The fight to heal India

And no wonder. "There are big bucks to be made in a place where medical care is still a scarce resource." At $US34 billion a year, the market is 1/ 50 the size of America's. But according to Ernst & Young, it has an annual growth rate of 16 per cent.

An estimated $400 million a year is pouring in from the likes of American George Soros' Quantum Fund, Warburg Pincus, Avenue Capital Group and Old Lane; not to mention the UK's Apax Partners and Bluewater International, says Bahree.

For every 10,000 patients, India has six doctors (compared with 19 in the US and 32 in Europe) and seven hospital beds (25 in the US, 64 in the EU). Overall, health insurance covers one in 13 Indians.
One of the big players vying to be king of Indian healthcare is Shivinder Mohan Singh. Shivi, as he's known to friends and family, rose to infamy in the industry after a business partnership with eminent Indian cardiologist Naresh Trehan – the pair co-founded a hospital chain – turned very ugly.

These days, says Bahree, "his company, Fortis Healthcare, is still a shrimp." Number two to Apollo Hospitals, the nation's largest chain, Fortis had an operating income of $US11 million on $102 million in revenue for the nine months ended December 31.

But by 2011 Shivi intends to triple his current holdings, of 14 hospitals and 2,400 beds. And he has the means, and the heritage, to pull it off, she says.

Shivinder's grandfather is Bhai Mohan Singh, the founder of Ranbaxy Laboratories, India's largest drugmaker. His father, Parvinder, ran the business until he died in 1999.

In an effort to move beyond pharmaceuticals, Shivi and his older brother, Malvinder, Ranbaxy's chief, chipped in $5 million to launch Fortis in 1996, later tapping into another $3 million from Ranbaxy. (The two brothers own a combined 30 per cent of Ranbaxy, a stake worth $1.3 billion; together their net worth is $2.5 billion, including $290 million worth of Fortis.)

The new company got off to a slow start, "partly because real estate is such a vexed business in India," says Bahree. "Contiguous plots are scarce, and so are electronic records of ownership, but escalating prices are not."

Fortis's first hospital opened in Mohali in Punjab in 2001, in the same year Shivi's closest rival, his uncle Analjit, launched his hospital chain.

As well as building from scratch, Fortis has bulked up by making three acquisitions, including Escorts Heart Institute, the four-hospital chain co-founded by Trehan.

"The idea is to fan out across India," says Bahree, "via a hub-and-spoke model, relying on smaller, general care hospitals in ex-urban communities and more specialised centres in larger urban areas."

The bigger hospitals can send out specialists each week to satellite hospitals, which lack specialists in oncology, electrophysiology and neurosurgery. To cut costs, nearby hospitals share some equipment, like high-end machines for CT scans and radiation oncology; while marketing, purchases and administrative support are all carried out at HQ.

As chief executive of Fortis, Shivi has a reputation for innovation "– and abrasiveness," says Bahree. He has started programs such as TimJ2 ("This is my job, too"), designed to get doctors and senior executives to answer simple questions from patients and visitors, and the so-called Blackbelt program, which grills employees on their knowledge of the company.

Meanwhile, Shivinder is muscling into Apollo's territory by buying a hospital in Chennai and buying and building in Mumbai, says Bahree. To attract overseas patients, Fortis has signed deals with foreign insurers like Aetna, Cigna, HTH Worldwide, the UK's Bupa and Belgium's Vanbreda, though so far they're only covering students, expatriates and tourists.

The company has also signed an agreement with SRL Ranbaxy, which does lab tests, to expand Fortis Healthworld – a one-stop pharmacy and medical supplies chain – to 1,000 stores in 200 cities by 201.

"If he can pull off all the stuff he's doing," says Ranjan Pai, chief executive of Manipal Education & Medical Group in Bangalore and a Fortis rival, "it'll be amazing."

The hellion of health care, Megha Bahree, Forbes