Overview

In Pakistan, public and private health care systems run in parallel. The public sector, led by the Ministry of Health until recently, has deferred to the provinces for issuance of healthcare to the general population. The administrative and fiscal space of provinces has increased manifold with simultaneous increase in their responsibilities but is still deficient in health workforce and facilities relative to the size of the population.

The private sector is also playing a vital role for the delivery of health care services in Pakistan. Most private hospitals, clinics and health related facilities are in the urban areas and are well equipped with modern diagnostic facilities. These Private health care options are in greater demand than the care available through the public sector.

The public health sector services are provided at federal, provincial and district levels through a well-established network of rural health centers, basic health units and allied medical professionals. Health profile of Pakistan is characterized by high population growth. The rising population pressure on state health institutions has allowed the private sector to bridge the gap of rising demand and limited public health facilities.

Similarly, expansion in the Government of Pakistan’s universal health coverage insurance program has led to an increase in the demand of healthcare infrastructure as government is providing health care services to general public both from public and private hospitals.

The Government of Pakistan (GOP) spent about $785 million on healthcare in the fiscal year ending June 2021. According to a well thought of research study, the medical devices market in Pakistan is estimated at $500 - $600 million with an estimated growth rate of 15 percent CAGR over the next five years (2019-2023). U.S. healthcare services and medical equipment are generally well-received in Pakistan and are known for their high quality.

The GOP imposes no restrictions on foreign direct investment in healthcare services, and allows medical equipment imports under its “Open General” regulations, however, imports of radioactive equipment require Pakistan Nuclear Regulatory Authority approval. Import tariffs range from 0 to 25 percent, depending on the category, however, some medical equipment is exempt from sales taxes. 

Price, quality, and after-sales service support are major factors in medical equipment purchase decisions. For government procurements, public tenders can be time-consuming, while decision-making is typically faster in private hospitals. A letter of credit is usually the mode of payment for imports while supplying equipment to either project, public or private.

Key regulators in the sector are the Drug Regulatory Authority of Pakistan (DRAP) and the Ministry of National Health Services Regulation and Coordination (MNHSRC). As of 2015, DRAP oversees regulations of medical devices as well. These new regulations include new medical device and in vitro diagnostic (IVD) products, and include requirements for conformity assessments, quality management systems, classification guidelines, authorized representation for foreign manufacturers and related registration steps. These rules cover procedures for registration of medical devices and conformity assessment bodies, licensing of establishments, classification and grouping of devices, post-market surveillance, import and export, labeling requirements, advertisement, and ancillary matters. To further streamline the registration process of medical devices, DRAP undertook certain amendments in the Medical Device Rules 2017, however, international companies still discern “bottlenecks” around indenting clauses of the rule and long registration processes.

Leading Sub-Sectors

There is a mushrooming in demand for diagnostic and lab equipment in Pakistan. Due to global pandemic, demand for protective equipment and vaccines have increased tremendously. With the number of hospitals, dispensaries, healthcare units expected to increase due to the GOP’s plan to expand their healthcare network and face COVID-19 situation, market demand for equipment listed below is expected to grow:

• Respirators (HS 9019)
• Monitors, Ventilators, and allied instruments
• Personal Protection Equipment, Dental Veterinary Instruments and Appliances (HS 9018)
• Orthopedic Appliances, Hearing Aids (HS 9021)
• X-Rays, Radiography/ Radio Therapy Apparatus (HS 9022)
• Second hand and used X-Ray Machines, Dialysis Machines, Anesthesia Apparatus
• Health IT/Telemedicine/eHealth

Opportunities

Public sector expenditures in health facilities are progressive across the country.  The following facilities are expected to grow:

• General Hospitals
• Specialized Hospitals
• Cancer
• Cardiac
• Kidney Transplant
• Liver Transplant
• Dialysis Centers
• Cardio-Pulmonary Diseases
• E.N.T
• Neurology
• Orthopedic
• Skin Diseases
• Upgrade and Privatization of Government Hospitals
• Diagnostics
• Diagnostic Labs
• X-Rays and Ultra- Sonography Labs / Clinics
• Fitness Centers
• Manufacturing
• Electro Medical Equipment
• Auto-disable Syringes/Safety Syringes

The impending construction of several hospitals in Pakistan will also bring opportunities for medical devices suppliers.

Challenges

Competitors include manufacturers from Europe, China, Japan, South Korea, and other countries. In general, U.S. goods and technologies are well regarded and have a reputation for quality and reliability. Local agents note the market is often seeking low cost, and quick decision-making on terms, which can put American companies at a disadvantage.

Healthcare in Pakistan is still in the early stages of development. Government funding on health as a percentage of GDP continues to lag other countries at similar stages of development. Also, moves to decentralize the healthcare system, from federal to provincial governments, have led to wider disparities, with non-uniform medical device approvals across the country.

Other issues include low health manpower levels, after-sales service, a lack of training on the use of medical equipment - abundant of them are poorly maintained or in disuse - and the underutilization of primary health facilities.

Resources

Healthcare Procurement

Government of Health Plans

Ministry of National Health Services, Regulations and Coordination

Drug Regulation Authority of Pakistan