Cardiovascular Diseases: a Global Concern

Although the world of the new millennium has seen many improvements in the health sector, the path of healing diseases is far to be overcome. Cardiovascular diseases (CVD) are still huge challenges for the medical society.  More people die annually from this kind of illness than from any other cause and that is the reason why it has been given an especial attention worldwide.

According to the World Health Organization (WTO), an estimated 17.3 million people died from cardiovascular diseases in 2008, representing 30% of global deaths. Coronary heart diseases and stroke are the main causes of these deaths (almost 80%). It is well known worldwide the main factors that increase the probability of getting a stroke: unhealthy diet, physical inactivity, overweight, high blood pressure, tobacco use and harmful use of alcohol.

Besides, low and middle-income countries are the most affected, about 80% of world’s death from CVD. As reported by the WHO, “people in low and middle-income countries are more exposed to risk factors such as tobacco (…). At the same time they often do not have the benefit of prevention programs compared to people in high-income countries.” Meanwhile, at a macro-economic level, it represents a heavy burden on the economies of low and middle-income countries. Non-communicable diseases – including cardiovascular and diabetes – are estimated to reduce GDP by 6,77% in low and middle-income countries facing rapid economic development.

The programs to fight against cardiovascular diseases are highly expensive. Integrated actions at country level, led by governments, are the means to maintain the people away from risk factors and, hence, not allowing it to become a burden on national economies.

There is no difference in Brazil. Around 300 thousands of people die from cardiovascular diseases each year, according to the Brazilian government. Nevertheless, by the public healthcare system (SUS), the government provides many preventive actions programs, diagnosis and free treatments for CVD.

References: http://www.who.int/en/

http://portalsaude.saude.gov.br/portalsaude/

Medical Devices Industry in Developing Countries

With the arrival of the 21^st century, a new era both in global technology industry and economic growth model began. Developed countries left the second industrial revolution behind and started focusing on the new generation of technologies: information technology, nanotechnology, internet, biotechnology. We are led to think that developing countries are still not capable of supporting this kind of industry, for requiring huge investments in R&D departments and qualified teams (without mentioning investments in infrastructure, energy and transportation). But there are some countries that are showing the world that this change is happening in the medical device sector.

 It is known that United States is the biggest global importer in this sector and verifying its top 5 importers partners of “Instruments, appliances for medical, etc science, nes” (UN Comtrade HS901890), one will find that two of them in the last four years are developing countries: Costa Rica and Dominican Republic.

The exports of HS901890 from Costa Rica to the USA sum twice the exports from Canada and Japan to the USA combined and it is higher than the export from Ireland (another top 5 import partner of the USA) to the USA. In the “Case of Costa Rica – Facts and Implications for Trade Policy”, presented by the Minister of Foreign Trade from Costa Rica in the WTO public forum, September 19, 2011, we can verify Costa Rica’s evolution on the structure of industrial exports since 1994 until 2010 and it shows that it is possible for countries in development to improve its industries, technologies and R&D departments. In 2010, Costa Rica’s top 10 export products included microchips, medical prosthesis, pharmaceutical, computer parts and transfusion equipment. In 2003, Costa Rica was consolidated as one of the main Foreign Direct Investment (FDI) locations in Latin America and in 2010, the first high-tech exporter in the continent.

The recipe of this success is simple and well known: political and economy stability (hence, FDI attraction), solid export platform, investments in human resource base (education, language skills), good geographic location (in the middle of America and close to the USA market). But according to the CIA – World Factbook of 2012, there are still things remaining to be improved like bureaucracy and legal uncertainties.

For the studies of international trade, however, exports are considered as belonged to the country of origin. But if we make a deeper analysis, we will see that, in the case of Costa Rica, the majority of the medical device companies are multinationals with international resources and not a national initiative. Nevertheless, even if the main investments are from abroad and there has to be royalties and profit transmission, Costa Rica is responsible for the attractiveness of foreign direct investments. If this country wouldn’t have created reliable conditions for multinationals, they wouldn’t have been established in its territory. With the construction of this scenario, Costa Rica is earning international visibility and confidence, which are responsible for the creation of jobs and national development.

In the case of Brazil, country where Biokyra is established, the production in this area is still shy.

       The Brazilian capacity utilization is insufficient to supply its demand. One of the reasons why this happens is the size of the market. Brazil is the 5th biggest country in population and it has a public health care that attends everyone. Apart of its demand and needs, the national production and offer are still taking their first steps. Considering that the USA is the biggest export and import player in this sector, Brazil is its 11th biggest export partner, but only its 32nd import partner (based on HS901890, UN Comtrade). The reasons why Brazilian medical device industry is falling behind other developing countries industries are the same reasons for the entire Brazilian industrial complex. Basic investments needs in energy, infrastructure, transportation, and logistics are still an obstacle for Brazilian development. Bureaucracy, slowness in legal procedures, high taxes and low-qualified labor represent some other difficulties faced by entrepreneurs, export/import and logistics professionals.

As one shall see in the graphic, the deficit between imports and exports is still huge. In 2010, while Brazilians were exporting U$600 million, they were importing more than U$3 billion of this kind of medical device. In the graphic, based on HS901890, we can see clearly the difference between imports and exports. Nevertheless, there are governmental programs and financial aid to promote any kind of export in Brazil. In the case of medical devices, the program is called “Brazilian Health Devices”, which is supported by ABIMO (Brazilian Association of Medical Devices and Equipment), in association with Apex-Brasil (Brazilian Agency of Export and Investments Promotion). It brings together 140 enterprises of this sector and it has helped increase international sales in 260%. Stimulus to get the FDA certificate, internationalization program, strategic planning and international trade missions are examples of actions that “Brazilian Health Devices” provides. Even if there are still many obstacles to be overcome, Brazilian governmental is trying to make Brazil a great nation for R&D and technologies investments.

           

References: http://www.abimo.org.br/modules/content/content.php?page=apex-brasil

http://www.wto.org/english/forums_e/public_forum11_e/made_in_the_world_the_case_of_cr_wto_19_09_11_fv_anabel_e.pdf

Brazilian private and public health system coverage growth

Brazilian health insurance market has reached revenues of  US$ 41 billion in 2011, increasing 11.7% over 2010, according to the National Health Agency (ANS).

The number of people covered by health insurance increased 4.3% and reached 47.6 million in December (about 25% of the brazilian population).

There were 1,600 health insurance operators in Brazil by the end of 2011. Three major health insurance groups - Amil, Bradesco and Intermédica - have approximately 13 million customers, which means nearly 30% of the 47.6 million users.

Following the same growth trend, SUS (Brazilian Public National Health Care System) has coverage of about 63% of the brazilian population and carries out 75% of the high-complexity procedures, playing a very important role in the entire health care chain in Brazil.

Although still representing around 1.2% of world medical products market, data indicates a growth rate above the world average in Brazil, while the government has been creating several incentives for the development of domestic medical products industry.

Sources: http://www.blog.saude.gov.br, http://saudeweb.com.br/29827/convenios-medicos-faturam-r-834-bilhoes-117-a-mais/, http://portalsaude.saude.gov.br.

Opportunities for the healthcare industry in Brazil

Emerging countries have been attracting attention from investors in the last years, and in the healthcare industry Brazil is especially promising, since it has the 7th largest nominal gross domestic product in the world and one of the largest populations, that is about 200 million people. Some recent changes, such as the higher income per capita and the aging population point for an even higher demand for healthcare services and products. For many years, healthcare expenditure in the country has been growing at a double-digit percent annually. On an absolute basis, Brazil's healthcare expenditure is nearly as high as China's and a multiple of India's.

Healthcare services, medical devices and the pharmaceutical industry are the most promising in the country, and it is even more attractive for companies that can offer innovative products and services. However, even though there are big opportunities, it is important to notice that there are also many barriers for those planning to do business in Brazil. Some of these barriers are the social differences among regions, the regulatory system, and the available sources for financing. The opportunities seem to overcome the barriers but it may be better to count on local specialists who know the country and its particularities in depth.