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Perspective What is your outlook on the diagnostic industry in India? What are the key opportunities and challenges? The Indian diagnostics market is currently valued at about `8000 crore. The market is fragmented and unorganised. The organised sector is about `1000 crore growing at 20 percent per annum. All the macro factors like rising per capita income and growing healthcare awareness are contributing to this growth. The growth in diagnostics is higher than the growth in overall healthcare industry. This is primarily because around 70 percent of the medical decisions are based on diagnostics. There is a rising trend towards evidence based medicine. The key challenges are lack of quality regulation in this space. Today, one does not need any registration or certification of lab testing instruments/processes to start a lab. This has led to proliferation of smaller labs. Many of these labs fall short on quality standards. The second challenge is the market practices adopted by some of the players. The real opportunity in the space is to aggregate and create an organised branded player.

“At Dr Lal PathLabs, service, quality and innovation is a way of life” As the CEO of Dr Lal Path Labs, Dr Om Manchanda has been instrumental in driving the business as well as quality operations of the laboratory. Today, LPL has a strong laboratory network in more than 500 cities serving more than three million patients every year across India In conversation with eHEALTH, Dr Om Manchanda, shares insights into the current industry scenario of diagnostic laboratories in India and Dr Lal Path Labs’ presence in this space


> > March 2011



Please provide a brief background of Dr Lal PathLabs and its reach in India and overseas? Dr Lal PathLabs is India’s leading and most reputed diagnostics chain. Established in 1949, today, the brand has reached the entire length and breadth of India. We have over 60 labs, 1000 centers, and we are present in 500 cities. We serve over 6 million patients every year.We have recently launched Asia’s largest diagnostics laboratory at Rohini, New Delhi. We also receive patient samples for testing from international markets like Nepal, Bangladesh, Sri Lanka, UAE, Saudi Arabia, etc. Which are the major areas that Dr Lal PathLabs is focusing on in the diagnostics segment? We are focusing on high-end tests, where the testing is centralised. The focus in this category of tests is on Molecular Diagnos-

The key challenge is lack of quality regulation in this space. Today, one does not need any certification of lab testing instruments/processes to start a lab tics and the promotion is through doctors. We promote Direct to Consumer –through health camps. We also have an exclusive insurance and corporate segment. What is the level and nature of IT applications in your laboratories? How is it adding value to your business efficiency? IT is at the centre of business operations both at front as well as back end. At front end, patients can download the reports from the web. At back end, all the instruments are bi directionally interfaced with Lab Information Systems thereby providing completely automated operation. It adds value in terms of providing better control in operations and enhanced customer service levels to the patients. What is the share of organised and unorganised laboratories in the diagnostic sector? What is the market share that Dr Lal PathLabs plans to garner in the next 2 years? The organised segment contributes around 13-15 percent of the market. Dr Lal Pathlabs currently has about 25 percent of the value share of this market. We plan to take this upto 30 percent value share in next 3 years. What is the role of accreditation and regulations in the diagnostic sector in India? Please share your perspective on the role of information and communication technologies in these services. There is no mandatory requirement from government and there is no regulation in this industry. Diagnostics is a very technical and precision oriented business, which needs trained hands and minds that are experts and qualified in this area. Dr Lal PathLabs is the most accredited lab

operation in India, which boasts of the best talent in India in pathology/IT and overall in all areas of its business. What is the average technology spends in your company and which areas would you prioritise for future technology investments? We built Rohini as Asia’s largest and most technologically advanced pathlab. This lab has the most advanced infrastructure in India. We invest significant amount of resources in research and development. Our plan is to introduce some other ground breaking IT systems over and above already advanced systems. At Dr Lal PathLabs, service, quality and innovation is a way of life. What are the investments that Dr Lal PathLabs is making and what type of benefits you want to achieve with these steps? We are investing in customer service by making things suited to what customer wants, an outside-inside focus. Customer centrality is basis of our business strategy. We also want to increase the speed, from sample collection to report delivery. The third most important area is convenience – how to make the service delivery convenient to patients and doctors. What is the future growth model of the company? What are the new test facilities Dr Lal PathLabs is bringing in? So far, we have grown organically in this market. The next phase of growth will be based on two pronged strategy of Organic as well as Inorganic route. The business is going to give very sharp focus to newer segments like Hospital Lab Management, Clinical Trials, and Public Private Partnerships (PPP).

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eHEALTH-Mar-2011-[12-13]-At Dr Lal PathLabs,Service,Quality and Innovation is a way of Life-Dr Om Ma