GCC hospital revenues are predicted to grow by 5.8 percent in 2021, driven by a surge in medical devices, a growing branded generics market and increased investment in infrastructure and innovation.
A report from Mashreq Bank and the research firm, Frost & Sullivan, said that the strength of the rebound suggests that healthcare growth is on track to return to pre-COVID levels. Hospital revenues heavily impacted by drop in outpatient visits and elective surgery volumes during the pandemic are forecast to bounce back strongly in Q1 and Q2 2021 in most GCC countries.
Between 2010 and 2020, the GCC region had the highest healthcare infrastructure investments with a major increase in the number of hospitals and beds, the report said.
The number of hospitals almost doubled in most countries, and at least 80 percent of the hospitals and primary care clinics built in the GCC were driven by government initiatives and expansion plans.
Karim Amer, SVP, Head of Healthcare and Education, Mashreq Bank, said: "For investors and innovators within the healthcare ecosystem, the Gulf is unquestionably full of opportunity. Increasingly digital opportunities are driving new trends - for example, soaring demand for e-commerce services will most likely result in a doubling of e-commerce providers by 2030. This shift to digital health will only continue to emerge in prominence moving forward."
According to the report, one of the challenges the GCC healthcare sector faces includes a dependency on imports of drugs and medical devices, which significantly hampered healthcare spending last year. In the US, for example, 70 percent of drugs in use are generics, while it is only 30 percent in the GCC. Additionally, healthcare digitization is still limited in the region, with most applications still at a pilot stage. Private sector expenditure has also been less than 12-30 percent across GCC countries, placing a significant burden on the public healthcare system, the report said.
Additionally, pharmaceutical manufacturing is expected to become an $8 billion to $10 billion market in the GCC in the next few years. About 25 percent of multinational manufacturers have already initiated discussions with local companies to collaborate and develop drugs in the region. Monoclonal antibodies and next-generation sequencing solutions are also emerging growth areas in the life sciences industry and are expected to create a $7-$10 billion market in the MENA region in the next two years.
(Writing by Brinda Darasha; editing by Daniel Luiz)
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