Estimated to account for around 10% of GDP of most developed nations, the
healthcare industry is big business and affords a wealth of opportunities – which
doesn’t escape the notice of the world’s industrial gas majors.
The medical and healthcare industry affects almost everyone, whether directly or indirectly, and is big business both in the West and around the world. The very nature of the industry and its service offering ensures that personal perspectives can change from
vitality to the volatile in mere seconds. Less capricious however, is the consistently healthy business prospects afforded by this industry.
From latex gloves to eye laser surgery, anaesthesia technologies and dental care products, the potential for manufacturers and distributors to tap into this market demand is immense. The industry covers a variety of functions and applications. According to the UK’s Department of Health, the term ‘healthcare
industries’ is not clearly defined and may be used to encompass an array of medical devices, systems and technologies, laboratory equipment and associated support services such as planning, design, management, training and education.
The term ‘medical device’ covers a multitude of
products used in healthcare diagnosis, prevention, monitoring or the treatment of illness. The number of significant UK medical device companies is small and varies from those with less than £1m per year turnover (around 85 %) to those with £500m – £1bn sales. In terms of just how widespread the reach of the industry is, it is estimated that around 38 million people in the UK per day have contact with a medical device. Patients on whom devices are used include those visiting hospitals, GPs, dentists, opticians, and chiropodists as well as those who daily use glasses, contact lenses or dentures.
Global Market
Estimated by some sources to account for the
consumption of over 10% of the gross domestic
product of most developed nations, healthcare can form an enormous part of a country’s economy. Five years ago, in 2003 health care costs paid to hospitals, physicians, nursing homes, diagnostic laboratories, pharmacies, medical device manufacturers and other components of the health care system were believed to have consumed around 25% of the GDP of the US – the largest of any country in the world.
Indeed, both the North American and Western
Europe markets are thought to dominate the global healthcare industry and account for a sizeable 69% of this. Figures from Spiritus Consultancy estimate that North America accounts for approximately 34.7%
of this industry, while Western Europe is marginally behind at around 34.3% and the rest of the global market is divided fairly equally – with the North Pacific Rim establishing a 14.7% share and South America
5.2%. Perhaps unsurprisingly, the so-called developing nations or regions, such as Africa and the India subcontinent, appear to make-up a minor segment of the market between them.
It is expected that the developed nations and
economies of the Western world hold such a high
proportion of the global healthcare scene, given that infrastructures are already soundly developed and so too are research bases. The UK’s Department of Health notes that the majority of companies operating in the UK are foreign-owned, mostly American. It also explains that the healthcare sector exports around £4bn worth of goods and services annually into a global market that is growing rapidly, and attributes the UK’s increasing presence in the global market to three key
factors. These are: complementary relationships between the industry, the government, the NHS (National Health Service), the private sector and voluntary organisations; a highly developed healthcare infrastructure; and an outstanding research base.
The department describes the sector’s outlook as ‘growing rapidly as individual expectations rise, and political pressure grows in many countries to improve services and facilities.’
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