India's Leading Healthcare & Pharma Companies 2023

42 | India’s Leading Healthcare & Pharma Companies 2023 [ OVERVIEW OF INDIA DIAGNOSTICS SECTOR ] KEY GOVERNMENT INITIATIVES FOR DIAGNOSTIC SECTOR Source: Ministry of Health & Family Welfare 6 union territories have adopted the CE Act. Since health is the state subject, several states have enacted their own legislations to regulate diagnostic sector in their respective jurisdictions. Some of the key initiatives taken by the government in the diagnostics space are as given below. KEY TRENDS Hi gh l eve l o f compe t i t i on putting pressure on margins: The absence of stringent regulatory framework andminimum standard requirements have led to low- entry barriers, in turn resulting into intense competition in the sector. This has led diagnostic companies to operate under high- volume low-cost model and offer their services at steep discount. As a result, the diagnostic test prices haven’t increased or only marginally increased in the last five years, in turn squeezing the margins. Prominent diagnost ic chains focusing on brand building: Given that the diagnostics market is dominated by the standalone d i agno s t i c p l a y e r s , ma j o r organised players are focusing on brand building through online marketing. There are aggressive market ing campaigns run by these companies to differentiate themselves from others based on Dun & Bradstreet