The ever-increasing demand of medical oxygen has opened doors for new players in this business. A number of allied businesses also thrive on the back of the fast growth in this segment.
As the healthcare sector remained recession-proof over the last year, it was not the hospitals alone that posted gains. A number of businesses that supply mission-critical products and services also thrived quite profitably. One such business is that of medical oxygen.
This gas is used during surgery, intensive care treatment, inhalation therapy, etc. Apart from being used for treatment of hypoxia or hypoxemia, medical oxygen is used for asthma, bronchitis, pulmonary edema, and chronic obstructive pulmonary disease (COPD). Oxygen is typically supplied to hospitals though bulk liquid deliveries and these hospitals employ distribution points and cylinder trolleys for portable use of medical oxygen.
Techniques to produce medical oxygen
Medical oxygen can be produced in two forms. It is called GOX or GO when produced and delivered in gaseous form, and as LOX or LO when in its cryogenic liquid form. To produce oxygen in large quantities and at high purity as a gas or liquid, cryogenic distillation is adopted. For lower purity percentage of oxygen, adsorption technologies namely, Pressure Swing Adsorption (PSA) or Vacuum-Pressure Swing Adsorption (VPSA, VSA) are employed.
| Opportunity Areas |
| Manufacturing |
| Distribution |
| Refilling |
| Maintenance |
| Allied businesses such as masks and pipes |
To produce medical oxygen, it is important that the oxygen gas is free of any hydrocarbons, water and impurities. Different technologies deliver different percentages of purity of oxygen. For medical use, 91-93 percent and 99.7 percent of purity is recommended.
To achieve 91-93 percent purity of oxygen, Pressure Swing Absorption (PSA) type oxygen plants are used. In these plants, compressed air is passed over a special grade of sieve beds for the generation of oxygen.
To achieve 99.7 percent purity of oxygen, bigger plants are used employing cryogenic distillation. A plant of capacity of 50 cubic m/hour would be ideal for filling around 200 cylinders of medical oxygen.
The business
The business of medical oxygen varies from the manufacturing of medical plants, production of medical oxygen, to distribution of gas cylinders. Other areas involve the manufacturing of medical gas cylinders, cylinder trolleys, regulators, pipes, and masks.
| Mandatory for Oxygen Cylinders |
| Standard color code as per BIS 5: 2004 |
| Cylinders should be fitted with product-specific customized valves |
| IP Tag with batch number, cylinder type, production date, production unit |
| Valve guards |
| Heat shrink seal |
| Purging and testing |
Ing L&A Boschi (India) manufactures oxygen plants of various capacities to produce gaseous and liquid forms of oxygen. The company says that a plant of 50 cubic m/hour costs around Rs 40 lakh and a similar amount would be required for the cylinders. The cost of space, which would be around 300-400 sq. yard., would vary from place to place.
Business for dealers would mean supplying the refilled cylinders on demand. Medical oxygen cylinders come in three different sizes: 5L, 10L and 47L. General refilling cost for these cylinders would vary: Rs 80 for 5L, Rs 100 for 10L and 160-180 for 47L. N Ravindran of RV Distributors in Chennai says he dispenses around 30,000 cubic m. of medical oxygen per month.
Vijay Parikh of Al-Can Exports says his company produces cylinders after getting orders from oxygen producers. The standard color codes are then painted on the cylinder before it is delivered. The cost of cylinders depends on the size. On an average, a cylinder of 5L would cost around Rs 3,000, while a 10L cylinder would cost around Rs 3,000. A 47L cylinder would cost around Rs 6,000.
| Mandatory for Oxygen Cylinders |
| Standard color code as per BIS 5: 2004 |
| Cylinders should be fitted with product-specific customized valves |
| IP Tag with batch number, cylinder type, production date, production unit |
| Valve guards |
| Heat shrink seal |
| Purging and testing |
The market
Hospitals, healthcare centers and nursing homes are the biggest buyers of medical oxygen. Some amount of the gas is sold to patients who are treated at home or those who need constant supply of oxygen because of medical reasons.
However, of late, some hospitals that have a continuous demand of medical oxygen and feel the pinch of transportation costs have started producing the gas on their own site.
Quality checks and standards
The production of medical oxygen is done under rigorous quality checks. So, the material and equipment needed for production of medical oxygen have to be approved by the Bureau of Indian Standards (BIS) and the grade of quality of medical oxygen should comply with Indian Pharmacopoeia 2007 (IP 2007).
| Features of a Good Oxygen Plant |
| Quick start for fast cooling |
| Simplicity of operation |
| Easy availability of spare parts |
| Low power consumption |
| Low working pressure of oxygen gas plants |
| Low maintenance for producing oxygen gas |
| High efficiency heat-exchanger to reduce operating cost. |
Cylinders to contain medical oxygen should be made from high strength aluminum alloy with standard finish and strictly inspected and tested at every stage of production as per BSEN -1975:2000 standards. The batches of cylinders need to be tested in an IP approved laboratory and certified by a competent person.
Challenges
The business is good in big cities and there are not many difficulties in starting a business, says Ravindran. However, he says the quality standards and fair business practices are needed to ensure sustenance and growth of the business.
Some challenges, like stricter testing policies, higher operating costs, and changes in medical gas standards pose some problems for production units.
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written by Harikrushna Pattani, June 12, 2011
I am very thankful to u for giving such a deep details on most prestigious business of medical oxygen. I want to know what is the initial cost for set up of mini oxygen plant. Pls reply in brief.
With thanks,
Harikrushna Pattani.
written by K SARKAR, March 30, 2011
I want to setup a mini medical oxygen plant.Request you to please provide some guideline like what would be the setup cost for mini plant.
Thanks
written by vikas, March 28, 2011
written by ananath, March 10, 2011
written by anand kumar daheriya, March 07, 2011
I would like to setup my own o2 refill plant in disctict chhindwara(m.p.) .I want full detail and information about this plant , which type of licence and formitity are requaired and how much amount is needed for this plant. plase help sir
thanks you
written by santosh k gupta, March 02, 2011
I am a pharma products manufacturing chemist and want to know the manufacturing process
of medical oxygen from air by compressing and liquification process.
guide me.
Thanking you.
santosh gupta
written by sridharan, November 11, 2010
written by sridharan, November 11, 2010
Please let me know how i can further proceed.
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Hope visiting this page will grab your trust, all anyone really wants is a trustworthy supplier who they can count on to deliver on quickly, correctly, and top quality every time!
written by Rajesh Sarma, October 04, 2010
written by Viral Shah, August 27, 2010
I would request you to send me a reply as soon as possible.
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Viral Shah.
written by Sandeep Patil, August 21, 2010
Myself Sandeep patil from Gulbarga Karnataka, Gulbarga is a Biggest District in Karnataka Talukawise it is having Population about 6lacs and some 50+ hospitals and 4 200+ bedded hospital. District has only one oxygen plant, will setting up of another plant in this area is advisable or the existing is sufficient for above said population and hospital.
written by rahul laddha, March 29, 2010
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I would like to setup my own refill plant in disctict jaunpur(u.p.) .I want full detail and information about this plant , which type of licence and formitity are requaired and how much amount is needed for this plant. plase help sir
thanks you