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Diagnostic chains plan expansion

The companies are also spreading their footprints in overseas markets and have also chalked out plans to tap the lucrative medical process outsourcing market.

SRL Ranbaxy is planning to double both its diagnostic centres and collection centres within a year. SRL Ranbaxy CEO Sanjeev Chaudhry told ET, “The company will increase the number of diagnostic centres to 40 from 20 and collection centres to 1,200 from 600 within a year. We will invest between Rs 50-60 crore for the expansion.”

In addition, the company is also looking at acquiring standalone laboratories across the country. “We are evaluating five standalone laboratories. The centres should match the standards of our laboratories and the acquisition would be in the range of Rs 2-20 crore,” Chaudhry added. The market size of the diagnostic is estimated to be around Rs 6,500 crore, which includes Rs2,500 radiology market, growing at 15-20 per cent.

Dr Lal Pathlabs plans to have increase it network to 50 laboratories from the current 25 by March 2009, and more than double the number of collection centres to touch 1,000 over the next five years the existing 450 centres. In addition, the company’s 65,000 sq ft laboratory in the capital is expected to be operational by 2008.

Metropolis Health Service is planning to raise Rs 100 crore for its expansion plans in India and overseas markets. The company is starting its operations in the US and Thailand by the end of the year and increasing its international presence in seven countries. In the domestic market, it is scaling up its collection centres to 700 from 400 in the next two years and add 10-15 diagnostic centres to its 46 laboratories.

All domestic chains are aggressively pursuing the lucrative medical process outsourcing market. They have conducted pilot tests and have already tied up with US companies or are in talks for strategic tie-ups to source samples from the US. Metropolis MD GSK Velu said, “Having an laboratory in the US shows our capabilities and accountability to our clients and insurance companies in the US.” International players have also joined the bandwagon with UK-based diagnostic chain Quest Diagnostic reportedly foraying in the Indian market while other Asian players are learnt to have expressed similar interest.

However, these companies say shortage of medical technicians who can be immediately absorbed is proving to be a bottleneck in their expansion plans. Most of them train freshers for about a year in their clinical laboratories as ‘observers or trainees’ because they are not trained in the latest equipment during their academic courses .