Brazilian Healthcare Market 2012: a retrospective

    As an innovative industry, the Brazilian healthcare industry exports to more than 180 countries and generates around 100 thousand jobs in the national territory. The sector is considered an important component in the Brazilian economy. And so, it is important to analyze its updated market numbers.

   ABIMO is the Brazilian Healthcare, Medical and Dental Equipment Industry Association. It releases healthcare market numbers every year. One can access some of the 2012 statistics in ABIMO’s official webpage. There are information about the healthcare national production value, productivity, investment, international trade, national production and demand, Brazilian taxes, etc. Some indicators draw more attention than others. The “healthcare national production value” is one of them, as it reached almost R$5 billion (more than US$2.17 billion) last year. “Investments” is as well an important indicator and it represented more than R$300 million (more than US$130 million) in 2012.

    Unfortunately, the Brazilian healthcare industry must be careful about the numbers of international trade (imports surpassed exports) and the national production only represents 38,9% of the national demand.

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

Medical Device Firms and Its Challenges

As the medical device industry faces some significant market threats these days, like slow-growing market and strong regulatory system, it became necessary to be vigilant for signs and understand when changes are needed. Executives should pay attention to at least four signs that indicate that their companies need to adapt. Frost & Sullivan's Venkat Rajan, principal analyst, who leads the firm's analysis of the medical device sector, discusses what those are.

The first sign is “Utter Lack of Product Differentiation” which means that customers see medical device products as commodities and it leads to customers’ indifference to the product. The second sign is “Profit Model Under Pressure”, this means that the profit margin declines year by year and to assure its market presence companies are facing significant internal cost-cutting. The third sign is “Market Disruptors on the Horizon”, this sign has to do with fast technology development which means that a product becomes obsolete quickly and, sometimes, its substitute proves to be better, faster and cheaper. Finally, the fourth sign is “Internal Infrastructure Deteriorating”, this means that the company’s workforce usually is slow to adapt or innovate and its strategy normally is focused on maintaining its market presence instead of expansion.

References: http://www.mddionline.com/article/four-signs-medtech-firm-needs-reinvent-its-business-model

Healthcare Industry Continues to Impress

Startups of the healthcare sector in USA attracted $1.81 billion from venture capitalists in the second quarter of 2013. Medical device startups represented 38% of the deals and 35% of the dollars invested. This according to the Q2 Venture Capital Activity Report issued by CB Insights, a venture capital database.

Although money invested by venture capitalists into startups declined 14% when compared to the same period last year, the number of deals remained the same. Total investments represented 24% increase over the first quarter when the money invested reached $1.47 billion.

California was the investments main destination (43% of the $1.81 billion invested in the sector and 41% of the deals), followed by Massachusetts (20% of the money invested in the sector and 15% of the number of deals).

The healthcare IPO (Initial Public Offer) market also impressed: 11 of the 22 IPOs in the second quarter of 2013 were of healthcare companies.

References:http://www.mddionline.com/article/q2-venture-capital-investments-early-stage-healthcare-companies-reach-five-quarter-high

Brazilian Medical Device Sector: national supply, imports and investments

Since the domestic supply of medical devices in Brazil is not able to fulfill the Brazilian increasing demand, imports continue to be an important resource. In 2012, the country imported approximately $4 billion in medical equipment and it can hit $9 billion over the next 2 years.

To prevent Brazil from becoming too dependent on imported medical device products, the Brazilian government is trying to change this scenario. Public and private investment in healthcare research may reach $7 billion over the next four years (almost 0,30% of the GDP). These assets come from the National Bank of Economic Development (BNDES), Brazilian Innovation Agency (FINEP), National Health Ministry, Science and Technology Ministry and Pharmaceutics’ Labs. The research agenda is guided by the needs of the Brazilian Healthcare Public System (SUS).

References: http://www.qmed.com/news/brazilian-medical-device-imports-hit-9-billion-2018?cid=nl_qmed_daily

http://www.anpei.org.br/imprensa/noticias/pesquisa-em-saude-tera-investimento-de-r-13-bilhoes-em-quatro-anos/

Human Health Framework in the 21st Century

To understand the global framework of the 7 billion citizens’ health, the Harvard School of Public Health (HSPH) along with other institutions promoted a worldwide project called Global Burden of Disease. Described as “the largest study of its kind and the first such study since 1990”, the project intends to make a list of the main causes of death and disability, and brings together about 500 scientists from 50 nations.

One of the findings shows the decline in children’s mortality rate due to improvements  in infectious disease control with sanitation and vaccines. Another finding is the increase of life expectancy, but, unfortunately, people are spending their  later years in poor health as a result of chronic diseases (cancer, diabetes, etc). The leading causes of death are: Ischemic Heart Diseases, Lower Respiratory Infections, Stroke, Diarrheal Disease, HIV/AIDS.

To check the pdf version of the HSPH infographic, go to: http://www.hsph.harvard.edu/news/files/2013/05/HPHSPRING2013infographic.pdf

References: http://www.mddionline.com/blog/devicetalk/global-burden-disease

Medical Device Industry Growth in Latin America and Brazil

Since every crisis might be seen as an opportunity, strategic measures must be taken in these days. Emerging markets can be considered as a strategic target market to escape from the international crisis. One region that is getting international medical device investors is Latin America.

Because of cost advantages, suppliers and medical OEMs are entering Latin America. The region expects a growth by double digits in the coming years. Today, the Latin America medical device market is worth U$10.5 billion and it is expected to reach US$20 billion by 2015. The exports of Costa Rica’s medical device represented 11.8% of its total exports of good. The government of Peru invested U$333 million to improve public healthcare. In 2011, Colombia imported U$799.3 million in medical equipment and supplies.

As for Brazil, the largest market in Latin America, the exports of medical device reached US$555.1 million in 2011. The growing of middle-income families and aging population makes Brazil a special target. Despite of the expected growth in the medical device industry, high import prices and a bifurcated public/private system could impede a higher expansion.

References: http://www.mddionline.com/article/latin-americas-medtech-market-growing-double-digits-infographic

http://www.mddionline.com/article/brazil%E2%80%99s-growing-economy-fuels-vascular-delivery-device-sales-despite-market-limiters

Medtech Global Market 2011-2018

As the world lives a crisis season, economic and financial advice has become one of the most important analysis. Result Healthcare intends to guide healthcare companies providing these kind of advice and one of these attempts is the “What’s hot and key trends in Medtech in 2013[1]”.

The report indicates a growth in the medtech global market at 4.4% until 2018. It also predicts that the pharmaceutical sector will grow at only 2.5% and the in vitro diagnostics will be largest medtech segment, with some important sub-segment areas as robotic-assisted surgery and mobile health.

Some of the main conclusions of this report can be seen in the tables below:

So, one can say that there are reasons for medtech companies to be optimistic about the future.

References: http://medicaldesign.com/business/medtech-be-440b-market-2018-says-report

---

[1]  To check on the report, go to http://www.resultshealthcare.com/media/105652/medtech_2013.pdf