Indian healthcare: From AI beds to remote ICUs, startups are filling India’s healthcare gaps

When racing car engineer Mudit Dandwate nearly lost an uncle to undiagnosed sepsis in an Indian hospital, he made it his mission to improve patient follow-up in this country of 1.4 billion people.

Dandwate, then a consultant to sports car manufacturers such as McLaren, decided to apply his experience with racing cars to health care. He and a fellow engineer began working on a project to use the types of sensors used in Formula 1 cars that can monitor the body’s microvibrations to non-intrusively map health metrics in hospitals.

“We use a lot of sensors, analytics and artificial intelligence to evaluate the condition of a car.” Dandwate, 33, told Bloomberg News in an interview. “And that’s where my background in race car engineering helped me, because we used some of the same methods to develop a sensor-based contactless patient monitoring system.”

Hospitals across India (as in much of the world) are often understaffed and doctors and nurses are overworked, leading to small delays in patient care that can lead to life-threatening complications.

Dozee is one of hundreds of health technology companies seeking to use artificial intelligence and other cutting-edge technologies to fill chronic structural gaps in healthcare delivery in the world’s most populous nation.

From private equity giants like TPG Capital to the investment arms of big pharma companies like Novo Nordisk A/S, investors have bet a combined $3.7 billion on Indian healthcare investments. new companies from 2022, according to data aggregator Tracxn Technologies Ltd. This is half of the $7.4 billion that healthcare technology-focused companies have raised across the Asia Pacific region, according to Tracxn.

Bain & Co. expects healthcare innovation in India to be a $60 billion opportunity by 2028, dominated by pharmaceutical services and health technology.Surviving Covid

Despite the country’s potential, at least 170 Indian healthtech startups have closed since 2023, according to data from Tracxn, when the world emerged from Covid lockdowns. Many of those who survived have seen their valuations drop significantly.

Most startups now see domestic expansion and access to more lucrative foreign markets as the two main avenues to scale their operations and one day become profitable.

The global Covid-19 pandemic and related movement restrictions spawned a wave of healthcare startups seeking to replace in-person interactions with online services, such as online pharmacy PharmEasy. Many of them are now facing valuation cuts as investors gravitate towards companies with a hybrid model aimed at plugging gaps in India’s healthcare infrastructure.

Co-founded by Dandwate in the southern tech hub of Bengaluru in 2015, Dozee is valued at around $150 million. The company uses two sheets of sensors placed under mattresses as an early warning system to detect cardiac, respiratory, sleep and other vital signs.

The sheets capture patient data every second with 98% accuracy, Dandwate says, easing the workload on hospital staff and improving real-time observation.

The company charges fees of more than half a million rupees ($5,947) for integrating its smart beds into a hospital’s administrative software, and its products are used in more than 16,000 beds in about 250 Indian hospitals and 55 others. of the United States.

Having raised $35 million so far, Dozee plans an additional funding round in six months to fund its U.S. expansion, Dandwate said.

This technology-backed healthcare allows people to ensure that “a limited resource of world-class, highly qualified experts is now used more democratically,” said Mohit Bhatnagar, CEO of a venture firm. Peak XV Partnersformerly known as Sequoia Capital India & SEA.

Acute shortage

India has 7.3 doctors per 10,000 inhabitants, compared to a world average of 17.2, according to data from the World Health Organization. This shortage is more serious for specialist doctors, especially in rural areas, where they do not reach the necessary number by 80%.

“Supplier shortages are a global phenomenon,” said Carl Byers, partner at F-Prime Capital, backed by Fidelity Investments. “I think it’s particularly bad in India, especially outside of the first-tier cities.”

Dhruv Joshi and Dileep Raman, two intensive care experts who previously worked at the Cleveland Clinic in the US, moved to India to create Cloudphysician, a company that enables remote monitoring of hospital intensive care units throughout India through its team of approximately 120 doctors and nurses who work from Bangalore.

The company, which raised $10.5 million in June, works with hospitals in 23 Indian states, from Mumbai to the small city of Deogarh in the eastern state of Jharkhand.

Reduce ICU stay

Paramount Hospital, a small 40-bed healthcare facility in North Mumbai, is one of CloudPhysician’s partners. With a five-bed intensive care unit and mostly low- or middle-income patients, Paramount did not have the money to hire full-time critical care specialists, its owner, Utkarsh Angachekar, told Bloomberg News.

Previously, Paramount did not hospitalize “patients beyond a certain level of criticality and let them go to a facility where there was better follow-up,” Angachekar said, recalling the situation when the hospital approached CloudPhysician. “This has now led to a greater level of confidence in consultants dealing with higher levels of criticality at our place,” he said.

The results are clear: the average patient stay in Paramount’s ICU has been reduced to three days from five days last year when not using CloudPhysician.

The combination of India’s infrastructure deficit and a rapidly developing economy means there is no shortage of these types of startups.

Bengaluru-based Qure.ai, which raised $65 million from investors including Merck & Co.’s global health innovation fund in September, uses AI for early diagnosis of conditions such as stroke and lung cancer. TPG-backed Asia Healthcare Holdings has helped treat 1,300 babies in smaller cities through its remote neonatal ICUs.

Becoming profitable

“In India’s case, technology is the reason we can provide cost-effective services to customers at prices they can afford,” said PeakXV’s Bhatnagar. “Over time, technology will lead to better medical outcomes and that’s what will win.”

The founders hope that tens of millions of new Internet users and a rapidly growing middle class will increase their customer base and eventually help them break even. Some, like CloudPhysician and Dozee, are also expanding abroad into higher-wage markets such as the United States and the Middle East to boost their margins while keeping prices low in India.

“You build such a powerful technology that you compete in the global market,” said Ashwin Raguraman, co-founder of Bharat Innovation Fund.