This article first appeared in The Edge Malaysia Weekly on May 17, 2021 - May 23, 2021

TMC Life Sciences Bhd has carved its niche in the Malaysian healthcare space thanks to its well-known fertility centres — it is in the Malaysia Book of Records for the highest number of babies (5,388) conceived via in-vitro fertilisation (IVF) by a single IVF practice.

While the group has proven its track record in the fertility space, TMC group CEO and executive director Nadiah Wan tells The Edge that the operator of the Thomson Hospital Kota Damansara and six fertility centres under the TMC Fertility brand across the country plans to be a more integrated holistic care provider.

“Fertility services have always been at the core of our group, but since the hospital opened in 2008, we have grown by leaps and bounds in creating niches in other services as well. Many of our hospital’s tertiary subspecialities — such as otorhinolaryngology (a surgical subspeciality that involves the ears, nose and throat), gastroenterology and hepatology as well as orthopaedic surgery — have been growing, similar to other big-name private hospitals.

“For us, the next big thing we are focusing on is our integrated cancer centre. It will be called Oncology@Thomson Hospital, and it will really cut across all cancer [treatment] modalities, from chemotherapy to surgery to radiotherapy and nuclear medicine. We have purchased a few machines that will be the first in Malaysia to provide this kind of advanced treatment to our patients, so we are really excited to get started on this.”

The cancer centre will be part of the group’s expansion plans for its flagship Thomson Hospital Kota Damansara. The expanded hospital, which is already almost completed, is scheduled to be opened in the third quarter of the year.

“The building is already 99% completed, and we are now getting all the regulatory approvals. We expect to open by the third quarter of this year, as projected.

“We have enough capacity for 600 beds [with the expansion], but we are going to open the wards progressively — a hundred beds by the end of this year, and then another hundred maybe at the end of next year or early 2023. Depending on the situation, we will stagger it that way,” she says.

Like other private hospitals in the country, Thomson Hospital is also playing its part in treating Covid-19 patients, as public hospitals reach maximum capacity with the rising number of cases in the country.

“Our occupancy [Covid-19 and non-Covid-19 patients] on weekdays is more than 80%, which is very full. We have a designated ward for ­Covid-19 patients, which is already at full capacity — we have allocated 10% of our beds for Covid-19 patients. Our non-Covid wards are also full. We believe most of the private hospitals are also facing the same situation now as the number of Covid-19 patients in the country is increasing, with more and more needing hospitalisation.

“If the number of cases in the country continues to rise, both the government and private hospitals will have to slow down on elective cases, and we hope it does not come down to that,” Nadiah says.

Covid-19 also impacted the group’s financials last year. Group profit after tax for the financial year ended June 30, 2020 dropped 43% year on year to RM13.3 million. Profitability was impacted by a decline in revenue as a result of lower patient load owing to the Covid-19 outbreak and subsequent Movement Control Order, as well as higher staff costs, lower interest income and higher depreciation. The group had guided for a double-digit revenue growth y-o-y, but this fell short when revenue slipped 3% y-o-y to RM153.4 million.

Nadiah says contribution from international patients — previously around 15% of group revenue — dropped to a single-digit percentage.

“There has been a slowdown in our fertility services because of the impact on medical tourism, with the borders being closed owing to Covid-19. Medical tourism is very highly regulated now. We still get a few patients but not many, as to come here to seek treatment they have to charter a plane and get quarantined in the hospital.

“However, we do see a pickup in local patient contribution, thanks to couples being able to withdraw [from Account 2] of their Employees Provident Fund savings for fertility treatment. We have also recently relocated our Puchong fertility centre to the Puchong Financial Corporate Centre. And we recently completed the refurbishment of our fertility centre in Kepong and recruited two new doctors as well. So we are growing in that way, but definitely not as fast as we could have, had the borders been open.”

For FY2021, Nadiah says the group will definitely be able to achieve double-digit growth in revenue, mainly because of the low base last year.

“However, our aim this year is to get back to our FY2019 figures, at pre-Covid-19 levels.”

The group has had to raise prices slightly — a single-digit increase on average — because of infection control measures to contain the spread of Covid-19 and the increased usage of personal protective equipment.

But there have not been any cost-cutting measures or layoffs.

“We did not lay off any people [despite a tougher FY2020], in fact we are still trying to recruit nurses aggressively. There is cost containment, of course, where we try to renegotiate prices with our suppliers,” Nadiah says.

While TMC may have been one of the pioneer fertility centres in the country — it opened its first centre in 1994 — many fertility centres have since come up as other fertility specialists branch out on their own.

Even so, TMC has had a head start and was named Malaysia Fertility Centre of the Year by Frost & Sullivan in 2016, 2017 and 2019, and Fertility Service Provider of the Year for four consecutive years, from 2016 to 2019, by Global Health and Travel.

Nadiah says innovation is key to staying ahead of the game. “We have always been at the forefront in terms of new services that we would like to introduce, such as pre-implantation genetic diagnosis, artificial intelligence-enabled embryo viability tools, which help to bring greater accuracy and improve IVF success rates. One such tool that we use is the state-of-the-art incubator with time-lapse technology that allows the embryologist to monitor the embryos while they are still in it.”

Another exclusive product, she says, is micro-RNA (miRNA)-based Receptivity Analysis, which assesses a combination of miRNA biomarkers in order to determine the status of a patient’s endometrial receptivity, thus increasing the chances of IVF treatment success.

“Last but not least, I think what differentiates us from other centres is being part of a larger network — the cross-synergies we have with other services of the hospital, for example, our fertility doctors work with our urologists at times. And in October, when we launch our cancer centre, egg preservation or egg freezing services will be something we would like to offer cancer patients,” she says.

On TMC’s Thomson Iskandar Medical Hub project in Johor — it will comprise a 500-bed multi-disciplinary tertiary Iskandariah Hospital, as well as medical, allied health and nursing training facilities and medical research facilities — Nadiah says the target is to commence hospital operations in three years.

“We recently received approvals from the Ministry of Health on the plan for the hospital, but now we are pursuing approvals from other agencies. We will also be closely monitoring the situation in Johor, in terms of the reopening of borders, as this is very crucial for the hospital and also for our fertility centre in Johor.

“The medical hub in Johor is definitely an important part of our growth aspirations as it is quite a big project, but we want to time it so that the opening coincides with the Covid-19 situation stabilising and cross-border travel being allowed to resume and the Johor Baru-Singapore rail transit system commencing, so that we are ready to catch the wave when it comes.

“Looking at the current situation, I would say that it would take three years for the hospital portion to kick off,” she projects.

Despite an earnings dip last year, TMC’s share price has increased steadily, gaining 17% y-o-y to close at 68.5 sen last Monday, which values the company at RM1.19 billion. Even so, its share price has underperformed compared with in 2017, when it was trading at over 90 sen.

Singaporean billionaire Peter Lim Eng Hock remains the largest shareholder of the group, with a 70.1% stake via his interests in Sasteria (M) Pte Ltd, Sasteria Pte Ltd and the Singapore Exchange-listed Thomson Medical Group Ltd. Johor crown prince Tunku Ismail Sultan Ibrahim is a substantial shareholder and owns 7.64% of TMC.

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