the brazilian healthcare sector - business sweden · confidential for internal use within client...
TRANSCRIPT
CONFIDENTIAL
FOR INTERNAL USE WITHIN CLIENT COMPANY ONLY
THE BRAZILIAN
HEALTHCARE SECTOR
GREAT OPPORTUNITIES ON LATIN AMERICA’S LARGEST HEALTH CARE MARKET
São Paulo, Brazil
August 2015
9,7% of GDP
BRL 470bn spent on Healthcare... … comparable to many European countries.
However, annual health expenses per capita is still
relatively low in Brazil (USD 1109, 2012).
BUSINESS SWEDEN 28 OCTOBER, 2015 2
THE BRAZILIAN HEALTHCARE MARKET IS THE LARGEST
IN LATIN AMERICA AND GROWING RAPIDLY
SOURCE: WORLD DATA BANK, BRAZILIAN INSTITUTE OF
GEOGRAPHY AND STATISTICS (IBGE), WHO
Development
of a middle
class
Welfare
diseases
increasing
Upcoming
growth of
the Brazilian
healthcare
market
Aging
population
BUSINESS SWEDEN 28 OCTOBER, 2015 3
THE BRAZILIAN CONSTITUTION PROVIDES UNIVERSAL
HEALTHCARE..
SOURCE: BMI: BRAZIL PHARMACEUTICALS & HEALTHCARE REPORT Q4 2012, ECONOMIST INTELLIGENCE UNIT: BROADENING HEALTHCARE ACCESS IN BRAZIL THROUGH INNOVATION, WHO, FOLHA DE SAO PAULO, THE
LANCET
The government has to provide free universal healthcare as a constitutional right for 200 million Brazilians, an
important democratization movement in the 1988 constitution
The SUS is one of the largest public health care system in the world. The SUS operates though both
public and private participation as it also finances the private sector performing complementary tasks not being taken on by the public
sector
PUBLIC HEALTHCARE REACHES 100% OF POPULATION BUT ANYONE WHO CAN AFFORD HAVE A PRIVATE HEALTH INSURANCE
SUS - UNIFIED HEALTH SYSTEM
Autonomy of federal units
SUS Mixed
Provided by
public or private
Free
universal access
Theoretically, the SUS reaches 100% of the population.
However it is estimated that today there are approx. 150
million people that depend exclusively on SUS and 49
million people (or 25%) having private
health insurances but that can also access to
SUS
Brazil’s medical system is to a significant extent
decentralized, giving autonomy to states and
municipalities
BUSINESS SWEDEN 28/10/2015 4
..YET THE PRIVATE SECTOR REPRESENTED 53% OF
TOTAL HEALTH EXPENDITURES IN 2014
47% BRL 221 bn
53% BRL 249 bn
PRIVATE PUBLIC
TOTAL HEALTH EXPENDITURES BY SECTOR The Brazilian governments’ share of total expenditure amounted
to 47% in 2014. As a comparison, the Swedish government’s
share represents 82% of total health expenditures
The public system in Brazil has since the start been
underfunded and the expenditures fall far behind the OECD average
of 70%. People often have to wait for months for exam results and critical
procedures
Governments’ share on expenditures in Brazil are relatively low when
compared to Sweden but absolute values are significant
BRL 221 bn for the public sector
BRL 249 bn for the private sector
The Brazilian Congress has approved that 25% of government
revenue from oil findings will go to fund public healthcare.
Oil and gas royalties reached BRL18,5 bn in 2014
ALTHOUGH UNDERFUNDED, THE PUBLIC SECTOR IS AN HIGHLY INTERESTING CLIENT SEGMENT ONLY BY ITS MERE SIZE
BUSINESS SWEDEN 28 OCTOBER, 2015 5
HIGHEST CONCENTRATION OF HOSPITALS IN
SOUTHERN AND SOUTH EASTERN BRAZIL
SOURCE: DATASUS
PRIVATE HOSPITALS MORE COMMON IN THE SOUTH WHILE PUBLIC HOSPITALS DOMINATE IN THE NORTH
Brazilian State Region Hospitals % Public % Private São Paulo Southeast 1 065 21% 79%
Minas Gerais Southeast 684 19% 81%
Bahia Northeast 634 46% 53%
Paraná South 509 32% 68%
Rio de Janeiro Southeast 499 32% 68%
Goiás Central West 434 41% 59%
Rio Grande do Sul South 341 15% 85%
Ceará Northeast 275 49% 50%
Santa Catarina South 255 17% 83%
Pernambuco Northeast 244 50% 50%
Maranhão Northeast 243 73% 27%
Pará North 238 46% 54%
Mato Grosso Central West 164 40% 60%
Paraíba Northeast 159 55% 45%
More than 1 000
Between 600 and 1 000
Between 300 and 600
NUMBER OF HOSPITALS PER BRAZILIAN STATE
Rio Grande
do Sul
Paraná
São
Paulo Rio de
Janeiro
Minas
Gerais
Bahia
Goiás
Ceará
Santa
Catarina
Pernambuco
Maranhão Pará
Mato
Grosso
Alagoas
Between 150 and 300
Less than 150
TOP 14 STATES IN NUMBER OF HOSPITALS
SÃO PAULO IS THE STATE WITH THE MOST HOSPITALS OF WHICH 79% ARE PRIVATE
PRIVATE PUBLIC
BUSINESS SWEDEN 28 OCTOBER, 2015 6
BRAZIL’S LEADING HOSPITALS ARE PRIVATE
PHILANTHROPIC INSTITUTIONS
SOURCE: MINISTRY OF HEALTH (MS), DATASUS, LEGISLATION
General Hospitals
Specialist Hospitals
Day Hospitals
(partial hospitalization)
Research/University
Hospitals
HOSPITALS
PRIVATE AND PHILANTHROPIC HOSPITALS GENERALLY MORE INCLINED TO PURCHASE HIGH-END PRODUCTS
Federal
State
Municipal
Philanthropic Managed by the federal government
Mostly general hospitals
100 hospitals
Managed by the state governments
Large share of specialist hospitals
610 hospitals
Example: Hospital das Clínicas (SP)
Managed by the municipal Government
Mostly general hospitals
1685 hospitals
Attend mainly to private insurance plans
Are generally high quality
Less than a half attend SUS
2860 hospitals
Private, non-profit oriented hospitals
At least 60% of beds must be reserved
for SUS patients. In return, the hospital
gets exemption from taxes
6 of the best Brazilian hospitals are
philantropic, considered Excellence
Hospitals by the government
1444 hospitals
Private and philanthropic hospitals are
generally more inclined to purchase
high-end medical devices and
equipment.
Purchase prices are in general also
higher in the private sector.
Attend mostly to SUS patients
Many are working with overcapacity
Although there are good quality
hospitals, most are in bad conditions
Private
MOST PRIVATE HEALTH PLAN BENEFICIARIES LIVE IN THE SOUTH AND SOUTH EAST
BUSINESS SWEDEN 28 OCTOBER, 2015 7
THE STATE OF SÃO PAULO ALONE HAS 19 MILLION
PRIVATE INSURANCE BENEFICIARIES
SOURCE: MINISTRY OF HEALTH - CNES, NATIONAL AGENCY FOR SUPPLEMENTARY HEALTH SERVICES (ANS)
More than 7 million
Between 2 and 7 million
Between 0,7 and 2 million
Between 0,4 and 0,7 million
Less than 0,4
NR OF PRIVATE INSURANCE PLAN BENEFICIARIES
MORE THAN 80% OF PRIVATELY INSURED BENEFIT FROM A HEALTH PLAN THROUGH THEIR EMPLOYMENT CONTRACT
Brazilian State Region Number of
Beneficiaries % Individual or Familiar
% Collective (Company)
São Paulo Southeast 18 805 870 19% 80%
Rio de Janeiro Southeast 6 059 970 19% 80%
Minas Gerais Southeast 5 380 330 15% 84%
Paraná South 2 900 763 26% 74%
Rio Grande do Sul South 2 789 899 14% 85%
Bahia Northeast 1 678 221 17% 83%
Santa Catarina South 1 517 826 12% 87%
Pernambuco Northeast 1 434 487 28% 72%
Ceará Northeast 1 278 580 31% 68%
Espírito Santo Southeast 1 130 645 13% 86%
Goiás Central West 1 109 992 23% 76%
Federal District (DF) Central West 952 797 4% 96%
Pará North 891 646 34% 66%
TOP 13 STATES - NR OF PRIVATE INSURANCE BENEFICIARIES
Rio Grande
do Sul
Paraná
São
Paulo Rio de
Janeiro
Minas
Gerais
Bahia
Goiás
Ceará
Santa
Catarina
Pernambuco
Pará
DF
Espírito
Santo
BUSINESS SWEDEN 28 OCTOBER, 2015 8
RECENT REGULATION OPENS UP FOR FOREIGN
OWNERSHIP OF HOSPITALS AND CLINICS IN BRAZIL
BRAZILIAN’S FEDERAL
CONSTITUTION FEDERAL LAW NO 8.080
Creates an universal public
healthcare system
Article 199 of the Federal
Constitution (CF-1988) states that
health care is open to private
enterprise. However paragraph 3
(§ 3º) declares the following:
§ 3º It is forbidden the direct or
indirect participation of foreign
companies or foreign capital
in healthcare in the country, except
in cases provided by law
AS FROM JANUARY 2015 IT IS NOW POSSIBLE FOR SWEDISH INVESTORS TO FULLY ENTER THE BRAZILIAN HEALTHCARE MARKET
FEDERAL LAW NO 13.097
The exceptions were
presented by the Federal Law
No 8.080: international
insurance companies,
laboratories,
pharmacies, diagnostic
companies, donations,
all authorized in the country in
1990
Law No 13.097, which amended
the Federal Law No 8.080
opened up additional areas where foreign capital is now
allowed for investments in
clinics and hospitals
1988
1990
2015
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
2009 2010 2011 2012 2013 2014
Total Export Million US$ FOB Total Import Million US$ FOB
BUSINESS SWEDEN 28 OCTOBER, 2015 9
BRAZIL IMPORTED USD 10 BILLION IN HEALTHCARE
PRODUCTS IN 2014
SOURCE: MINISTRY OF DEVELOPMENT, INDUSTRY AND FOREIGN TRADE
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
2009 2010 2011 2012 2013 2014
Total Export Million US$ FOB Total Import Million US$ FOB
BALANCE OF TRADE - MEDICAL DEVICES AND EQUIPMENT
(including HS headings 9018, 9019, 9020, 9021, 9022)
BALANCE OF TRADE – PHARMACEUTICALS
(including entire HS chapter 30)
CAGR Export: 7,8%
CAGR Import: 10,7%
CAGR Export: 4,3%
CAGR Import: 11,4%
LARGE POTENTIAL FOR MEDICAL DEVICES AND PHARMACEUTICAL EXPORTERS
Examples - key items Brazil is importing:
• Probes, catheters and cannulae
• Orthopedic or fracture appliances
• Magnetic resonance imaging apparatus
• Stents
• Ultrasonic scanning apparatus (doppler spectral analysis)
Examples - key items Brazil is importing:
• Blood fractions and immunological products (modified)
• Medicines containing heteroatoms heterocyclic nitrogen compounds
• Vaccines
• Medicines with enzymes
• Medicines with hormones
Documentation
Required* Class I Class II Class III Class IV
Cadaster
(ANVISA)
Register
(ANVISA)
For register within ANVISA, products are framed in the following risk
classes:
Class I – low risk for individuals and public health;
Class II – medium risk for individuals and/or low risk for public health;
Class III – high risk for individuals and/or medium risk for public health;
Class IV – high risk for individuals and public health.
In accordance with ANVISA, Class III and Class IV products need
mandatory registration within ANVISA, while only some Class II products
need registration, such as medical equipment, due to special risks. Other
Class II products and all of the products Class I need a cadaster*.
BUSINESS SWEDEN 28 OCTOBER, 2015 10
ANVISA IS THE NATIONAL SURVEILLANCE AGENCY FOR
PHARMACEUTICALS AND MEDICAL DEVICES
COMPLYING WITH ANVISA STANDARDS ESSENTIAL FOR ENTERING BRAZILIAN MARKET
SOURCE: BUSINESS SWEDEN DESK RESEARCH AND INTERVIEWS WITH ANVISA *DEPENDING OF CLASSIFICATION PRODUCT WILL NEEDED A CADASTER (STANDARD REGISTRATION) OR GO THROUGH A COMPLETE
REGISTRATION, INVOLVING A SIGNIFICANTLY MORE RIGOROUS EVALUATION PROCESS.
= yes, need approval = no, do not need approval
= only certain products need approval
Formulating rules
Establishing controlling mechanisms
Assessing risks and adverse events regarding
health provision in hospitals, clinics, and health posts
Enforcing rules
Nationwide health
surveillance
services
ANVISA
NATIONAL HEALTH SURVEILLANCE AGENCY (ANVISA)
BUSINESS SWEDEN 28 OCTOBER, 2015 11
BRAZIL’S HEALTH CARE MARKET IS CHALLENGING BUT
OFFERS GREAT BUSINESS OPPORTUNITIES
Which
opportunities
make Brazil
interesting?
What
challenges
should companies
be ready to face?
High production costs
Excessive bureaucracy for registration of products
Complex tax system
Current economic crisis
Complex SUS funding
system
Precarious situation in
healthcare public institutions
Complex public hospital
purchase process
High future investments
Oil royalties will increase public health expenditure
New opening for foreign capital in clinics and hospitals
Aging population, increase of welfare diseases
Increasing imports of healthcare products
Large market of 200 million people, with 100% public
health insurance coverage and strong private sector
Investments
Stakeholders
Market
Investments
Business in Brazil
Public System Presence of top quality
hospitals
High number of
healthcare institutions
Developing pharma
industry
Public health system is historically underfunded
Most of health expenditure comes from the private sector
Total healthcare expenditure per capita is low
SIGNIFICANT BUSINESS POTENTIAL ON LARGE AND GROWING BUT COMPLEX HEALTH CARE MARKET
BUSINESS SWEDEN OFFERS A FULL SERVICE
PORTFOLIO FOR EFFICIENT MARKET ENTRY
* BSO SERVICES INCLUDE: OFFICE PLACE & SERVICE, ADMINISTRATION, COMPANY ESTABLISHMENT (INCL
LEGAL ADRESS) , DELEGATE MANAGER AND FINANCIAL ANALYSIS
28 OCTOBER, 2015 BUSINESS SWEDEN 12
ICT
OUR INDUSTRY FOCUS
HEALTH CARE
& LIFE
SCIENCE
MATERIALS &
MANUFACTU
RING
SECURITY CREATIVE
INDUSTRIES
ENERGY &
ENVIRONMENT
TRANSPORT
SYSTEMS
OUR CUSTOMERS
SWEDISH COMPANIES EXPANDING
INTO BRAZIL LOCAL SUBSIDIARIES OF
SWEDISH COMPANIES SWEDISH GOVERNMENT
OUR MARKET OFFERING
MARKET ENTRY
STRATEGY
OUR STRENGTH
PARTNER
SEARCH STAKEHOLDER
MANAGEMENT
IMPORT
ANALYSIS
SOURCING
ANALYSIS ACQUISITION
SUPPORT
MARKET
ANALYSIS
BUSINESS
SUPPORT
OFFICE *
RECRUITING
EXPERIENCED
TEAM WITH
INDUSTRY FOCUS
UNIQUE OWNERSHIP PROVIDE
ACCESS TO THE SWEDISH
GOVERNM.& FUNDING STRUCTURE
GLOBAL
PRESENCE
LOCAL& SWEDISH
PERSPECTIVE TO BUSINESS
OPPORTUNITIES
ACCESS TO HIGH LEVEL
AUTHORITIES & BUSINESS
NETWORKS IN BRAZIL
CONTACT US
BUSINESS SWEDEN IN BRAZIL
Rua Joaquim Floriano, 466 – cj 1908 – Ed. Office
BR 04534-002 – São Paulo - Brazil
Phone: +55 11 2137 4400
Fax: +55 11 2137 4425