Dr Azad Moopen, chairman of the private medical firm DM Group, talks to Claire Ferris-Lay about Dubai's medical tourism ambitions and his planned IPO.
Dr Azad Moopen has managed to successfully switch from one career to another on more than one occasion. The former general practitioner was a university medical lecturer for five years before he launched and became the chairman of the Dubai-based Dr Moopen's Group (now known as the DM Group) in 1987.
"I don't have regrets about giving up general medicine because you have to compromise something if you want to gain on something else," he tells CEO Middle East. Today Moopen's firm sees up to 40,000 patients from across the GCC and India in any one week. This figure is set to rise as the firm looks to invest as much as $354m over the next five years to expand its operations across the GCC and India.
Investment in the GCC healthcare sector has continued to increase despite the global economic downturn. There are currently $14bn worth of healthcare related projects underway in the Gulf, led by Saudi Arabia, which is spending more than $6.6bn on a total of 83 projects and followed by the UAE and Qatar (who are spending $2.9bn and $2.8bn respectively), according to UAE investment firm, Crescent Investments.
While the majority of the firm's expansion plans will be funded by private equity and debt, Moopen says he is also looking to list his company's shares on an Indian stock exchange in the next three years to fund further expansion both in the GCC and his home country of India. "We are planning to go for an IPO at the appropriate time. Most probably it will be in India," he says, adding he may look to dual list in the UAE.
Of the $354m the DM Group plans to invest over the next three years, the majority will be spent in Saudi Arabia, the GCC's largest country, says Moopen. "Next year and maybe in two-three years we'll have a significant presence in Saudi Arabia. We plan to have three hospitals in Saudi, around fifteen clinics and the same number of pharmacies, so that's a large market for us. We'll be investing about SAR200m ($5.3m) in Saudi alone," he says.
In addition to the country's large population the DM Group will also benefit from new legislation in the kingdom, which aims to make health insurance mandatory for up to 1.5 million nationals and their families working for private companies.
Under the new scheme, the Saudi government plans to make health insurance compulsory for 80-85 percent of employees at small to medium size companies, bringing them in line with the country's large private companies that already provide insurance to their employees. As the GCC continues to grow and additional strains are placed on public healthcare, regional governments are turning to the introduction of compulsory health insurance. Both Saudi Arabia and Abu Dhabi already have legislation in place that ensures private companies provide health insurance to their employees while governments in Dubai and Qatar are also working on introducing similar schemes.
Moopen believes its introduction is likely to impact positively on private healthcare providers. "Payment is an issue for many people when they want to access private healthcare so if there is regulation that ensures healthcare is provided by employers it's going to have a significant impact on private healthcare," he says.
Often insurance firms demand healthcare providers to drop their costs in order to become a preferred provider but Moopen says this is unlikely to become a problem in the Gulf. "We have a fixed tariff and we give a discount to the insurance companies because they provide business but we don't go below a line just to get on their list," he says.
"What we have found is that insurance companies also have a compulsion for us to be on their panel, it is mutually beneficial," he explains.
He is, however, unsurprised that Dubai has delayed its plans to introduce similar regulations to those in the UAE capital and Saudi Arabia. In May last year, the Dubai Health Authority announced it would delay its introduction by a year. "I think it would have taken some time to get this done because there are a lot of challenges involved. What they were planning is a new experience that takes time to mature."
Not that the delay will affect Moopen's plans for the DM Group in the country. In addition to his expansion plans outside of the UAE, Moopen also plans to tap into the country's medical tourism ambitions. The firm currently treats three patients from outside the UAE for major medical procedures a week but Moopen hopes to increase this figure by 20-30 percent.
Medical tourism is fast becoming a big business and is globally worth $60bn, according to the Medical Tourism Association. By the end of this year medical tourism in the UAE is expected to generate AED7bn ($1.9bn) and grow fifteen percent annually, according to the Abu Dhabi Chamber of Commerce and Industry.
Dubai, which has more than 80 clinics and hospitals is well placed to see the industry grow, says Moopen. "The connectivity with most countries surrounding it makes it very well placed as a destination, it is also very well known as a destination. What are required initially are good hospitals, facilities and internationally acclaimed doctors and facilities," he explains. "That is what is supposed to be happening in Healthcare City," he continues. "Unfortunately this got delayed due to the recession. But the existing hospitals and upcoming hospitals can provide these facilities."
But with procedures significantly more expensive in the UAE compared to other medical tourism hubs such as India and Thailand, Dubai cannot compete with price. Moopen says this is unlikely to stop patients from within the GCC travelling to Dubai for procedures. "The cultural advantage to the GCC population when they come to an Arab country, they feel much more comfortable when they come to Dubai for a treatment rather than going into some place where they can't speak the language," he says.