Investment opportunities in ethiopia

2. Outline
• Glance of the Health care sector
• Why health sector
• Reasons for referral
• Priority areas
• Modalities of Private Sector Investment/engagement
• Local Medical Product Industry
• Market
• Industrial parks(IP)
• Human resources
• Wide ranging incentive packages
• Regulatory preparedness

3. Ethiopian Health Sector at a
glance
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Number of hospitals (Public) >411
Number of health centers >4200
Number of health posts >16600
MMR ( UN est.) 353 per 100000
U5MR 59 per 1000
Average Life Expectancy 66.6
Health Professionals to Population Ratio 2.1/1000

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5. Why Invest in the Health Sector in Ethiopia?
‒ Government commitment to
Universal Health Coverage & global
commitments such as SDGs
‒ An epidemiologic shift with high
morbidity and mortality from the
triple burden of diseases.
‒ Increasing demand from the
community for high
quality healthcare
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6. Why Invest in the
Health Sector in
Ethiopia?
• High political commitment to
improving health infrastructure.
• Large population with high need for
services and products
• Increased number of health
professionals’ training institutions
(public and private sectors)
and programs
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7. Why Invest in the
Health Sector in
Ethiopia?
• Introduction of insurance schemes
(e.g., Community Based Health
Insurance system ( 55%) , third-party
road accident)
• Efforts to introduce Social Based Health
Insurance system
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8. Reasons for overseas referral
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>6,000 patients seeks overseas treatment per year
1. Advanced Cardiac Surgeries /
interventional cardiac procedures
2. Organ transplant (Renal and Liver)
3. Fertility treatment – IVF
4. Advanced orthopedics procedures
5. Oncology services (Diagnostic ,
radiotherapy and chemotherapies )
6. Ophthalmologic
7. Neurosurgery
8. Rehabilitation Medical Services

9. Specialty and
Subspecialty-
Prioritized Service areas
• Oncology
• Laparoscopic treatment
• Neurological treatment
• Fertility treatment
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10. Specialty and Subspecialty- Prioritized Service
areas
Cardiology ( Interventional &
Surgery)
Organ transplants
Advanced Orthopedics
Rehab. Services
Advanced Diagnostic Services
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Priority investment areas in the health sector
Tertiary Health
care services
Human Resource
Development
Advanced
Diagnostic
Services
Healthcare
Technologies &
Innovation
Medical Product
Manufacturing
Pre-Hospital
Emergency
Care

12. Pipeline PPP in
health sector
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Integrated Diagnostic Center ( on
tender process)
Oncology services ( On
feasibility assessment )

13. PPP in Health
Yeabe Dialysis Unit at Millink II Hospital
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Modalities of Private Sector Investment/engagement
Foreign or local direct investment
Public Private Partnership (PPP)
Joint venture
Outsourcing

15. Local
Medical
Product
Industry
Includes
•Pharmaceuticals
•Biological products
•Vaccines
•Diagnostics & laboratory
instruments
•Medical supplies
•Medical equipment
•Contract research
organizations-eg. Bioequivalent
centers
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16. Invest in Medical Product Industry!
Why?
•Market
•Industrial Parks(IP)
•Human Resources
•Regulatory system
•Economic and Trade Cooperation
•Wide range of incentive packages
•Initiative to improve the medical product industry
ecosystem
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17. Market
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18. ETHIOPIAN PHARMACEUTICAL
MARKET OVERVIEW
• In 2015, the Ethiopian pharmaceutical market
was estimated to be $ 450M and it has been
growing at 15% to reach an estimated value
of $ 1.8Bn by 2025.
• According to the market research company
Fitch Solutions, the estimated size of the
market in 2021 was $1.12Bn
• Public sector purchase by EPSS is estimated to
be 75% of the total pharma.
• The Ethiopian pharmaceutical market is highly
dependent on import >90%.
Ref: EPSA, Frost &Sullivan, NSPA-Pharma & Fitch Solutions – Ethiopia Pharmaceuticals & Healthcare Report: Q42020

19. Market
Share by
dosage
Form
53.7%
29.9%
4.7%
3.8%
3.4%
0.8%
0.8%
0.5%
0.4%
0.4%
1.8%
0.0% 10.0%20.0%30.0%40.0%50.0%60.0%
Tablet
Injection
Oral drop
Implant
Capsule
Oral Solution
IV Infusion
Aerosol
Suppository
Ointment
Others
Percent

20. Industrial Parks(IP)
• More than 15 owned by governments and 10 privately
owned and are governed by EIC & IPDC
• Kilinto Industrial Park (KPIP) is dedicated to the
pharmaceutical, vaccine and other biological products
and medical device manufacturers.
• KPIP will provide one window service and host :
• Banks
• Logistic firms
• R&D facilities
• Training center
• Regulatory, calibration
institution/companies etc. This Photo by Unknown author is licensed under CC BY-SA-NC.
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21. Human Resources
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Has a large pool of highly educated workforce
• approximately half a million students being enrolled in local
universities annually.
More than 814 TVET institutions and more than
58 universities
• Close to hundred thousand science, engineering and health
discipline students graduate every year
The labour market is well structured, enabling
employees to be hired on different terms;
• i.e consultancies, contracts, fixed-term employment or
permanent employment.

22. Incentives...
Loss carry forward – Up to 5 years
Personal income tax exemption
• 5-10 years for expat experts
• Long term employment visa work permit
100% customs duty exemption and other tax
exemption during importation
• Raw materials/inputs
• Capital goods/ machineries
• Spare parts
• Vehicle necessary for the investment
100% export duty exemption

23. Contnd…
Procurements ( government)
• 25% price preference to local
manufacturer
• Long term procurement framework
on sale of exported medical
products
• 18% additional cost logistic
consideration
Finance and Forex
• Increased earnings retention ;
• Up to 30% indefinitely
• 70 % can be used in within 28
days
• Higher external loan threshold

24. Regulatory preparedness
EFDA is working to
reach Maturity level III
or above by based on
WHO GBT
•This helps in the
recognition of EFDA’s
regulatory measures
by NRA with
similar/lower Maturity
level
•Eg. Marketing
authorization issued
by EFDA may be
recognized by other
countries
IGAD harmonization
initiative :
•Joint assessment of
dossier and GMP
inspection
•Facilitate
obtaining marketing
authorization by
member countries
•Ultimate goal of this
initiative is “Mutual
recognition”
African Medicine
Agency :
•Established
•Ethiopia will be
signatory member
•The treaty will be
ratified soon
•Will create access to
more than 1.1 billion
market
WHO Collaborative
registration procedure
•46 countries
participating including
Ethiopia
•31 African countries
•Prequalified products
will be recognized by
46 countries
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