Smooth Business Operation in India is No Easy Task

drug distributor in india, india drug distribution

By Ames Gross, President and Founder of Pacific Bridge Medical

This blog post was also published on MedTech Intelligence.

India’s medical device market is valued at $4 billion, which makes it much smaller than the Chinese and Japanese markets, but bigger than all of the other individual Asian device markets. India’s large middle class is demanding better healthcare, which is fueling medical device growth. A more affluent Indian population is also contributing to an increased incidence of Western diseases such as cancer, heart disease and stroke. These factors are pushing the Indian healthcare system to find better technology to upgrade its hospitals and clinics. For foreign device companies, selling products to India now makes sense.

India is also becoming a good place to source some low-tech medical devices and components at reasonable prices. While China has been the largest low-tech disposable device manufacturer over the last 15 years, prices in China have dramatically increased. As a result, I’ve been helping several Western device companies find factories and products in India where lower prices and steadily improving quality are making the country a more appealing location for sourcing.

While the quality of India’s healthcare is improving, the overall care in the public hospital system is still poor. Patients who go to a hospital will find crowded rooms, poor sanitary conditions and low quality services.  However, wealthier patients can use premier hospital services such as the Apollo hospital chain, which operates 9,200 beds across 64 hospitals. In contrast to most public Indian hospitals, the Apollo hospital chain meets Western health standards, has state-of-the-art devices, and often employs Western-trained Indian doctors.

In order for Western device manufacturers to succeed in India, patience and a better understanding of the Indian culture and regulatory environment are necessary.

For example, a number of years ago I visited India and set up meetings with distributors in both Mumbai and Delhi to represent my clients’ device products there. Unfortunately, the day before I left, I had to cancel my trip to Mumbai.  Upon learning that I would only be traveling to Delhi, I quickly sent out messages to the people I was scheduled to meet in Mumbai and said I had to postpone my trip. While I was attending my scheduled meetings in Delhi, I began receiving calls and messages from the Mumbai distributors who had decided on their own to travel to Delhi to meet me. I had a tight schedule with the previously scheduled Delhi meetings, and had to cut them in half to accommodate the Mumbai distributors who had unexpectedly made the trip to meet with me. This situation seemed a bit strange at the time, but the Mumbai distributors knew I was handling some clients’ devices, and they wanted to have a chance to distribute these products too. During this business trip, I discovered that Indians can be quite aggressive in business and, in this case, were prepared to fly on their own dime to another city to meet with me for only 30 minutes.

In another incident that occurred several years ago, a Western device company asked for help in setting up a manufacturing operation in India. They were making a type of catheter that had a liquid component. The company’s new factory in India was only set up for export. In the United States, the catheter was classified and registered as a device, and the liquid component did not need registration. However, the rules and regulations in India are often unclear and complex.  This was also the case with the new device factory, which had to adhere to several manufacturing regulations.

After the factory was built, the Western device company was preparing to send over its raw materials and liquid component. At the last moment, they suddenly learned that the device factory they had built also required that the imported liquid component meet local Indian drug requirements. This was a nuance that the Western company had not anticipated since the liquid component did not need approval in the United States. As a result, the company had to knock down some existing walls to make their new facility drug-compliant. This oversight delayed final manufacturing and export by an additional year.

As demonstrated by my experiences, the Indian culture and way of doing business are unique. To succeed in India you need to keep the above points in mind. In addition, be careful to study the local device regulations closely in order to ensure that your business meets appropriate Indian laws.