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TABLE OF CONTENTS
1. INTRODUCTION.............................................................................................................................................................. 1
1.1 SCOPE OF THE REPORT ........................................................................................................................................ 1
1.2 REGIONAL ANALYSIS............................................................................................................................................. 1
1.2.1 PESTLE ANALYSIS .......................................................................................................................................... 1
1.2.2 ANALYSIS OF EASE OF DOING BUSINESS .................................................................................................. 3
2 MARKET DYNAMICS ...................................................................................................................................................... 5
2.1 DRIVERS ................................................................................................................................................................... 5
2.1.1 GAPS IN DELIVERY OF SPECIALIZED MEDICINE AND EQUIPMENT ....................................................... 5
2.1.2 INCREASING FOCUS ON UNIVERSAL HEALTHCARE ................................................................................ 6
2.2 RESTRAINTS ........................................................................................................................................................... 7
2.2.1 IRANS CURRENCY WOES .............................................................................................................................. 7
2.2.2 DRUG REIMBURSEMENT ISSUES ................................................................................................................. 8
2.3 OPPORTUNITIES ..................................................................................................................................................... 9
2.3.1 GROWING MEDICAL TOURISM MARKET ..................................................................................................... 9
3 MARKET DEMAND ANALYSIS ....................................................................................................................................10
3.1 SOCIO-ECONOMIC SEGMENTATION ..................................................................................................................10
3.2 DEMOGRAPHIC STRENGTHS & WEAKNESSES ...............................................................................................11
3.3 SPENDING PATTERNS.........................................................................................................................................11
3.4 TARGET MARKET IDENTIFICATION ..................................................................................................................12
4 MARKET SIZE OF IRAN HEALTHCARE INDUSTRY BY TYPE (USD MILLIONS) ...................................................13
4.1 HEALTHCARE SERVICES .....................................................................................................................................13
4.1.1 DOMESTIC PATIENTS OVERVIEW ..............................................................................................................14
4.1.2 MEDICAL TOURISM OVERVIEW ..................................................................................................................15
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1. INTRODUCTION
1.1 SCOPE OF THE REPORT
The market entry series offers an overview of how to enter a particular market, customized for a particular
geographical region. The report details political, economic, legal, and other risks that you need to be cognizant
of while entering a particular market. Here, we break down the complex process of entering a market into
steps, delineating the time and monetary outlay for each step, competition analysis (key market players,
market share analysis in the market and its sub segments), and other critical elements, which are critical when
you decide to enter a market or are in the process of market entry.
Economic
1. Irans
economy,
as
well
as
dependent
investors
industry in Iran
on
oil
and
mineral
global
market
is
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Persian Gulf
Technological
1. Iran has well-rounded, self-sufficient
infrastructure,
especially
pharmaceuticals
and
for
healthcare.
Legal
Iran suffers from severe social and economic damages, An unfamiliar regulatory and legal regime that
owing to seismic activities within its territory. Many cities lacks transparency, complicated regulations,
including Tehran, Manjil, Tabas, Tabriz, Rudbar Lar, Qazvin, and the challenge of finding good business
Hamedan Zanjan, Kermanshah, and Fars have sustained partners are some of the risks faced. The labor
extensive damages due to high magnitude earthquakes. law in Iran is employee-friendly and this makes
The role of the Ministry of Housing and Urban it particularly difficult to lay off staff.
Development and its associated Housing Foundation is Employing personnel on consecutive siximportant, as these are the two chief organizations for the month contracts is illegal, so is dismissing
approval and execution of special plans, housing ventures staff without proof of serious offence. Labor
and building codes, including earthquake mandatory disputes are settled by a special labor council,
codes.
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2016 Rank
2015 Rank
118
119
Remarks
The
Business
Environment
Since the last review (2015), the country has streamlined the
name reservation and company registration processes. In the
Starting a
Business
87
82
Dealing with
Construction
69
98
Permits
before
construction,
construction,
quality
liability
insurance
and
quality
control
control
after
regimes,
and
during
construction,
professional
Getting
Electricity
94
Registering
Property
91
89
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Categories
Getting
Credit
2016 Rank
2015 Rank
90
Protecting
Minority
Remarks
149
Investors
Paying
Taxes
123
122
Trading
across
167
166
Borders
Enforcing
Contracts
62
62
Resolving
Insolvency
140
137
15% of the debtors estate. The most likely outcome was that
the company was sold as piecemeal sale. The average
recovery rate is 18 cents per dollar.
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2 MARKET DYNAMICS
2.1 DRIVERS
2.1.1 GAPS IN DELIVERY OF SPECIALIZED MEDICINE AND EQUIPMENT
Iran has a successful public health delivery system. The country provides primary care to all its citizens
through access to Primary Healthcare Networks. The next challenge that the Iranian Government is tackling
is the higher inclusion of its population. This attempt is supplemented by a focus on expanding healthcare
facilities and access to such facilities. The number of public hospitals, hospital beds, doctors, medical
laboratories and clinics are all being increased, along with the GDP outlay for healthcare (to 6.7%). However,
Iran lags behind in the next wave of innovation in medicine and healthcare, being exempted from access to
software, technology, research and other global medical advances. In fact, the country is ranked the 7th least
attractive market for medical devices in the MENA region. Hence, the market is ripe for developments in the
sector of biomedicine, medical devices, pharmaceuticals, and others. The lifting of sanctions is expected to
boost the demand for foreign medical equipment, and FDI is expected to play a major role in the development
of the Iranian healthcare sector.
683
672
680
660
640
620
600
600
586
582
580
560
540
520
2010
2011
2012
2013
2014
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7.12
7.1
6.98
6.89
6.9
6.8
6.7
6.6
6.49
6.5
6.4
6.3
6.2
6.1
2011
2012
2013
2014
% of GDP
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2.2 RESTRAINTS
2.2.1 IRANS CURRENCY WOES
Iranian healthcare devices market is highly import-dependent, with most imports coming in from the European
Union. This has resulted in an increase in foreign trade in the country. While the proportion of investment has
increased considerably, with nearly 31% in general healthcare and 35.4% in pharmaceuticals, the depreciation
of the Iranian Rial has been causing problems to the Iranian system, resulting in reduced import value. Iran
also received a lower appraisal score on the business front, which made it fall to as low as number 22 in the
rankings in the Middle East and Africa market. This situation, along with financial restrictions, has been
causing problems to the Iranian healthcare system.
30000
30000
25000
25000
27000
20000
15000
11000
13000
10000
5000
0
2011
2012
2013
2014
2015
USD/IRR
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Reimbursed Drugs
53.50%
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2.3 OPPORTUNITIES
2.3.1 GROWING MEDICAL TOURISM MARKET
The WHO estimates the global medical tourism market at more than USD 100 billion. Although, a relatively
new concept, medical tourism in Iran is booming, and Iran is one of the most attractive medical tourism
destinations across the globe, owing to several factors. Irans geographical location makes it an approachable
destination to most Middle Eastern nations. Up to 15 of Irans neighbors have an inferior market for medical
devices. Moreover, Iran imports 90% of its medical devices from Europe and other countries. Combined with
exchange rate fluctuations, this offers people in the country access to well more than 200 million by way of
regional target audience, who can now access the countrys well-developed medical infrastructure accessible.
Most medical tourists belong to neighboring nations such as Azerbaijan, Iraq and the Persian Gulf countries.
Earlier, barriers like the availability of a skilled workforce, coupled with challenges in acquiring VISA access to
the country undermined the countrys medical tourism prospects. With a lift in the sanctions, Irans medical
tourism market is ripe for entry.
Table: Various wellness related health services provided to medical tourists in Iran
Surgical Treatments
Cosmetic Surgery
Orthopedic
Heat
Dialysis
Plastic surgery
Rheumatism
Rehabilitation
Weight loss
Neurology
Skin diseases
Pain management
Psoriasis
Limited Treatments
Lasik surgery
Diet therapy
Eye diseases
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Values
81.8 million
0-14 years: 23.69%
Age structure
1.05 male(s)/female
71.15 years
Fertility rate
1.83 births/woman
Ethnic groups
Persian, Azeri, Kurd, Lur, Baloch, Arab, Turkmen and Turkic tribes
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Primary, secondary and tertiary health services are provided by the public sector in the country. The focus and
emphasis of the government on primary health care over time has made the public sector the main provider
of primary health care services across Iran.
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2016
2017
2018
2019
2020
2021
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Number of Patients
2014
7,127,641
2013
6,514,772
2012
6,267,202
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4.2 PHARMACEUTICALS
Table: Iran Pharmaceuticals Services Market in 2016 (in USD millions)
2016
2017
2018
2019
2020
2021
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6.00
5.61
5.25
4.91
4.60
4.30
2016
2017
2018
2019
2020
2021
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5 MARKET ENTRY
5.1 MARKET ENTRY: THE STRATEGY
We delineate parameters that will ensure the best decisions taken when contemplating a market entry strategy
ideal for your interests. Indicators like ideal market entry modes by risk appetite, competition analysis across
(sub) segments, strategies adopted by your competitors, news/events, pricing strategy, overview of the supply
chain to help you inquire in the right places.
5.1.1 TYPES OF ENTRY MODES, BY MARKET ENTRY OBJECTIVES
Market entry in a new geography is decided primarily by the outcome expectations of the entity.
Learning in lead
markets
To leverage
technical
advantages
(patents, etc.)
by achieving
scale
To further expand
existing global
market footprint
Competition
based attack or
defence
New market
exploration due to
lucrative shortmid term gains
Export
Incentives
Co-selection of process
Market health and momentum
analysis
Verification of value proposition
and competitive advantage
Evaluation of sales pipeline
(importers, distributors, trading
houses, and their varying levels of
efficiency and accountability)
Evaluation of sales and marketing
personnel
Control
Cooperation
Joint Ventures
Licensing
DATA INTEGRATION,
REPORT PREPARATION
Intelligent
Databases
Direct Exporting
Distributor
Franchising
Indirect Exporting
Trading Cos,
Piggyback
Risk
Analytical
Model
Bottom up
& Top
down
Estimation
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Company C
20%
Company A
54%
Company B
16%
Company C
16%
Others
64%
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According to sources at the Ministry of Health and Medical Education, Iran, more than 60 companies
from all over the globe, have submitted their application to invest in Irans healthcare projects, and
also invest in the construction of hospitals in Iran. Companies like Samsung and Korean Daewoo are
on the verge of landing projects to construct excellent hospitals in Iran
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Hospitals
Domestic drug manufacturing
Drug
Imported drugs
Wholesalers
Patients
Drug stores
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The distribution of medical devices largely occurs through wholesale distributors or agents. Some local
companies use direct-selling models. A typical pharmaceutical distribution network consists of market
warehouse/distribution centers, wholesalers, retails/hospitals and patients (end-users).
Monetary Outline
5 days
3 days
reservation
1 day
circulation newspaper
No charge
1 day
No charge
2 days
activities
Register for VAT
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Action
Monetary Outline
IRR 100,000
1 day
1 day
No charge
1 day
workplace number.
Reserve a unique company name, Register at the Companies Registration Office and Pay the
registration fees
o To register with the Companies Registration Office, the company must submit the following
documents:
o Articles of association, signed by all shareholders
o Declaration stating that all shares have been subscribed
o Minutes of the general assembly of founders and board of directors
o Minutes of the shareholders meeting, reflecting the election of the first directors and
inspector(s)
o Written statement accepting the position of directorship and inspectorship
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o National ID Card (Carte Melli) and birth certificates (certified copies) of the shareholders and
inspectors
o Name of a mass circulation newspaper in which all company announcements will be
published
Place a notice of the company formation in the Official Gazette and the selected newspaper of
general circulation
o It is possible to directly publish the notice of the company formation through the Official
Gazette and the selected newspaper or general circulation or submit it to the post office,
which then forwards the notice to the Gazette.
Notify the State Tax Affairs Organization of the commencement of business activities
o The new company must notify the State Tax Affairs Organization in writing about the
commencement of its business operations within 4 months. A failure to do so will result in a
fine and a deprivation of any applicable tax facilities and exemptions.
Enroll workers in the social security program at the Iranian Labor Department and Obtain a
workplace number
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2598
info@statetaxorganization.ir
E-mail: gocr@ssaa.ir
Phone: +98218573696
E-mail: infopack@irimlsa.ir
982166739191
66405598
E-mail: Info@mfa.gov.ir
E-mail: dinarvand@fda.gov.ir
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Test reports and certificates from the Iranian Standards Institution for those Devices subjected to
mandatory local standards,
Letter of Authorization, which is to be legalized by the chamber of commerce and Iranian embassy
Labelling on the product should carry the name of the manufacturer, the serial or batch number, the
date of manufacture and the shelf-life for disposables, specifications and warnings. Compliance with
the COMEs labelling requirements is also mandatory.
Registration number
After the approval of the application, a registration number is given, which is valid for five years. Medical
Devices are registered at MOH where a registration number and a marketing authorization are issued. The
applicant cannot manufacture or import these products unless the registration number and marketing
authorization are issued.
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Step I: Approval letter of Legal Commission, Original Legalized LOA, Legalized Certified Protection
Professional, Good Manufacturing Practice Certificate, legalized registration status of the product in
countries in which the product is sold.1
Step II: Copy of Ministry of Health letter for registration fee payment, Drug Master File, Receipt of
registration fee payment
Once these processes are completed, the bilingual packing will be submitted & the price for Iran will be sent
to the Pricing Committee. Then, the IRC request form will be sent to the MOH & finally the IRC will be issued.
5.2.4 PRODUCT CONTROL GUIDELINES SPECIFIED BY THE GOVERNMENT
A certificate/letter containing list of the countries where product (in any dosage form) is registered
and its registration number
A certificate/letter containing list and of the countries where product (any dosage form) is sold/used,
and information about the date of introduction in these markets.
A certificate/letter has a factory/manufacturing unit and the address of factory containing list of the
countries in the company
In the first step, if the company owns GMP certificate from US/FDA, EMA, JAPANS PMDA, PMDA, SWISSMEDIC-TGA
UK/MHRH, it will not be inspected. If not, it will be inspected by MOH inspectors as well.
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6 SOURCES
Ministry of Healthcare, Iran
Paid Databases
US National Library of Medicine, National Institutes of Health
Iran Medical Tourism Board
International Medical Travel Journal
WHO
UNICEF
Pars Times
Novin Investment Bank Group
Wilson Centre
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7 DISCLAIMER
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use and not for general publication or disclosure to third parties.
Quantitative market information is based primarily on interviews and therefore, is subject to fluctuation.
Mordor Intelligence takes no responsibility for any incorrect information supplied to us by manufacturers or
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About Us
Mordor Intelligence is a global market research and consulting firm. Our singular focus is to provide actionable
research to our clients for their organizations success. Our research team has expertise in diverse fields like
Agriculture, Healthcare, ICT, Chemicals, Manufacturing, Logistics, Electronics and Automotive. We at Mordor
love data and we love solving our clients problems through accurate analyses. Watching your business
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Mordor Intelligence | +1 617-765-2493 | No.30 Padma Nilaya, RT Nagar, Bengaluru, India 560032 | info@mordorintelligence.com