Ámbar Capital
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Investing in Healthcare Services Offers Valuable Future Returns

Thu, 12/13/2018 - 17:02

Q: As a private capital firm, what do you see as the biggest opportunities in the healthcare sector?
A: We only invest in growing-mode companies with a defined client base, a proven business model and consistently growing income. In Mexico, we focus our operations solely on the education and healthcare services areas, given the significant opportunities to generate social and economic impact. After several years with extensive presence in the healthcare services arena, Ámbar foresees significant opportunities in specialized clinics, hospitals and medical devices. Pharma is definitely an attractive sector, but since it is not in our area of expertise and it demands high specialization, we do not participate.  
The private hospital sector in Mexico is in a mature stage, meaning there are few big operators with country-wide presence while most are single hospitals with local presence, thus opportunities for consolidation are huge. However, one of the main factors for success in this space lies in the ability to serve patients at the lowest possible cost, since the natural market for them are patients paying out-of-pocket.  
On the other hand, the specialized clinics segment is relatively new in Mexico compared to Europe or Asia, we think it also offers interesting opportunities especially among leading players in the non-communicable disease segment. Conditions such as diabetes, hypertension and heart failure have become the main drivers of the mortality rate in Mexico and we expect this trend to continue given the aging population. As a result, specialized clinics will have an even bigger role to play.
Medical devices are a risky bet, but with much higher potential returns. We decided to invest in Onko Solutions, a medical devices company focused on early detection of cervical cancer leveraging Mexican high-tech knowledge. From our perspective, Onko can really transform the industry and have a tremendous social impact by saving women lives. However, adoption of new equipment and technology is always difficult and getting approvals for use is extremely complicated in Mexico. For new startups, investing in this kind of process is costly, takes a long time and is very risky. However, it pays off when companies manage to get past the process. We are aware of the risks and we want to be there for players that need the resources to make their business grow.
Q: What would be the ideal conditions for new investments to bloom more effectively?
A: Overall, technology development, regulatory procedures and capital investment should be closely integrated. Strict regulations will always be necessary given the nature of the healthcare business; however, they have to adapt to market reality and end-users needs. Companies cannot be subject to countless tests when a statistical sample would be adequate to determine a new technology’s application and the benefits for patients. Through our venture with Onko Solutions, for example, we established a partnership with Grupo México’s Tren de la Salud to use Onko Solutions’ cervical cancer detection device. The equipment has already been approved by COFEPRIS and is used to save the lives of women who would otherwise fail to get an early diagnosis.
The country must find a way to take advantage of technological developments. Making available healthcare services to remote and very poor areas was indeed a demand of the population, putting pressure to adapt public policies.
Q: How can the public and private sectors strengthen their collaboration to improve the overall healthcare sector?
A: Looking at both sectors combined, the number of hospital beds in Mexico could satisfy total demand. There are problems in terms of pairing beds available with local demand or services offered with treatments required. The most natural road to follow is to enforce collaboration through various schemes that favor the use of all available hospital infrastructure in the country without the need to devote public investment to build more.