The Russian government has made significant progress in creating a favorable business environment for foreign investors in the recent years even as the Ukraine crisis led to various trade restrictions. With the country looking to become a technology oriented economy from an oil and raw materials one, several steps including tax and custom concessions, IP protection and creation of industrial parks and special economic zones have been taken. While improving investor confidence, it helped FDI in Russia to grow by 83% in 2013. Following the Ukraine crisis, there has been a negative perception within various industries towards doing business in Russia. Capital flight and restrictions imposed by international community have dampened economic growth. EMeRG predicts a moderate decline in the economic growth of Russia in short term (2015-2016). Restriction on imported medical device companies from participating in public tenders will have a negative impact on the market growth in short term.
With over 61% of the healthcare expenditure being accounted for by the government, the Russian healthcare system is primarily driven by the public sector. However, it is faced with major challenges including inaccessible healthcare in rural areas; inadequate primary care services; limited number of specialists as well as overworked specialists. There has been a significant reduction in the number of rural healthcare facilities from 8249 in 2005 to 2085 in 2013. The Russian private healthcare market is growing at about 12% per year. However only about 7% of all hospitals and about 10% of the clinics in Russia are private owned. It is anticipated that the growth of single-specialty clinics will increase across a majority of Russian cities. Multispecialty / multidisciplinary clinics are anticipated to increase only in the large cities with a population of over 1Mn including Moscow, Saint Petersburg and Novosibirsk etc.
Growing at a CAGR of 1.9% from 2015 to 2018, the Russian medical device market is expected to be valued at $7.19Bn in 2018. Owing to the economic slowdown, the medical devices market was negatively impacted in 2014 as the market contracted by 0.3% over 2013. In 2015 too, the Russian medical device market is anticipated to shrink as the government looks to prohibit imported items into public tenders. While the current socio-economic factors may negatively impact market growth in immediate future, medical device sales are expected to increase post 2016. It is expected that in future, foreign companies may enter into special investment contracts with the government while localizing its manufacturing facilities in Russia and creating job opportunities. Such initiatives may be impeded in the short term, given the current political and economic situation in Russia. Lack of funds has severely hampered the growth of medical technologies in the country. A large majority of the diagnostic imaging equipment including CT scanners, MRI and digital radiography systems are not covered under any form of service contract. The overall diagnostic radiology imaging equipment and accessories market in Russia is expected to be valued at $1354.2Mn in 2018. With an increasing number of local manufacturers entering the market, the affordability of various critical care equipment including patient monitors as well as NICU devices has improved. However with dwindling exchange rates, the overall critical care devices market is expected to grow at a CAGR of 0.9% from 2015 to 2018 in Russia.
Created with crisp data representations, graphics and concise style of writing, the report provides an in-depth coverage of the business environment in Russia, post the recent events leading to the country’s economic slowdown. With the current sanctions impacting the perception of foreign investors about the Russian markets, there have been various changes to the overall investment scenario in the country. The report is aimed at highlighting the current opportunities and threats inside Russia for medical device manufacturers while taking into account the existing policy changes, regulatory amendments and other market dynamics. The report captures the current healthcare structure, purchase decision criteria for medical devices and types of hospitals across Russia and highlights the various opportunities across hospitals types and by disease areas. The report takes a deep-dive into the medical device market and highlights opportunities and revenue forecasts by various product categories including medical imaging equipment and accessories, medical consumables, dental devices, orthopedic devices and other medical device products. Finally, the report provides an in-depth qualitative analysis of the current competitive landscape with a focus on the local manufacturers as well as the recent activities of global market participants in Russia over the past 3-4 years.
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