Market Study: Russian Health Market
Health expenditures in Russia are significantly lower than in developed countries (3,5% vs. 9-12% GDP), while private/total expenditure ratio is significantly higher (38 vs. 25 %).Russian healthcare market is estimated around 2.2Trillion RUB (39 BUSD) and dominated by state providers (clinics, hospitals, etc.) and the state obligatory health insurance system.
Russian health care system in obviously underfunded. The number of hospital beds in Russia fell from 137 per 10,000 people in 1990 to 84 in 2015, and the number of clinics fell from 35,000 to 23,000. The number of private clinics, hospitals (including the number of private beds) is constantly increasing and expected to increase further. There is a clear trend for commercialization of Russia health care market.
The majority of medical organizations in Russia are in a bad technical conditions. 31% of all medical organizations in Russia do not have water supply, 36% sewage, 40% do not have central heating, 33% of all x-ray machined and 25% of all ultra sound machines are older then 10 years old the same apply to laboratory equipment
Russian pharmaceutical market in 2017 was estimated as 1357 BRUB in distributors prices (+8,4% compare to 2016). Top 10 distributors count for 72% of the market (compare to 80% in 2016). Almost all large national distributors own one or several pharmacy chains (Protek, Katren, Rosta, Oriola, etc) and actively develop their own production (Protek, R-Pharm, SIA International, etc)
Medical equipment market
Russian medical devices market is one of the largest in Eastern Europe and dominated by import with 79% of the market, local producers count only for 21% of the market (even the target set by “Pharma 2020” strategy was 40%). The main importer countries are: Germany, USA and China. Russian medical equipment market is dominated by state purchases with 71,5% market share in 2016 or 266 BRUB (around 4 BEUR)
Import substitution policy
The Russian Ministry of Industry and Trade has introduced an Order # 655 dated 31.03.2015 which sets a strategic 5-year plan for import substitution in medical devices industry. In this strategic plan, there is a list of 111 groups of medical devices with targeted shares of foreign producers by 2020
Russian health tourism market
Every year around 100.000 tourists from Russia travel overseas for medical treatment. They are assisted by more than 150 specialized assistant companies. Market is estimated around 1-2 BEUR per year
The new telemedicine law came into effect in Russia in 01 January 2018. This legislation makes now legal distance communication between doctors, as well as communications between doctors and patients. Also this law will allow doctors to issue online medical prescriptions, since the beginning of 2019.
Russian health market shows the biggest potential in the following sectors: telemedicine, wearable health gadgets, personal diagnostics (express-tests) and in many other sectors as well. Russian health market is big, diverse and there is a market niche for many Finnish companies in health sector.
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Senior Advisor, Health