Iran emerging at key market for medical sector
Post-sanctions Iran’s healthcare and clinical facilities sector will be a top priority, and the 6th Development Plan (2016-2020) will set aside over $25 billion for the industry. The funds will be used to construct 100,000 new hospital beds, 200 imaging centers for cancer and dialysis patients, develop medical tourism, and most importantly, renovate over 35,000 existing hospitals beds, laboratories and medical clinics.
“Since sanctions were lifted, over 70 European and Asian companies have expressed their interest to invest at Iran’s healthcare sector. In fact, its geographical position, cost-effective healthcare system, large population, tourism opportunities, and growing advanced medical facilities will make Iran a medical hub in the region within a decade” said Ali Mirmohammad, senior consultant and business development manager, MENASA, Iran.
The Iran 2025 Outlook will strongly bolster this growth by encouraging imported technology, foreign partnerships, tax exemptions, secure money transactions, protection and extendable residence permits for workers and their families, among other measures. Of the many healthcare segments, medical devices will be highly promising. Worth over $ 1.8 billion in 2015, the segment has seen demand double despite sanctions having affected quality, according to a new report by Frost & Sullivan, a consulting firm.
“Broad prevalence of strokes, neurological diseases, diabetes, cancers, cardiovascular diseases and obesity is expected to expand the demand for devices,” noted Mr. Mirmohammad. “Hearing aids, wheelchairs, walkers, blood pressure and glucose monitors for the disabled and elderly will also be in demand as their demographic expands.”
However, Iran’s domestic manufacturing market for high tech medical devices is still too weak to meet internal demand. While nearly 90% of the disposable tools and 60% of the general medical devices were supplied in house, over 80% of advanced devices such as imaging, analyzers, hemodialysis machines, and dental and optical equipment, were imported.
The lack of local manufacturing plants in the GCC, Azerbaijan, Armenia, Turkmenistan, Kyrgyzstan, Tajikistan, Iraq, Afghanistan, Syria, Lebanon, Yemen as well as East, West and Central countries in the African continent presents a strong opportunity for foreign investors to target these markets through partnerships with local Iranian manufacturers. The country is planning to triple the export of medical devices to over $100 million in the next 3 years through joint ventures with well-known brands.
“To improve the quality of market, the Iranian government aims to tighten the market for low quality and second hand devices through intensive supervision,” added Mirmohammad. “This will protect brands against the unorganized market. The sales presence of brands like GE, Siemens, Brookfield, MiE, Unico, Medtronic, Carestream and Snowa highlights the importance of the market, which will continue to grow rapidly.”
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