Vol. XXI, No. 241 [ BusinessWorld Online ]
Wednesday, July 9, 2008 | MANILA, PHILIPPINES
DAVAO CITY — Davao Doctors Hospital is looking for locations where it can build new facilities, as it capitalizes on the booming medical tourism business.
Hospital President Dominador O. Cabrera said Davao Doctors sits on a cramped 1.5-hectare property, which prevents it from expanding within the compound.
Incorporated in 1996, Davao Doctors Hospital has 250 beds. It is located in a 1.5-hectare property along a busy street in front of a medical school and near a shopping mall. "We can’t expand here. We have to expand out," Mr. Cabrera said. He noted that their rival, Brokenshire Hospital, has 14 hectares, allowing it to build more hospital buildings.
Three years ago, Mr. Cabrera found a seven-hectare location in the city’s diversion road, but the hospital did not have money at that time.
An option, he said, is to partner with spa and resort owners who can offer the hospital’s medical tourism packages.
In May, listed holding firm Metro Pacific Investment Corp. (MPIC) bought 34% of Davao Doctors Hospital for P498 million as part of its vision to create the country’s first network of hospitals.
MPIC is betting on the hospital industry as it acquires four more hospitals this year worth up to P1.2 billion.
MPIC Chairman Manuel V. Pangilinan earlier said the company was in talks to buy hospitals in Luzon and the Visayas.
Mr. Cabrera said he hopes MPIC would bring its managerial expertise to make the hospital more competitive. Mr. Cabrera will give up his post next year as the new management takes over. He will be designated executive vice-president for medical affairs. MPIC will install four representatives to the hospital board.
Davao Doctors has a wholly owned subsidiary, the Davao Doctors College, with about 4,000 students. For fiscal year ending in June, the hospital posted a consolidated net profit of P134 million.
Analysts earlier said there is a guaranteed market for hospitals, but MPIC might be taking a big risk by venturing into this business. Aside from doctors and nurses leaving the country for opportunities abroad, the hospital industry also has to contend with new government regulations, the increasing number of health maintenance organizations, self-medication and the rise of new hospitals.
The Philippine Medical Association has blamed absconding patients, taxes, expensive facilities, and high maintenance and labor costs for the bankruptcy of about half of the country’s 2,000 hospitals — three-fourths of which were private — since 1988. — JBE
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