Cardiology Catheters To Become Cheaper By 25-30% After PendraCare Acquisition: Poly Medicure MD

Medical device manufacturer Poly Medicure recently announced the acquisition of a 90% stake in Netherlands-based PendraCare Group. 

The acquisition is expected to reduce the cost of critical cardiology catheters in India by up to 30%, according to the company's Managing Director (MD), Himanshu Baid.

“We think we can reduce the cost by around 25% to 30% if we make the product in India and that's a significant markdown from the current cost structures, where everything is imported,” he said during a conversation with NDTV Profit on Friday.

In a press release dated Sept. 3, Poly Medicure said it has entered into a definitive agreement to acquire a 90% stake in PendraCare Group from Wellinq Holdings BV at an enterprise value of Rs 188.5 crore. The remaining 10% stake is to be acquired in 2030 based on PendraCare Group’s Ebitda in CY29.

However, he cautioned that building market share takes time. “It is not easy to garner a portion of the pie because it takes time to build the market for any product globally, whether it's in India or outside India.”

Baid said close to 20 lakh angiographies are done annually in India, with the vast majority of the required devices being imported. By leveraging PendraCare Group's technology, Poly Medicure will begin manufacturing these high-demand products locally.

“We will have the ability to manufacture these products in India as well as in Europe and reduce the cost of the product by local manufacturing,” the top executive said.

The products at the centre of the deal are catheters used for angiography and angioplasty. These include angiographic, guiding and diagnostic catheters.

Poly Medicure will get “immediate access” to the United States and European markets after the acquisition.

“This acquisition is very strategic because this company has a manufacturing setup in Europe and it's got all the necessary approvals to sell products in the US and in European markets. So I think that gives kind of immediate access to that market for the products we are manufacturing in India,” the top executive noted.

He added that PendraCare Group's research and development setup would also help "fast-track our R&D in the cardiology space."

He highlighted that the acquisition comes just six to eight months after Poly Medicure entered the interventional cardiology sector. 

“We are looking at maybe in two to three years, €3-4 million of synergy between the two companies. Probably we could see margins improving to plus 25% over the next two to three years,” he said.

Baid also discussed the guidance for the domestic business and the impact of the recent GST (Goods and Services Tax) rationalisation, which comes into effect on Sept. 22.

“Our domestic business should grow over 30% and of course, the price impact, we have to pass it on from Sept. 22 onwards. So, that's a little bit of a challenge because there's a lot of stock in the market with all the old pricing, old MRP. So, we have been talking to the government right now on how this will take place,” the MD said.

Shares of Poly Medicure closed 1.47% higher at Rs 2,025 apiece on the NSE, while the benchmark Nifty50 ended at 25,114, up 0.43%.