Market Brief for Egypt

Healthcare
Health care is, nominally, socialized in Egypt. The Egyptian Ministry of Health and Population (MOHP), the key government agency charged with meeting Egypt’s health care challenges, is continuing its efforts to expand the quality of healthcare services for its citizens. Despite many notable achievements in the last few decades, there remains a high rate of preventable illness and death -- particularly among the poor and illiterate in the more under-served, rural areas of the country. The Government’s primary care services are inefficient and of poor quality. This situation forces many people to seek primary care in the private sector and leaves the population with a large burden of healthcare costs.

Total government spending on healthcare ($870 million) is considered low by international standards for a country of 70 million citizens, and large-scale reform in the health sector is urgently needed. The Government of Egypt (GOE) has stated that its long-term goals include providing universal health coverage by 2010. Currently only 8 million of the population benefits from social or private insurance coverage. In response, the MOHP has developed a Health Sector Reform Program designed to universally improve the health status of all Egyptians via providing a package of health services based on universality, equity, efficiency, affordability, sustainability, quality, and patient satisfaction.

USAID among other donors has a long-term commitment to assist the GOE in improving healthcare practices by establishing first class research facilities and upgrading hospital technology. In 2005, USAID has allocated some $21.2 million for healthcare and family planning projects. The Government’s current five-year plan (2002-2007) allocated some $1.5 billion for upgrading medical facilities and health care services. In addition to the construction of new hospitals, funds will be made available for enhancing medical services in urban and remote areas, broadening the training of physicians, increasing the number of nurses, supplying hospitals and medical centers with near state of the art equipment, and increasing the budget for research and development at universities and research centers.

Medical Equipment and Supplies

The highly competitive medical equipment market in Egypt is estimated at about $600 million, with an annual growth rate of 15%. As there is little local production, the market relies mainly on imports and is extremely receptive to American products because of the reliable high technology and the associated training, well-developed marketing systems, and financing available through USAID’s Commodity Import Program. USAID-financed tenders support U.S. firms by ensuring a wide distribution of American products and services, an advantage that should be utilized by US firms. Despite this solid reputation, U.S. market share is estimated at only 30%. As the population continues to grow, more hospitals are being built. The GOE is working on upgrading the existing facilities in different hospitals, clinics, laboratories and healthcare facilities, and is adding new technologies. The private sector's demand for sophisticated medical equipment is also growing. Most American companies are currently selling medical equipment to Egypt through local agents, although direct subsidiaries (e.g., GE, J&J) also exist. The most promising sub-sectors include highly specialized disposables, high-tech equipment, software for hospital management/network, and ICU monitoring equipment.

The importation of used and refurbished medical equipment and supplies to Egypt is banned. The ban does not differentiate between the most complex computer-based imaging equipment and the most basic of supplies. At present, even new medical equipment must be tested in the country of origin and proven safe before it will be approved for importation into Egypt. These regulations also apply to medical equipment that is being donated, not sold for profit. FDA approval is key to having medical products registered, although the Ministry of Health may still do additional testing on any medical device. The registration process of medical devices takes between six months to up to two years.

Standards issued by the Egyptian Organization for Standardization and Quality Control (EOS) are applied to some specific medical measuring devices and instruments. With respect to other medical products where no mandatory standards exist, the following international standards are adopted: International Standards (ISO/IEC); European Standards (EN) - (in the absence of EN standards, British (BS), German (DIN), and French (NF) standards may be applied); American Standards (ANS); and Japanese Standards (JIS). In the absence of an Egyptian or international standard, authorities often will refer to the Analysis Certificate accompanying the product.

For more information, please contact the author of this report, Commercial Specialist (Mrs.) Jihan Labib, U.S. Embassy, Cairo, Jihan.Labib@N0SPAM.mail.doc.gov

Market Brief for Israel

Over one third of Israel’s $800 million medical equipment market originates from the United States. This market continues to present an outstanding export potential to manufacturers of instruments and disposables:

Market Size in 2003
($ Millions):
Sources: Israel Central Bureau of Statistics of Israel, U.S. Department of Commerce

	Medical Equip.	Dental Equip. & Supplies	Laboratory/Scientific Instruments
Total Market Size	540	60	220
Total Imports	400	40	220
U.S. Imports	200	12	55

The Healthcare System

The national Health Law provides basic healthcare services for every citizen through four health insurance organizations known as “Sick Funds.” The private sector offers additional services including dental care, plastic/aesthetic surgery and alternative medicine. A quick comparison between Israel’s healthcare market in 1995 and 2003 reveals that:

• The total number of hospital beds increased by 24%.
• The number of nursing and elderly home beds grew by 62% to 20,560 beds.
• The number of private in-patient hospital beds was up 57% to 12,304 beds.

	1990	1995	2003	1995-2003 change
Population			6.7 million
Total number of hospital beds	29094	33,142	41104	0.24
Nursing and elderly home beds	9287	12,687	20560	0.62
Private in-patient beds	6512	7,815	12304	0.57
Number of physicians	14946	20,722	24577	0.18
Number of admissions in acute care hospitals	727974	980,922	1168880	0.19
Number of inpatient surgical procedures	314230	411,520	564810	0.37
Total health expenditure as % of GDP	7.3	7.8	8.8	0.13
Total pharmaceutical expenditure as % of total health expenditure	14.9	15.5	17.4	0.12

Market Accessibility
The Ministry of Health (MOH) accepts FDA certification (510K, PMA and Certificate to Foreign Government) and approves products carrying such certification without further requirements. The MOH does not as readily approve devices that carry export permits only and are not allowed in the US market. Devices in this status undergo a more strict registration procedure.

Technical Standards:
Electronic/electric medical devices are subject to approval by the Standard Institute of Israel. The electric standard currently used in Israel is the CB test protocol.

For more information, please contact the author of this report, Commercial Specialist (Mrs.) Yael Torres, U.S. Embassy Tel Aviv; Yael.Torres@N0SPAM.mail.doc.gov

Market Brief for Jordan

Market Overview and Trends

• Jordan’s total expenditure on health is estimated at $325 million, around 9% of total GDP.
• $168 million of government expenditure on public health of which $67 million in medical devices.
• The average per capita spending is around $1,657 per year.
• Jordan’s health care system is regarded as one of the best in the region. Jordan is striving to become a medical hub/tourism for the Middle East by offering relatively high-quality care at comparatively inexpensive rates.
• The total number of patients came to Jordan for treatment was 109,215 in 2002 and 112,300 in 2003 generating a total revenue of JD 400,000,000. As per the experts in the field, the total number of the patients came to Jordan in 2004 was expected at 115,000. According to MoH statistics, the top beneficiary regions are: GCC, Yemen, North Africa, Palestine, and others.
• There are highly potential investments in hospital projects, both public and private, across the country. USAID and WHO are major players, among other donors, in funding upgrades in healthcare service and supporting reforms to Jordan’s healthcare system.
• The Ministry of Health, private hospitals and clinic operators show great interest in contacting U.S. manufacturers of medical equipment.
• Jordan is a leader in cardiology and cardiovascular surgery, laparoendoscopic surgery, kidney transplantation, ophthalmology, neurosurgery, plastic surgery, oncology and many other areas. One growth area in Jordan is aesthetic procedures and related products.
• As part of the Jordanian Government’s health sector reform, sales of medical equipment and service by foreign suppliers are expected to continue to increase during 2002-2006. The Ministry of Health (MOH) plans to continue to invest on hospital infrastructure throughout the country, improving the quality of health care and hospital services and developing and implementing health information system. Purchases will consist of a variety of equipment including sophisticated laboratory diagnostic, laboratory reagents, testing equipment, cardiology equipment, hospital furniture as well as other laboratory equipment.

Download the rest of the Market Brief, Jordan Market Brief Healthcare Products & Services (06)

Market Brief for Lebanon

Lebanon is the leading importer of healthcare and pharmaceutical drugs in the Levant area with over 50 importers. Some 5,976 types of drug are imported from more than 508 factories in 25 countries constituting between 92 and 95 percent of the total available in the market. In 1999, $275 million worth of pharmaceutical drugs were brought in. The number went up to $280 million in 2000 and to $294 million in 2001, which generated some $7 million worth of Customs duties.

There are eight companies in Lebanon that manufacture healthcare equipment and pharmaceutical drugs and export around $4 million worth of pharmaceuticals yearly mostly to Arab countries. In 1998, locally manufactured drugs made up 5.7 percent, or $14 million, of all drugs consumed.

The pharmaceutical market generates around $400 million every year in retail sales. There are around 1,405 independent pharmacies and hospital-based pharmacies, of which an estimated 200 of those outside hospitals are working without a license. Among the regulations governing pharmacies is one that is meant to control their number. It is now required that a minimum of 300 meters be maintained between each facility.

The Government of Lebanon continuously tries to control and limit medication costs, and a proposal to open up the facility to import drugs away from exclusive agencies is seen as increasing competition and therefore reducing costs. The cost of health service is generally high. The market for medications, which accounts for 35-40 percent of health care expenditures, is largely unregulated. Local industry provides only a small share of the market. Imported medication is expensive and not wholly controlled. In any case, the government formed the National Drugs Office (NDO) to handle direct medicine imports to reduce the fees charged by exclusive dealers. NDO acts as an importer of basic drugs and its mandate allows it to manufacture pharmaceutical drugs on low profit margins. To decrease the amount of drugs in the marketplace, the NDO in 1992 selected a list of essential drugs, including 290 used to treat the most common diseases.

The supply of physicians has been growing at a rate of around nine percent annually since 1993, a rate that greatly exceeds the rate of population growth of 1.9 percent per year. In 2001 there were 8,598 registered doctors, or around 250 doctors for every 100,000 residents.

Lebanon has 144 medium sized private hospitals with 10,137 beds, and 17 large private hospitals with 3,378 beds. The rehabilitation and development of the public health sector saw the addition of one new public hospital in 2000 and the rehabilitation of eight others. In addition, the Lebanese government is supervising the setting up of a drug quality control laboratory, funded mainly by the World Bank and by Saudi Arabia.

Finally, the demand for U.S. products has increased over the last year due to the decline in the value of the dollar vis-à-vis the Euro. More Lebanese companies are now looking to the U.S. market to procure their needs.

For further information please contact Naman Tayyar at TayyarN@N0SPAM.state.gov .

Market Brief for Morocco

Morocco is a leading country in the African region in terms of health care equipment and services. Morocco serves as a health care center for the Sub-Sahara neighboring countries, which lack equipment.

Though health care expenditures seem small according to international standards (4.6% of Morocco’s GDP), there has been a yearly increase of 10%, since 1999. The budget allocated to healthcare increased from $400 million in 1999 to $700 million in 2005. In 2005, Government expenditures amount to $131 million for procurement of medical equipment and $121 million for other public hospitals expenditures. To meet the population growth rate (1.4%) and the domestic growing demand for modern and western health care standards, the Ministry of Health plans an annual budget increase of 13% to implement its 2003-2007 Action Plan. Under this plan, the Ministry will build 4 new cancer hospitals, upgrade 120 existing hospitals with modern equipment, increase hospital in-patient capacity, improve hospital operations, and automate the systems. In addition, the law 65//00 on the mandatory health care coverage (Assurance Maladie Obligatoire “AMO”) was implemented in August 2005. This new law will increase the health coverage from 20% to 40% in the next six months and aims at rapidly reaching 80%.

The Moroccan health sector is divided into the public sector and the private sector, both being under the supervision of the Ministry of Health (MOH). The public sector counts 127 public hospitals, 4 University hospitals (Centres Hospitaliers Universitaires “CHU”), which are autonomous but under the general supervision of the Ministry of Health, 4 military hospitals and 14 Social Security hospitals, (Polycliniques de la Caisse Nationale de Securite Sociale “CNSS”), which belong to the national social security, and are slated for privatization. The public sector totals 89,057 hospital beds and 380 operating theaters, and represents the main end user. The public sector provides the basic health care (immunization) as well as the highest-end medical care (cardiology, oncology, gastroenterology, radiology, surgeries, etc.). A few cases are referred to foreign hospitals. The private Sector counts over 248 private clinics, which compete with the public sector. Due to the growing demand, this number is increasing rapidly. In addition to the private clinics, private radiology centers provide radiology services exclusively.

With a total of 407 healthcare centers offering a total of 34,445 beds (1.15 hospital beds per 1,000 inhabitants), Morocco is an up growing opportunity field in terms of medical equipment and services. The medical material and equipment production is extremely low and limited to basic and technologically un-advanced material. It is mainly centered on furniture, which does not comply with international standards, and single use material, such as bandages and syringes. Morocco relies on imports to supplies hospital facilities with technologically advanced medical devices.

The competition is high with more than 200 actors due to the free access to the market. However, Moroccan medical officials consider the U.S. equipment as efficient and modern. U.S. companies such as GE and Johnson & Johnson have been successful in the country. U.S. technical and managerial expertise in the health field is highly regarded. With this reputation, U.S. firms could benefit tremendously from reforms in the health sector, as well as the U.S. Morocco Free Trade Agreement, which will abolish the import duties, and offer a “competitive import advantage” over European competitors.

Market Access

Except for X-rays that require special authorizations to enter the country, other medical equipment is freely imported. Import taxes are presently around 2.5% but will be abolished with the enactment of the U-S. Morocco Free Trade Agreement.

The metric system is the system of measurement and the electric standard is 220V, 50 Hz. New regulations include CE standards quality requirements for electro medical equipment such as a CE Mark certificate and U.S. standards.

Refurbished equipment is not allowed in public health procurement. However, tremendous opportunities exist in the private sector, especially the sophisticated and expensive equipment. U.S. used equipment that offers technical warrantees such as a certification from the U.S. FDA, will find excellent opportunities with the Moroccan private sector.

Procurement in the public sector is performed through tenders, which are publicly announced in newspapers. U.S. firms are advised to select a local distributor with strong French language skills, who knows the market and public procurement procedures. U.S. firms also need to provide long-term assistance to their local partner, such as brochures and manuals in French.

For more information, please contact the author of this report, Commercial Specialist (Ms.) Najia Tourougui, Commercial Service, U.S. Embassy, Rabat, Morocco. Najia.Tourougui@N0SPAM.mail.doc.gov

Market Brief for Turkey

Turkey, having a population of 70 million people, is a growing market for the medical products and services sectors. In fiscal year 2005, US$ 4.016 billion was allocated to the Turkish Ministry of Health by the Government of Turkey (GOT). The Ministry of Health (MOH) budget for FY 2005 showed a 15.07% increase compared to that of FY 2004. The Ministry’s budget stood at around 1.13% of the Gross National Product in 2005. Additionally, in FY 2005 consolidated budget, the GOT, allocated US$ 2.552 billion to spending on healthcare, for the purchase of goods and services.

Compared to other OECD countries Turkey has a low profile, in terms of health expenditures. However, when health expenditures are considered as percent of the GDP, the country is viewed at higher level. Thus, as a percent of GDP devoted to health expenditures, Turkey is on average with its peers.

There are 1,191 hospitals, 4,095 independent laboratories and 19,627 physician offices in Turkey. More than 90% of the hospitals are owned by the public; generally by the Ministry of Health. The bed capacity was 180,797 in 2003 and it is targeted to reach 200,000 by the end of 2005, within the scope of the VIII. Five Years Development Plan. The total number of medical equipment owned by the Ministry of Health and other health related institutions, from year-end 2003, was as follows:

Computerized Tomograph: 516
Magnetic Rezonans: 211
Ultrasonograph: 3063
Scintigraphy: 157
Mammograph: 456
Gastroscope: 492
Laparoscope: 623
EEG: 288

More than 60 % of the health expenditures are devoted to medical services alone, while medical devices constitute a smaller portion of the total overall health expenditure budget. Major health services are provided by both public and private hospitals. Approximately 40% of in-patient and 56% of the outpatient expenses are financed by the public sources.

The medical equipment market in Turkey is estimated to be around US$ 2 billion. The United States maintains the largest market share among imports and is strong in radiology, surgical equipment and supplies, pathology and laboratory equipment, and hospital furnishings. The U.S. is followed by the EU member countries and Japan.

The largest single buyer of medical products is the Ministry of Health and its healthcare facilities. Teaching hospitals, university hospitals, and the private hospital system, as well as private physicians' offices are also among potential buyers of U.S. medical products. Market growth for medical products is expected to continue due to the expansion of private sector health care services, rising expectations among patients, and efforts of some private hospitals towards attracting foreign patients. Modern private hospitals in Istanbul, Ankara and Izmir have set new standards for the health sector in Turkey. Many existing hospitals are launching renovation projects in order to compete. The private sector strives to import equipment with advanced technology, an area where the United States has a good reputation. In addition, Turkey is looking to leverage its location at the crossroads of Europe, the Middle East and Central Asia to advance health care tourism to Istanbul and other major health care delivery sites throughout Turkey. A number of private clinics have been attracting foreign patients undergoing treatments ranging from cardiology to cosmetic surgery.

Transformation of the Health System in Turkey

Turkey relies on imports for a large portion of its sophisticated medical equipment needs. The "Health Reform Project" of the 1990's foresaw a gradual privatization of hospitals and the introduction of the "family physician" system. The reform program comprises service delivery, finance, administration/management, human resources, the establishment of a national health academy and the creation of a management information system in the health care services sector.

As the second phase of the program, the GOT has engaged in a project with the World Bank worth US$ 200 million involving the transformation of the healthcare system in Turkey. Five major goals are pursued within the scope of this project:

1) Reconstructing the administrative and functional structure of the Ministry of Health, giving autonomy to the independent units (hospitals, polyclinics, etc.)
2) Establishing a unified social insurance system
3) Establishing a family practitioner system
4) Establishing a health accreditation system
5) Establishing an electronic health information system

Market Strategy

Most medical equipment suppliers prefer to appoint national and, usually, exclusive distributors in Turkey. The distributor/importer is knowledgeable about shipping products into Turkey, and about building a good reputation with Turkish customers. Currently a large majority of U.S. manufacturers use exclusive distributors to export to Turkey. Prospective agents should be selected on the basis of their organizational and technical ability to support a manufacturer's products in Turkey's own unique national environment. They should be evaluated over time to be sure that they have also earned the respect of customers. The distributor is responsible for advising the manufacturer about the customers' preferences and specific sales requirements. In interviews with hospital buying offices in Turkey, a manufacturer's performance was equated with the performance of its distributor. In short, a good distributor is the single most important key to success in this market. The critical need, therefore, is to be cautious in the selection of a Turkish distributor.

New Medical Device Regulations in Turkey - Turkey Adopts European Union Industrial Directives (CE Marking)

Turkey is in a transition phase and has adopted the New Approach Directives of the European Union. According to the New Approach Directives, medical devices fall under one of the three directives.

90/385/EEC Medical Devices: Active Implantable,
93/42/EEC Medical Devices: General,
98/19/EC Medical Devices: In Vitro Diagnostic

All medical devices, imported or locally produced, must be CE marked in order to be sold into the Turkish market. Custom made medical devices intended for clinical investigations and made available to specialist doctors, and the medical devices that will be displayed during fairs and exhibitions do not have this requirement of needing the CE mark.

Equipment meeting the directive definition of products needing to conform to EU technical regulations must have evidence of meeting the requirements either through verified laboratory testing conducted by an EU approved notified body or by a manufacturer’s self-declaration if the directive dictates. Companies selling to the Turkish market must submit evidence of conformity compliance (CE Mark) either by providing a notorized/consularized conformity certificate from a notified body or a manufacturer’s issued certificate of conformity, which declares compliance of all relevant standards and directive annexes

MOH bans the importation of used/refurbished medical devices.

In order to obtain more information about the Turkey’s Healthcare Medical Market, please contact Commercial Assistant Ms. Ozge Cirika at Ozge.Cirika@N0SPAM.mail.doc.gov .

Market Brief for West Bank & Gaza

The total Palestinian population in the West Bank and Gaza is around 3.6 million and the growth rate is 3.9%, and around 47% of the population is 14 years and younger according to mid 2003 figures. GDP for 2003 stood at $4.01 billion

The size of the medical equipment and supplies market in the West bank and Gaza is estimated at $20 million annually. The figures may change depending on international donors’ support for specific health projects carried out in the area. The market is made up of medical capital equipment, medical supplies, and lab equipment and lab disposable supplies. There is no in country production of medical equipment and supplies, so West Bank and Gaza depend 100% on imports. Germany and the UK are the primary sources for imports followed by European and Asiatic countries, the U.S. and Israel.

The U.S. share of the market does not exceed 15% of total imports, however two factors are expected to change the percentage. First the falling value of the U.S. dollar vs. the Euro that makes U.S. exports more competitive. Second is the continued support by USAID towards health projects in the West Bank and Gaza; USAID regulations stipulate that funds can be spent on American-made equipment only.

There are no import duties on U.S. made goods entering the West Bank and Gaza, however products are subject to value added tax (VAT) currently 16.5% and purchase tax. In order to benefit from duty free entry, products must have a U.S. certificate of origin for exporting to the West Bank and Gaza. Also prior to shipping approvals must be obtained from both the Palestinian and Israeli ministries of health for any medical product coming into the area.

The majority of the Palestinian population relies on medical services provided by public hospitals that are run by the Palestinian Ministry of Health under a general health insurance program. The Ministry is in charge of providing all medical equipment and supplies that are paid for mostly through international donors support programs. Total number of public and private hospitals in West Bank and Gaza is 72 and total number of beds is 5000.

West Bank and Gaza Contact:
U.S. Commercial Service
Issa Noursi, Commercial Specialist
19 Keren Hayesod
Jerusalem
Tel: 972-2-625-5201, Fax: 972-2-623-5132
E-mail: issa.noursi@N0SPAM.mail.doc.gov