healthcare

Malaysia Healthcare Insights – Emerging Trends, Ensuing Opportunities

Date: 21st June 2012

Wilson Tan

Director of Data Insights

Clearstate: Annual market tracking of Malaysia Medtech industry since 2007

Diagnostic Imaging Modalities – 8 APAC markets

o CT / MR

o X-Rays

o Ultrasounds

Surgical Procedure Volumes – 13 APAC countries

o Cardiovascular

o General Surgery / Minimally Invasive Surgery

o Orthopaedics

o OB\GYN

In Vitro Diagnostics Applications – 13 APAC countries

o Centralized Diagnostics

o Point of Care Testing

o Molecular Diagnostics

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Per capita healthcare expenditure

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

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9.0 11.3 11.2 7.3 6.5 6.3

Malaysia Indonesia Thailand Singapore Vietnam Philippines

28 mil 230 mil 68 mil 5 mil 88 mil 92 mil

USD 387 USD 60 USD 174 USD 1,491 USD 92 USD 50

Total Healthcare Expenditure (USD bil, 2009)

Population

$$$$ $ $$ $ $ $$$$$$$$$$

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

As a proportion of GDP

4.8% 2.4% 4.3% 3.9% 7.2% 3.8%

Malaysia health: Young population, high life expectancy but also high infant mortality rates

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Malaysia

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%

Health demographic indicator 2010

Population (million) 28.3

Annual rate of growth 1.6%

Population in urban areas 70% (2008)

Life expectancy at birth (years) 73.55

Infant deaths per 1,000 live births 15.5

Total fertility rate (per woman) 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

While private hospitals account for 60% of the hospitals, they are generally smaller in size, accounting for only 25% of the beds

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Public 133

Public 35,745

Private 201

Private 11,841

# facilities # beds

334 hospitals 47,586 beds STATE # hospitals %

Selangor & Kuala Lumpur 102 30.5%

Penang 29 8.7%

Johor 40 12.0%

Perak 29 8.7%

Sarawak 29 8.7%

Sabah & Labuan 28 8.4%

Kedah & Perlis 21 6.3%

Pahang 17 5.1%

Kelantan 13 3.9%

Negeri Sembilan 12 3.6%

Melaka 7 2.1%

Terengganu 7 2.1%

Sources Malaysia Ministry of Health

Strong government push to extend national healthcare capabilities

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Continued healthcare infrastructure development

Construction of new hospitals and specialized facilities

o Eight new hospitals to be built, 156 rural clinics and 41 community health clinics, and 50 additional 1Malaysia clinics

Improved rural access to healthcare

o 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

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?

One of the fastest growing markets for Medical Imaging in Southeast Asia

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Malaysia USD 66.5 11%

Indonesia USD 141.9

24%

Thailand USD 146.9

25%

Singapore USD 38.9

7%

Vietnam USD 120.0

21%

Philippines USD 72.7

12%

COUNTRY 3-year CAGR (2011-2014)

Malaysia 7.5%

Indonesia 6.8%

Thailand 7.2%

Singapore 2.1%

Vietnam 7.5%

Philippines 4.5%

Source: Clearstate IMGTrac Database

Southeast Asia Medical Imaging Market (2011)

While hospitals have basic radiology capabilities, untapped opportunities present in high end imaging modalities

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305

27.9% 18%

29

72.1% 82%

# hospitals # with Radiology With MRI

334 hospitals

With Radiology Dept

With MRI

Less than 1.0T

More than 1.0 T Without MRI

Without Radiology

305 hospitals 85 hospitals

Source: Clearstate IMGTrac Database

Emerging trends, Ensuing opportunities

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Decentralization in radiology

Minimally invasive and spine surgery

Medical tourism

Interventional therapies

Increased demand for Healthcare IT

Diagnostic equipment with IT connectivity

Increased demand for Angio, CT, MR, Ultrasound, Fluoro

Establishment of new hybrid Operating Theatres

Increased need for C-Arms

Equipment upgrades in high end private hospitals

Rapid growth of interventional therapies across specializations driving future demand for 3D imaging equipment

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26,000 29,000

49,000

10,000 11,000

18,000

3,500 4,000

7,000

2009 2010 … 2014

39,500 44,000

74,000 Rapid adoption of

interventional techniques in

o Cardiovascular

o Endovascular

o Urology

Increasing need for fully equipped Hybrid Operating Rooms

Drives need for Angio suites, MR, CT, Ultrasounds, Fluoroscopy

Interventional cardiology procedures

CAGR (‘09-14): 13.4%

Source: Clearstate Surgical Procedure Volumes Database

Cardiovascular Cardiovascular

Cardiovascular

Endovascular Endovascular

Endovascular

Electrophysiology Electrophysiology

Electrophysiology

Versatility of C-Arms promoted by the swift adoption of Minimally Invasive Surgery techniques

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29,500 40,500

80,000

2009 2010 … 2014

Laparoscopic surgery procedures expected to double in 4 years

Minimally Invasive Spine procedures growing at >10% annually

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

Laparoscopic surgery procedures

CAGR (‘09-14): 22.1%

Source: Clearstate Surgical Procedure Volumes Database

Developments in medical tourism underscore need to upgrade equipment and boost capabilities

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Source: Malaysia Healthcare Travel Council

341,288 370,000 450,000

578,403

2007 2008 2009 2010

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

Annual medical tourism patients

CAGR (’07-10): 19.2%

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