“We were the pioneers for online diagnostics in the country”

Founded in February 2015, the Healthians.com based out of Delhi-NCR is fast emerging as one of North India’s largest online health diagnostic services provider. The brand is presently targeting patients in the 25 to 55 age bracket, living a sedentary lifestyle. In an exclusive interaction with the BioVoice News, Mr Deepak Sahni, Founder and CEO of Healthians.com shared his views on the company’s operations, challenges, opportunities and much more

What was the idea behind founding Healthians and the journey so far?

The idea of home-based pathology testing crystallised in April 2014, after my 14-year exposure (direct and indirect) to healthcare services. In 2006-08 in my personal capacity, I had represented India in the USA, pitching the country as an ideal medical tourism destination. An association was created, and I helped individual hospitals set up their international patient departments, and in making a sound digital presence. It is during this period that I realised that unlike the US hospitals, Indian hospitals do not offer alternative therapies to their patients and have a single business-focused approach. All research, marketing and solutions are focused on the sick or the ‘sickness industry’ and post-disease phase, wherein the cost, efforts and stress involved are way too high. By 2013, I had a clear vision to focus on a patient-centric activity to fill a major gap in healthcare activities in our country.

The first contact point of the disease and wellness industry is diagnosis and this became our patient-centric area of focus. Currently, this business is driven by doctors and is commission-based (50-60 per cent). This cost burden is very conveniently shifted onto patients. A breakthrough was required and hence, Healthians came into being in 2014. We directly go to the patients saving them up to 50% compared to the traditional route. Also, we have kick-started the informed wellness market in India where we not only cater to people who are unwell but also to young people whom we inspire and educate to measure their health with accurate diagnostics and support them in altering their lifestyles.

How is the Healthians different from the competition?

There are many start-ups in healthcare but our path is different and is a result of deep understanding and experience of the industry. Our tech-led, asset-light business and deeply integrated model is our greatest strength. We control end to end process, and are not concerned with just the booking of a test like the aggregators and marketplaces, but make sure that the customer’s complete experience right form booking to report delivery is pleasant. We have our own sample collector team which is highly trained and the complete process from sample collection to delivery of reports is controlled by technology. With our App, this process becomes seamless for customers.

We definitely have an early mover advantage and have been able to evolve the business on our capabilities of assuring high quality, reliable, fast diagnostic services at 50% lower cost than the market. There are many diagnostic aggregators and marketplaces, but Healthians is the only online company that controls the end to end process, guaranteeing quality and accuracy to each of its customers. We are also technologically ahead of most of them.

What has been the major challenges that you have faced as diagnostics service provider?

We were the pioneers for online diagnostics in the country. Being the first mover, the first and foremost challenge was to demonstrate there is a demand.  We faced twelve rejections from investors before we raised our first funding as there was no other precedent.

Second challenge was figuring out the business model. We started out as a pure market-place for diagnostics but soon realized that the lab partners, including the best known names are not equipped to provide reliable and quality service. The business is very complex and there are numerous places where corners are cut leaving the customer dissatisfied.

We pivoted to our current model to provide high reliability and accuracy. Not only is the entire highly trained sample collection staff, our own, we also deeply integrate with labs using technology and we ensure accuracy by controlling quality at 250 points within the lab and 50 additional points in the sample collection and testing process.

Third challenge has been scaling with minimum addition to manpower costs. We have spent a lot of time in automating our entire back-end processes to ensure the experience is as smooth and the requirement for manpower during scaling is minimized. For this, we had to map out the myriad number of complex operational flows and hard code them with technology.

How much of your customers are in the rural areas as against the cities? How are you trying to reach out?

Currently, we cater to Delhi NCR region covering Delhi, Noida, Greater Noida, Gurgaon, Ghaziabad and Faridabad.

How is Healthians doing in terms of revenue and the response from the customer base? What are your immediate and long-term goals?

We have done 7x growth in revenues during FY 16-17 and tracking to further growth of 4x in revenues during FY 17-18 while 95% of the revenues still are from Delhi NCR. Having set stable operations in Delhi/NCR, the company plans to expand to the other major cities including Mumbai, Bengaluru, along with expanding to five identified Tier II cities by end of FY 17-18. The company aims to add over 200 labs and over 3,000 phlebotomists across 30 cities by the end of 2019.

We would like to increase our base to 1 million customers in Delhi NCR in next 6-8 months and would be doing over 3,00,000 booking every month by end of next financial year.

What is the current market size of Indian medical diagnostics industry and which are the growth drivers for the sector?

The diagnostics market in 2014 stood at around $5 billion, wherein pathology was 70% and radiology was 30%. Our estimate is that overall market growth would be 15-17% and pathology testing would be growing at 20-22%. By that logic, today the overall market would be $8 Billion and pathology testing would be close to $6 billion. Home-based testing does not have any significant share, but is a rapidly expanding segment.

We estimate the market size to double in 5-6 years. India’s medical spend is approximately $160 billion, out of which 50% is spent on curing and managing lifestyle diseases. With rising awareness about preventive health, the necessity of regular monitoring of various health parameters and cost and convenience benefits, it is a no-brainer that a major section of this expenditure will get onboarded to our segment model. Market expansion will also be triggered by comprehensive testing. Hence, when the share of pathology testing reaches $10 billion, we see home-based testing at 15-20% of that market.

How do you view the latest R&D trends in the medical diagnostics?

With the way market is evolving and concepts of preventive healthcare and monitoring gaining importance, the sector will continue to grow much faster in next 5-10 years. The gap between innovation globally and it’s availability in India is fast closing and the credit goes to growing demands and need for R&D. There is already a lot happening in Cancer diagnostics in India. Alongside technology is going to play a major role with machines doing their own work, a lot will change when artificial intelligence using clinical and IT algorithm is going to be used while making final diagnosis. The partnerships between technology enabled companies, diagnostic companies and pharma companies is creating an ecosystems that enables meaningful R&D.