Biotech & medical devices in India, explained
By Abha Lohia · Startup Decoded
Biotech and medical device startups invent and make new treatments, tests and equipment. They spend years on research and approvals first, and earn later from sales, licences or partnerships.
What are biotech and medical devices?
Biotech uses living systems, such as cells, proteins and genes, to make medicines, vaccines and tests. Medical devices are physical or software tools used for diagnosis or treatment, from a thermometer and a stent to an ECG machine or a wearable monitor.
Both are hard to build. They need scientists, labs, factories, careful testing and permission from regulators before a single patient can use them. In return, a successful product can serve many patients for many years.
In StopDown's data, examples include Temple, a brain blood-flow wearable, Sunfox, with its Spandan ECG device, Molbio Diagnostics, which makes diagnostic tests, and 4baseCare, which works in cancer genomics.
A few terms help when reading news about this area. A clinical trial tests a new drug or device on people in phases, from small safety checks to larger studies. A pilot is a small early use of a product in a hospital. A wearable is a device worn on the body to track a health signal. Consumables are the parts or kits used up with each test. A licence deal gives another company the right to use a technology for a fee. When a funding story mentions a pre-seed or Series A in this area, it often pays for building a prototype and starting approvals.
How did it grow in India?
India already has a large pharmaceutical industry that makes generic medicines for the world. That base gave the country trained chemists, factories and export links. Biotech and devices grew on top of it, helped by government support for research and by incubators.
For a long time, India imported most advanced medical devices, especially for high-end equipment. The Medical Devices Rules, 2017 brought devices under a clearer licensing system, and the government has offered support schemes to encourage local manufacturing. Check current schemes before relying on them.
COVID-19 showed what local capability can do. Indian firms made test kits, ventilators and vaccines at speed. Since then, startups have worked on low-cost devices designed for Indian conditions: small clinics, patchy electricity and few specialist doctors.
How do these businesses make money?
A device company sells the machine, often to hospitals, labs or distributors. It then earns again from consumables, spare parts and service contracts. A wearable may add a subscription for the data and reports.
A biotech company may sell a product, license its technology to a larger company, or work as a contract researcher or manufacturer for others. Some earn through partnerships and milestone payments long before they have a finished medicine.
Because of this, early funding matters. A company may spend several years with little or no revenue. Investors who back it, such as Bessemer Venture Partners, Elevation Capital or Blume Ventures, are betting that a device or discovery will clear approvals and reach customers.
What rules apply?
CDSCO regulates drugs and devices at the national level. Under the Medical Devices Rules, 2017, devices are placed in four risk classes, A to D, from low to high risk, and the higher the risk, the stricter the approval, testing and quality system. Check the current licensing arrangements for your class.
New medicines and clinical trials follow the New Drugs and Clinical Trials Rules, 2019. These set how a trial is approved, how patients give consent, and how safety is monitored. Manufacturing plants follow good manufacturing practice standards under the Drugs and Cosmetics Act, 1940.
Research on human subjects needs ethics committee approval. Genetic and health data fall under the Digital Personal Data Protection Act, 2023, whose Rules were notified in November 2025 and are being phased in. Intellectual property, mainly patents, protects inventions. This is general information, not legal advice.
Who are the customers?
Hospitals, diagnostic labs and clinics are the usual buyers of devices. Distributors sell to smaller facilities and rural centres. Governments buy in bulk for public hospitals and health programmes, which can mean large orders but slow payment.
Pharmaceutical companies buy research services and licence new technology. Patients buy directly in some cases, such as wearables sold online. Exporters sell to hospitals abroad, since Indian devices can cost less than imported ones.
Doctors influence every sale, as they decide which tool they trust. Evidence from studies and peer use matters more than advertising.
How should you judge one, and what are the risks?
Check the stage of approval first. A product that has a licence and early customers is further along than one still in the lab. Ask how the company will pay for the next stage.
Check the team: do they include scientists, engineers, clinicians and someone who knows regulation? Check the intellectual property, such as patents, and whether the product is hard for others to copy.
Finally, check the plan for selling. Many good devices fail because no one planned how to reach hospitals, train staff and handle service. A clear plan for repeat revenue from consumables or subscriptions is a good sign.
Time and cash are the first risks. Approvals and trials can take years, and a company may run out of money before it earns. A second risk is technical: many ideas fail in testing. A third is selling: hospitals buy slowly, and doctors need proof before they change what they use.
Cost and quality of manufacturing are a further concern. A device must work every time, so a company needs a quality system that satisfies regulators and customers.
Looking ahead, expect more wearables and low-cost devices built for primary care, more genomics for cancer care, and more partnerships between startups and large hospitals or pharmaceutical firms. Early rounds in StopDown's data, such as Sunfox's Series A, suggest steady investor interest in this area.
The breakdown
Business models
| Model | How it makes money | Who uses it |
|---|---|---|
| Device sale | Sell machines to hospitals, labs or distributors | Diagnostic and monitoring device makers |
| Consumables and service | Earn again from parts, kits and service contracts | Test-kit and equipment companies |
| Wearable plus subscription | Sell a device and charge for data and reports | Wearable and remote-monitoring startups |
| Licensing and partnerships | Earn fees and milestone payments from larger firms | Drug discovery and biotech research companies |
| Contract research or manufacturing | Do research or make products for others | Biotech services companies |
The numbers that matter
- Years and rupees needed to reach approval.
- Gross margin on devices and on consumables.
- Hospital sales cycle length.
- Share of revenue that repeats from consumables or subscriptions.
- Cost of a quality system and a manufacturing line.
Rules and regulators
| Regulator or law | What it means |
|---|---|
| Medical Devices Rules, 2017 | Four risk classes with licensing, testing and quality requirements. |
| New Drugs and Clinical Trials Rules, 2019 | Govern approval of new drugs and conduct of clinical trials. |
| Drugs and Cosmetics Act, 1940, and CDSCO | Set the base law for manufacturing, import and sale. |
| Ethics committees and data protection law | Human research needs ethics approval; health and genetic data fall under the DPDP Act, 2023. |
Risks
- Long approval and trial timelines that drain cash.
- Technical failure during testing.
- Slow hospital buying and need for clinical proof.
- Manufacturing quality problems.
- Competition from imported devices from large global companies.
Biotech & medical devices: latest on StopDown
- Sunfox raises $7M Series A for Spandan ECG 7 October 2026
- Theranautilus wins Top Innovator at ET Startup Awards 18 September 2026
- Integris Medtech files for initial public offering 12 September 2026
- Indegene posts strong FY26 results, outlines growth roadmap 10 September 2026
- Cyrix Healthcare acquires Blue Star E&E's MedTech business 4 September 2026
- xStep raises undisclosed funding from Titan Capital 1 September 2026
- Biodimension builds human tissue alternatives to animal testing 29 August 2026
- BioCipher Labs wins HealthSprint 2026 medtech programme 29 August 2026
Every Biotech & medical devices story →
Most active investors here
- Ashish Kacholia (2 rounds)
- Lashit Sanghvi (2 rounds)
- Yali Capital (2 rounds)
- 3i Partners (1 round)
- 3one4 Capital (1 round)
- Alchemy Capital (1 round)
- Alkemi Growth Capital (1 round)
- Dr Sanjay Arora (1 round)
Rounds StopDown covered in the last 12 months. Activity is not a measure of quality.
Questions people ask
Who approves medical devices in India?
CDSCO and state licensing authorities do, under the Medical Devices Rules, 2017, which place devices in four risk classes from A to D.
How long does it take to launch a medical device in India?
It depends on the risk class and the testing needed. Low-risk devices can be faster; higher-risk devices can take much longer, so plan for years rather than months.
How do biotech startups earn before they have a product?
Often through research contracts, partnerships, grants and milestone payments, and by raising investor funding to cover the long research period.
Why do investors back biotech and device startups?
A successful product can serve many patients for years and be hard to copy. The trade-off is long timelines, large costs and a real chance of failure.
Which Biotech & medical devices startups in India raised money recently?
Sunfox Technologies ($7M, Series A); xStep (Undisclosed, early); CARPL.ai ($10 Mn, Series A); Bioscan Research ($1M, seed); 4baseCare (Rs 128 Cr, Series B).
Who invests in Biotech & medical devices startups in India?
Among the most active backers in StopDown's coverage over the last year: Ashish Kacholia, Lashit Sanghvi, Yali Capital, 3i Partners, 3one4 Capital.
Which Biotech & medical devices companies are in the news?
Recent stories on StopDown cover Sunfox Technologies, Theranautilus, Integris Medtech Ltd, Indegene, Cyrix Healthcare, xStep, Biodimension, BioCipher Labs.
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