• Opportunities

According to 2009 statistics by Global Health Observatory, WHO India’s total expenditure on health as a percentage of GDP stood at 4.2 percent. This figure ranks low not only when compared to developed countries globally, but BRIC nations too and has led to severe public health issues. While 70 percent of our population lives in rural India, struck by its own set of challenges vis-a-vis infrastructure, changing patterns in lifestyle of urban Indians has increased the incidence of cardio-vascular diseases, diabetes and cancer particularly. Access and delivery of healthcare information is a major catalyst here which could otherwise empower and have positive outcomes on people’s lives.
Anurag Dubey, Industry Manager, Healthcare Delivery and Healthcare IT at Frost and Sullivan, assigns this gap in the market to an over-dependency by Indians on health providers, in both rural and urban settings. Despite having access to media, internet and mobile phones, urban populace aren’t proactive enough to gather information on diseases or preventive measures and their first interaction with doctors occurs only when ill. “In rural areas, apart from television, internet is not accessible and unless healthcare providers do something to get information to them, the gap will still exist,” highlights Dubey. Also, healthcare infrastructure in rural areas is limited to small hospitals or clinics, only for primary and secondary care, and not tertiary, unlike urban centers where hospitals conduct camps and awareness programs.
Estimates from a ‘Big Four’ 2011 Report [name undisclosed] on emerging trends in healthcare says that 74 percent of graduate doctors are concentrated in urban settlements which is only one-fourth the population. Government’s initiatives, therefore, are the only services reaching poor population through primary healthcare centers. “Government faces a shortage of manpower and involves NGOs and health workers to educate people on basic hygiene and other diseases,” explains Dubey. Grassroot level health workers also collate data on information present in each region, which is sent to government bodies. “Based on the disease surveillance they decide on new programs, depending on budgets for healthcare services,” he adds. According to Frost and Sullivan, the Indian government spends Rs.4,900 per capita [per person], per year on health, compared to BRIC nations that spend Rs.9,800-Rs.14,700 a year on a per capita basis while developed nations spend about Rs.19,600. “Government’s focus has been on infrastructure needed to be developed at the lowest level, but the kind of services required around it is currently lacking,” says Dubey. “Government mandates to MBBS graduates to work in villages for two years, also has had no real impact,” he adds. Concurrently, the doctor-patient ratio in India today stands at six  physicians per 10,000 population, on an average, while the number of beds is 0.9 per 1,000 population. “Keeping in mind these factors there’s an opportunity for private players to provide healthcare information,” states Dubey, in addition to the fact that most efforts in tier II and III cities so far have been by private sector as well. “Private sector provides 70-75 percent of total healthcare in the country and the balance is provided by government,” he says.

For Social Causes: Nandu Madhava, CEO, mDhil

Cashing in is IIT Kanpur graduate Kunal Sinha who sold his IT firm Tech Unified to launch Healthcare Magic in February 2008 (self-funded Rs.46 lakh as seed capital, subsequently funded by Accel in 2009 for an undisclosed sum), a website connecting doctors with patients 24/7, along with five co-founders. Business reasons were two-fold: scale and convenience. “Everyone falls sick, at least twice a year and often patients aren’t driven to meet a doctor, though they wouldn’t mind speaking to one for peace of mind,” says Sinha, Founder and CEO, Healthcare Magic. Metros, he observed, have a large migrant population propelled by a spurt in job opportunities, thereby creating a hidden need. “Not everyone has a family doctor, nor are doctors available easily,” he points out. Alongside, access to top doctors is difficult because of a huge load on the system apart from being a time-consuming activity for patients given bad traffic, distances and fast-paced lifestyle. These factors, plus growing internet penetration not only in metros but tier II and III cities too, and low entry barriers in the healthcare industry gave him a viable business model. “There are no super specialists available in tier III cities; accessibility is a factor here,” he points. “The nearest specialist will be based in next big town.”
Healthcare Magic’s focus is clear and it’s not a substitute for a doctor. It simply aims at helping patients know their case better. “We are just complementing what doctors do, to give patients educated information on their case,” reiterates Sinha. His findings on the lack of healthcare information in India came from perspective of both doctors and patients. On the latter, he mentioned people are intimidated when meeting top doctors at big hospitals. Long queue of patients gives them limited time too. “People just end up getting prescriptions and can’t get peripheral questions answered,” he says. Healthcare Magic thus deems to be the system providing more information to a patient either before meeting a specialist or after. Thanks to the power of the internet, the startup began getting queries from patients outside India (60 percent of traffic today), by default, and currently has a network of doctors across the globe as well: over 2,000 registered domestic doctors/specialists and 300 from overseas with the U.K., the U.S., Australia and Pakistan as major contributors. “When a patient asks a question, a doctor anywhere in world can answer it,” states Sinha.
From a doctor’s point of view, they seemed to get several cases which could’ve been handled at a primary level, thereby putting a load on them. In metros, he says, there’s a trend for people to visit only specialists and quite often patients from smaller towns travel here for simple cases. “The mind-set is that big cities have better solutions,” notes Sinha. Overall, most patients aren’t well informed about their condition, and even if they can afford visiting doctors, it takes away quality time from serious patients. To get the portal up and active was a chicken and egg situation and so founders opted to provide free services to patients for 12 months while they paid doctors from own pockets. “No one was comfortable taking a medicine recommended by a doctor over net, but comfortable to get answers,” he recalls. Since the startup wasn’t aiming to be a treatment company, but a provider of information, it worked well. Healthcare Magic today has 60,000-70,000 visitors who visit the portal daily for its content and 400-500 health queries to doctors are asked per day on the back of a 4-lakh registered user base. “You don’t need registration on our site, so not a specific indication,” he points out.
Patients are promised answers within 24 hours and are charged between Rs.150-Rs.600 per case with an allowance of two to three free follow up questions. The startup’s revenue model works on revenue sharing, taking a percentage of doctor’s fee. So far it gets an even mix of users from across India with the only exception of higher ratio of female-related cases, which is 60:40. “65-70 percent people come for first opinion, balance for questions to corroborate with a specialist,” observes Sonal Verma, Head of Medical Content, Healthcare Magic. “Kind of questions received were far more intricate, going by initial expectations,” she adds.
“Technology is the answer to provide healthcare information,” says Dubey who refers to tele-medicine initiatives by major private hospitals. These, he says, have been used for marketing and reaching out to patients in small towns and villages only. “Government has 500 tele-medicine centres across 400-500 districts,” says Dubey, adding there have been no successful business models in PPP owing to challenges around last mile connectivity, and power shortages in rural areas.
Harvard graduate Nandu Madhava’s decision to come back to India and run his own venture with a definite social impact was largely propelled by factors affecting health scenario in India too. He launched mDhil in 2009, a firm providing basic healthcare information to the Indian consumer via text messaging, web browser and digital video. “We chose mobiles as they have a higher penetration in India coupled with the move to faster data networks like 3G,” says Madhava, CEO, mDhil. While researching perception of risks around diabetes in low income groups, Madhava’s interaction with a certain Tamilian gentleman in Chennai was a general indicator of low-level of information among most, especially on the preventive side. “Though his father died from heart disease and mother from diabetes, his lunch consisted of heaps of rice drowned in ghee followed by a pack of cigarettes,” quips Madhava. When questioned on his risk to diabetes, Madhava was met with a predictable response. “God will determine.” Once they presented reasons that put him at a higher risk, this mid-40-yearold man sat back to think.
Another big takeaway was that people assumed infant mortality, HIV and the like only affected bottom of pyramid. “While it does affect them in a big way, these problems among others affect people across the pyramid,” says Madhava. Awareness on taboo topics like family planning, sexual health, birth control was even scarce. “Parents don’t talk to children about it and doctors highlighted the abuse of morning after pills by girls not realizing the side effects, only because they don’t know of other birth control techniques,” he adds. “With a population of 1.2 billion we’ve got the reproduction part right, but need the information around it,” retorts Madhava.
mDhil’s content broadly focuses on sexual and reproductive health, women’s health, diet and nutrition. “Diabetes and cardio vascular diseases are growing at 8-11 percent annually,” points Dubey.
“In India, if you look at data usage to be downloaded, the growth is not linear but exponential,” cites Madhava. “That enables all sorts of different businesses.” When mDhil began operations they worked with carriers, Airtel being the biggest partner till date. “I question even how much longer carriers will have a hold on the system with 3G, it creates an easy way to reach markets and we can’t change the wave that’s happening,” he states. Currently, its text messages reach 3 lakh subscribers across carriers. Its views per day for health videos has grown from 40 in January 2011 to 4000 in October 2011 with 35 percent of video views taking place on mobile phones and 75 percent of all video traffic from India and regional countries.

Dubey cites wellness services as an opportunity for entrepreneurs in this space to include prevention programs. Wellness services market (including products, retail) has picked up growth in last five years. “However, any business must start in urban areas so entrepreneurs understand the challenges ahead and develop models which can penetrate into smaller towns to meet unmet needs,” says Dubey.
For sake of sustainability and additional revenue channels both mDhil and Healthcare Magic have B2B verticals. The online portal has 23 corporate clients who provide this service free to staff. The value for corporates is statistical data on health conditions affecting employees and health and wellness index for employees. Likewise, mDhil has a partnership with pharmaceutical giant Biocon for a diabetic drug, Insugen. All diabetics using this drug now get 30 days of SMS content on diabetes through a health card that captures all personal medical records.
Looking ahead, Healthcare Magic hopes to increase its network of doctors to 10,000 in the next two years and also connect patients with doctors offline while mDhil will be foraying into video content in Hindi by end of the year.
Optimistic on mobiles as a channel to disseminate information, especially to lower level of pyramid, Dubey concludes saying: “Firms needs to develop a business model to sustain themselves here and that is the tough part.”

Tags:
Frost and Sullivan, Global Health Observatory, HEALTHCARE