India’s medical process outsourcing (MPO) segment has benefited from an evolved medical education system and its established prowess as a hub for outsourcing and can grow further given a favourable and stable regulatory environment and increased transparency.
A study, ‘Medical Process Outsourcing in India’ by Assocham and EY (Ernst & Young), said India’s MPO segment was currently estimated at $3.3-4.2 billion of which the pharmaceutical outsourcing market (excluding contract manufacturing services) accounted for about 75 per cent at $2.5-3.1 billion. The payer outsourcing market constituted $700-900 million and the remaining accounted for by the provider market.
“India has emerged as the second largest destination after the US in the healthcare outsourcing space,” Milan Sheth, partner and Technology Industry leader, EY India, said. “The growing ability of Indian players to analyze big data, discover hidden patterns and unknown correlations are driving new service offerings in the market.”
The report said domestic players gradually moved up the value chain in terms of service offerings while maintaining their cost competitiveness. Besides, the recent U.S. regulation on Patient Protection and Affordable Care Act (PPACA) and the proposed introduction of ICD-10 standards gave an impetus to the Indian MPO market.
These factors would see the payer BPO market grow at about 10 per cent per annum in the next 3-4 years globally, the provider outsourcing at more than 30 per cent during 2011-16, and the Contract Research Organizations (CROs) market at 18-20 per cent in coming years, it said.
The domestic demand for MPOs was fuelled by rising demand for high-end healthcare facilities and multi-specialty hospitals, established medical and central lab infrastructure and training centres, which contributed to the growth of healthcare and life-sciences industry. The Assocham-EY study said that in order to fuel growth in MPO sector, the government should focus on implementing data privacy laws and introducing proper regulations around intellectual property (IP) and patent laws.
