Markets with Bertie: India's healthcare sector is far from dead. It's thriving

Mint

5 days ago

Recent news that an Indian pharmaceutical company was paid a large sum of money for their research on a new cancer drug made Bertie quite happy. From the looks of it, this could be the first multi-billion novel drug to hit the global market whose foundational research was done by an Indian company. Bertie's exultation was partly from a sense of patriotism but also from having closely seen the founder's sheer tenacity in continuing the expensive research, despite the counsel of every 'market-type' to shelve it, Bertie included.
It was with this sense of enthusiasm that Bertie attended the company's analyst meet. Now that he occupied the higher echelons of fund management hierarchy, attending analyst meets was below his pay grade but our man sees himself as someone whose sleeves are always rolled up. He expected to see only young analysts who would have no memory of the frenzy around patent expiry dates that led to bleary-eyed scrolling on Blackberrys to find out who bagged the coveted first-to-file approval.
More out of habit than hope, Bertie scanned the room for a familiar face and was happy to see an old friend who had covered the sector for over two decades, quietly sitting in the corner. Although he was not a medical doctor, the man was generically referred to as 'doc'; a title collectively conferred on him by the industry in acknowledgement of his prowess with the healthcare sector. Bertie waved and pointed to the bar outside, making a sign of afterwards with his index finger. Doc nodded without losing focus on what the founder was saying.
After the meet, the two gents found a quiet corner and, after catching up on their respective career trajectories, delved into the subject of healthcare sector. In keeping with his perch on the higher branches of the fund management tree, Bertie was familiar only with the top few names in the space and was of the view that nothing exciting was happening there. 'All dead, no?' Bertie ventured, channeling his battle-worn skepticism. 'Domestic market growing single digit and US still under price pressure.'
Doc took a thoughtful pause and said, 'Yes and no'. Bertie sensed that a long discourse was coming up and instinctively looked for a chair. 'What you say about India and US markets is right and that's what matters for the large companies but there is lot of interesting stuff underneath.' Having found a chair, Bertie was now looking for pen and paper which he fished out of the goodie bag that the pharmaceutical company had given.
'See this company for instance' Doc said pointing at the gift bag. 'Innovative drug development; that's got little to do with the current growth in Indian and US markets. There are other companies that are consolidating drug distribution. Diagnostics and hospital companies have their own dynamic as well.' Bertie was busy making a tree diagram, with Doc reeling out company names and their main business lines.
'Then there is the hot space—contract development and manufacturing (CDMO); earlier a Chinese preserve but the changing geopolitical tide is benefiting Indian companies now. Specialized tech companies that support the global healthcare industry—that's another fast-growing space.' By now, Bertie was not able to keep up- his handwriting had become illegible. 'Wow!' is all he could muster. He already had a list of 25 names on his writing pad.
But Doc was not done. 'And we haven't even talked of the big thing.' He paused for effect. 'Launch of generic version of the famous weight-loss drug in over 80 markets in 2026. Even with the price cuts, it will be a multi-billion-dollar opportunity and Indian companies will play a big role there.'
On the ride home, Bertie was excited. He knew that, if ever there was a sector in which rolling up the sleeves gets rewarded, it was healthcare, and our man is determined to do just that.
Bertie is a Mumbai-based fund manager whose compliance department wishes him to cough twice before speaking and then decide not to say it after all.