With a rise in healthcare expenditure, business opportunities for medical technology firms are abound in the Middle East.
Though healthcare has largely been a neglected area among regional governments, events like the Arab Spring and rapidly rising population are changing the face of the industry.
Public and private sector investment into the Middle East’s healthcare sector is estimated to touch $150 billion by 2016, according to data compiled by Zawya.
“We believe the market grew by eight per cent last year,” said Maher Abouzeid, president and CEO of GE Healthcare in Middle East and Pakistan.
“If you look at the GDP spent on healthcare, it is between three to four per cent, which is less but at least we are moving away from 2.2 per cent and 2.4 per cent that was spent previously by governments.”
Though healthcare expenditure still falls below desired levels, Abouzeid said that there has been a serious effort from Ministries of Health across the region to improve the quality of healthcare.
But as governments and healthcare providers step up investment, market demand has also undergone significant change.
“We need to provide instruments that drive clinical excellence, enhance patient experience and provide economic value,” said Diederik Zeven, vice president of Philips Healthcare Middle East and Turkey.
Abouzeid said that the rising population is raising the bar for medical technology companies investing in the region.
“We need to structure our technology to meet the new demand. [Goverments] need machines that secure patient comfort, secure clinical confidence, machines that are smart and improve access to healthcare in rural areas that don’t have qualified healthcare workers,” said Abouzeid.
“We are seeing more of a demand for solutions rather than technology because the [healthcare] demand is surging and so they need somebody to provide them with complete turnkey solutions.”
However, as conglomerates such as GE and Philips deal with changing demand from healthcare providers, many niche firms are moving into the region targeting market gaps.
Medtronics, a firm that specialises in implantable devices and therapies, is shifting its regional headquarters to Dubai as it looks to cash in on the Gulf’s healthcare boom.
The medical technology company, which provides therapies to treat various lifestyle diseases, is upbeat about carving a space for itself in the Middle East market among major players.
“When we look at the markets in the region, the Middle East is a big growth region for us,” said Omar Ishrak, chairman and the CEO of Medtronics.
“The timing now is very good for us since lot of the infrastructure is just built and the capacity needs to be utilised so we consider that as a big opportunity.”
Medtronics is also looking to open up a training facility in Dubai after identifying a market gap for skilled professionals in the region.
The new academy will offer training courses to healthcare practitioners in order to improve the knowledge and skills of physicians in the areas of cardiac and vascular therapies as well as spine surgery.
“By our own estimation, in all emerging markets – which include India, China, Latin America, South East Asia and the Middle East and parts of central Europe – we find that if our existing therapies are adopted just like in developed market – we have a $5 billion a year opportunity,” said Ishrak.
“That is massive, and the Middle East market must be close to around $1 billion.”
Source: Gulf Business