This is a best prospect industry sector for this country. Includes a market overview and trade data.
Last Published: 8/7/2019

Overview

As one of the most economically developed and diversified markets in the Middle East, the United Arab Emirates (UAE) has a strong healthcare infrastructure. The creation of a world-class healthcare infrastructure is a top priority for the Government of the UAE and, as a result, the sector has advanced and expanded significantly during the past few years.  

The World Health Organization has determined that a third of the adults in the UAE are obese, and one out of five people live with diabetes.  As the incidences of lifestyle diseases increase, these populations, supported by relatively high levels of income, will demand greater quality of healthcare.  The government’s has focused on developing a healthcare infrastructure to address this demand. 

Both federal and emirate level governments regulate healthcare in the UAE.  Federal-level legislation began in the 1970s and 1980s and there are pending legislative reform initiatives to facilitate the development of the healthcare industry.  The UAE Government is liberalizing policies to attract foreign investments to improve the healthcare standard and boost the healthcare industry. 

The UAE’s health expenditure reached a value of $13.7 billion (AED 50.3 billion) in 2018.  This includes healthcare expenditure from the seven emirates in addition to their contribution to the federal budget.  There is an expectation for this figure to reach $14.4 billion (AED 53 billion) in 2019, a 5.4 percent y-o-y increase.  The forecast on spending is to rise to $18.3 billion (AED 67.2 billion) by 2023, which translates to a local currency and US dollar compound annual growth rate of six percent.  A 10-year forecast to 2028, health expenditure is expected to rise to $26 billion (AED 95.5 billion).  Overall healthcare spending is expected to account for 3.6 percent of the country's GDP by 2028, gradually increasing from 3.4 percent in 2018, according to Business Monitor International (BMI). 

Government commitment to the healthcare sector is one of the key drivers of growth within the UAE's healthcare market, particularly given that public spending accounts for over two thirds of overall healthcare expenditure. In the 2019 federal budget, a total of $16.4 billion (AED 60.3 billion) was approved for public spending, up 17.3 percent from $14 billion (AED 51.4 billion) from the 2018 budget.  While this does not constitute total government expenditure in the UAE, which derives from overall spending at the respective Emirati level, it is, nonetheless, a solid indicator of the UAE's fiscal stance.  As such, the federal government has made fiscal consolidation a priority over the past two years, efforts which began after oil prices slumped in late 2014. 

In June 2015, the UAE government launched a new health insurance program in Dubai to support nationals not covered under any other government funded health insurance scheme.  This scheme benefited around 130,000 by offering healthcare at 23 private hospitals and more than 500 medical clinics in and around Dubai.  The Dubai Health Authority (DHA) announced in June 2016, that all Dubai residents should be covered by health insurance and this will be tied to the renewal and issuance of their UAE residence visas. 

The UAE government wants to boost the number of medical tourists coming to the UAE in order to establish Dubai as a center of healthcare excellence in the region.  The country has a robust transportation and logistics infrastructure and is geographically well positioned to be the center of a transportation network that links the economies of India and China to Europe and the United States.  These factors also make the country an attractive location for establishing a regional distribution center for medical devices. 

According to investment experts, some of the biggest UAE opportunities are likely to be found in healthcare projects.  For instance, “Unison”, a public-private partnership between GE Healthcare, the UAE Ministry of Health and Prevention (MoHAP) and Abu Dhabi International Medical Services (ADI) aims to bring together the best of healthcare technology, hospital management, and patient care into one group of eleven radiology departments spread across the UAE.  These types of partnerships are emblematic of the government’s efforts to privatize the public healthcare sector in the country. 

Medical Devices 

Definition:  Any product, including accessories, used in healthcare for diagnosis, prevention, monitoring or treatment of illness or handicap excluding drugs.  Medical devices can be consumables, diagnostic imaging, dental products, orthopedic & prosthetic products, and patient aids. 

In terms of medical devices, the UAE is an import driven market that is growing rapidly to keep pace with the country’s expanding healthcare infrastructure.  The government and private healthcare sector are investing heavily to provide countrywide healthcare solutions to the residents, expats, and medical tourists. 

According to BMI, it is anticipated that the UAE medical device market will record moderate growth, supported by economic acceleration over the next two years. With rising healthcare costs, the government will increase private sector participation.  Population growth, a changing epidemiology, a growing medical tourism industry, healthcare infrastructure developments, an expanding health insurance, digital transformation and new technologies will remain key market drivers. 

Regulations

All medical devices must be approved by the MoHAP Drug Registration and Control Department. Imported medical devices will not be cleared by Customs unless a pre-approval for importation of the consignment is issued by MoHAP. 

If the exporter company/manufacturer has no legal presence in the UAE, it will have to appoint a local representative to act on its behalf to register the devices.  The local representative must be appointed by written contract stating the appointment of the local authorized representative by the company.  The local representative should be licensed by the MoHAP. 

Qualification of Registration of Medical Devices
The application to place a medical device on the UAE market must be made by the manufacturer or its authorized representative.  The manufacturer or its authorized representative is required to maintain objective evidence on the safety and effectiveness of the medical device. 

The Ministry of Health and Prevention’s Registration and Drug Control Department shall accept accreditation of conformity assessment bodies from the European Union, Australia, Canada, the United States, Japan, and Singapore. 

The registration or listing of a medical device shall be valid for five years unless suspended or revoked by the MoHAP's Registration and Drug Control Department, or terminated by the registrant.  Applications for renewal of registration shall be made at least 90 days before the expiry date of registration of the device.  The application shall include submission of filled in application form and information pertaining to changes that were made to a registered device. 

Medical devices are classified under Class I (low risk), Class II and III (medium risk) and Class IV (high risk). In addition, in-vitro diagnostic medical devices are classified under Class A (low individual risk and low public health risk), Class B (moderate individual risk and/or low public health risk), Class C (high individual risk and/or moderate public health risk) and Class D (high individual risk and high public health risk). 

Market Entry

A law allowing 100 percent foreign ownership of companies in the UAE for certain sectors is now in force. The law is designed to make the country more attractive for investors while limiting the impact on local businesses.  Foreign companies seeking to establish an entity onshore in the UAE would previously have to team up with a UAE national, who was required to own 51 percent of the shares of the company. 

The plan is to aim to boost the UAE’s attractiveness for investment, create jobs and diversify the economy. 
There are also free-zones with the UAE which offers a wide variety of benefits to businesses and a degree of flexibility including:

  • 100 percent foreign ownership through branches, single or multiple shareholder companies - known as Free Zone Enterprises (FZEs), Free Zone Companies (FZCOs) or Free Zone Limited Liability Companies (FZ-LLC)

  • No national agent required for branch offices of foreign companies

  • Special assistance in getting work permits for staff 

Barriers

Some of the barriers include:

  • A small, young, and fragmented population

  • The high number of expatriate workers affecting demographics and healthcare

  • The fragmentation of the healthcare system led by Abu Dhabi and Dubai

  • A lack of federal health insurance

  • A shortage of qualified healthcare personnel

  • Customer Price Sensitivity 

Main Players
In 2018, the major players in the private healthcare market in the UAE are NMC Healthcare, Al-Noor Medical Company, VPS Healthcare, Tumbay group, Al-Zahra Group, Belhoul Lifecare, Emirates Healthcare, Gulf Healthcare International, Gulf Medical Projects Company, Zulekha Hospital, Saudi German Hospital Group, GE Healthcare and Aster DM Healthcare. 

In October 2017, the MoHAP announced that all healthcare facilities in the UAE will have international accreditation by medical bodies from the US, Canada or Australia by 2021. Currently, nearly 70 percent of more than 4,000 facilities, including hospitals, ambulatory services, clinics, polyclinics and primary care centers, have international accreditation.

Leading Sub-Sectors

Pharmaceuticals
As one-of-the-largest, most-developed economies in the Middle East, the UAE pharmaceutical market presents significant growth opportunities for multinational drug makers.  The expansion of private healthcare coverage and the modernization of health infrastructure will contribute to drive prescription market growth. Stricter pricing controls, generic drug substitution and an unfavorable demographic profile will act headwinds to firms over the coming years. 
Medical Equipment
The projected growth of UAE’s medical equipment market broadly mirrors that of other sectors. BMI estimated in 2015 that medical device market would grow at a compound annual rate of 8.2 percent from $967 million in 2015 to $1.4 billion in 2021.  Given that the UAE produces relatively little medical equipment domestically, this means significant business opportunities for international companies. 
Healthcare Information Technology 
The UAE’s Healthcare Information Technology market is set to grow swiftly in coming years. Technavio, a market research company that focuses on emerging markets, estimated in 2015 that this market would grow at a compound annual growth rate of over 11 percent from 2014 to 2019. This growth is partly driven by government initiatives around the digitization of electronic medical records. 

Education and Research 
In order to meet its ever-increasing need for qualifies medical professionals, the UAE has sought to grow its nascent medical education and training capacity.  At the same time, it has endeavored to make the country a regional hub for medical research and events.

Opportunities

The UAE needs to increase the number of hospitals, despite an expanding private healthcare sector. We estimate that the UAE had 128 hospitals in 2016, and note that the Federal Competitiveness & Statistics Authority (FCSA) reported 115 hospitals in 2014, of which 36 were public and 79 were private.  There are numerous hospital construction and renovation programs underway, as a result of both public and private investment.  A growing medical tourism sector is boosting demand for modern facilities with the latest medical equipment, as there is keen competition between Emirates to attract medical tourists. 

The MOHAP continues its plans to modernize hospitals in the country with the latest technology aimed at preventing and treating the increasing incidence of non-communicable diseases, particularly cardiovascular disease, cancer and diabetes.  The DHA will continue to align medical technology to the smart city vision of Dubai.

New UAE retirement visas to benefit the medical sector
Demand of medical home care is growing: doctors and nurses visiting patients at home (elder care, speech therapy, post–surgical nursing care & rehabilitation from injuries); medical advice and services remotely using telemedicine (for remote areas, potentially enabling provision of quality diagnosis and treatment of patients).

Trade Shows and Exhibitions

Arab Health
Date:  January 27-30, 2020
Venue:  Dubai World Trade Center, Dubai – UAE
Website: https://www.arabhealthonline.com/en/Home.html

OBS –GYNE
Date:  January 27-30, 2020
Organized by:  Informa Life Science Exhibitions
Website:  https://www.arabhealthonline.com/en/education/conferences/obs-gyne-conference.html

Building Healthcare
Date:  January 27-30, 2020
Organized by:  Informa Life Science Exhibitions
Website:  https://www.buildinghealthcare-exhibition.com/en/Home.html

Med Lab
Date:  February 3-6, 2020
Venue:  Dubai World Trade Center, Dubai – UAE
Organized by:  Schrage International
Website:  https://www.medlabme.com/en/home.html

Web Resources

UAE-Ministry of Trade
Ministry of Health
Health Authority Abu Dhabi
Dubai Health Authority
Gulf News
Dubai Healthcare City (Free Zone)
Abu Dhabi Health Authority
Abu Dhabi Health Service Company
Sharjah Heath Care City
Tejari Solution
Emirates Medical Association
Dubai Autism Center
Emirates Autism Center


 

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United Arab Emirates Healthcare Trade Development and Promotion