%, and Kovai registered 17.76%. Staff expenses are more for lotus when compared to its peers. Other expenditure is high for Lotus when compared to the peer companies. Interest, and PBT are high for the Poly compared to other companies. Tax charges are high for Kovai medicals when compared to Lotus, and for Poly medicure. Net profit is high for Poly Medicure that stood at 12.78% when compared to the other two companies which registered 2.27%, and 6.91% respectively. Common Size Comparison for 2010-11 Poly Lotus Kovai Other Income 0.23 0.98 0.57 Raw materials 36.80 17.45 17.76 Staff Expenses 15.68 30.31 12.98 Other Expenditure 24.35 38.01 6.47 Interest 2.62 0.54 6.35 Depreciation 5.06 13.79 3.79 PBT 14.11 3.54 11.16 Tax 1.32 1.26 4.25 PAT 12.78 2.27 6.91
Source: BSE India; Cygnus Research
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Rs mn
During 2010-11, the company’s revenue increased by 24.75% as compared to 2009-10. The total revenue of the company reached Rs1696.68m in 2010-11 from Rs1360.05m in 2009-10. The boost in profits was on account of economies achieved due to completion of backward integration project lower forex losses and cost cutting measures taken by the company.
Revenue Performance
1700
10
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Industry Monitor – Health Care
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Cost Structure Analysis In 2010-11, the interest expenses as percent Cost Structure as Percentage of Net Sales of sales decreased by around 311bps points 2010-11 2009-10 2008-09 2007-08 as compared to 2009-10. Raw material Raw materials 36.80 37.97 39.38 44.98 expenses decreased as compared to the 15.68 15.83 14.65 17.33 previous year. Other expense for the Staff cost 24.35 24.46 29.80 24.84 company in the financial year 2010-11 Other exp. 5.06 5.20 5.76 6.29 decreased by around 127 basis points taking Depreciation the profit margins to the lowest category. As Interest 2.62 3.04 4.25 4.33 compared to the previous year, the company Tax 1.32 1.33 0.64 0.46 is performing well in terms of cost Source: BSE India; Cygnus Research management and earnings. The company has taken cost cutting measures to tackle the slowdown and to perform better against its peers.
Stock Market Performance
Relative Index
115
Shareholding Pattern as on 31st Dec 2011
100 Others, 51.30
85
BSE Sensex Tata Steel
Promoter s, 48.70
70 Mar '11 July'11 May'11 Dec'11 Sep'11 Aug'11 Apr'11 Nov'11 Feb'12 Oct'11 Jan'12 Jun'11
Source: BSE India; Cygnus Research
From March 2011 to February 2012, the BSE Sensex has seen a fall of 9% from the base of 19445.22 points to 17752.68 points. Over the same period, Poly Medicure has seen a fall of 7% from Rs278 to Rs259.90. The company’s share price during the period is showing a declining trend mainly because negative sentiments over the stock and revenue performance. The political stability showed bullish trend in the manufacturing and mining and service sector and launch of some innovative products with increase in demand leads to have growth in the market. The fall in Sensex is mainly because of poor global market performance and negative sentiments prevail in global economy and higher domestic interest rate.
Outlook
The Indian healthcare market is one of the prominent contributors to the country’s gross domestic product (GDP) having attracted large number of players- domestic as well as international during the past few years. Highly qualified doctors and scientists, state-of-the-art technology and low costs helped India to become an attractive global destination for medical tourism, clinical studies, and research and development (R&D) programs. The sector offers massive growth potential and a chance to capitalize on its expansion, especially as the country sees a rise in the incidence of lifestyle-related diseases. A growing elderly population paired with a rise in income levels also emphasizes the need for better facilities in the country. The US$50 billion-a-year health care industry has grown rapidly and is now the second-largest service-sector employer in the country, providing jobs to about 4.5 million people directly or indirectly. The Indian healthcare sector would double its size to US$100 billion by 2015.
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Industry Monitor – Health Care
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UPCOMING EVENTS
1. Event Date Venue Highlights Indo Health Expo 2012 10 May 2012 - 13 May 2012 Jakarta Convention Center, Jakarta, Indonesia Fitness club & Slimming Center, Fitness Equipment, Alternative Medicine, Aerobic and yoga studio, Bio Technology Product, Health spa & resort health, Health food & Beverage, Health appliances, Medical supplies, Natural ingredients, Organic food & beverages. Krista Media Pratama PT.; Jl. Blandogan no.28 D/G - Jakarta 11220, Indonesia; Tel: +62 21 634 5861; +62 21 634 5862; Fax: +62 21 634 0140 The International Conference on Integrative Medicine 13-15, May 2012 ICC Jerusalem International Convention Center, Jerusalem 91060 Motor System, Movement and Posture Study, Muscular Skeletal Pain, Myofascial Pain Nutrition, Dietary Supplements, Digestive System, Metabolic Diseases; Wellness and Aging, Neurological Disorders, Cognitive Disorders, Memory Disturbance Stress, Sleep Disturbances, Insomnia - Non Organic Origin. The Jerusalem International Conference on Integrative Medicine Secretariat, Ilana Berkowitz; Paragon Conventions; 18, Avenue Louis-Casai; 1209 Geneva, Switzerland; Tel: +41 22 5330948; Fax: +41 22 5802953 E-mail: [email protected]; The 8th Annual World Health Care Congress 23 – 24 May 2012 Dorint Hotel; Amsterdam; The Netherlands Sharing international experiences in the development of sustainable health care systems; Learning lessons from successful integrated care systems in Europe and the USA; The rise of health consumerism and the growing power of the health consumer; Personalised health and predictive medicine; Developing partnerships to improve long term disease prevention; Productivity and efficiency in health care delivery. Patrick Golden; Director of Communications Tel: +1-781-939-2511; Fax: +1 781-939-2526 Email: [email protected]; Web: Worldcongress.com Hospital Build Middle East 2012 4 - 6 Jun 2012 Dubai International Convention & Exhibition CentreDubai, United Arab Emirates Hospital Build Middle East is one of the prestigious trades shows for the health care community. It will build a sustainable and hospital infrastructure and health care development industry. The exhibition will showcase products, solutions and services across all areas of hospital investment, designing, planning, building, operating, managing and refurbishing. IIR Middle East;, Office 301, Sultan Business Centre, Dubai, United Arab Emirates Tel: +971 43365161; Fax: +971 43364021 Cardiostim 2012 13 - 16 Jun 2012 Nice Acropolis Convention Centre; Nice, France As a worldwide scientific congress in the field of electrophysiology and cardiac techniques, Cardiostim gathers more than 5,000 scientists, including the most distinguished ones from all over the world. Reed Expositions France52-54, Quai de Dion-Bouton, CS 80 001, Puteaux, France Tel: +33 1 4756 5084; Fax: +33 1 4756 2455 12
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Contact Details Event Date Venue Highlights
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Contact Details Event Date Venue Highlights Contact Details
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6. Event Date Venue Highlights Contact Details Event Date Venue Highlights
May 2012
7.
Contact Details 8. Event Date Venue Highlights Contact Details 9. Event Date Venue Highlights Contact Details
Vietnam Medi-Pharm Expo-Hanoi 22 Aug 2012 - 25 Aug 2012 Tan Binh Exhibition & Convention CenterHo Chi Minh , Vietnam This trade show will explore all the new tools and techniques in medical industry, healthcare and treatment services. It will showcase all the latest techniques which help in generating positive outcomes and provide more security to the patient A's life. VINEXADNo.9 Dinh le Street, Hanoi city, Vietnam Tel: +84 4 3825 5546; Fax: +84 4 3936 3085 Meditec Clinika 2012 7 - 9 Sep 2012 Palace Grounds; Bangalore, Karnataka; India It is the largest platform for the Medical Equipment and technology industry. It will act as a catalyst to bring together a varied genre of medical professionals under one roof to interact, promote and transact business in this industry which will eventually lead to better healthcare for the common man in this densely populated region. Orbitz Exhibitions Private Limited; 202, Navyug Industrial Estate, T. J. Road, Sewree, Mumbai, Maharashtra, India Tel: +91 22 2410 2801; +91 22 2410 2802; Fax: +91 22 2410 2805 Healthex 2012 7 - 9 Sep 2012 Bangalore International Exhibition Centre; Bangalore, Karnataka; India The show presents a complete range of equipment, materials, services, processes, systems, components, consumables which find wide use in medical surgeries, hospitals, clinics, diagnostic centres from across the world. Bangalore International Exhibition Services Pvt. Ltd.10th Mile, Tumkur Road Madavara Post, Bangalore 562 123, Karnataka, India. Tel: +91 80 6583 3234; +91 9972929976; Fax: +91 80 6624 6661 Medtec China 2012 26 - 27 Sep 2012 Shanghai World Expo Exhibition & Convention Center; Shanghai, China For the first time, China's medical device and equipment manufacturers will have access to hundreds of leading medical OEM suppliers from around the globe providing a vast array of equipment, materials & services. UBM Canon11444 W. Olympic Blvd. Los Angeles, California 90064, USA Tel: +1 310 445 4200; Fax: +1 310 445 4299
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Vol. 1205
May 2012
CONTENTS
INDUSTRY AT A GLANCE ....................................................................................................2 KEY DEVELOPMENTS ..........................................................................................................3 Marketing and Investments .....................................................................................................3 Mergers, Acquisitions, and Agreements...................................................................................4 Others.....................................................................................................................................4 INDUSTRY STATISTICS .........................................................................................................5 PRODUCT FOCUS ...................................................................................................................7 Fertility Clinics ........................................................................................................................7 Introduction........................................................................................................................7 Diagnosis ............................................................................................................................7 India Experiences ARTs .....................................................................................................7 Outlook ..............................................................................................................................8 COMPANY SCAN.....................................................................................................................9 Poly Medicure Ltd...................................................................................................................9 Introduction........................................................................................................................9 Common Size Comparison ...............................................................................................10 Stock Market Performance................................................................................................11 Outlook ............................................................................................................................11 UPCOMING EVENTS ...........................................................................................................12
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Industry Monitor – Health Care
May 2012
INDUSTRY AT A GLANCE
MARKETING AND INVESTMENTS Harrington HealthCare introduces Strengthening Our Future campaign, USA GE Healthcare Initiates Evaluation Period for New Global Patient Safety Network, USA The Wellcome Trust Launches £200M Business to Invest in Healthcare and Life Sciences, UK €30m fund to invest in young Irish firms, Ireland Abu Dhabi to Host Global Healthcare Meet, UAE Vasan Healthcare receives $100m investment from Singapore’s GIC, India MERGERS, ACQUISITIONS, AND AGREEMENTS Sunpeaks Ventures Completes Acquisition of Healthcare Distribution Specialists LLC, USA GE Healthcare to acquire Xcellerex Inc., UK OTHERS Supreme Court to release audio in healthcare cases, USA
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Industry Monitor – Health Care
May 2012
KEY DEVELOPMENTS
Marketing and Investments
Americas USA: Harrington HealthCare introduces Strengthening Our Future campaign Harrington HealthCare System formally launched a fundraising campaign to rebuild the Emergency Department at its Webster campus, Harrington HealthCare at Hubbard. The $8.8m Strengthening Our Future campaign would enable Harrington HealthCare at Hubbard to continue to deliver the highest quality care to its patients. Harrington HealthCare System CEO announced at a Strengthening Our Future kick-off ceremony at Harrington HealthCare at Hubbard that Harrington has a $4m anonymous challenge match from a local donor. The campaign also received an additional $434,500 in donations and pledges from local individuals, businesses and five financial institutions -- Webster Five Foundation, Savers Bank, Southbridge Savings Bank, Hometown Bank, and a grant from TD Bank, which would partially fund donor management software. Combined with the anonymous match, the total amount pledged comes to $869,000. USA: GE Healthcare Initiates Evaluation Period for New Global Patient Safety Network GE Healthcare Performance Solutions, a unit of GE Healthcare, announced the launch of a 90-day evaluation for its Global Patient Safety Network (GPSN), an online community for hospitals to collaborate with peers around the world with the goal of improving patient safety. Following the recent initiative announced by the U.S. Department of Health and Human Services (HHS) to establish Hospital Engagement Networks (HENs), the GPSN will provide a resource for providers to meet the needs of HENs. The Global Patient Safety Network is an online patient safety community operated under the GE Patient Safety Organization (GE PSO) designed to help healthcare professionals connect locally and globally with their peers to enhance and empower existing efforts to improve patient safety. The 90-day evaluation offers hospitals the opportunity to collaborate with local and global peers and evaluate the GPSN without cost. Europe UK: The Wellcome Trust Launches £200M Business to Invest in Healthcare and Life Sciences The Wellcome Trust, a London, UK-based charitable foundation dedicated to achieving improvements in human and animal health, is launching a new business focused on investing in emerging businesses and technologies in the healthcare and life sciences sectors. The new firm, whose name will be announced shortly, will have an initial capital of £200m to back promising healthcare businesses, which will typically be at an early stage in their development with significant potential to grow. The business, which will take and retain ownership positions in these companies, will be led by Chairman Nigel Keen and CEO Martin Murphy. Ireland: €30m fund to invest in young Irish firms Minister for Jobs and Innovation Richard Bruton announced an investment of almost €30m in young and growing Irish healthcare companies. The investment is being made through a specialized US venture capital company which the Government persuaded to set up in Ireland, as part of the investment. Enterprise Ireland and the National Pension Reserve Fund are putting $37.5m (€30m) into a fund that invests in young companies in the life sciences and medical area. That money goes into a company called Sofinnova Ventures, a well-known American healthcare venture capital company, based in San Francisco in California. Sofinnova would set up in Ireland and will invest in Irish life science and healthcare companies. Healthcare is one of the few areas of the economy that has grown, even as the financial crisis has engulfed the country. Asia Pacific UAE: Abu Dhabi to Host Global Healthcare Meet Abu Dhabi in the United Arab Emirates (UAE) will host the 7th International Conference of Al Noor (ICAN) under the patronage of Nahyan Bin Mubarak Al Nahyan, minister for higher education and
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Industry Monitor – Health Care
May 2012
scientific research. The three-day conference titled "Tumors (Oncology) in Healthcare" is expected to be participated by over 350 physicians and technicians from various medical fields relevant to the diagnosis and treatment of tumours of all types from UAE and abroad. The conference will begin March 15. India: Vasan Healthcare receives $100m investment from Singapore’s GIC Vasan Healthcare, which runs a chain of eye and dental clinics, received a $100m funding from the Government of Singapore Investment Corporation (GIC). GIC picked up a minority stake in Vasan Healthcare and thus joined other private equity investors like Sequoia Capital and WestBridge Capital. Vasan Healthcare plans to use the fund to expand its network of 102 eye care hospitals and 14 dental treatment centres through a mix of organic as well as inorganic routes.
Mergers, Acquisitions, and Agreements
Americas USA: Sunpeaks Ventures Completes Acquisition of Healthcare Distribution Specialists LLC Sunpeaks Ventures, Inc. completed the acquisition of Healthcare Distribution Specialists LLC ("HDS"), a value-added distributor of hard-to-find and specialty drugs. In addition to its drug distribution business, HDS also owns and markets Clotamin®, a specialized over-the-counter multivitamin product designed exclusively for use by patients also on Warfarin®, a popular blood thinner that has a long list of known adverse drug and food interactions. Sunpeaks Ventures expects to gain significant traction going forward as the company works to grow awareness of Clotamin and expand role as special purchasing agent and procurement expediter for many distribution customers. In addition, the company is also pleased to announce the engagement of Anslow & Jaclin, LLP as its lead legal counsel. Anslow & Jaclin offers advice and counsel to diverse clients worldwide on unique and sophisticated corporate and securities transactions, reverse mergers, self-filings, PIPEs, corporate finance, and mergers and acquisitions. Europe UK: GE Healthcare to acquire Xcellerex Inc., GE Healthcare, a unit of GE announced today reached an agreement to acquire Xcellerex, Inc. a supplier of innovative manufacturing technologies for the fast-growing biopharmaceutical industry. The acquisition of Xcellerex will allow GE Healthcare to expand its offering of products and services for the manufacture of biopharmaceuticals such as recombinant proteins, antibodies and vaccines. The strong strategic fit between the two companies, combined with expanded capabilities in product development and marketing, will offer significant customer benefits. Xcellerex develops and produces turn-key biomanufacturing systems and production-scale bioreactors based around single-use components. The proprietary products offer significant advantages such as faster installation, lower capital investment, reduced risk of cross-contamination, and significantly increased flexibility compared with traditional manufacturing technologies. Xcellerex’s production-scale single-use bioreactor systems are complementary to GE Healthcare’s products and range of media for cell culture.
Others
Americas USA: Supreme Court to release audio in healthcare cases The U.S. Supreme Court said would release audio recordings and transcripts of oral arguments in the healthcare challenge immediately after the March 26-28 sessions, responding to what it called "extraordinary public interest." The court rejected a request, however, from C-SPAN, endorsed by some members of Congress, to allow video recordings of the arguments. The court long barred cameras from its white marble setting - a practice that has drawn criticism from Congress and media groups. Demand to see arguments in the trio of cases centering on the 2010 Obama-sponsored healthcare overhaul is high. The core of the dispute tests the constitutionality of a provision requiring most people in the United States to buy health insurance by 2014. The courtroom seats a maximum of 400 and most of those seats already are reserved for people associated with the cases or connected to the justices and other court officials.
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Industry Monitor – Health Care
May 2012
INDUSTRY STATISTICS
State-wise Funds Released under Supplementary Nutrition Programme (SNP) in India (Rs. in Billion) 2009-10 2010-11 Released Expenditure Released Expenditure Andhra Pradesh 3.13 5.23 1.60 0.00 Bihar 4.07 9.23 2.55 4.98 Chhattisgarh 0.75 2.13 0.73 1.66 Goa 0.04 0.09 0.04 0.06 Gujarat 0.87 1.85 0.95 1.26 Haryana 0.69 1.46 0.38 0.09 Himachal Pradesh 0.29 0.59 0.17 0.34 Jammu and Kashmir 0.17 0 0.19 0 Jharkhand 1.69 5.32 1.01 1.66 Karnataka 2.63 5.66 1.42 3.26 Kerala 0.75 1.58 0.41 0.73 Madhya Pradesh 2.23 5.20 3.21 5.86 Maharashtra 2.04 4.87 2.04 0 Orissa 1.40 3.22 1.81 3.78 Punjab 0.17 0.24 0.44 0.41 Rajasthan 1.10 3.05 1.07 2.62 Tamil Nadu 1.33 2.66 0.74 1.08 Uttar Pradesh 0.74 17.88 12.25 19.87 Uttarakhand 8.68 0.15 0.13 0.06 West Bengal 1.36 5.51 1.68 2.30 Andaman and Nicobar Islands 0.14 0.05 0.01 0.03 Chandigarh 0.02 0.02 0.01 0.01 Dadra and Nagar Haveli 0.00 0.01 0.01 0 Daman and Diu 0.01 0.01 0.00 0.00 Lakshadweep 0.00 0 0.00 Delhi 0.42 0.69 0.23 0.53 Puducherry 0.01 0.05 0.01 0.03 Arunachal Pradesh 0.09 0.10 0.12 0.28 Assam 1.77 2.99 1.55 1.79 Manipur 0.15 0.24 0.19 0.26 Meghalaya 0.53 0.70 0.28 0.45 Mizoram 0.20 0.25 0.10 0.24 Nagaland 0.27 0.33 0.21 0.21 Sikkim 0.08 0.06 0.03 0.04 Tripura 0.29 0.36 0.18 0.13 India 37.3 81.78 35.76 53.88
Source: India Stat; Cygnus Research
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Industry Monitor – Health Care
May 2012
38
Funds Released under SNP in India
Released (RHS)
37
Expenditure (LHS)
90
Rs bn
36
60
35 2009-10 2010-11
30
Source: India Stat; Cygnus Research
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Rs bn
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Industry Monitor – Health Care
May 2012
PRODUCT FOCUS
Fertility Clinics
Introduction
Fertility clinics are staffed medical clinics that assist couples, and sometimes individuals, who want to become parents but for medical reasons have been unable to achieve this goal through the natural course. Clinics apply a number of diagnosis tests and sometimes very advanced medical treatments to obtain the desired conceptions and pregnancies. Fertility clinics are staffed with highly trained personnel including Reproductive Endocrinologists, Embryologists, Sonographers, and Nurses. Additional specialists from Acupuncture, Hypnotherapy, and Nutrition may also be part of the team.
Diagnosis
In Fertility Clinics both men and women are diagnosed for fertility problems. Diagnosis showed that fertility problems arise 35% of the time from men, 35% from women, 20% from combined issues, and 10% from unexplained causes. For men, semen collection is a standard diagnostic test to ascertain problems with the semen quality. While women may undergo a multitude of tests including an ovulation analysis, x-ray of fallopian tubes and uterus, and laparoscopy. Feasibility of Treating Infertility with ARTs With the advancements in reproductive medicine and the experiences gained through the specialised infertility management clinics a wider range of diagnostic and treatment options become available to the infertile couple. In fact, it is now the issue of affordability which became a deciding factor for most infertile couples. Assisted Reproduction Techniques (ARTs) are proving increasingly effective for the management of many types of male infertility. In fact, the technique of ICSI almost replaced the other treatment modalities. Using this technique, one single spermatozoa recovered from the testes or epididymis, or picked up from the ejaculate of normal or deficient spermatogenesis and regardless of underlying path physiology, is adequate to fertilize the egg. ARTs also proved increasingly effective in treating many types of female infertility. IVF-ET was initially applied successfully in patients with fallopian tube block.
India Experiences ARTs
India is increasingly becoming a hot destination for ART like Intra Uterine Insemination (IUI), In-Vitro Fertilization (IVF), Intracytoplasmic Sperm Injection (ICSI), Percutaneous Epididymal Sperm Aspiration or Extraction and ICSI (PESA, MESA), Testicular Sperm Aspiration or Extraction and ICSI (TESA, TESE). In addition to Indian couples, most of the reputed infertility clinics are attending couples from developed countries and South East Asia. A study by the Confederation of Indian Industry (CII) on medical tourism estimates a business of US$2.3 billion by 2012. ART is one of the most sought after and revenue building services that India has to offer. The cost of IVF, ICSI is about one-fifth to one tenth of the cost as compared to the cost in western countries. People all over the world are choosing India for a number of reasons. The hospitals that offer the latest diagnostic and treatment facilities, availability of experienced and highly qualified doctors, favorable legal support, lower costs, availability of English speaking doctors and care takers are some of the aspects in its favor. Providers of ARTs conveniently used the need for a child, to project this technology as being pro women. Governed by the demand and supply, this field of infertility ‘treatment’ is generating profits through the sale of ARTs. The fertility market issues a price tag to reproductive tissues and then appropriates them in
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Industry Monitor – Health Care
May 2012
order to sell the unfulfilled dream to millions of people, under the rubric of ‘choice’ and ‘rights’. The process of reproduction is systematically pushed out of the personal domain into the commercial through these technologies. Developing countries and the comparatively poorer population within these countries increasingly emerged as ‘suppliers’ of cheap labour (womb) and services (both medical services and egg donation). In a globalised economy with uneven regulation across countries, couples manage to access the services either in their own countries or elsewhere. This led to the super-specialised phenomenon of reproductive tourism across the world. As part of this process, India is slowly turning into the surrogacy outsourcing capital of the world because of the lower costs involved, the lack of regulation in provision of ARTs, prohibition and unavailability of certain procedures in their own countries and minimum waiting periods. The ART industry in India remains, as of now, unchecked by any state rule or law. The lack of political will in regulating these technologies can be linked to the commercial gains being made by the state and the private entrepreneurs through the in-country rapid proliferation of clinics and the cross-country transactions for services, gametes and surrogates. Fertility Clinics Market in India Relaxed regulations and cheap costs made India a hotbed for In Vitro Fertilization (IVF). Couples looking to conceive through artificial means are coming from all over the globe to take advantage of these fertility services. The Indian Society for Assisted Reproduction (ISAR) claims that there are nearly 400 fertility clinics in the country. These were visited by 30,000 patients in the last year. According to some doctors, half of their patients come from overseas. Quality IVF procedures at a clinic in a major city like Mumbai cost about one-third of what they do in the US. Even after airfare, a couple stands to save thousands of dollars. The boom indicates the demand for egg donors, who could earn between US$200 and US$1000 per donation. Medical tourism, in general, is on the rise in India. Elective procedures cost a fraction of the US and Europe and most top Indian doctors who are trained in Western medical schools, are on par with the best American and European surgeons. Because of these factors, India expects medical tourism to account for US$2 billion in revenue by 2012. Medical tourism companies made significant profits from commercial surrogacy by using sophisticated Internet-based strategies to market comprehensive services to prospective fertility patients. Designed to bridge the distance between healthcare consumers in developed countries on the one hand and healthcare providers and surrogates in developing and transitional-economy countries on the other, these services depend on low prices and lack of regulation in India to keep costs and hassles to a minimum.
Outlook
Indian healthcare industry come a long way and witnessed a robust growth in the past few years on the back of increasing healthcare campaign, increasing medical insurance coverage, rising income levels and a rise in medical tourism. India still lags behind in health related infrastructure in the primary healthcare sector, when compared to other developing nations. Indian fertility clinics are increasingly popular in industrialized nations because of the relatively low cost. India is flexible country in terms of treatment and cost which makes it a unanimous destination. Apparently, more than 350 fertility clinics are currently operational in India. There are various reports about surrogacy and fertility regulations being introduced in the near future.
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Industry Monitor – Health Care
May 2012
COMPANY SCAN
Poly Medicure Ltd
Introduction
POLYMED was conceived and established by a group of engineers and technocrats dedicated to the idea of providing the benefits of modern healthcare to the mankind at affordable price. This unique philosophy is the driving force behind the company since its inception in 1995. Today the company has grown into one of the most dynamically versatile manufacturers of disposable healthcare products in the region with over 60 different products. Product Segment of company Infusion Therapy: Infusion therapy is a type of medical treatment in which medication is delivered directly into the body through a blood vessel, the spinal cord, or a muscle. The Infusion Therapy includes major safety products namely Cannulae, flow regulators, extension lines and burette set. Central Venous Access Catheters: A tube surgically placed into a blood vessel for the purpose of giving intravenous fluid and drugs. Major products include single lumen CVC, and catheter mount Anesthesia: Anesthesia is a pharmacologically induced reversible state of amnesia, analgesia, loss of responsiveness, loss of skeletal muscle reflexes and decreased stress response. Major products include Oxygen catheter, Nasocath and Nebulizer mask. Gastroenterology: The branch of medicine deals with the study of disorders affecting the stomach, intestines, and associated organs. Gastroenterologys product line includes Ryle’s tube, Levin’s tube and umbilical catheter. Company’s Performance at a Glance (Rs in m) Net Sales Operating Profit/Loss OPM NPM Depreciation Interest PAT
Source: BSE India; Cygnus Research
2010-11 1696.68 369.68 21.79 12.78 85.88 44.41 216.90
2009-10 1360.05 294.32 21.64 12.08 70.70 41.30 164.30
2008-09 1122.24 178.76 15.93 5.28 64.64 47.67 59.26
2007-08 883.82 177.10 20.04 8.96 55.59 38.28 79.15
Item Debt-Equity Ratio Long Term Debt-Equity Ratio Current Ratio OPM (%) NPM (%) ROCE (%) RONW (%)
Source: Company; Cygnus Research
2010-11
KEY RATIOS 2009-10 0.00 0.00 0.00 21.79 12.78 0.00 0.00
0.62 0.46 1.99 21.64 12.08 30.78 27.66
2008-09 0.78 0.57 1.86 15.93 5.28 29.64 12.78
2007-08 0.85 0.56 1.83 20.04 8.96 10.28 18.90
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Industry Monitor – Health Care
May 2012
Sales Other Income PBIDT Interest PBDT Depreciation PBT TAX PAT
Performance Analysis of Apollo Hospitals Quarterly Performance Financial Year Performance OND11 OND10 Var(%) 2010-11 2009-10 Var(%) 551.80 417.50 32.17 1696.68 1360.05 24.75 1.15 0.83 38.55 3.93 5.29 (25.71) 100.90 87.30 15.58 369.68 294.32 25.60 12.56 11.60 8.28 44.41 41.30 7.53 88.34 75.70 16.70 325.27 253.02 28.56 25.60 23.17 10.49 85.88 70.70 21.47 62.74 52.52 19.46 239.39 182.33 31.29 22.65 4.17 443.17 22.48 18.03 24.68 40.10 48.35 (17.06) 216.90 164.30 32.01
Source: BSE India; Cygnus Research
During the quarter OND11, the company’s sales increased by 32.17%, which was at Rs551.80m when compared to OND10. The other income of the company increased by 38.55%, which stood at 800 Rs1.15m compared to the OND10 of Rs0.83m. 2007-08 2008-09 2009-10 2010-11 Tax for the company increased sharply by 443.17% when compared to the OND10. Net Source: BSE India; Cygnus Research Profit decreased by 17.06% in OND11 as compared to OND10mainly because of higher tax payment by the company.
Common Size Comparison
When compared the Poly medicure ltd with its peers, the other income of the company is low at 0.23% when compared to its peers. The raw material cost is more for Poly medicure, which is 36.80%, where as Lotus registered 17.45%, and Kovai registered 17.76%. Staff expenses are more for lotus when compared to its peers. Other expenditure is high for Lotus when compared to the peer companies. Interest, and PBT are high for the Poly compared to other companies. Tax charges are high for Kovai medicals when compared to Lotus, and for Poly medicure. Net profit is high for Poly Medicure that stood at 12.78% when compared to the other two companies which registered 2.27%, and 6.91% respectively. Common Size Comparison for 2010-11 Poly Lotus Kovai Other Income 0.23 0.98 0.57 Raw materials 36.80 17.45 17.76 Staff Expenses 15.68 30.31 12.98 Other Expenditure 24.35 38.01 6.47 Interest 2.62 0.54 6.35 Depreciation 5.06 13.79 3.79 PBT 14.11 3.54 11.16 Tax 1.32 1.26 4.25 PAT 12.78 2.27 6.91
Source: BSE India; Cygnus Research
© Cygnus Business Consulting & Research Pvt. Ltd., 2012
Rs mn
During 2010-11, the company’s revenue increased by 24.75% as compared to 2009-10. The total revenue of the company reached Rs1696.68m in 2010-11 from Rs1360.05m in 2009-10. The boost in profits was on account of economies achieved due to completion of backward integration project lower forex losses and cost cutting measures taken by the company.
Revenue Performance
1700
10
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Industry Monitor – Health Care
May 2012
Cost Structure Analysis In 2010-11, the interest expenses as percent Cost Structure as Percentage of Net Sales of sales decreased by around 311bps points 2010-11 2009-10 2008-09 2007-08 as compared to 2009-10. Raw material Raw materials 36.80 37.97 39.38 44.98 expenses decreased as compared to the 15.68 15.83 14.65 17.33 previous year. Other expense for the Staff cost 24.35 24.46 29.80 24.84 company in the financial year 2010-11 Other exp. 5.06 5.20 5.76 6.29 decreased by around 127 basis points taking Depreciation the profit margins to the lowest category. As Interest 2.62 3.04 4.25 4.33 compared to the previous year, the company Tax 1.32 1.33 0.64 0.46 is performing well in terms of cost Source: BSE India; Cygnus Research management and earnings. The company has taken cost cutting measures to tackle the slowdown and to perform better against its peers.
Stock Market Performance
Relative Index
115
Shareholding Pattern as on 31st Dec 2011
100 Others, 51.30
85
BSE Sensex Tata Steel
Promoter s, 48.70
70 Mar '11 July'11 May'11 Dec'11 Sep'11 Aug'11 Apr'11 Nov'11 Feb'12 Oct'11 Jan'12 Jun'11
Source: BSE India; Cygnus Research
From March 2011 to February 2012, the BSE Sensex has seen a fall of 9% from the base of 19445.22 points to 17752.68 points. Over the same period, Poly Medicure has seen a fall of 7% from Rs278 to Rs259.90. The company’s share price during the period is showing a declining trend mainly because negative sentiments over the stock and revenue performance. The political stability showed bullish trend in the manufacturing and mining and service sector and launch of some innovative products with increase in demand leads to have growth in the market. The fall in Sensex is mainly because of poor global market performance and negative sentiments prevail in global economy and higher domestic interest rate.
Outlook
The Indian healthcare market is one of the prominent contributors to the country’s gross domestic product (GDP) having attracted large number of players- domestic as well as international during the past few years. Highly qualified doctors and scientists, state-of-the-art technology and low costs helped India to become an attractive global destination for medical tourism, clinical studies, and research and development (R&D) programs. The sector offers massive growth potential and a chance to capitalize on its expansion, especially as the country sees a rise in the incidence of lifestyle-related diseases. A growing elderly population paired with a rise in income levels also emphasizes the need for better facilities in the country. The US$50 billion-a-year health care industry has grown rapidly and is now the second-largest service-sector employer in the country, providing jobs to about 4.5 million people directly or indirectly. The Indian healthcare sector would double its size to US$100 billion by 2015.
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Industry Monitor – Health Care
May 2012
UPCOMING EVENTS
1. Event Date Venue Highlights Indo Health Expo 2012 10 May 2012 - 13 May 2012 Jakarta Convention Center, Jakarta, Indonesia Fitness club & Slimming Center, Fitness Equipment, Alternative Medicine, Aerobic and yoga studio, Bio Technology Product, Health spa & resort health, Health food & Beverage, Health appliances, Medical supplies, Natural ingredients, Organic food & beverages. Krista Media Pratama PT.; Jl. Blandogan no.28 D/G - Jakarta 11220, Indonesia; Tel: +62 21 634 5861; +62 21 634 5862; Fax: +62 21 634 0140 The International Conference on Integrative Medicine 13-15, May 2012 ICC Jerusalem International Convention Center, Jerusalem 91060 Motor System, Movement and Posture Study, Muscular Skeletal Pain, Myofascial Pain Nutrition, Dietary Supplements, Digestive System, Metabolic Diseases; Wellness and Aging, Neurological Disorders, Cognitive Disorders, Memory Disturbance Stress, Sleep Disturbances, Insomnia - Non Organic Origin. The Jerusalem International Conference on Integrative Medicine Secretariat, Ilana Berkowitz; Paragon Conventions; 18, Avenue Louis-Casai; 1209 Geneva, Switzerland; Tel: +41 22 5330948; Fax: +41 22 5802953 E-mail: [email protected]; The 8th Annual World Health Care Congress 23 – 24 May 2012 Dorint Hotel; Amsterdam; The Netherlands Sharing international experiences in the development of sustainable health care systems; Learning lessons from successful integrated care systems in Europe and the USA; The rise of health consumerism and the growing power of the health consumer; Personalised health and predictive medicine; Developing partnerships to improve long term disease prevention; Productivity and efficiency in health care delivery. Patrick Golden; Director of Communications Tel: +1-781-939-2511; Fax: +1 781-939-2526 Email: [email protected]; Web: Worldcongress.com Hospital Build Middle East 2012 4 - 6 Jun 2012 Dubai International Convention & Exhibition CentreDubai, United Arab Emirates Hospital Build Middle East is one of the prestigious trades shows for the health care community. It will build a sustainable and hospital infrastructure and health care development industry. The exhibition will showcase products, solutions and services across all areas of hospital investment, designing, planning, building, operating, managing and refurbishing. IIR Middle East;, Office 301, Sultan Business Centre, Dubai, United Arab Emirates Tel: +971 43365161; Fax: +971 43364021 Cardiostim 2012 13 - 16 Jun 2012 Nice Acropolis Convention Centre; Nice, France As a worldwide scientific congress in the field of electrophysiology and cardiac techniques, Cardiostim gathers more than 5,000 scientists, including the most distinguished ones from all over the world. Reed Expositions France52-54, Quai de Dion-Bouton, CS 80 001, Puteaux, France Tel: +33 1 4756 5084; Fax: +33 1 4756 2455 12
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Industry Monitor – Health Care
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May 2012
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Vietnam Medi-Pharm Expo-Hanoi 22 Aug 2012 - 25 Aug 2012 Tan Binh Exhibition & Convention CenterHo Chi Minh , Vietnam This trade show will explore all the new tools and techniques in medical industry, healthcare and treatment services. It will showcase all the latest techniques which help in generating positive outcomes and provide more security to the patient A's life. VINEXADNo.9 Dinh le Street, Hanoi city, Vietnam Tel: +84 4 3825 5546; Fax: +84 4 3936 3085 Meditec Clinika 2012 7 - 9 Sep 2012 Palace Grounds; Bangalore, Karnataka; India It is the largest platform for the Medical Equipment and technology industry. It will act as a catalyst to bring together a varied genre of medical professionals under one roof to interact, promote and transact business in this industry which will eventually lead to better healthcare for the common man in this densely populated region. Orbitz Exhibitions Private Limited; 202, Navyug Industrial Estate, T. J. Road, Sewree, Mumbai, Maharashtra, India Tel: +91 22 2410 2801; +91 22 2410 2802; Fax: +91 22 2410 2805 Healthex 2012 7 - 9 Sep 2012 Bangalore International Exhibition Centre; Bangalore, Karnataka; India The show presents a complete range of equipment, materials, services, processes, systems, components, consumables which find wide use in medical surgeries, hospitals, clinics, diagnostic centres from across the world. Bangalore International Exhibition Services Pvt. Ltd.10th Mile, Tumkur Road Madavara Post, Bangalore 562 123, Karnataka, India. Tel: +91 80 6583 3234; +91 9972929976; Fax: +91 80 6624 6661 Medtec China 2012 26 - 27 Sep 2012 Shanghai World Expo Exhibition & Convention Center; Shanghai, China For the first time, China's medical device and equipment manufacturers will have access to hundreds of leading medical OEM suppliers from around the globe providing a vast array of equipment, materials & services. UBM Canon11444 W. Olympic Blvd. Los Angeles, California 90064, USA Tel: +1 310 445 4200; Fax: +1 310 445 4299
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