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Frost & Sullivan Market Insight Published: 2 Dec 2004

The Indian Wound Care Market: A Review.

Date Published: 2 Dec 2004

By Vanita Khetan

Introduction to Healthcare in India

Healthcare in India is typical to that of any developing country, characterized by

combination of public-private, advanced-rudimentary and accessible-unavailable
oxymorons.

High rural-urban ratio, innumerable geo-socio-cultural variables, high economic

dependence on the monsoon, deficient infrastructure and of course core
development issues like poverty, illiteracy and nutrition, characterize the Indian
fabric. However, rapid urbanization, positive consumer outlook, increase in foreign
exchange reserves do not bring significant panacea for Indian business.

Within healthcare, the national indicators mask the immense disparities. The
combined investment in health by the Centre and State governments is just 1.3
percent of GDP. Reimbursement is negligible, though privatization of the insurance
sector has helped.

Figure below numerates the Supply Side and Demand side issues being faced in the
Indian Healthcare Scenario
SUPPLY SIDE ISSUES
1. Prevalence and prioritization of
basic health problems in
reproductive health, immunization
and communicable diseases leaves
little room for else;
2. Vast diversities in demography,
geography, weather, culture and
economy making conflicting
health-related demands, making
monitoring, planning,
implementation of concerted
programs a daunting task;
3. Non-uniform supply of manpower
/ services / facilities / equipment /
drugs;
4. Lack of financial muscle for R&D 5. Lack of consumer and health
investment in both public & private
sectors
5. Non-availability of cost-effective
high-technology quality health
solutions
DEMAND SIDE ISSUES
1. Sub-optimal functioning of the
system
2. Both accessibility and usage of
services being the worst in critical
areas.
3. Increasing plurality in disease
burden (communicable and
non-communicable diseases) as a
result of ongoing demographic,
lifestyle, and environmental
transitions.
4. Ever-widening gap between
availability and affordability due to
complete lack of social security and
inadequate coverage by insurance.
awareness
6. Rife use of alternative medicine
techniques, especially in rural /
illiterate settings
Source: Frost & Sullivan

India’s 16,000 hospitals house over 900,000 beds, but 60% of these are in the public
sector. This, at best, is inadequate and not maintained. The private healthcare sector
is booming, even in the smaller towns, due to, or maybe leading to, increase in
quackery and alternative medicine. Health surveillance, tracking & record-keeping
loses out to basic priorities in healthcare.

Most among the populace have minimal accessibility or affordability for even basic
healthcare. Low purchasing power, combined with low health protection, makes the
Indian customer extremely price-sensitive. The doctors’ choice of products depends
on the economic status of the patient. This patient has extremely low awareness
about advancements in therapy or quality. Hence, usage of advanced techniques &
products is very limited.

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The Indian Wound Care Market: A Review. http://www.frost.com/prod/servlet/market-insight-print.pag?docid=28934022

The Indian Wound Care market

This Rs. 521 crore market is a typical competitive market – products are available
across a wide range of quality and price points.

The traditional wound care segment is the Goliath in Indian Wound care, what with
products like cotton & gauze still ruling the roost. Swabs & dressings, and tapes
make up the rest of it.

The Medical bandages & plaster segments has mostly orthopedic products like crepe
& elastic adhesive bandages, and immobility products.

In a stark contrast to developed markets, the smallest segment in the Indian Wound
care market is advanced wound care, consisting of high-technology products like
hydrocolloid, hydrogel, alginate, foam, film & tulle dressings among other scar /
burn management products.

There are a handful of organized companies in this market, namely 3M, Beiersdorf,
Casil Health Products, Johnson & Johnson, Elder-Hartmann and Smith & Nephew.

All the other international brands (Coloplast, Convatec, Hollister, Lohmann &
Rauscher and Molnlycke) are present indirectly, through large wholesalers. More
players are entering the market through this route in the next few years.

But they are trounced hands down by the unorganized sector in both numbers as
well as value. In fact, some of the unorganized players have a very significant
presence in most of the traditional wound care & medical bandages segments.

The primary methods of sales are to hospitals through the wholesaler-stockist

channel, or through institutional business. Promotion is primarily done only by the
large players to doctors and purchase officers.

Moist wound care is not a well-known concept in India. The few doctors who are
aware about it know it either by virtue of traveling abroad or by updating
themselves with the latest. Advanced wound care products have a perception of
high cost-low benefit products, and hence the use of traditional products like cotton
and gauze is rampant. Counterfeit and local substitutes are easily available and
there is continuous downward pressure on pricing. This further drives down the
usage of advanced wound care products towards traditional wound care. However,
the market scenario is changing, with increasing realization of the value of advanced
wound care. For instance, already most of the hand-made plaster bandages have
now been replaced with ready-to-use POP bandages. In fact, in many settings, even
those are getting substituted with artificial casts.

Conclusion
The advanced wound care market in India definitely has many mountains to climb
before it can overtake the huge traditional wound care market, as in developed
countries. Vendors will need to educate the medical fraternity to make inroads. But
only a reimbursement system can bring about the penetration levels seen in
developed economies, and that, is unexpected in the foreseeable future.

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