Netexplo Group 6
Acix-100 by Achira Labs
Submitted by:
Devendra Meel (Roll No. -1511171)
Sahil Makkar (Roll No. -1511202)
Table of Contents
1. The concept/Technology (Acix 100- Analyser & Fabric-based platform cartridges). .2
1.1 Societal value of the invention........................................................................................ 2
1.2 Locating ACIX-100 on the Gartners Hype Cycle
1.3 Mapping ACIX-100 on
Innovation framework:............................................................................................................ 2
2. Product Differentiation........................................................................................................ 2
2.1 Convenience of Low turnaround time-...........................................................................2
2.2 Low Cost.............................................................................................................................. 3
2.3 Product Design................................................................................................................... 3
2.4 ACIX-100 customer centric Delta Model:.......................................................................3
3. FabChip Manufacturing-........................................................................................................ 3
4. Industry Analysis and Competitive Positioning...............................................................4
5. Business Model...................................................................................................................... 4
5.1 Substance and Enactment in Achira Labs Technology Strategy:...............................4
6. Strategic Intent and core competence and Mapping activity system for Achira
Labs:.............................................................................................................................................. 5
6.1 Strategic intent:................................................................................................................. 5
6.2 Core competence:.............................................................................................................. 5
7. Potential market size:............................................................................................................ 5
8. Customers:............................................................................................................................... 5
9. Financial Analysis................................................................................................................... 6
9.1 Primary revenue stream................................................................................................... 6
9.2 Secondary revenue stream............................................................................................. 6
9.3 Accessing ACIX-100 on Appropriability, Dominant Design and Complementary
assets framework:.................................................................................................................... 6
9.4 Capital Investment and Costs-....................................................................................... 6
10. Long Term Exit Strategy:..................................................................................................... 6
Appendix....................................................................................................................................... 7
1. Product Acix-100 (Left), Fabric based cartridge (middle) & plastic based
cartridge for Acix-100.............................................................................................................. 7
2. New Product development cycle & S-curve...................................................................7
3. Fabchip weaving................................................................................................................. 8
4. Industry structure.............................................................................................................. 8
2. Product Differentiation
2.1 Convenience of Low turnaround time- The product can help diagnose a fever of
unknown origin and identify if its malaria, dengue, typhoid or any viral infection with a single
finger-prick of blood within 20-30 mins compared to centralized labs taking at least 24 hours. The
convenience of having real-time results is important, especially for critical conditions like heart
attack and in cases like TB where every infected patient can spread the disease to his/her
community. Real time testing helps doctors as well as the patients. Doctors benefit from low
leakage of patients while the patients save on bundled costs associated with visiting the doctor
in city from far off rural areas - the cost of overnight stay, etc.
2.2 Low Cost - Acix-100 is a low cost diagnostic testing
solution compared to existing centralized labs. For example,
results for up to 10 tests are provided at 1/10 th of the cost
charged by automatic analyzers like ELISA. The low cost testing
is possible because Acix-100 uses fabric based strips (FabChips)
costing about 1/3rd the price of commercial testing kits. These
chips are 1/10th the size of normal chips and are cheaper
because of the low cost of raw material i.e. yarn. This can bring
down the cost of glucose test to Rs 5/test from current market
cost of Rs 25/test.
2.3 Product Design Achira labs has used Design thinking for making its product very
simple to use which is extremely critical in order to achieve scale. The product can be used by
any untrained person (no requirement of trained technicians) and the results can be
comprehended easily. It consists of microscope slide size cartridges (size of a credit card) and a
desktop reader. It takes a small finger prick of blood sample and then does battery of tests (at
this point of time ~10 tests/ protein tests along with thyroid tests).
3. FabChip Manufacturing-
reagents, these spots glow with fluorescent lights: the brighter the glow, the more the presence
of the analyte. Reading each spot, we can identify the disease.
Chip Manufacturing India has places like Kanchipuram where very intricate millimeter sized
repeatable pattern woven over a saree (Refer
Appendix 3). Silk has interesting properties-it is a
polypeptide, one can do a number of interesting
conjugation with silk. Silk yarn is coated with reagents
then put on a handloom and weaved. The use of silk
allows everything to be sourced locally- the fabric, the
looms, the weavers. This process is extremely scalable
in terms of manufacturing (involves low capex) and
cheap & efficient distribution. Fabric is woven in a
single eight-hour-shift, by a single hand-operated loom,
could be used to make 100,000 sensors. With a mechanized loom, the company could turn out
ten times as many. And then, it could drive down costs even further by setting up specialized
units closer to the populations that need them, and cutting out cost-inflating middle-men. ACIX100 is in preparadigmatic design phase and process innovation has yet to be started.
5. Business Model
Diagnostic industry currently works on printer and cartridge model. Equipment providers make
money on consumables/reagents. They provide bulky analyzers to lab at no-cost in return for
agreement to buy minimum fixed amount of reagents at pre-agreed price. This kind of model
forces centralization since only the large labs can afford to take testing analyzers due to their
ability to have high test volumes/business while the smaller labs become the sample collection
centers of these large labs. There are more than 100,000 labs in India but only 200 of them are
accredited by national regulator NABL which clearly shows that majority of these labs are sample
collection centers. So, patient submits sample to doctors office or lab, then it is sent to
centralized lab which performs tests and shares the result. In this model there are a lot of
problems such as sample storage issues (cold chain logistics), high waiting time (minimum 24
hours), labelling errors. Multiple tests can be performed on a single chip using Achiras product
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which makes it disruptive technology that could bring about decentralization in diagnostic
testing
8. Customers: Achira is initially focusing on thyroid tests and female infertility panel testing
which can be used by leading IVF chains. After this small standalone labs, doctors and
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diabetologist facilities will be targeted. This will enable them to conduct a variety of tests in
their premises itself, instead of outsourcing it to central labs.
The end users can also be hospitals which can be convinced easily due to weak regulatory
environment. Indian government no clear regulation is there in diagnostics instead more
regulations in good manufacturing practices. Hence they check more the facility making the
product rather than sample test results. Many times the MNCs also release product without any
approvals under RUO- research use only sale. This helps to convince the customers many
hospitals like Apollo can chose to use such new technology as legally they dont need to comply
with any regulation. They need to find the key opinion leaders i.e. physicians who believe in the
technology and then can take it forward.
8.1 Crossing the chasm: We analyze the Achira
Labs microfluidic point-of-care medical test platform ACIX100 on the basis Technology Adoption Lifecycle (TALC)
model. The ACIX-100 product has been received quite well
by the innovators or technology enthusiast, however, there
is little money to be made from this segment of customers.
The next segment in TALC model is early adopters or
visionaries who are the tech investors and look for higher
returns. In the current scenario, ACIX-100 has received
investments from
Catamaran, various government
institutions etc.
The biggest challenge for ACIX-100 is to cross this chasm between Visionaries and
Pragmatists (~34% of total market). The chasm here is too big as most of the doctors and labs
have a relationship with centralized large pathology labs. The biggest hurdle for Achira will be
breaking the cozy doctor-lab nexus in which doctors gets a 30-40% cut for every lab test(s)
recommended. Below are some of the recommendations that will help Achira Labs to make ACIX100 a mainstream product:
In healthcare business the trust is most critical factor. Hence there is a need to find the key
opinion leaders i.e. physicians who believe in the technology and then can take it forward.
After 6 months of launch Achira will have to work with local distributors.
As ACIX-100 is a low-cost, low-turnaround solution, it will be really useful in rural India. Hence,
Achira Labs should partner with central & various state governments to make this platform
available in such areas. After our discussion with the founders, we have found out that they
are already in talks with Karnataka government to launch the ACIX-100 platform in rural
districts of Karnataka. Subsequent to this launch, founders are planning to take this initiative
to various other states and eventually the goal is to make it Pan India solution.
9. Financial Analysis
9.1 Primary revenue stream will be the microfluidic product sales to small labs and
doctors. Nearest comparable product available for small hospitals and labs costs 9 lakhs. Even
though Achiras product would be priced at a much lower level, still not many of these small-labs
will buy the product upfront. They prefer reagent-rental model in which lab signs a fixed tenure
contract with the equipment manufacturer, and assures product manufacturer a fixed monthly
amount in consumable sales. In case of Achira labs product for example, endocrine test/thyroid
will cost around Rs100-150 compared to Rs 500 in pathology labs. Currently, a small lab
performing 100 thyroid tests a month pays pathology labs ~ 70% of 500*100 = Rs 35000/
month. However, if they switch to Achiras product they will pay only ~150*100 = 15000/month
rentals to Achira. The second set of customers i.e. small hospitals would fetch a revenue of 3-4x
of a small standalone lab resulting into a rental income of Rs 50,000/month. According to our
estimates, Achira will capture 4% of 100,000 labs and small hospitals/doctors (1/10 th the no. of
small labs) in next five years.
9.2 Secondary revenue stream- Achira provides custom-made microfluidic chip
services to institutional research labs across the country including IIT Bombay, IIT Madras, IIT
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Guwahati and others. These chips may not necessarily be used for diagnostic purposes some
professors may be developing an organ on a chip, some may be working on a sperm separation
device for IVF applications. Besides, it also has product partnerships with a couple of MNCs for
developing new diagnostic tests on its platform.
Financial year
2017-18
2018-19
2019-20
2020-21
2021-22
No.
of
labs 500
1000
2000
3300
4000
paying~15000/month
No. of hospitals paying 50
100
200
330
400
~ 50000/month
Primary revenue
12 crores
24 crores
48 crores
79.2 crores 96 crores
Secondary revenue (% 40%
30%
20%
15%
10%
of primary)
Secondary revenue
4.8 crores
7.2 crores
9.6 crores
11.88
9.6 crores
crores
Total Revenue
16.8
31.2
57.6
91.08
105.6
crores
crores
crores
crores
crores
Appendix
1. Product Acix-100 (Left), Fabric based cartridge (middle) & plastic
based cartridge for Acix-100
S-curve-Explaining how innovations start slow, accelerate and then hit a ceiling requiring the
companies to jump to a new technology. Achira labs product has just past the fermenting stage
where initial performance might not be up to the mark and was improved. Now the product is
ready for commercialization and Take-off stage.
3. Fabchip weaving
Weaving of repeatable patterns in saree at Kanchipuram (Left), Weaving and dyeing
of yarn with reagents at Achira Labs facility (Right)
4. Industry structure
There are 2 segments of the diagnostics industry In vitro diagnostics/Pathology- where one needs to take a sample (blood,urine,stool,etc)
and diagnose the proteins, DNA, metabolic.
In vivo diagnostics/Radiology- where one needs to get a full body scan in person e.g cancer
monitoring, X-ray, Ultra-sound, tumor, bones, eyes scan.
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