Frost & Sullivan - APAC’s Medical Devices Market Ready To Skyrocket


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Frost & Sullivan - APAC’s Medical Devices Market Ready To Skyrocket

  1. 1. APAC’s Medical Devices Market ready to skyrocketThe Asia Pacific medical devices market is making a steady comeback after the globalrecession of 2009. Frost & Sullivan forecasts a CAGR of 10.2% from year 2009 – 2012, withthis sector being worth 62.3 billion in APAC by 2012, a contribution of 25.8% of the globalmarket.Frost & Sullivan say that the APAC medical devices market is transitioning toward a mindsetmore focused on patient monitoring. An increased demand for safety, accuracy, efficiencyand cost from healthcare service providers will consequently also drive the silver industrydevices, whilst the convergence of devices and pharma products will be a trend morecommonly witnessed especially so in drug delivery. These factors will drive medical devicemanufacturers to increase R&D budget to develop newer and better products to meetmarket demands and customer requirement standards.Whilst globally, CAGR from 2009 to 2012 is expected to be at 5.8%, APAC will see a CAGRof 10.2%, and revenues in this segment are set go up to USD62.3 billion by 2012, capturing25.8% of the global market revenues.Technological convergence between diagnostic, monitoring and treatment devices will beanother major driver as medical professionals view the merging of technology as the nextbig step in accurately delivering drug treatments on time and in specific doses whileconducting regular diagnostic and monitoring procedures. Doctors are actively prescribingmedical devices such as the Insulin Pump & Blood Glucose Monitor for Type 1 Diabeticpatients to help patients to monitor blood glucose level and administer regulated insulin atthe same time.Indicatively, it is likely that by 2015, the medical devices industry in APAC will be looking ata growth rate almost double that of the rest of the world, signifying exciting times aheadindeed for Asia Pacific. APAC Medical Devices Market Transition to a mindset of monitoring Medical Devices Revenues, US$ Bn, 2009-2012 Market Drivers 350 •Safety, accuracy, efficiency, cost 300 CAGR •Silver industry devices 5.8% 227.5 240.7 250 215 •Convergence of devices and pharma products 203 Rest of the 200 World 150 163.7 171 178.4 APAC 156.5 100 Market Restraints CAGR 10.2% 50 46.5 51.3 56.5 62.3 •Regulatory and reimbursement hurdles 0 2009 2010 2011 2012 •Lack of sufficient distribution networks 23.8% APAC Share 25.8% •Inadequate training/certification for allied staff Note: All figures are rounded; the base year is 2009. Source: Frost and Sullivan Source: Frost & Sullivan. 14 1
  2. 2. Some of the market restraints that APAC will have to address include regulatory andreimbursement hurdles, lack of sufficient distribution networks and inadequatetraining/certification for allied staff.Looking from a country perspective, a strong regulatory policy that enforces stringentcontrol over medical devices manufacturing processes is crucial for market growth. Malaysiais striving to be an example for the region with the enactment of the Medical Devices Act tocircumvent proper manufacturing processes, packaging, distribution & sales within thecountry.Such regulatory policy will help raise the quality of medical devices manufactured inMalaysia to be equivalent to that of international standards. The policy will also attractforeign investors to view Malaysia as a viable manufacturing option for medical devices andin turn increases exports activity.The medical device industry in Malaysia is climbing steadily at a CAGR of 9.3%. Frost &Sullivan foresees that by 2012, the overall revenue forecast for medical devices will exceedUSD 900million, which is over a 31% increase in revenue from the year 2009. The growthwas attributed to driving factors such as growing global demand for disposable surgicalproducts, growth in cardiovascular disease and orthopedic procedures, as well as astrengthening of the legal framework for IP for medical devices manufacturers. Malaysia Medical Devices Market Growing demand for disposables buoys up market Medical Devices Revenues, US$ Mn, 2009-2012 Market Drivers • Growing global demand for disposable surgical products • Growth in cardiovascular disease and orthopedic procedures • Strengthening of legal framework for IP for medical devices manufacturers Market Restraints • Medical Devices Act to be fully implemented in 2010- unregistered companies may no longer be able to supply products •Distribution challenges in rural areas restricts Note: All figures are rounded; the base year is 2009. Source: Frost and Sullivan growth Source: Frost & Sullivan. 15Self monitoring blood glucose & insulin injection devices will see increased demand, spurredby an increased level of awareness as well as an increase in the number of diabetic patientswithin the country which are currently standing at about 1.8 million people, though a good80% more of diabetics in need of treatment, are yet undiagnosed.The pressing need to address and curb an increasing number of infectious diseases &hospital-acquired infections such as H1N1, MRSA, will naturally result in a strong movetoward disposables, signifying this is an area of high growth potential. Malaysiamanufacturers are already implementing technological advances in disposables esp. medical 2
  3. 3. gloves, catheters, etc., and many companies have already set the stage to become leaderswithin the industry.Opportunities are also abound to set up design & manufacturing innovation clusters forhigh-end medical devices e.g. cardiovascular, orthopedic implants, etc. There has been aglobal push for implantable devices based on the Asian physiology. For example, Malaysiaby market forces has developed a dynamic cluster focusing on the entire value chain oforthopedics from biopharma growth factors & natural supplements to implantable devices.In order to fast track this sector, centres of excellences in orthopedics are required so thatproducts can move from bench to bedside much quicker. Under the Industrial MalaysianPlan 3 US$ 234 M (RM 800 million) has been targeted as investment in medicaldevices/equipment for 2010Given the right incentive and the right timing, investors may be well placed to capture andcapitalize on the abundant opportunities that may be reaped in the medical devise industrywithin Asia Pacific and Malaysia.This article was authored by Simranjit Singh, Director, Healthcare Practice, Asia Pacific,Frost & Sullivan.Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth andachieve best-in-class positions in growth, innovation and leadership. The companys GrowthPartnership Service provides the CEO and the CEOs Growth Team with disciplined researchand best-practice models to drive the generation, evaluation and implementation ofpowerful growth strategies. Frost & Sullivan leverages over 45 years of experience inpartnering with Global 1000 companies, emerging businesses and the investmentcommunity from 40 offices on six continents. To join our Growth Partnership, please visit contact, please email or 3