healthcare

Malaysia Healthcare Insights Emerging Trends, Ensuing Opportunities

Wilson Tan Director of Data Insights
Date: 21st June 2012

Clearstate: Annual market tracking of Malaysia Medtech industry since 2007

Diagnostic Imaging Modalities 8 APAC markets
o o o CT / MR X-Rays Ultrasounds

Surgical Procedure Volumes 13 APAC countries

o o o o Cardiovascular General Surgery / Minimally Invasive Surgery Orthopaedics OB\GYN

In Vitro Diagnostics Applications 13 APAC countries

o o o Centralized Diagnostics Point of Care Testing Molecular Diagnostics

Healthcare in Malaysia: Highest standard of healthcare in Southeast Asia (after Singapore)

Population

28 mil

230 mil

68 mil

5 mil

88 mil

92 mil

Total Healthcare Expenditure (USD bil, 2009)

9.0
Malaysia

11.3
Indonesia

11.2
Thailand

7.3
Singapore

6.5
Vietnam

6.3
Philippines

As a proportion of GDP
Per capita healthcare expenditure

4.8%

2.4%

4.3%

3.9%

7.2%

3.8%

USD 387

USD 60

USD 174

USD 1,491

USD 92

USD 50

$$$$

$$

$$$$$$$$$$

Sources: EIU, WHO, World Bank, Clearstate internal databases 3

Malaysia health: Young population, high life expectancy but also high infant mortality rates
Malaysia Health demographic indicator
Population (million)

2010
28.3

Annual rate of growth

Population in urban areas Life expectancy at birth (years) Infant deaths per 1,000 live births

1.6%
70% (2008) 73.55 15.5

Total fertility rate (per woman)

Total land area= 328,657 sq km Total population (2009) = 28.3mil Under 15 years old: 31.4% 15 to 64 years old: 63.6% 65 years and older: 5.0%

2.7

Rising incomes and sedentary lifestyles resulting in an increasing incidence of diabetes, hypertension and cardiovascular disease
o Diabetes prevalence from 8.3% in 1996 to 14.9% in 2006 o Obesity increased from 17% in 1996 to 43% in 2006
Sources: National Heart Association of Malaysia, Malaysia Heart Foundation 4

While private hospitals account for 60% of the hospitals, they are generally smaller in size, accounting for only 25% of the beds
334 hospitals 47,586 beds
Private 11,841 Private 201

STATE
Selangor & Kuala Lumpur

# hospitals
102

%
30.5%

Penang
Johor Perak Sarawak

29
40 29 29

8.7%
12.0% 8.7% 8.7%

Sabah & Labuan

Kedah & Perlis Public 35,745 Public 133 Pahang Kelantan Negeri Sembilan Melaka Terengganu
# facilities # beds

28
21 17 13 12 7 7

8.4%
6.3% 5.1% 3.9% 3.6% 2.1% 2.1%
5

Sources Malaysia Ministry of Health

Strong government push to extend national healthcare capabilities

Continued healthcare infrastructure development
Construction of new hospitals and specialized facilities
o o Eight new hospitals to be built, 156 rural clinics and 41 community health clinics, and 50 additional 1Malaysia clinics Under the Tenth Malaysian Plan, healthcare access, coverage and quality to be improved, especially for the bottom 40% of households in both rural and semi-urban areas

Improved rural access to healthcare

Digitizing health information & Telemedicine

Long wait times for scans and diagnosis in public hospitals due to disproportionate geographical distribution of patients vs radiologists (45% of radiologists are in Klang Valley and Johor) Telemedicine identified as a solution to distribution issue, as well as a key foreign income earner when infrastructure is leveraged internationally

National healthcare ecosystem developed to propel economic growth

Healthcare sector identified as a key engine to propel future growth Healthcare National Key Economic Area to encourage collaboration between public and private sector via identified Entry Point Projects to generate income and jobs by 2020

Flavour of the month schemes or sustainable initiatives?

6

One of the fastest growing markets for Medical Imaging in Southeast Asia
Southeast Asia Medical Imaging Market (2011)
Philippines USD 72.7 12%

Malaysia USD 66.5 11%

Indonesia USD 141.9 24%

COUNTRY
Malaysia Indonesia

3-year CAGR (2011-2014)

7.5% 6.8% 7.2% 2.1% 7.5% 4.5%

Vietnam USD 120.0 21%

Thailand Singapore Vietnam

Singapore USD 38.9 7%

Philippines
Thailand USD 146.9 25%

Source: Clearstate IMGTrac Database 7

While hospitals have basic radiology capabilities, untapped opportunities present in high end imaging modalities
Without Radiology

334 hospitals 29

305 hospitals

85 hospitals

Without MRI

72.1%
With Radiology Dept

More than 1.0 T

82%

305

With MRI

27.9%
# hospitals # with Radiology

Less than 1.0T 18%

With MRI
Source: Clearstate IMGTrac Database 8

Emerging trends, Ensuing opportunities

Interventional therapies Minimally invasive and spine surgery
Increased demand for Angio, CT, MR, Ultrasound, Fluoro Establishment of new hybrid Operating Theatres

Increased need for C-Arms

Medical tourism

Equipment upgrades in high end private hospitals

Decentralization in radiology

Increased demand for Healthcare IT Diagnostic equipment with IT connectivity

9

Rapid growth of interventional therapies across specializations driving future demand for 3D imaging equipment
Interventional cardiology procedures CAGR (09-14): 13.4%

74,000
Electrophysiology
7,000

Rapid adoption of interventional techniques in

o o o Cardiovascular Endovascular Urology

18,000

44,000
Electrophysiology 39,500 4,000 Electrophysiology
3,500

Endovascular

49,000
Cardiovascular

Endovascular

10,000

Endovascular

11,000

Increasing need for fully equipped Hybrid Operating Rooms Drives need for Angio suites, MR, CT, Ultrasounds, Fluoroscopy
10

26,000
Cardiovascular

29,000
Cardiovascular

2014

2009

2010

Source: Clearstate Surgical Procedure Volumes Database

Versatility of C-Arms promoted by the swift adoption of Minimally Invasive Surgery techniques
Laparoscopic surgery procedures CAGR (09-14): 22.1%

Laparoscopic surgery procedures expected to double in 4 years Minimally Invasive Spine procedures growing at >10% annually

80,000

40,500 29,500

2009

2010

2014

As more hospitals offer minimally invasive procedures, penetration of C-Arms expected to increase

Source: Clearstate Surgical Procedure Volumes Database 11

Developments in medical tourism underscore need to upgrade equipment and boost capabilities
Annual medical tourism patients CAGR (07-10): 19.2%

Strong government and private sector development efforts in medical tourism sector Successfully driven medical tourism arrivals by 19% annually from 2007-2010 Hospitals require state of the art medical imaging equipment to compete

578,403 450,000 341,288 370,000

2007 2008 2009 2010

Source: Malaysia Healthcare Travel Council 12

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