EEP Demand Estimation
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Transcript of EEP Demand Estimation
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Archana.M (12010) Jaishankar.K (12036)
Demand Estimation forMedical Device and Equipment
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About Medical Device and Equipment
• Currently valued at $4.4 billion• Expected to grow to around $5.8 billion by 2014 and $
7.8billion by 2016Medical Equipment Industry
Medical In-struments 27.01%
Orthopaedic Goods - 20%
X-ray ap-paratus 12.10%
Electromedical 13.20%
Syringes and needles 12.4%
Bandages and oth-ers 15.3%
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Factors affecting the demand
Demographic factors
Macro-economic factors
Regulatory factors
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Demographic factorsFactor Theory Source
Ageing population Replacement Level Fertility (RLF) Global average = 2.1
Life expectancy (LE) theoryIndia LE grew up by 4.6 years
Management Institute of Population and Development
Human Development Index Report 2011
Change in disease profile
Increase of non-communicable diseases (NCD) – diabetes, cancer, cardiovascular diseases
World Health Organization
Rising purchasing power/per capita Disposable Income
People can afford to better quality of healthcare services.CAGR - 5.7%
IMF, World Bank data
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Macro-economic factorsFactor Theory Source
% of GDP on Healthcare India spends around 4.1% of GDP and most of it is from Private Expenditure
Economic Survey
Socio economic inclusion of rural and deprived
Urban market is saturatedRural constitutes close to 3/4th of the population
Government expenditure on health
It increases year-on-year but it is far less than Private sector
Economic outlook
Increased Health Insurance Private and State-run insurance schemes with increasing medical coverage. Increase to 20% by 2015
IRDA ( Insurance Regulatory and Development Authority)
Technological advancement and innovation in medical field
Innovative machines with comparatively lower cost
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Regulatory factorsFactor Theory Source
Foreign Investments FDI in healthcare sector
Medical Tourism Presence of skilled medical professionals and affordable cost of treatments. The CAGR expected is 27% in 2014 and we have 85 million in 2012.
Ministry of Health
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Demand Estimation• Independent Variables
– Medical & public health Central Plan Outlay • (Data Source : Economic Outlook)
– GDP of Medical Services• (Data Source : Economic Outlook)
– Improved Sanitation Facilities• (Data Source : World Bank Data)
– Ageing Population• (Data Source : World Bank Data)
– Life expectancy• (Data Source : World Bank Data)
– Health Expenditure Per Capita• (Data Source : World Bank Data)
• Dependant Variable– Medical Equipment Sales
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Regression EquationMed. Equip Demand = 10,43,375.115+0.1476*Med. Health Central Plan Outlay+0.1457*GDP of Medical Services+1,378.65*Improved Sanitation Facilities+-6.74*Health Expenditure Per Capita+-11,212 *Ageing Population+-15,250*Life Expectancy at Birth
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DATAYear
Med. Equip. Sales Value(Rs. Million )
Med. Health Central Plan Outlay(Rs. Million)
GDP of Medical Services (Rs. Million)
Improved Sanitation Facilities (Rs. Million)
Health Expenditure Per Capita (Rs.)
Ageing Population(Million)
Life Expectancy at Birth (years)
1991 719 2,551 171,450 158 225.92 34.48 58.821992 959 2,816 174,610 169 342.39 35.44 59.141993 772 4,492 185,810 180 438.89 36.42 59.471994 1,052 5,056 198,770 191 464.84 37.45 59.821995 1,151 5,990 211,210 203 494.08 38.53 60.191996 1,429 6,482 228,520 215 530.45 39.67 60.571997 1,664 8,176 249,420 227 651.55 40.87 60.971998 1,654 9,162 270,490 240 684.17 42.13 61.371999 2,602 9,798 293,170 252 766.84 43.44 61.772000 4,769 10,768 335,850 266 848.00 44.81 62.162001 4,461 12,769 373,350 279 955.90 46.23 62.562002 5,232 12,962 400,350 293 1,004.28 47.71 62.952003 5,615 13,699 432,830 307 1,144.86 49.23 63.342004 8,328 14,116 481,700 322 1,318.87 50.78 63.722005 14,682 21,738 535,460 337 1,402.64 52.35 64.102006 16,497 25,482 574,840 351 1,460.49 53.91 64.462007 22,729 28,843 588,720 366 1,646.91 55.48 64.792008 18,525 33,315 615,370 382 1,854.09 57.07 65.112009 18,758 49,884 631,290 398 2,107.63 58.68 65.412010 22,238 53,499 670,430 412 2,349.03 60.28 65.692011 29,479 71,151 697,480 429 2,758.32 61.89 65.96
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CORRELATION
Med. Equip. Sales
Value(Rs.
Million )
Med. Health Central Plan Outlay(Rs.
Million)
GDP of Medical
Services (Rs. Million)
Improved Sanitation
Facilities (Rs. Million)
Health Expenditure Per Capita
(Rs.)
Ageing Population(Million)
Life Expectancy at Birth (years)
Med. Equip. Sales Value(Rs. Million ) 100.00%
Med. Health Central Plan Outlay(Rs. Million) 93.51% 100.00%GDP of Medical Services (Rs. Million) 94.95% 88.76% 100.00%
Improved Sanitation Facilities (Rs. Million) 92.99% 89.11% 99.28% 100.00%Health Expenditure Per Capita (Rs.) 95.88% 96.77% 96.85% 97.24% 100.00%Ageing Population(Million) 93.57% 89.59% 99.48% 99.97% 97.50% 100.00%Life Expectancy at Birth (years) 90.33% 85.10% 98.66% 99.63% 94.97% 99.48% 100.00%
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Regression Result Inferences• R-Square : 96.95%• Adjusted R-Square : 95.65%• F-Value : 74.37 Significant• T-Values*
– Med. Health Outlay : 0.718 Insignificant– GDP of Med. Services : 2.799 Significant– Improved Sanitation : 1.614 Insignificant– Per Capita Health Expenditure : -0.645 Insignificant– Ageing Population : -1.546 Insignificant– Life Expectancy : -1.436 Insignificant
• Med. Health Outlay, GDP of Med. Services, Improved Sanitation – all becomes “SIGNIFICANT” when rest of ‘3’ variables are removed and Vice-versa
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Conclusion
• Estimated Demand for 2012 : 28,015 Million
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Regression output usingMedical & public health Central Plan OutlayGDP of Medical ServicesImproved Sanitation FacilitiesAgeing PopulationLife expectancy
Health Expenditure Per Capita
Demand Estimated for 2012 (In Rs. Million) 28,015R-Square 96.96%Adjusted R-Square 95.65%Intercept 1,043,375Med. Health Central Plan Outlay(Rs. Million) InsignificantGDP of Medical Services (Rs. Million) SignificantImproved Sanitation Facilities (Rs. Million) InsignificantHealth Expenditure Per Capita (Rs.) InsignificantAgeing Population(Million) InsignificantLife Expectancy at Birth (years) Insignificant
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Regression output usingMedical & public health Central Plan OutlayGDP of Medical ServicesImproved Sanitation FacilitiesHealth Expenditure Per Capita
Demand Estimated for 2012 (In Rs. Million) 28,087R-Square 96.28%Adjusted R-Square 95.35%Intercept 6,716Med. Health Central Plan Outlay(Rs. Million) InsignificantGDP of Medical Services (Rs. Million) SignificantImproved Sanitation Facilities (Rs. Million) SignificantHealth Expenditure Per Capita (Rs.) Insignificant
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Regression output using Medical & public health Central Plan OutlayGDP of Medical Services Improved Sanitation Facilities
Demand Estimated for 2012 (In Rs. Million) 28,169R-Square 96.27%Adjusted R-Square 95.61%Intercept 7,524Med. Health Central Plan Outlay(Rs. Million) SignificantGDP of Medical Services (Rs. Million) SignificantImproved Sanitation Facilities (Rs. Million) Significant
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Regression output usingAgeing PopulationLife expectancyHealth Expenditure Per Capita
Demand Estimated for 2012 (In Rs. Million) 26,752R-Square 95.22%Adjusted R-Square 94.37%Intercept 702,268
Health Expenditure Per Capita (Rs.)Insignifican
tAgeing Population(Million) SignificantLife Expectancy at Birth (years) Significant
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SUMMARY OUTPUT - REGRESSION
Regression StatisticsMultiple R 0.98R Square 0.97
Adjusted R Square 0.96t-critical 1.76
Standard Error 1,894.84Observations 21.00
ANOVA
df SS MS FSignificance
F
Regression 6.001,602,101,902.2
0267,016,983.7
0 74.37 0.00
Residual 14.00 50,265,633.00 3,590,402.36
Total 20.001,652,367,535.2
0
Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0%
Intercept 1,043,375.11 641,151.77 1.63 0.13 -331,758.66 2,418,508.89 -331,758.66 2,418,508.89Med. Health Central Plan Outlay(Rs. Million) 0.15 0.21 0.72 0.48 -0.29 0.59 -0.29 0.59GDP of Medical Services (Rs. Million) 0.15 0.05 2.80 0.01 0.03 0.26 0.03 0.26Improved Sanitation Facilities (Rs. Million) 1,378.65 853.97 1.61 0.13 -452.94 3,210.24 -452.94 3,210.24Health Expenditure Per Capita (Rs.) -6.74 10.46 -0.64 0.53 -29.17 15.69 -29.17 15.69
Ageing Population(Million) -11,212.61 7,254.10 -1.55 0.14 -26,771.11 4,345.89 -26,771.11 4,345.89
Life Expectancy at Birth (years) -15,250.39 10,616.90 -1.44 0.17 -38,021.38 7,520.61 -38,021.38 7,520.61
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Thank You