Myanmar’s emerging medical device market has seen growing opportunities especially in Diagnostics Imaging (DI) device and In-Vitro Diagnostics (IVD) sector. The drivers behind this include the increase in healthcare spending, upgrading of healthcare facilities and the growing demand for high quality diagnostics test results, as highlighted in a recent white paper by Solidiance, an Asia-focused management consulting firm. Furthermore, the high incidence rate of diseases caused by the lack of early detection and changes in lifestyle signals the growing need for diagnostic devices in the country.
Growing healthcare spending
Despite the fact that Myanmar’s total healthcare spending is the lowest among Southeast Asian countries, it had increased by 40 percent from $908 million in 2010 to $1.9 billion in 2014. Approximately, 60 percent of total healthcare expenditure mainly comes from the private sector due to high spending from Out-of-Pocket (OOP) expenses, which accounts for 78 percent of total healthcare expenditure.
Myanmar’s healthcare insurance system, which was initiated by the government in mid-2015, is still in a very nascent stage. It is expected that healthcare spending would increase significantly if the healthcare insurance system continued to grow with the influx of private players into the market.
Upgrading healthcare facilities and new hospitals
The government has been upgrading the public and military hospitals by increasing the national budget contribution to the healthcare sector. Government’s budget allocation on healthcare had grown from 12 percent in 2010 to 40 percent in 2014. In addition, the Ministry of Health has planned to increase healthcare budget allocation with an annual growth rate of six percent until 2020.
Although private hospitals have occupied 14 percent of total hospitals in the country (there are a total of 1,192 hospitals in Myanmar as of 2014), people prefer to have medical treatment in private hospitals and clinics due to its better quality of medical treatment and efficient healthcare services. Thus, the number of private hospitals had increased by 10 percent between 2010 and 2014. Both private and public hospitals catering to specialized medical treatments and services are located in big cities such as Yangon, Mandalay and Naypyitaw, while 70 percent of people who reside in rural areas have limited access to healthcare services.
The trend of non-communicable diseases
The rising trend of chronic diseases and the lack of early detection of diseases suggest the need for better diagnostics services and devices. Premature deaths related to non-communicable diseases (NCD) contributed to 60 percent of total deaths in 2014, compared to 40 percent of total deaths in 2010.
To reduce the high burden of NCD deaths, Myanmar’s Ministry of Health had developed a comprehensive national plan in 2014 for prevention and control of incidence caused by NCDs. Priority is given to early detection of NCDs by upgrading and installing advanced medical devices to minimize premature deaths. An estimated 60,000 cancer cases have been identified each year in Myanmar, of which majority of patients recognize their disease in the last stage due to lack of regular medical check-up and early detection.
In-Vitro diagnostics in Myanmar: Surging demand
The prevalence of diseases, especially diabetes and hypertension, and rising incidence of cancer are also key factors demanding advanced IVD tests. With attempts to reduce the risk factors of high prevalence of diseases, IVD diagnostics labs have seen high demands across the country.
Currently, private standalone laboratories and private hospital laboratories cater to approximately 80 percent of total IVD test centres as they provide easier access and offer high quality laboratory tests. On the other hand, public hospitals offer IVD tests at a cheaper price. Yet due to more promising accuracy, some patients take sophisticated IVD tests such as detailed biopsy and tumour markers abroad. The demand for high quality laboratory testing and the growing emphasis on the necessity of early detection of diseases have therefore spurred the growth of IVD market in Myanmar.
A doctor from SSC Hospital in Myanmar states, “In Myanmar, there is little spending on IVD due to limited awareness of usage and its benefits. However, with the increasing outreach of media and health education programs, IVD will see significant growth in the next 3-5 years.”
Market potential for Diagnostics Imaging in Myanmar
The growing need for early detection of disease and the need for modern and sophisticated diagnostics devices for more accurate test results are expected to fuel the demand of the diagnostics imaging devices. With regards to current DI services offering and availability, advanced DI equipment is only available in private tertiary hospitals and big private hospitals in main cities which highlights the fact that there is a gap in the market to cater to large population coverage nationwide.
In terms of updated facilities, basic DI devices such as X-Rays and ultrasounds are available in almost all of the public and government hospitals, while more advanced DI machines such as CT scanners and MRIs are only available in tertiary care hospitals in main cities such Yangon, Mandalay, Naypyitaw and Taunggyi.
Furthermore, despite the fact that every citizen is entitled to enjoy subsidised rate at public hospitals, many people still have to rely on the private sector due to the limited facilities at public hospitals. Although public hospitals offer significantly lower prices for DI tests, they have limited facilities to serve patients, resulting in long waiting time for patients to undergo the medical tests. Moreover, modernized devices such as 3D and 4D ultrasounds are equipped in private hospitals while only 2D ultrasound machines are available in public hospitals.
To sum up, there are growing market opportunities for medical devices in Myanmar driven mainly by the significant increase in healthcare budget, spending and the rising incidence of diseases - although the limited awareness of the importance of early detection still poses significant challenges.
Mie Mie Ko is a business analyst at Solidiance Myanmar Co Ltd and helped create the white paper “Emerging opportunities in Myanmar’s Diagnostic Imaging and In-Vitro Diagnostics”. Solidiance is a corporate strategy consulting firm with a focus on Asia Pacific. Views and opinions expressed in this article are the author’s own and do not necessarily reflect Myanmar Business Today’s editorial opinion.