Identify the leading healthcare trends in Latin America. With information on Brazil, Mexico, Colombia, Chile, Peru, Argentina. Pharmaceuticals and Hospitals, as well as hospital demographics.

1. Guillaume
Corpart
+1
(305)
441-­‐9300
x302
gc@globalhealthintelligence.com
www.globalhealthintelligence.com
February
2015.
©
2015,
Global
Health
Intelligence.
All
rights
reserved.
Global
Health
Intelligence
whitepaper
Latin America’s 9 healthcare
trends to watch in 2015

2. 4%
7%
7%
2%
Emerging markets will shape healthcare growth
…GHI delivers intelligence to win globally.
Source: Global Health Intelligence analysis based on data
from the OECD, CEPAL, WHO, the World Bank and certain
local ministries
Healthcare expenditure will grow 2 to 3x as fast in emerging markets…

3. Global Health Intelligence provides:
Hospital
demographics
The
world’s
largest
hospital
demographics
database
focused
on
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markets
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equipment
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Mexico
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Market
Intelligence
experience
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sizing
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&
market
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diligence
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• Best
pracQces
• PosiQoning
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opportunity
idenQficaQon

‚
ƒ
2

4. Latin America’s 9 healthcare
trends to watch in 2015

5. La/n
America’s
healthcare
market
is
evolving
in
ways
that
will
present
new
opportuni/es
for
firms
willing
to
invest
in
the
region.
The
report’s
insights
are
intended
to
enable
decision
makers
to
seize
the
right
opportuni/es
and
inform
their
go-­‐to-­‐market
strategies
throughout
the
region
accordingly.
This
report
outlines
4
key
themes
driving
change
in
customer
behavior
and
market
context:
1. The
aging
populaQon
2. The
prevalence
of
chronic
diseases
3. The
beginnings
of
healthcare
technology
innovaQon
4. Policy
changes
As
well
as
5
developments
in
specific
segments
of
the
healthcare
market
with
important
implicaQons
for
investors:
1. PharmaceuQcal
sales
growth
2. Predominance
of
generic
drugs
3. ConsolidaQon
of
pharmacy
retailing
4. OpportuniQes
in
the
region’s
16,000+
hospitals
5. The
appeal
of
the
medical
device
market
Forward
4
To
learn
more
about
Global
Health
Intelligence,
our
services,
consulQng
engagements
and
speaking
opportuniQes,
please
contact:
Guillaume
Corpart,
Managing
Director
+1
(305)
441-­‐9300
gc@globalhealthintelligence
www.globalhealthintelligence.com

6. 9 drivers and opportunities
5
EVOLVING
CONTEXT
AND
CUSTOMERS
OPPORTUNITIES
IN
A
CHANGING
COMPETITIVE
LANDSCAPE
1.
Demographics
will
create
opportuniQes
for
the
private
sector
5.
Pharmaceu/cal
sales
will
grow
12%
per
year
through
2017
2.
Chronic
disease
prevenQon
and
treatment
will
drive
growth
in
certain
healthcare
segments
6.
Generics
will
account
for
65%
of
LaQn
America’s
retail
pharmaceuQcal
drug
sales
by
2016
3.
Technology
advancement
will
create
opportunity
for
new
market
developments
7.
The
consolida/on
of
pharmacy
retailing
will
generate
investment
opportuniQes
4.
Brazil
invites
foreign
investment
to
private
healthcare
8.
The
potenQal
of
LaQn
America’s
16,000+
hospitals
9.
Imported
medical
devices
account
for
over
$10
billion
in
LaQn
America

7. Evolving Context and
Customers

8. SHIFTING
DEMOGRAPHICS
LaQn
America
is
basking
in
a
2-­‐to-­‐3
decade
demographic
sweet
spot:
• There
is
lower
popula/on
growth,
driven
by
urbanizaQon,
greater
access
to
educaQon
and
a
larger
proporQon
of
women
in
the
workforce
• Popula/on
aged
over
65
will
rise
at
a
rate
three
Qmes
higher
than
the
growth
rate
for
the
populaQon
as
a
whole
in
2000-­‐2025
This
will
shia
healthcare
needs
moving
forward
OPPORTUNITIES
1. Private
enterprise
could
play
a
greater
role
in
coping
with
increased
demand,
parQcularly
in
non-­‐hospital
care
such
as
clinics,
ambulatory
services,
hospice
care,
nursing
faciliQes,
and
home
care
2. Technology,
IT
and
the
private
sector
have
opportuniQes
in
lowering
healthcare
access
costs
(especially
of
an
aging
populaQon)
in
fields
such
as
telemedicine,
healthcare
IT,
medical
devices
and
medical
technologies
3. Preven/ve
care
and
health
promoQon
are
on
the
rise,
expanding
opportuniQes
for
healthy
eaQng,
exercise
and
diets
1. Demographics will create opportunities for the private
sector
7
40%
41%
32%
23%
18%
56%
55%
62%
67%
64%
3%
4%
6%
10%
18%
1950
1975
2002
2025
2050
0-­‐14
15-­‐64
65+
Percentage of Latin American population by
age group, historic and forecast
Demographic
bonus
Demographic
dividend
Probability
High
Impact
Regional
Speed
Slow

9. THE
PREVALENCE
OF
CHRONIC
DISEASES
Non-­‐communicable
diseases
will
be
the
cause
of
84%
of
deaths
in
La/n
America
by
2030
• Obesity
is
at
the
heart
of
the
discussion
as
it
is
a
trigger
for
condiQons
such
as
diabetes,
high
blood
pressure
and
cholesterol,
heart
disease,
strokes
and
respiratory
and
gastrointesQnal
diseases
• Cancer
is
also
on
the
rise
–
esQmates
show
that
1
million
people
will
succumb
to
cancer
annually
by
2030,
with
1.7
million
cases
diagnosed
annually
IMPLICATIONS
FOR
HEALTHCARE
1. Preven/on
is
a
vast
area
of
opportunity
for
pharmaceuQcal
companies
and
food
manufacturers
2. Improving
healthcare
access
and
the
quality
of
detec/on
methods
is
an
area
of
future
growth
for
medical
imaging
equipment
manufacturers
and
providers
of
diagnosQcs
services
and
equipment
3. The
increasing
demand
for
drugs
designed
to
treat
cancer,
diabetes
and
heart
disease
will
affect
local
and
internaQonal
laboratories
2. Chronic disease prevention and treatment will drive growth
in certain healthcare segments
8
Adult obesity in the world, as a percentage
of total population
Probability
High
Impact
Regional
Speed
Medium
2%
2%
3%
4%
14%
15%
17%
19%
19%
25%
31%
35%
India
China
Japan
Korea
Poland
Brazil
Russia
South
Africa
Turkey
Chile
Mexico
USA

10. Two
types
of
transformaQve
changes
to
modern
healthcare
could
eventually
take
LaQn
America
by
storm:
1.
EFFICIENCY
GAINS
IN
PUBLIC
HEALTHCARE
EXPENDITURE
• Telemedicine,
which
can
help
reduce
the
high
cost
of
spreading
healthcare
infrastructure
in
rural
areas,
is
a
new
area
of
growth
for
medical
equipment
manufacturers
who
supply
integrated
technology
soluQons
• “Big
data”
analysis,
which
can
yield
cost
savings,
remains
costly
and
is
not
yet
widespread
even
in
U.S.
hospitals,
yet
early
movers
may
reap
many
dividends,
especially
with
government
customers
looking
to
boost
cost
efficiencies
2.
THE
PERSONALIZATION
OF
MEDICAL
TREATMENTS
• Mobile
health
apps,
which
enable
users
to
monitor
their
health
and
manage
chronic
diseases,
are
a
growing
market
in
the
region,
where
smartphone
use
is
expected
to
double
by
2017,
accounQng
for
40%
of
the
region’s
populaQon
• 3D
prin/ng,
beginning
to
be
used
in
the
medical
technology
industry,
is
unlikely
to
disrupt
LaQn
America’s
healthcare
sector
in
the
near
future,
offering
a
longer
horizon
for
maximizing
profits
from
tradiQonal
medical
devices
sales
3. Technology advancement will create opportunity for new
market developments
9
Probability
Medium-­‐Low
Impact
Brazil,
Mexico,
Colombia
Speed
Medium

11. The
Brazilian
government
announced
in
January
2015
that
it
would
allow
foreign
investment
in
the
private
healthcare
sector,
marking
a
significant
turning
point
with
broad
implica/ons
for
investment
in
the
healthcare
sector:
INCREASED
HEALTHCARE
SPENDING
• Aaer
growing
from
8.9%
of
GDP
in
2011
to
9.1%
in
2013,
healthcare
spending
is
now
projected
to
rise
to
$255.5
billion
by
2017.
FOREIGN
FIRMS
TO
PLAY
IN
THE
HOSPITAL
MARKET
• Hospitals
and
clinics,
to
be
open
to
foreign
investment
for
the
first
Qme,
have
great
potenQal
–
Brazil’s
concentrated
hospital
market
and
their
revenue
streams
make
for
rich
pickings.
PROTOCOL
STANDARDIZATION
• Foreign
investment
is
likely
to
accelerate
the
professionalizaQon
of
hospital
management
pracQces,
which
will
create
opportuniQes
for
investment
in
IT
systems,
management
skills,
and
tools
to
monitor,
control,
and
report
key
performance
indicators.
SUSTAINABILITY
OF
THE
SUS
• Investment
in
the
private
healthcare
sector
has
the
potenQal
to
shia
the
burden
away
from
the
public
healthcare
system,
the
Sistema
Único
da
Saúde
(SUS),
which
could
gradually
stabilize
the
SUS’s
long-­‐term
financial
health.
4. Brazil invites foreign investment to private healthcare
10
Probability
High
Impact
Brazil
Speed
Medium-­‐Fast

12. Opportunities in a Changing
Competitive Landscape

13. 38%
35%
24%
21%
18%
23%
12%
11%
8%
10%
$954
bi
$1,172
bi
North
America
Europe
Asia
/
Afirca
/
Australia
Japan
LaQn
America
DEFINING
DEVELOPMENTS
The
growing
middle
class
will
spend
more
on
healthcare,
as:
• An
increased
use
of
generics
will
conQnue
to
be
the
main
consumpQon
papern
• Local
producers
of
generic
drugs
are
becoming
the
driving
force
of
the
pharmaceuQcal
market
• The
consolida/on
of
pharmacies
and
the
conQnued
expansion
of
retail/supermarket
chains
will
accentuate
MARKETS
THAT
STAND
OUT
1. Brazil,
accounQng
for
43%
of
the
region’s
pharmaceuQcal
sales
between
2013-­‐2017,
is
expected
to
become
the
world’s
fiah
largest
pharmaceuQcal
market
by
2016
2. Mexico
is
the
second
largest
market
in
LaQn
America
with
17%
of
the
region’s
sales
3. Colombia
and
Peru
present
strong
growth
prospects,
albeit
from
a
small
base
5. Pharmaceutical sales will grow 12% per year through 2017
12
Probability
High
Impact
Brazil,
Mexico,
Colombia,
Peru
Speed
Fast
Share of global pharmaceutical spending by
region 2013-2017
Ý
12%
Ü
3%
Ý
12%
Ü
2%
Ü
3%
CAGR
2013-­‐2017
2013
2017

14. GROWTH
OF
THE
GENERIC
MARKET
As
healthcare
expenditure
grows
in
the
region,
two
market
forces
will
drive
the
growth
of
the
generic
drugs
market:
• The
expira/on
of
46
patents
in
the
U.S.
will
invite
greater
compeQQon
to
provide
low-­‐cost
alternaQves
for
popular
drugs
• Governments
who
heavily
subsidize
the
health
system,
notably
Brazil,
ArgenQna
and
Colombia,
turn
to
generics
as
their
opQon
of
choice
The
use
of
generics
is
expected
to
increase
16%
per
year,
unQl
reaching
65%
of
all
drug
sales
by
2016
THE
WINNERS
1. Local
generics
manufacturers
have
been
growing
28%
per
year,
selling
generics
70%
more
economically
than
their
patented
counterparts
2. Large
pharmacy
and
retail
chains
have
leveraged
their
buying
power
and
logisQcs
networks
to
sell
greater
volumes
of
generics
at
the
expense
of
smaller
medical
distributors
and
pharmacies
$79
$86
$466
$631
$62
$234
$122
$417
$14
$40
$88
$143
$0
$300
$600
$900
$1,200
ROW
Pharmerging
markets
Developed
economies
Global
Spending
Branded
Generic
Other
$78
$58
$458
$602
$45
$111
$88
$239
$12
$25
$82
$115
$0
$300
$600
$900
$1,200
ROW
Pharmerging
markets
Developed
economies
Global
Spending
6. Generics will account for 65% of Latin America’s retail
pharmaceutical drug sales by 2016
13
Pharmaceutical spending by class of drug
and type of market, 2011 vs. 2016 forecast
Probability
High
Impact
Brazil,
Mexico,
Chile,
Colombia
Speed
Fast

15. 7. The consolidation of pharmacy retailing will generate
investment opportunities
14
Probability
High
Impact
Regional
Speed
Slow
Dominant
local
pharmacy
chains,
which
are
expanding
both
in
terms
of
geography
and
breadth
of
services,
will
become
ever
more
appealing
to
foreign
investors
–
the
sector’s
consolidaQon
and
diversificaQon
is
playing
out
in
three
ways:
1.
DIVERSIFICATION
INTO
BASIC
MEDICAL
SERVICES
The
expansion
of
low-­‐cost
and,
in
some
cases,
free
medical
checkups
and
exams
onsite
within
the
premises
of
pharmacy
outlets
is
set
to
conQnue
2.
VERTICAL
INTEGRATION
OF
THE
PRODUCTION
CHAIN
Pharmacy
chains
are
venturing
into
the
producQon
of
private
label
generic
drugs,
becoming
producers
and
distributors
of
pharmaceuQcals
3.
CONSOLIDATION
OF
THE
DISTRIBUTION
CHANNELS
The
trend
of
medical
distributors
and
pharmacy
retailers
forging
Qghter
bonds
is
beginning
to
take
place
in
LaQn
America
as
well
Pharmaceutical sales in leading Latin
American countries, US$ millions
$36 $37 $38 $40 $42 $45 $49
$16 $17 $18 $19 $20 $21
$22
$2 $4 $4 $4 $5
$6
$6
$0
$20
$40
$60
$80
$100
2011 2012 2013 2014 2015 2016 2017
Brazil Mexico Colombia

16. THE SIZE OF THE OPPORTUNITY
While
hospital
spending
in
LaQn
America
lags
behind
that
of
the
U.S.
and
Europe,
the
size
of
the
opportunity
warrants
a
closer
look
–
La/n
America
is
home
to
16,000+
hospitals
TRAGETTED INVESTMENT
Analyzing
hospital
demographics
can
uncover
a
wealth
of
opportuni/es,
including:
• 50%
of
hospitals
in
Brazil
are
located
in
six
states
• 20%
of
hospitals
in
Brazil
have
over
100
beds
• 25%
of
hospitals
in
Mexico
are
located
in
three
states
• 10%
of
hospital
physicians
in
Mexico
are
pediatricians
• Amongst
other
8. The potential of Latin America’s 16,000+ hospitals
15
Probability
High
Impact
Brazil,
Mexico,
Colombia,
ArgenQna,
Peru,
Chile
Speed
Slow-­‐Medium
Number of hospitals by country
5,700
6,700
3,900
2,400
1,650
1,000
420
US
Brazil
Mexico
Colombia
Argentina
Peru
Chile

17. IMPORTED
DEVICES
TRUMP
LOCAL
PRODUCTION
Most
countries
in
the
region
have
liple-­‐to-­‐no
local
manufacturing
of
medical
devices
or
medical
technology.
As
a
result,
most
countries
rely
on
imports,
especially
for
high-­‐end,
complex
devices.
Mexico,
Brazil,
Argen/na
and
Colombia
together
account
for
more
than
75%
of
imported
devices.
TOP
MARKETS
• Brazil
is
the
region’s
largest
and
most
mature
market
for
medical
devices
–
it
accounts
for
50%
of
the
U.S.
exports
to
the
region
and
has
a
strong
domesQc
manufacturing
industry
of
its
own.
• Mexico
is
the
region’s
largest
importer.
Its
proximity
to
the
U.S.,
developed
road
systems,
integraQon
into
the
NAFTA,
and
robust
export
manufacturing
industry
make
it
a
natural
expansion
when
looking
outside
the
US.
• Beyond
the
top
four
markets
—
Brazil,
Mexico,
ArgenQna
and
Colombia
—
a
second
Qer
stands
out,
including
Chile,
Peru
and
Costa
Rica,
which
each
benefit
from
the
right
condiQons
to
make
them
apracQve
to
medical
device
suppliers
and
manufacturers.
9. Imported medical devices account for over $10 billion in
Latin America
16
Probability
High
Impact
Regional
Speed
Medium
Medical device imports by country
Mexico,
$2.9
Brazil,
$2.2
Colombia,
$.
7
ArgenQna,
$1.9
Others,
$2.7
$.
$1.
$2.
$3.
$4.
2009
2010
2011
2012
2013
2014
US$,
billions

18. www.globalhealthintelligence.com
To
learn
more
about
Global
Health
Intelligence,
our
services,
consulQng
engagements
and
speaking
opportuniQes,
please
contact:
Guillaume
Corpart,
Managing
Director
+1
(305)
441-­‐9300
gc@globalhealthintelligence