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Indonesia and Vietnam Healthcare Outlook: 2012-2015

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Frost & Sullivan Analyst Briefing on Indonesia and Vietnam Healthcare Outlook: 2012-2015

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Indonesia and Vietnam Healthcare Outlook: 2012-2015

  1. 1. Indonesia and Vietnam Healthcare Outlook 2012 Where are the healthcare opportunities in these emerging markets Rhenu Bhuller, VP – Asia Pacific Healthcare 29 June 2012
  2. 2. Ensure a comfortable presentation today!1. Want to Ask a Question? – Simply press Ask a Question on the player.2. Want to Share this webcast? – Click on the Share button on the player3. Use the Full Screen button ( bottom right- hand corner) on the player4. Escape button to return to normal view on your keyboard.5. Ratings button on the player for your valuable feedback. 2
  3. 3. Today’s Presenters Rhenu Bhuller, VP, Healthcare-Asia Pacific Frost & Sullivan • Rhenu Bhuller has close to 20 years of healthcare industry knowledge, including more than 10 years of consulting expertise in the pharmaceutical and biotechnology sectors. She is an industry expert and has particular expertise in new market and therapeutic area analysis; sales, marketing and business planning; market entry and business strategy; strategy discussions with c-suites, government officials, etc. • She is a regular keynote speaker at industry conferences and is also often featured in the media, such as BBC, Bloomberg, CNN, and CNBC. 3
  4. 4. Globalization, consumerism and prosperity are the majortrends that will impact healthcare in SEAGlobalization:• World is becoming smaller: cheap air- travel, connectivity,internet, medical tourism• Increased healthcare awareness because of multiple mediaINFRASTRUCTURE 1 Consumerism: • Increased self medicating behaviour; ease of access (online) • Increased expression of consumer individuality through brand choices 2 3 Prosperity: • Increasing disposable income, financial independence leading to exploring more choices • Increased health awareness has led to consumers spending more on health prevention and OTC Source: Frost & Sullivan 4
  5. 5. APAC among the fastest growing economies over thenext 5 years CAGR 2.9% a ali str Au Source: Data in the above charts were based on GDP per capita data in the respective country’s national currency as sourced from the WEO online database. The data above was converted to US dollar based on the currency conversion rate for the respective years. Analysis by Frost & Sullivan 5
  6. 6. Diverse population structures with varying levels ofpurchasing power Hi gh in m is c om o ur t G e, al ro 5- 10 d ic w e ay in % m Lo g of y, -p ru we m po a co or ra r id dl pu l fp e, tf l a ec e la Se nc an re on cl t io ra nd as o m as n su pe ic s in de HC e t pr at e n ic of ile Priv n m bas , er ov G Increasing consumer power •Rural population, low income, relies on government support. •Upwardly growing middle class, living in tier 2 cities, educated, can pay for some level of healthcare • High income category, first adopters of new technology, services, private HC lia s tra Au Sources: World Economic Outlook (WEO), World Bank and countries data. CAGR data is for 2006 to 2016 6
  7. 7. Total Indonesia and Vietnam Healthcare Market Size Healthcare Industry: Revenue Forecast Indonesia and Vietnam, 2011–2015 Market Drivers • Growing middle-class population in12000.0 Indonesia; per capita income expected to10000.0 CAGR grow from $2,580 in 2011 to $3,500 by 12.7% 2015. 8000.0 • Rise in non-communicable disease 6000.0 incidence, cardiovascular disease will CAGR account for 31 percent of total number of 4000.0 8.7% deaths in Indonesia by 2030, followed by 2000.0 other chronic diseases at 28 percent. • Vietnamese government intervention to 0.0 enhance healthcare workforce by 2020. 2011 2012 2013 2014 2015 Year Market Restraints Indonesia 5549.30 6016.30 6515.90 7072.10 7742.50 $ (Billion) • Per capita healthcare expenditure is far below global average (lowest is Vietnam Vietnam 2647.20 2970.40 3332.70 3746.80 4266.50 and Indonesia). $ (Billion) • Shortage of healthcare professionals in both countries. • Efflux of medical tourists seeking treatment in other countries; 400,000 Indonesians patients travel annually. Source: Frost & Sullivan analysis. 7
  8. 8. Indonesia—Healthcare System 8
  9. 9. Indonesia—Healthcare Indicators Healthcare Indicators: Indonesia, 2007–2011Healthcare Indicators 2007 2008 2009 2010 2011Population (Million) 226 229 232 238 245Population Growth Rate (%) 1.3 1.3 1.3 1.07 1.04Birth Rate (per 1,000) 19.65 19.24 18.84 18.10 17.76Mortality Rate (per 1,000) 6.90 6.85 6.80 6.28 6.26Life Expectancy (Female) (years) 72.7 73.1 73.4 74.0 74.3Life Expectancy (Male) (years) 67.6 68.0 68.3 68.8 69.1 Key Features• The population of the country as of 2010 stands at 238.0 million people. It is recorded as the fourth most populous country in the world.• The population of the country is expected to grow at a consolidated pace of 1.0 percent for the 2010‒ 2015 period.• Life expectancy at birth has increased by 16 months per person from 2007 to 2011, and decreasing mortality rates are a result of improving healthcare services. Source: IMF, CIA World Fact Book, Indonesian Department of Health, Frost & Sullivan analysis. 9
  10. 10. Disease Information – Major Causes of Death Source: Indonesian Association of Medical Doctors (Ikatan Dokter Indonesia, or IDI) 10
  11. 11. Indonesia—Health Care Delivery System Healthcare System Public Private Puskesmas Specialty General MOH Provincial District Private Pustus and Private PrivateHospital Hospital Hospital Clinics Mobile Hospital Hospital Clinics Source: Ministry of Health and Frost & Sullivan analysis 11
  12. 12. Indonesia—Hospital Categorization Class A (>400 beds) Extensive specialist medical = 10 services + extensive sub specialists Public Hospital Class B (100-400 Extensive specialist medical beds) = 120 services + limited sub specialists Has minimum of four basic Class C (50-100 specialist medical beds) = 250 servicesHospitals (General and Specialty) Class D (<50 beds) Provides basic medical facilities = 126 General medical services + Priority specialists and sub-specialists Private Hospital Minimum four specialists medical Madya services Pratama General medical service Source: Indonesian Department of Health, Frost & Sullivan analysis 12
  13. 13. Indonesia—Hospital Classification Hospital Classification by Type Hospital Classification by Specialty Percent of Hospitals by Type and Percent of Specialist Hospitals Sector, Indonesia, 2010 Split by Specialty, Indonesia, 2010 Public (Military) Mental 15.3% Leprosy 8% 6.6% Public Pulmonary(Ministry of Others TB Health) 19.5% 3.0% Public (State 36% or other govt dept-owned) 5% Eye 3.9% Maternity 19.5% Pediatric Private 32.1% 51% Source: Indonesian Department of Health, Frost & Sullivan analysis 13
  14. 14. Number of Hospitals: Regional Spread Aceh Hospitals are concentrated in major cities in the Sumatra No. of hospitals: 35 and Java province, such as Jakarta, Surabaya, Medan. Sumatra Selatan No. of hospitals: 34Sumatra Utara Jawa BaratNo. of hospitals: No. of hospitals: 130 144 Jawa Timur No. of hospitals: 171 Sulawesi Selatan No. of hospitals: Sumatra Barat 62 No. of hospitals: 41 DKI Jakarta Jawa Tengah Bali No. of hospitals: No. of hospitals: No. of hospitals: 124 162 34 Source: Ministry of Health, Indonesia 14
  15. 15. National Health Strategic Plan: Infrastructure Targets• Aim to increase the number of community health centers from 9,133 in 2010 to 10,856 in 2014• Develop hospitals to achieve a ratio of 1 bed per 1,000 population in 2014• Indonesia also aims to achieve sufficient numbers of medical professionals: Source: Indonesia Human Resource for Health; Development Plan, 2010 Regional Health Forum, 2006 15
  16. 16. Indonesia—Healthcare Expenditure Forecast Health Industry: Healthcare Expenditure Forecast by Type Indonesia, 2007–2015 30.00 45.00 Private Government 40.00 25.00 35.00 30.00 20.00 12.8 25.00 11.3 20.00 15.00 n o b B n o $ ) ) ( 9.5 l i 15.00 l iE 10.00udnpexrti 7.3 5.00 10.00 0.00 m G P n o a s e v 4.7 2013F 2014F 2015F r t i D U H S E u d n p h x a e 4.3 r ( t i l 12.1 13.6 5.00 10.3 Private 7.8 14.66 16.96 19.95 5.1 5.7 Expenditure 0.00 Government 15.44 17.44 19.95 2007 2008 2009 2010e 2011e 2012e Expenditure Source: EIU, World Bank, Frost & Sullivan analysis 16
  17. 17. Indonesia—Health Insurance Coverage Health Insurance Coverage, Indonesia, 2010 Enrolment (% of Scheme Target Population Funding Source(s) insured) Jamkesmas Poor and near poor, based on General revenue (100% (Askeskin) individual and household funded by central 32.3 targeting government) Jamkesda Poor and near poor, District/Out‐of‐ homeless, orphans and non- Pocket, Based on 13.5 civil service teachers affordability Askes Active civil servants and Member contribution of 2 dependents, civil service and percent of salary plus military retirees government match of 2 7.4 percent Jamsostek Private formal sector Member contribution of 3 employees (and dependents) percent of salary for of firms with ten or more singles, 6 percent for 2.1 employees families Private Health Private formal sector Out‐of‐pocket Insurance employees and dependents 7.7 Not insured 37.0 . Source: MOH, Frost & Sullivan analysis 17
  18. 18. Vietnam—Healthcare System 18
  19. 19. Vietnam—Healthcare Indicators Healthcare Indicators: Vietnam, 2010 Healthcare Indicators 2010Population (M) 88.3Population Growth Rate (%) 1.0Birth Rate (per 1,000) 17.0Mortality Rate (per 1,000) 6.8Life Expectancy (Female) (years) 74.7Life Expectancy (Male) (years) 69.5 Key Features• The population of the country as of 2010 stands at 88.3 million people. Vietnam’s population size is expected to expand about 9.2 percent from 2006 to 2014, and is likely to grow 1.0 percent annually from 2010–2014.• The increase of life expectancy (73.9 years in 2006 to 74.7 years in 2010) have led to an increase in aging population. Source: Datamonitor, Worldbank, http://vietnam.unfpa.org, Frost & Sullivan analysis 19
  20. 20. Vietnam—Major Causes of Death Major Causes of Death: Vietnam, 2010 Source: World Health Organization, 2009, Frost & Sullivan analysis 20
  21. 21. Vietnam—Health Care Delivery System Healthcare Delivery System: Vietnam, 2010 Government Professional Units under Ministry •Curative:30 hospitals with beds •Preventive:17 institutes or centres MINISTRY OF HEALTH •Quality Control: 5 institutes or centres •14 Department and Administration •Training:14 schools or colleges •The Cabinet •Centre for health education and communication •Inspectorate :17 unitsProvincial People’s Committee Professional Units under the PHS PROVINCIAL HEALTH •General and specialized hospitals for curative care SERVICE •Preventive Health Centres •Office •Quality Health Centres •Inspectorate •Training Middle Level Schools or Colleges •Centre for health education and communicationPeople’s Committees at District PROVINCIAL HEALTH •District General •District Preventive SERVICE hospitals Health Centres •Office •Clinics •InspectoratePeople’s Committees at Communes COMMUNAL HEALTH Village Health Workers CENTRES •Head •Healthcare Workers Source: Department of Health, Vietnam; Frost & Sullivan analysis 21
  22. 22. Vietnam—Classification of Public Health System Public Healthcare Infrastructure, Vietnam, 2009 Type Department DescriptionsProvincial Health Department of the • 304 general and specialist provincial hospitals in 64 Province of the People’s provinces, mostly with 50–100 beds and consultation and Committee treatment rooms. • 64 preventive medicine centres, 61 medical secondary schools, and 61 pharmaceutical companies.District Health Department of the • 3,014 medical specialist groups and 1,507 hospitals and District of the People’s polyclinics (more than 600 hospitals nationwide) Committee • About 100 beds in each of the hospitals; focus is on obstetrics, geriatrics, and paediatricsCommune Health Station of the • More than 10,600 commune health stations, with 4–6 Commune of the Peoples beds, a delivery room, and a cabinet stocked completely Committee with medicines. • Staffed with doctors, pharmacists, and nurses who transport serious cases to district and central hospitals. • Volunteers involved largely in providing immunization and family planning services. Source: The National Bureau of Asian Research, US and Frost & Sullivan analysis 22
  23. 23. Vietnam—Key Health Care Infrastructure Statistics Public Healthcare Infrastructure Statistics: Vietnam, 2009 CAGR %Infrastructure 2006 2007 2008 2009 (2006–2009)Total Number of Hospitals 903 956 974 1,002 2.6%Regional Polyclinic 847 829 781 682 (5.3%)Sanatorium and Rehabilitation 51 51 40 43 (4.2%)HospitalMedical Service Units in Communes, 10,672 10,851 10,917 10,979 0.7%PrecinctsTotal Number of Beds 1,31,500 1,42,800 1,51,800 1,63,900 5.7%Number of Beds Per 10,000 23.8 25 25.8 27.1 3.3%PopulationGeneral Doctors 52,800 54,800 57,300 60,800 3.6%Assistant physician 48,800 48,800 49,800 51,800 1.5%Nurses 55,400 60,300 65,100 71,500 6.6%Midwives 19,000 20,800 23,000 25,000 7.1%Pharmacist 16,300 18,100 19,700 21,600 7.3% Source: General Statistics Office (GSO) of Vietnam, Frost & Sullivan analysis 23
  24. 24. Vietnam—Regional Spread of Healthcare InfrastructureCentral hospitals in Vietnam are facing a shortage of beds; in some hospitals, a single bed is being shared by two or sometimeseven three patients. GSO statistics show that there were just 2.58 hospital beds per 1,000 people in Vietnam in 2008. Accordingto MOH, demand for beds in provincial hospitals is 115.0 percent while in major cities it is 250.0 percent. Hospital Description Hanoi Bach Mai Hospital It is a multi-field medical facility and one of the largest in Vietnam, recognized as one of the three specialized medical centres specializing in internal medicine. L’Hôpital Francais de The hospital stands as a 68-bed multi-disciplinary care facility offering essential medical and Hanoi surgical services, supported by 20 rotation doctors and 93 qualified nurses. Viet Duc Hospital It is the largest surgical centre in Vietnam. The hospital has more than 500 beds for patients and 18 surgery rooms and can perform over 800 open-heart operations annually. Central Vietnam Hue Central Hospital The hospital is one of three largest in the country, providing 2,078 beds. HCH is organized into 52 clinics and para-clinic departments, notably the Cardiovascular Center, Blood Transfusion Center, and Training Center. Ho Chi Minh City Chợ Rẫy Hospital It is the largest general hospital in Ho Chi Minh City. At present, the hospital has 35 clinical, 11 subclinical, and 8 functional departments. Source: Ministry of Health Vietnam, Frost & Sullivan analysis 24
  25. 25. Vietnam—Healthcare Expenditure Government and Private Expenditure on Health: Vietnam, 2006–2012 9.00 8.00 7.00 6.00 5.00 4.00 3.00 B n o $ ) ( l i 2.00 1.00 H 0.00 E u d n p h x c a e r t i l 2006 2007 2008 2009 2010 2011 2012 Private Expenditure 2.63 2.98 3.98 4.19 4.53 4.77 5.02 Government 1.29 1.99 2.05 2.52 2.76 3.01 3.25 Expenditure Source: WHO, Frost & Sullivan analysis 25
  26. 26. Mega Trends and Healthcare Market Trends 26
  27. 27. Key Mega Trends impacting Indonesia and Vietnam Future The Middle Economic High Bulge Growth Connectivity Generation Y Increase in Urbanization Working Age Population “She-conomy” Future Infrastructure Degree of Impact Private public partnerships Top Industries of Wealth the Future Innovating Watchers to Zero Health, Wellness “Value for Many” and Well Being Business Model Space Jam “Click-n-Connect” Mobile users Future Energy Power Generation E-Mobility E-Governance Low Low Probability of Success High 27
  28. 28. What’s Trending for Indonesia Between 2012 and 2015 Indonesia’s per capita expenditure on pharmaceuticals is expected to remain below the US $30 mark by 2015 as patients continue to be responsible for the bulk of their medical bills. Indonesian health ministry established a supervisory body, the Indonesian Hospitals Supervisory Agency (BPRSI), in Nov 2011. The University of Indonesia is constructing a new hospital at its Depok campus; the Japan International Cooperation Agency will provide a loan of $158.0 million to the university to establish UI Hospital. Indonesian Q3 GDP growth came in at a strong 6.5 percent year-on-year for 2011. As of December 2011, the Indonesian health insurance program for the poor, Jamkesmas, covered 76.4 million people. In Q4 2012, some of the major reforms announced by Indonesian MOH include a merger of ASKES and JAMKESMAS, and five committees are now working to set the insurance system. Source: Frost & Sullivan analysis 28
  29. 29. Examples of investments into Indonesia A state pharmaceutical company PT Bio Farma announced that it is to spend USD 60 million on a facility to produce blood plasma Singapore-based Invida Group, a specialty products, including albumin and Factor IX. The plant will be the biopharmaceutical company announced a first of its kind in Indonesia and will be built using assistance from joint venture with the local Indonesian drug South Korean and Australian pharmaceutical companies, based manufacturer PT MUGI Laboratories. Under on guidelines stipulated by the WHO. the terms of the agreement, Invida will seek to expand its operations in Indonesia to Philips supplied most of $140m in include the importation of raw materials and medical equipment for the first auxiliaries and the manufacture of dedicated cancer research centre pharmaceutical products. and the biggest hospital in Indonesia. Philips, which has group sales of $32bn and 120,000 employees, has set up a regional headquarters in Singapore with almost 300 staff with a view to increasing its share of the medical and home healthcare products in Indonesia, the Philippines and Vietnam. Siemens in Indonesia has provided support to public and private hospitals by installing computed tomography, magnetic resonance imaging systems, and angiographic systems, as well as conventional x-ray units and life support systems. Siemens supplied the first 128-slice computed tomography (CT) Somatom Definition AS+ in Indonesia. Sources: Company websites, Frost & Sullivan 29
  30. 30. What’s Trending for Vietnam In Vietnam, new health service facilities Quality of public hospitals in Vietnam is are expected to be charged an likely to improve following the enterprise income tax of 10% rather establishment of private hospitals by than the previous 28%. Singapore-based Thomson International and Pacific Healthcare, Malaysia-based Columbia Asia and the French Hospital of Hanoi, owned by the French company Eukaria S.A. Vietnamese government’s health care development plan, extending to 2020, aims at doctor patient ratio of 8, pharmacists of 2, and 25 hospital beds Vietnam’s healthcare expenditure is per 10,000 patients. growing in next five years with its healthcare spending as a % of GDP surpassing most ASEAN countries, forecasted grow up to 8.3% of GDP in 2014. Vietnam government aims to modernize traditional medicine by 2020. According to a plan, hospitals that offer traditional Regulatory reforms, ASEAN alternatives to patients will receive new harmonisation equipment in 2015 Source: Frost & Sullivan 30
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