GIG: The company has announced some ambitious expansion plans for 2020. Can you tell us a little bit about them and how they are proceeding?
Spanos: Despite the difficulties that the private healthcare sector faces in Greece with the rebate and clawback imposed by the National Organization of Health Services (EOPYY), Bioiatriki continues to invest and grow. We currently operate 47 diagnostic centers in Greece, in Attica and Thessaloniki and recently we opened the first one outside of these two metropolitan areas, in Chalkida.
Our expansion plan started in 2016, by 2018 we had opened 14 new diagnostic centers and in 2019 & 2020 we are opening another 10 and 6 respectively. We have invested in excess of 40 million, including two acquisitions in Cyprus. Starting in 2020, we will also be investing heavily in the digital transformation of the Group, focusing on improving the customer journey and experience in both our physical and virtual diagnostic centers.
GIG: Economic conditions are starting to improve in Greece, but consumer and business sentiment remains fragile. What is your outlook for the medical sector? What kind of growth rates do you see ahead?
- The Greek economy has bottomed out and GDP growth is projected for the years ahead;
- Ageing population increases the demand for healthcare services;
- Private healthcare spending is expected to increase by 6% on average between 2018 and 2022;
- People prefer private hospitals due to the suboptimal service and infrastructure of public hospitals;
- The outsourcing of exams currently performed in public hospitals to private providers will result in a revenue increase, improved capacity utilisation, better service for the patients, and reduced costs for the public hospitals.
GIG: There has been a wave of consolidation activity in the industry. Do you expect this buyout activity to continue?
Spanos: There has already been significant consolidation in the secondary healthcare sector, so there are fewer opportunities for further consolidation in the future. On the other hand, there are significant opportunities for consolidation in the primary healthcare segment, as there are about 300 large diagnostic centres and close to 3,000 small, independent microbiologists and labs – some of which lack in the quality of services offered.
We believe that in the future inevitable consolidation will take place in the primary segment that will prove beneficial for the public, allowing for better EOPYY services due to cost containment and greater economies of scale for companies.
GIG: In 2018, you announced the acquisition of the Alpha Evresis diagnostic centre in Cyprus. Can you tell us about your future plans for Cyprus? Are there any other foreign markets on your radar right now?
Spanos: Cyprus is one of the best investment destinations in the world today.
Bioiatriki acquired Alpha Evresis, the biggest diagnostic imaging centre in Cyprus, in 2018. Alpha Evresis is a modern and complete imaging centre, which – among others – provides special examinations such as endoscopic ultrasounds (EUS), FibroScans, full MRI examinations of the heart, and foetal MRIs, which are not offered by any other diagnostic centre in Cyprus.
Before that, in 2017, Bioiatriki acquired a majority stake in Yiannoukas Medical Laboratories Ltd, the largest clinical laboratory in Cyprus, active in the medical services sector since 1981.
Our immediate plans for Cyprus include the creation of a large diagnostic centre in Nicosia (about 1,200 sq. metres), which will cover all blood tests and also all imaging tests. This one-stop, state-of-the-art shop will be the first one in Cyprus that will offer all diagnostic tests under one roof – a new concept for Cyprus.
Bioiatriki, via its recent acquisitions, is ideally situated to cooperate with the corresponding EOPYY of Cyprus (OAY), which has started operating in the second half of 2019. The compensation system awards providers who have the ability to offer quality services to the public and applies a fair-for-all compensation system with specific budgets based on the type of test. So, when more tests are needed, the price of each one drops, while, when test volumes fall, the unit price rises.
Other geographies to be considered for expansion in the future would include Bulgaria and Romania.
GIG: Bioiatriki absorbs a big chunk of the medical tourism business in Greece. What is the outlook for this segment of Bioiatriki’s business?
Spanos: Tourism is one of the very few sectors that wasn’t affected by the financial crisis, and contrary [to others] it is constantly growing. According to the WTTC, tourism represents 20.6% of Greece’s GDP. In particular, the health and wellness tourism market is significant and rapidly growing. In 2013, Bioiatriki established the international patient centre CrossBorderMedCare in a bid to penetrate this market. Its objective is to offer medical services to international patients nationwide by using the existing network of Bioiatriki Group and the collaboration networks in strategically selected areas of high touristic interest. We have created a network of more than 700 collaborating doctors of all specialties, selected based on their experience in various healthcare systems abroad. All our doctors are multilingual, bypassing the most important anxiety factor for international patients, which is their ability to communicate with their physician.
CrossBorderMedCare is the only healthcare provider in Greece that has received the highest accreditation from Temos as a Qualified Partner (in International Medical Travel Coordination), that is also certified by the Diplomatic Council as among the best healthcare companies in the world, and that has also acquired International Organization for Standardization (ISO) certification 9001:2015.
This international recognition opens up new horizons for collaborations with international medical tourism market players, as well as attracting patients from abroad who want to receive the best possible healthcare services.
GIG: What is the biggest challenge in providing health services to such a globally diverse group of people?
Spanos: The biggest challenge is the different cultures and, consequently, the different approaches needed. Taking that into account, CrossBorderMedCare administrative and medical staff are constantly reinforcing their cultural sensitivity skills, which are very important to function cohesively as well as – and most importantly – in a respectful and courteous way with our patients regardless of cultural differences.
Particularly, we implement training on cultural sensitivity, reinforcing:
- Communication through a patient-centred approach with real case studies with multinational patients;
- Non-verbal skills: increasing an awareness of body language, enabling our staff to better read and interpret their patients’ physical and emotional signs;
- Cultural awareness through a widening of understanding not only of cultural issues in the broader sense (professional, local, medical, and ethical) but also the impact of our own cultural background regarding our interactions with patients.
GIG: Innovation and R&D are the cornerstones of development in the health sector. What are you doing on these fronts to stay ahead of the competition?
Spanos: Bioiatriki has invested in medical equipment and in specialised, scientifically trained staff with the purpose of creating pioneering tests for patients. These tests cover all major diseases and conditions such as oncology, infectious diseases, prenatal control, and genetic diseases. The Molecular Biology, Cytogenetics, and Biomaterials Analytical Departments are specialised laboratories aiming at creating pathways in markets with special needs and significant growth prospects.
Bioiatriki has developed a significant portfolio of specialised tests through a collaboration with teams of doctors and specialists who, until recently, have had limited diagnostic tools for these diseases.
So, we have combined tests such as: (a) BIOMED STDs where sexually transmitted diseases are examined at the same time (12 infectious micro-organisms); (b) BIOMED CSF where the most common genetic diseases are examined prenatally such as Inoculative Disease (CF), Spinal Muscular Atrophy (SMA), and Fragile X (FRAG X), occurring in the Caucasian race; (c) the test of BRCA1-2 genes autonomously or NGN-based polygenic panels, which examine the heredity of breast and ovarian cancer and other cancers.
Using the latest technologies and by cooperating with endocrinologists, gynaecologists, and IVF specialists, we design polygenic tests that offer a diagnostic value to couples with infertility, aiming at the domestic as well as the international market and thereby helping to treat a serious problem that is more and more frequent.
Bioiatriki became the leader in medical diagnosis in Greece by staying at the forefront of the scientific developments in the field. Bioiatriki also has a long cooperation with Roche Diagnostics.
GIG: The brain drain has taken a massive toll on the Greek economy. Bioiatriki is a key employer of highly trained medical professionals. As a company, how do you develop and boost your staff? What do you believe would help jump-start the reversal of the brain drain in Greece?
Spanos: Bioiatriki is highly sensitive to the human factor and demonstrates in practice the belief that its human capital is its greatest asset. The group invests in employee development through a well-structured annual educational plan that includes skills and competences development, knowledge and expertise improvement, and [addresses] issues such as technology, ISO, certifications, and management.
Also, Bioiatriki covers the expenses of postgraduate programmes for high-performing executives, has in-house trainers, and makes use of available European programmes. The company implements a transparent and objective rating system that sets clear targets, improves individual performance, monitors long-term employee progress, and promotes job rotation and staff development.
Above all, we ensure a safe and healthy working environment in excellent facilities and create new jobs on a systematic basis through new diagnostic centres and the development of activities and specialisations.
The reversal of the brain drain of Greece will happen only if our society and state begin supporting and encouraging – instead of vilifying – entrepreneurship that leads to rewarding, good-paying jobs with growth prospects.