MedPlus Health Services Unfazed by Subsidiary’s License Suspension, Eyes Enhanced IT Solutions for Regulatory Compliance

Gangadi Madhukar Reddy, the Managing Director and CEO of MedPlus Health Services, remains unfazed by the recent suspension of a drug license for one of the company’s subsidiaries, foreseeing no significant impact. The subsidiary, which operates across multiple states, received a seven-day license suspension order, a development disclosed by MedPlus on December 28. With 4,200 stores in its retail pharmacy chain, Reddy emphasized that such suspensions, while not ideal, are not deemed material and are part of regular operations.

Reddy explained that recent changes in SEBI’s reporting requirements prompted the company to disclose even non-material events. In response, MedPlus is actively working on bolstering its IT systems to minimize incidents of this nature, ensuring better regulatory compliance and reducing disruptions.

Despite the license episode, MedPlus Health Services is optimistic about its expansion into the diagnostics business. The diagnostics segment is currently in a pilot stage, concentrating efforts exclusively in Hyderabad. Reddy detailed a subscription-based model with city-wide coverage and plans to introduce insurance-like subscriptions. While immediate plans for expansion beyond Hyderabad are not on the horizon, Reddy emphasized the importance of refining the model before contemplating wider geographical reach.

Looking ahead to the financial year 2024, MedPlus anticipates slightly improved revenue and margins. Reddy clarified that the recent resolution enabling fundraising is not an urgent requirement. The company, operating debt-free with robust internal accruals, is well-positioned to fund growth plans, particularly in the diagnostics sector, without immediate reliance on external capital.