Competitive

Governments

Healthcare sector
in Saudi Arabia
 Healthcare sector in Saudi Arabia

Opportunities in the healthcare sector

The Kingdom of Saudi Arabias rapidly expanding healthcare sector offers investors many attractive opportu-
nities. Not only is Saudi Arabia the Middle Easts largest healthcare market, it also has the fundamentals for
sustainable growth. Trends in population growth / ageing, and the prevalence of chronic diseases will
create ample opportunities for private sector-led innovation in healthcare service delivery and prevention.
As a result, healthcare spending of ~SAR 90Bn is expected to grow by %14 annually.

Saudi Arabia has made significant strides in improving the quality of healthcare over the past decades.
While healthcare infrastructure has expanded, it still offers significant opportunities to respond to the rapid
population growth. On key metrics such as physicians, nurses, and hospital beds per 1,000 population,
Saudi Arabia lags global averages and OECD benchmarks, as illustrated in Exhibit 1. Additionally, although
KSA is improving significantly in some of the health key indicators, it is still lagging compared to global
averages, as illustrated in Exhibit 2. Finally, the system is still heavily reliant on acute hospital based care
model. As a result, there are plans to double current capacity of 65,000 beds by 2020, with new secondary
and tertiary care provision sectors poised to grow significantly, and a real effort to improve outcomes and
efficiency of the system.

Exhibit 1
Exhibit 2

Government initiatives

The government of Saudi Arabia intends to significantly increase the quality of healthcare services while also
increasing cost efficiency, raising the productivity of this key sector and transforming it into an engine for
creating opportunities for the employment of Saudis and ensuring the local development of value adding
activities.

To achieve these objectives, over USD 70 Bn of potential investment and 40 unique investment opportuni-
ties have been identified in 7 healthcare-related areas:

Service provision: USD 60-50 Bn of investments to promote appropriate access to higher quality care for all
Saudis and expatriates and improve the efficiency of care delivery, shifting the responsibility for care to the
most appropriate locations. This includes the construction of 750 new primary healthcare centres,
25,000-15,000 new public hospital beds/alternative delivery models, 12,000-8,000 new private hospital
beds, and an E-Health system.

Education and training: USD 7 Bn of investments to move healthcare toward self-sufficiency, training the
required number and quality of healthcare professionals, increasing the number of medical school gradu-
ates from 4,000 to 6,000 and the number of nursing graduates from 5,000 to 12,000 annually.
 Medical device manufacturing: USD 1 Bn of investment from multinational medical device manufacturers
in local manufacturing capabilities, to develop an advanced medical device manufacturing cluster, there-
by laying the foundation for home-grown Saudi Arabian manufacturing businesses for the Saudi Arabian
market and the region.

Pharmaceuticals manufacturing: USD 8 Bn of investments to spur the development of a diverse and

integrated pharmaceuticals manufacturing cluster, reducing the portion of purchasing spend on imports
to <%70. These include opportunities in vaccines, sterile injectables, plasma, generics, biosimilars, and
APIs.

Prevention: Investments to reverse poor health choices being made by the Saudi Arabian population
choices fuelling the current rapid growth in chronic non-communicable diseases by increasing public
health awareness on risky behaviour (e.g., healthy eating, speeding, smoking), implementing initiatives to
raise public activity levels, and launching immunization campaigns.

Support services: Investments to establish local capabilities in the key support services (e.g., bioequiva-
lence centres, cold-chain logistics, outpatient imaging, CROs) needed to engender growth in healthcare
service provision and manufacturing

These opportunities and many others are available for local Saudi investors and international investors to
participate in leapfrogging the healthcare sector into a new era of competitiveness. Saudi, join the
journey