30-Minute Interview

'We are Building Cancer Centres in Tier II Cities'

Krishna Institute of Medical Sciences (KIMS) in Hyderabad was founded in January 2004 with 150 beds. Today, this 200-bed hospital with a turnover of Rs 200 crore, is slated to become a national player with a slew of oncology centres. Dr Bhaskar Rao, MD & CEO, KIMS, speaks to Rita Dutta about the group's expansion plans and the reasons to focus on cancer. Excerpts:

Dr Bhaskar Rao MD & CEO, KIMS, Hyderabad

Please brief me about the second hospital that you have planned in Hyderabad.

That would be a 200 to 250 bed hospital at Madhopur in Hi-tech city, which is 15 kilometres away from our current hospital at Minister Road. The total area of the project would be 2,50,000 square feet and cost of the project is estimated to be Rs 200 crore, partly funded by promoter and debt. We are yet to start construction of the project. Our current hospital would continue to be the flagship hospital of the group.

What expansion plan do you have for the flagship hospital?

From the current 300 beds, we are expanding to become 500 beds by October, this year. Another 400 beds would be added by January 2012, making KIMS a 900-bed hospital. The additional 300 beds to be added in a few months time would be utilised for adding on oncology unit providing medical, surgical and radiation oncology. The radiation oncology department would have three linear accelerators, brachytherapy, IMRT and IGRT. We would also be offering stereo tactic surgery. We also plan to start full-fledged programme for transplantations of liver, pancreas, bone marrow and stem cell. As of now, we are doing only kidney transplantations.

You are keen on setting up centres providing oncology facility in tier II and tier III cities. Why did you choose to focus on oncology?

It is estimated that there are approximately 2 - 2.5 million cases of cancer in the country at any given time. Nearly 800,000 cases were diagnosed in the year 2000 and 550,000 deaths due to cancer occurred in the Indian population. The tobacco-related cancers account for almost a third of cancers diagnosed in head and neck, lung and oesophagus in the Indian population. The two most common cancers of women viz. cancer of the cervix and breast further account for half the cancer burden in Indian women. The heavy cancer toll is due to the fact that 70 per cent present in the clinically advanced stages T3-T4 with catastrophic economic impact.

Cancer centers are coming up in metropolitan areas. However, cancer is equally prevalent in small towns and rural areas. In fact, India has among the world's most prevalent incidence of mouth and tongue cancer. This cancer is killing people in small towns and villages because of the limited availability of specialists and medical technologies. Low awareness is another important factor and leads to non-recognition of disease even when symptoms are present. I have observed that people put off their diagnosis and sometimes treatment because it's too expensive for them to travel to metropolitan clinics that have the needed technology and capabilities. People often come for diagnosis when the cancer is in stage III or IV when treatment is ineffective and the disease is irreversible. Thus, I chose to focus on oncology. These centres, spread over around 1,00,000 square feet, would also offer diagnostic facilities in cardiology and neurology.

When and where are the centres coming up?

The initial plan is to roll out 10 to 12 'see and treat' oncology centers with an investment of Rs 200 crore. The first two centres are coming up in Vishakapatnam and Vijaywada in Andhra Pradesh by January, 2010. The one is Vishakapatnam is at our own hospital and the one is Vizag would be a greenfield project. We are focusing on AP first as it would be easier for us to plan and commission centres there. The other targeted areas are Bhubaneswar in Orissa, Thrissur in Kerala, Pune and Nagpur in Maharashtra, Raipur and Indore in Madhya Pradesh, Ahmedabad in Gujarat, Coimbatore and Chennai, Tamil Nadu and Patna, Bihar. We are still looking for areas for these centres.

What would be the cost of the project and what is the nature of the funding?

We would spend Rs 200 crore on technology. It would be funded by a mix of debt and equity. There is no private equity player involved.

Are you looking only at greenfields? Then the project cost would shoot up.

We are looking at greenfield and brown field, spending Rs 2,000 per square feet.

What kind of diagnostic and treatment facilities would be offered in these centres? What is the tie-up that you have with GE and Variant for that?

The proposed network of centers will have one advanced GE Discovery PET/CT Molecular Imaging Systems each for detecting the disease at its earliest possible stage and three centrally located cyclotrons for producing FDG bio-markers required for the disease detection. Several of these centers will be equipped with radiotherapy and radio-surgery technology from Varian Medical Systems for treating patients. The centers will feature three cyclotrons - GE PET-Trace and CGMP laboratory that produces high yields of radioisotope biomarkers. These are essential for accurate PET diagnosis.

GE Healthcare and Varian Medical Systems will provide turnkey assistance to equip these 'see and treat' cancer care centers in the above mentioned towns. GE Healthcare is the largest supplier of molecular imaging and Cyclotron systems globally and in India. GE is also helping with the finance. Varian Medical Systems is the world leader in systems for treating cancer with radiotherapy and radio-surgery.
GE and Varian are collaborators in marketing and developing newer oncology diagnostic and therapeutic treatment solutions and together we can present a holistic approach to KIMS's vision for cancer detection and treatment.

How would you make it viable to have offer radiation therapy in tier II cities?

GE and Variant would help me in making it a more affordable model. There is no written agreement, but they have expressed desire to subsidise whenever required or prolong their EMI payment.

With these 'see and treat centres' are you aiming to become a national player or do you want to continue to be a south-based player?

A national player, without doubt.

rita.dutta@expressindia.com