The field of healthcare has always been and in many ways remains in Russia an area of state financing and management. On the one hand, this is correct. Article 41 of the Constitution of the Russian Federation guarantees all citizens of our country the right to free medical care. At the same time, it is difficult to argue with the fact, proven by the experience of not only our country, that the state is not the most effective manager. And the medical service, like any other, is being improved faster and in the best way under conditions of the competitive and market environment. Where is the balance and the golden mean? And why are private investors still not too willing to go into the medical business? We will select the medical industry, the production of medical equipment, the pharmaceutical industry and the segment of medical services to talk specifically about services.

Who are investors and what drives them?

The state invests in healthcare (it is actually a market maker in this industry), as well as private investors. Their behavior is very different, the state and private investors solve different tasks. The State aims to distribute budget funds evenly across all medical institutions in order to ensure the availability of services for the entire population. At the same time, the receipt of budgetary funds by institutions does not depend on the quality of the services they provide. And the state does not expect the return of its investments in the form of live money. Private investors, on the contrary, are focused on return on investment. When making an investment decision, they are driven by two emotions: fear and greed. If translated into a formal language, this is an unwillingness to face risks and a desire to get maximum profitability. The balance of these two factors becomes the determining factor when answering the question whether or not to invest in a particular industry. And the balance for each individual industry, for each individual business depends not only on the situation in a particular company, but also on the situation in the country as a whole.

Is the medical services sector so attractive to investors?

Private medicine attracts the attention of private investors, because it can offer a fairly favorable risk-return ratio. The medical sector is very stable: a person will not save on his health, which means that the business will continue to exist under political and economic cataclysms, in a wide range of probabilistic events. It is important. The risks of this sector are low. At the same time, private medicine has the ability to scale and, therefore, increase profitability. Almost every major investment fund in Russia today has private medical companies in its portfolio. Here are just a few examples of investors in the healthcare sector: Baring Vostok Capital Partners, UFG Asset Management, Severgroup, Elbrus Capital Funds. There could be more of these examples if it were not for two factors limiting the development of private medicine in our country: low purchasing power, that is, the inability of people to pay for services, and the lack of a sufficient number of qualified doctors. If the first factor is a consequence of general economic problems, then the second is a consequence of state policy. The state invests a lot of money in equipment and not enough in the training and retraining of medical personnel. This is a deterrent factor to both public and private medicine. Until doctors become the elite of our society, until they receive decent salaries, the medical services sector will not become an attractive business and private money will not go into it.

The eternal question: what to do?

We will not get away from the fact that the state will remain the largest player in this market. At least as long as the purchasing power of the population will be what it is now. There are private investors in this segment, and there are successful cases, for example, the EMC and Mother and Child clinic networks, which are traded on Russian and Western exchanges, but these are niche players. All of them work in the premium segment, serve customers who are able to pay quite serious money. If you look at the sector below - polyclinic services, network clinics in the middle price segment - then the situation will be worse, because with the purchasing power that exists in Russia, it is difficult to build a well-capitalized business. All this suggests that increasing the investment attractiveness of the medical services sector is not a local task of the industry. To do this, it is necessary to increase the purchasing power of the population, which is the main driving factor. The main player in this sector is the state. It can pay for the service rendered to the population within the framework of the MHI. But there should be transparency here so that public and private clinics compete for the client.The first thing that is necessary is that the client determines himself where he can go. It is not the case yet. Secondly, it is necessary to invest in the advanced training of doctors, this is the basis for providing qualified, capitalized services. Finally, the third thing is to create a legal framework so that an investor can invest money in a business without fear that it will be taken away from him tomorrow. This is a general problem of the Russian economy, not a particular problem of the medical sector. What investors lack in the medical business in Russia | Columns | GxP News Maxim Kravchenko: "The low purchasing power of the population limits private investment in healthcare in Russia."