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Home - Market - Article

In Focus

Sharing an Eastward Vision

Medica Synergie's retail pharmacy, project consultancy and hospitals divisions are making inroads into the under-served and untapped healthcare landscape of Eastern India, Rita Dutta finds out

Tales of entrepreneurship always make for fascinating case studies. It becomes all the more enthralling when people from varied geographic locations and experience come together on one platform, share a common vision, chart out an unconventional business plan, nurture their dream for years and then put in their life's savings to fuel their dream. We are taking about Medica Synergie, the Kolkata-based healthcare company, which created a buzz when the group's 500-bed Medica Super Specialty Hospital was inaugurated in Kolkata in April this year. However, unknown to many, Medica has been making inroads into Eastern India's healthcare landscape over the last three years in the verticals of pharmacy retail, project consultancy and hospitals.

Birth of Medica

Dissatisfaction often leads to creation. In 1998, that's what happened with a bunch of colleagues at Dr Devi Shetty's Asia Heart Foundation (AHF). When differences simmered between long-time business partners Dr Shetty and Dr Alok Roy, Vice Chairman, AHF, the latter decided to venture out on his own with some of his colleagues and industry professionals. People who shared Dr Roy's dream and passion were Dr Alexander Kuruvilla, Udayan Lahiri, Sudhanshu Roy, Ayanabh Debgupta, Aruna Nair and Shrabani Basu from AHF, Sanjay Dasgupta (an IAS) and Acchama Joseph (from IT sector). Though the idea of a new company was conceived in 1998, the company was registered by the end of 2003, when Dr Roy finally left AHF.

"As we did not have enough funds in 2003, we decided against working full-time for Medica, immediately. We thought of coming back after saving a substantial amount," recollects Dr Roy. Thus, Dr Roy went and joined Apollo and then Fortis (Delhi), Dr Kuruvilla worked at Apollo Hospitals, Ahmedabad and Debgupta in Muthoot's healthcare venture (Delhi). Lahiri continued with AHF for some time.

Then in 2006, during a family vacation in Bhimtal (in Uttarakhand), this group of five (Dr Roy, Dr Kuruvilla, Sudhanshu Roy, Debgupta and Lahiri) realised that the time was right to give wings to their long-nurtured dream. It was in this sabbatical that the group rolled out its business model- that of foraying into retail pharmacy, hospitals and project consultancy. The underlying mission and vision was to provide healthcare services that were affordable and accessible to all. It zeroed in on the Eastern part of India because of the region's wide lacunae of healthcare services. They decided to operate from Kolkata, where most of them had roots, except for Dr Kuruvilla, who was from Bengaluru. While Sanjay Dasgupta and Acchama Joseph did not join the group for various reasons, Lahiri and Nair left AHF to join Medica.

The Early Days

Once the business plan was finalised, the first task was to garner the working capital. The founders chipped in with Rs 15 crore to start the company, with the bulk coming in from Dr Roy. Eventually, Medica borrowed Rs 45 crore from SBI and Rs 65 crore (so far) from ICICI Ventures for various projects. For the first three months, they worked from Lahiri's home. "It was his child's room, which was converted into an office for us. His wife cooked for us," reminisces Debgupta. In the last few years, they moved office five times to accommodate their expanding work.

In 2006, the first project that the group bagged was that of preparing a health insurance scheme for landless labourers of West Bengal. This was the first project of the projects division. "After devising the Karnataka Yashasvini Health Insurance scheme for rural farmers in AHF, health insurance scheme for landless labourers was an easy one," says Dr Roy. Soon, they approached the Government of West Bengal for land for building Medica Super Specialty Hospital and received permission. "As the work for the hospital was supposed to take time, we took over a brown field project in 2008 and made it into Medica ENT Hospital," says Dr Kuruvilla. This was the genesis of the hospital division of the group.

Now, after four years, the company has already turned EBITDA positive, and is rolling out aggressive growth plans across verticals. "The new projects are funded by a mix of debt and equity," says Dr Roy.

The Hospital Division

The Hospital Planning and Management division provides turnkey design and project management consultancy services to healthcare providers. Says Dr Alexander Kuruvilla, CEO and President, Medica, and the head of the Hospital Division, "The core principles are to provide a cutting edge to the hospital management practice group in the following areas: functionalities of healthcare facilities wherein form always follows function in any design, optimum space utilisation considering future expansion plans, construction of cost-effective infrastructure executed in compliance with pre-planned time lines, environment-friendly energy efficient buildings, patient-friendly designs wherein designs are developed for patients and not for equipment, and designs complying with national and international accreditation."

Besides Medica Super Specialty Hospital and Medica ENT Hospital in Kolkata and Medica North Bengal Clinic (management consultancy) in Siliguri, this division is coming up with its own secondary care hospitals (greenfield projects) in Murshidabad and Asansol in West Bengal, Shillong in Meghalaya and Tinsukhia in Assam. It has done the turnkey design and build project of Sankara Nethralaya at Kolkata, and is also managing the hospital now. It has bagged master planning of three medical colleges and hospitals in Orissa funded by DFID, master planning of seven hospitals in Assam, design review and equipment planning for the medical college and hospital of Vedanta University, Orissa and three in Uttarakhand under the World Bank project, turnkey consultancy for design development and project management services for Metro Blood Bank, Kolkata, preparation of infrastructure expansion plan for Bishnupur sub divisional hospital, West Bengal and preparation for institutional strengthening plan for district hospitals in Assam.

Pharmacy Retail Division

A behaviour change communication roadshow organised in Meghalaya by Medica

The flagship hospital of the group— Medica Super Speciality Hospital

The Rs 36,000-crore pharmacy retail market, growing at an annual rate of 18 per cent, seemed a lucrative sector to explore with the concept of neighbourhood pharmacy. Medica Pharmacy, a subsidiary, offers competitive prices leveraging its strength of bulk purchase and efficient supply chain management, ensuring adherence of crashed timelines for availability just in time. The stores offer drugs, health, beauty, neutraceutical and FMCG products. So far, 58 outlets have been rolled out in West Bengal, Jharkhand and Orissa.

Medica Pharmacy, under its brand name Medica Health Shoppe, undertakes O&M of retail pharmacy outlets in hospitals and nursing homes. It offers technological advantage, efficient supply chain, marketing inputs and best practices with a new look as per its existing chain's interior and branding to operate them in an organised manner and optimise the business potential with excellent customer care. It provides free BP and weight check-up to its patrons at its outlets, also maintaining records and free consulting/counselling. It offers auto refill plan catering to patients with chronic diseases like abnormal blood pressure, diabetes, arthritis, cancer etc. and also to pregnant women who consume medicine for a prolonged period of time. This ensures timely delivery of medicine to the consumers every month without any reminder. Says Anupam Shukla, MD, Medica Pharmacy, "In the next three years, we will roll out 100 pharmacies. We will roll out another 150 outlets in the second phase."

Projects & Consultancy Division

This division has been doing work on reproductive and sexual health, ICD, adolescent health, gender and sexuality, HIV/AIDS, PPP, biomedical waste management, telemedicine and tele-health, health financing and livelihood. Says Ayanabh Debgupta, CEO, Projects Division, "The services offered by the division range from policy formulation, strategic project planning, assistance in project implementation, capacity building, monitoring and evaluation, research health communication, system strengthening, designing of management information systems, to human resource rationalisation, procurement and logistics management, and social marketing."

Some of the key projects developed by them include 'Preparation of State Implementation Plan and District Implementation Plan for ICDS IV' (2007-2013), Bihar, 'Study of Knowledge, Attitudes, Perceptions' in South Africa, preparation of Decentralised District Health Action Plan under National Rural Health Mission in Sikkim, Vaishali and Nalanda District of Bihar, Biomedical Waste Management Strategy in 74 PHCs of Tripura, conducting 'Strengthen State Health Resource Centre' for providing independent Technical Assistance to the Directorate of Health Services and UKHFWS and Evaluation of Sabuj Sangha's Rural Health Training Centre (RHTC), a component of health under 'Model Villages in the Sunderbans Delta' Programme in 2009.

Let's elaborate on some of the projects in Eastern India:

Procurement Audit and Procurement Systems Reform for State Health Societies of Manipur, Mizoram and Nagaland: The overall objective of this audit was to appraise RRC about the contracting, procurement activities and processes being followed by the State Health Societies of Nagaland, Mizoram and Manipur under NRHM for procurement of drugs and equipment during the fiscal years of 2005 to 2009. The audit consisted of a review of related policies, procedures, guidelines and processes, conducting interviews with departmental officials, the examination of procurement and contracting files and a review of the contracting and financial databases and assessment of selected procurements in detail.

Design, Implementation and Monitoring of Biomedical Waste Management Strategy in Tripura: The state health society has entrusted the responsibility of designing a suitable strategy to implement the biomedical waste management practices in 74 PHCs across the state of Tripura. So, Medica had to offer assessment of the prevailing scenario, designing of a Biomedical Waste Strategy in consultation with state officials, training of trainers, medical and paramedical staff of PHCs, procurement and supply of infrastructure, equipment and supplies for 74 PHCs across four districts, recruitment and training of Safai Karmacharis, monitoring of the project, development of monitoring tools and monitoring mechanism and assessment of the change after 15 months.

Preparation of State Implementation Plan and District Implementation Plan for ICDS IV, Bihar: ICDS was initiated in India in 1975 as a pilot programme and has expanded to constitute one of the country's major national development programmes. "However, while the programme is intended to target the needs of the poorest and most undernourished, there is often a mismatch between the programme's intentions and actual implementation and not much has been achieved in 33 years. To address these gaps, the ICDS IV programme was floated. The programme had limited coverage and was targeted at the most poorly performing/vulnerable states and districts. Nineteen districts of Bihar were identified for which a five-year implementation plan was to be developed," says Debgupta.

Developing Comprehensive Behaviour Change Strategy for Meghalaya: The Government of Meghalaya has approached Medica with the task of developing a service oriented behaviour change communication strategy for Reproductive Child Health based on assessment of current status of knowledge, attitude and practices among local people in the rural areas. Therefore, communication research related to key processes and local customs is being undertaken which in turn would enable the development of integrated and comprehensive behaviour change communication material for the state. A complete BCC toolkit will be developed in order to cater to the project objective. Medica Synergie will also be providing initial 'Training of Trainers' at the state level simultaneously. Monitoring and evaluation will form an integral part of the assignment for which Medica Synergie experts will develop carefully thought out methods and tools.

The Road Ahead

While the initial focus has been on Eastern India, the group is slowly picking up projects in other parts, as well. Eyeing the southern market, the group has recently set up an office in Bengaluru. With the healthcare industry witnessing exponential growth, the three legs of Medica can only be expected to power its galloping growth.



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