Asia-Pacific Healthcare Outlook 2014


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Asia-Pacific Healthcare Outlook 2014

  1. 1. Frost & Sullivan’s Asia Pacific Healthcare Outlook 2014 Bringing Localization to Global Markets © 2014 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property of Frost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.
  2. 2. Today’s Moderator and Panelists Reenita Das Partner, Healthcare Rhenu Bhuller Senior Vice President, Healthcare Natasha Gulati Senior Industry Analyst, Connected Health 2
  3. 3. Focus Points for Today’s Panel Discussion What are some of the key developments in APAC that could change the playing field in Healthcare Reenita Das What are some of the key predictions for 2014? What are some of the key developments in healthcare financing impacting the industry? What are some of the key regulatory changes affecting the industry? How are the investments and consolidation shaping-up in the region? What could be some of the technologies that could shape our future? 3
  4. 4. Poll Question Which are the top three challenges facing your organisation in Asia Pacific markets today: • • • • • Requirements for evidence to show cost effectiveness of medical products (e.g. health technology assessments) Price controls for innovative products Lack of reimbursement coverage/access to innovative medicine/products. Under-utilization of advanced technology in healthcare delivery Others (please indicate) _____________________________ 4
  5. 5. 2013 – The year that saw the Industry moving Toward Better Access, Transparency, Investments and Spending $2.2 Tn 99.0% coverage of UHC for China’s rural population via New Rural Cooperative Scheme (NCMS). $1.34 Tn APAC HC spend by 2018 (10.5% CAGR) Investment by SK MOH for dev. of 20 new drugs Spend on HCIT by hospital operators Target for generic consumption in Japan PHI benefits paid out in Australia Private HC spend . . . >10 Bn ~2% >15 Bn 45% (2013) $9Bn 30% 4.8% APAC HC M&A (>10% increase over 2012) 38% Of healthcare service providers operating beyond their home country 78% OOP 15-20% Price cuts in China for 700 formulations. 348 drugs in India may receive similar treatment Increase in per capita HC exp by 2018 500+ Drug approvals in China (-17% from 2012) 213 Drugs added to China’s EDL 5
  6. 6. What are Some of the Key Predictions for 2014? 6
  7. 7. Frost & Sullivan’s Predictions 2014 Even Though HTA Gains Momentum, Value Based Care in its Entirety Remains Nascent Replication of Home Healthcare Models Entering Growth Markets Transparency in Pharmaceutical Pricing Would Negatively Impact Bottom Line for Pharma/Biotech Companies Source: Frost & Sullivan. 7
  8. 8. Poll Question Please select the top three emerging markets in Asia Pacific which are of highest priority to your organization for future growth? 1. 2. 3. 4. 5. China India Indo China (Laos, Myanmar, Cambodia) S E Asia (Indonesia, Malaysia, Thailand, Phillippines) Others _____________________ 8
  9. 9. Key Developments in Healthcare Financing and Regulations
  10. 10. Total APAC Healthcare Spending is expected to Grow from USD1.34tn to USD2.2tn in 2018 at a CAGR 10.5% Healthcare Expenditure per Capita, APAC, 2012 - 2018 CAGR 2012-2018 2.3% 8000 $7,762 7000 3.4% 9.7% 5.5% 16.1% 4.7% 8.7% 13.8% 15.3% Healthcare expenditure per capita is expected to increase 4.8% across the region by 2018 $6,777 USD$ 6000 5000 $4,269 4000 $3,494 $3,841 3000 $2,200 2000 $2,277 $1,655 $730 1000 $297 $518 $681 $281 $170 $237 $109 $148 $63 Indonesia India 0 Australia Japan Singapore South Korea 2012 China Malaysia Thailand 2018 10
  11. 11. Although Enrolment to the UHC Schemes Would Eventually be Achieved, Delivery will be Challenging UHC – Universal Health Coverage. Sources: Frost & Sullivan, Ministries of health of respective countries. 11
  12. 12. While Governments Enforce more Complex value based Healthcare Measures… Cost Control Tools* Increasing level of complexity Risk-sharing agreements AUS CH IND JP KR TW Y ID MY Y SG TH VT R/L Cost-effectiveness assessment R/L R/L R/L Quality/innovation/ therapeutic value rating Y Y Generics promotion Y Y Y R/L R/L Y Y Y R/L R/L Y Y Y International price referencing Spending caps Y Patient contributions Prescribing controls Y Y Y Mandatory price cuts *Some of these are currently being practiced/applied only for pharmaceutical products R/L: Recently implemented/Limited applicability; Y: Yes Y Y R/L Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Sources: Frost & Sullivan, Ministries of health of respective countries. 12
  13. 13. How are the Investments and Consolidation shapingup in the Region? 13
  14. 14. Japan Leads M&A Activity Followed by China and India Very High High Medium Low APAC M&A in healthcare: Till Q3 2013: $10.1bn 2012: $9.1bn Japan M&A in healthcare Till Q3 2013: $1.7bn 2012: $0.4bn * Only till Q3 2013. Sources: Frost & Sullivan. 14
  15. 15. Healthcare Services Sector Ripe for Partnerships India Fortis sold its stake in Quality Healthcare in Hong Kong to BUPA for $355 M. Indonesia First REIT acquired 2 of Siloam Hospital chains for $190.3M Thailand Vibhavadi Hospital acquired 4 hospitals for $90.59 M Malaysia KPJ continues acquisitions. Australia Ramsay Sime Darby JV established in Malaysia Increasing Asia Pacific level acquisitions and partnerships Healthcare services and delivery continues to see healthy activity, both expansion and consolidation Sources: J.Chakma et al. NEMJ. Ministry of Health of respective countries, Frost & Sullivan 15
  16. 16. What could be some of the Technologies that could Shape our Future? 16
  17. 17. Frugal Innovations Addressing Common Challenges Input Cost: R&D Output Cost: Affordability Scale-up Quality Distribution Adaptability Simplification Frugal Innovation Performance Servicing Companies Technology Cost Market Impact Indian prosthetics organization, BMVSS Artificial Limb $45 Used in over 1000 amputees TouchHb Not available Device to detect anaemia without a blood sample. undergoing clinical trials at a few hospitals in Mumbai $40 to $55 A bluetooth-powered hardware device for easily monitoring and managing blood sugar levels in diabetics Biosense Diabeto Forus Health Phoenix medical systems Diabetes Monitoring low-cost portable pre-screening ophthalmology device 3nethra Infant warmer and incubator $1,300 affordable alternatives to infant warmer and incubator Source: Frost & Sullivan 17 17
  18. 18. ICT Becomes More and More Pervasive in Healthcare RFID (Radiofrequency Identification) Secondary Use of EMR/ EHR Data M2M (Machine-toMachine) Bluetooth Population Health Management NGS Informatics and Analytics Big Data GSM; Mobile Networks Remote Patient Monitoring Medical Imaging and Informatics Healthcare Consumer at the center of the eco-system and in control of his health Cloud Infrastructure Other Unexplored Technologies Seamless information gathering, collation, analytics, and dissemination 18 18
  19. 19. Asian Companies come out of the Closet: Our Top Picks SYSMEX Hengrui Medicine Samsung Electronics Telstra Slated to be one of the top global diagnostic companies by 2018, already leading in one of the key IVD segments . One of the leading domestic pharmaceutical companies with turnover of close to $1B. It is one of the first Chinese companies to have received USFDA and European regulatory authorities for its products e.g. Imrecoxib. Samsung S Health has emerged as the mobile app of choice not only because of its multiple functionalities but also because of the wide consumer base the company enjoys. Telstra Health recently announced its eHealth strategy focusing on how it can leverage its differentiating services to solve healthcare problems. 19 19
  20. 20. Next Steps Develop Your Visionary and Innovative Skills Growth Partnership Service Share your growth thought leadership and ideas or join our GIL Global Community Join our GIL Community Newsletter Keep abreast of innovative growth opportunities Phone: 1-877-GOFROST (463-7678) Email: 20
  21. 21. Your Feedback is Important to Us What would you like to see from Frost & Sullivan? Growth Forecasts? Competitive Structure? Emerging Trends? Strategic Recommendations? Other? Please inform us by “Rating” this presentation. 21
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  23. 23. For Additional Information Jennifer Carson Corporate Communications Healthcare (210) 247-2450 Reenita Das Partner, Healthcare Healthcare (408)857-9386 Rhenu Bhuller Senior Vice President, Healthcare Healthcare Natasha Gulati Senior Industry Analyst Healthcare 23