Executive Summary
Market Entry
Current Market Trends
Best Prospects
Market Size
Main Competitors
Current Demand
Registration Process
Reimbursement
Barriers
Procurement & Tenders
U.S. Commercial Service Contact Information
Tab Options
Executive Summary
Market Entry
Current Market Trends
Best Prospects
Market Size
Main Competitors
Current Demand
Registration Process
Reimbursement
Barriers
Procurement & Tenders
U.S. Commercial Service Contact Information
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Executive Summary
Malaysia provides universal healthcare access to its citizens through its public healthcare system. The Malaysian government allocated $7.6 billion under Budget 2023 to strengthen health and wellness programs, improve and repair healthcare facilities, increase the effectiveness of health treatments, replace critical and old medical assets, and digitalize healthcare services. Over the next ten years, the public and private healthcare sectors will be focused on expanding investment in healthcare technology, medical devices, and digital health to ensure work-class quality healthcare service delivery. That initiative is part of a broader modernization effort aimed at outbreak preparedness, elder care, and non-communicable disease management.
Malaysia uses a two-tiered healthcare system in which the government-run healthcare sector co-exists with a private healthcare system. As of 2020, Malaysia had 146 government hospitals and 202 private hospitals. Services at private healthcare facilities are either entirely self-funded out-of-pocket or covered by private insurance. As a result, private healthcare services in Malaysia are predominantly used by the population’s upper-middle income to affluent segment.
In 2020, Malaysia imported over $1.3 billion worth of medical devices. The U.S. companies were the leading source of those devices, accounting for over 17 percent of the market share. Key opportunities for U.S. exporters are wellness products for monitoring health conditions, dental equipment, healthcare technology, and private healthcare services.
Malaysia has developed a detailed Halal certification for medical devices that meet requirements prescribed by Islamic Shariah law. While it is not compulsory for all manufacturers who market their devices in Malaysia to get their devices Halal-certified, those medical devices with Halal certifications would be preferred over other non-certified products.
The established private healthcare facilities supported by internationally recognized doctors and trained medical staff have made Malaysia a top destination for medical travel. Only private healthcare providers can cater to health travelers. Within the region, Malaysia faces strong competition for medical travelers from neighboring countries Singapore and Thailand. In 2019, the country attracted 1.3 million international healthcare tourists who generated over $380 million in hospital receipts. Over 50 percent of all medical travelers come from Indonesia.
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Market Entry
U.S. companies interested in entering the Malaysian market may consider appointing an authorized local distributor/importer to represent their products and services. The local distributor will handle the product registration with the local authorities such as Medical Device Authority (MDA) and National Pharmaceutical Regulatory Agency (NPRA). The distributor can also handle marketing efforts and provide immediate technical support to Malaysian clients. Another market entry method is setting up a subsidiary company in Malaysia.
Relationship building plays an essential role in doing business in Malaysia. Good relationships will influence customer procurement decisions. Malaysians are typically cost-conscious but welcome the opportunity to engage with U.S. companies committed to increasing their presence and providing after-sales support.
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Current Market Trends
The healthcare sector is expected to grow to $30 billion by 2027, fueled by increasing demand for healthcare services from an aging population, rising affluence, and increasing life expectancy. In 2020, there were 3.4 million senior citizens aged 60 and above. As a result of urbanization and globalization, the typical lifestyle in Malaysia has changed dramatically over recent years. That lifestyle change has been in parallel with the rapid rise in the number of Malaysians suffering from non-communicable diseases (NCDs) such as cancer, diabetes, stroke, heart disease, and hypertension. Based on current trends, a Malaysian will be spending an estimated 9.5 years of life expectancy in poor health due to NCDs or chronic diseases. The key focus for the Ministry of Health is to transform sick care into health care.
Apart from the COVID-19 recovery, the Malaysian government aims to enhance the current healthcare travel ecosystem and strengthen the Malaysia healthcare brand, to develop its capabilities and reputation as the Fertility Hub of Asia, Cardiology Hub of Asia, and Cancer Care Centre of Excellence. Private healthcare providers are driving health technology adoption and pursuing partnerships with international healthcare providers to strengthen their service offerings to medical travelers.
The Malaysian government and leading medical schools are actively entering research and development for vaccines and genomes. In 2022, the government started the first phase of the MyGenom Project, which plans to collect 10,000 Malaysians’ genomes to characterize the genetic variation of Malaysians for diagnostics and prevention purposes. The national vaccine development roadmap will look at producing two types of COVID-19 vaccines but also vaccines for other diseases, like head and neck cancer vaccine by the Cancer Research Centre.
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Best Prospects
Electronic Health Record – ICT systems that focus on healthcare data management. Clinical Diagnostics products and equipment - diagnostics growth due to increase clinical demand.Nutritional Supplements - For Beauty and Wellness.Orthodontics – Implant and Esthetics procedures.
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Market Size
Healthcare spending (including investment)
$13.57 billion (2019)
… as percent of GDP
4.3% (2019)
Hospitals, Procedures, Healthcare Professionals
Number of hospitals
348 (2020)
…Public
146 (2020)
…Private
202 (2020)
Number of hospital beds
Public and Private: totaling 61,272 (2020)
… available beds per capita
19 (2020)
…of which in general hospitals
Public: 44,117 (2020)
…of which in specialized clinics and rehabilitation centers
Public: 5,574 (2020)
Physicians
73,996 (2020)
Dentists
11,597 (2020)
Demographics
Population
32.7 million (2020 est.)
Life expectancy men/women
Men: 72.5 years; Women: 77.4 years
Infant mortality
6.4 per 1000 live births (2019)
Percent of population older than 65
6.7% (2019)
…projection, 2030
N/A
Annual deaths
5.3 deaths/ 1000 population (2019)
…caused by [highest disease burden]
Public hospitals: Diseases of the circulatory system (2020)
Private hospitals: Neoplasms (2020)
…caused by [second highest]
Public hospitals: Diseases of the respiratory system (2020)
Private hospitals: Diseases of the circulatory system (2020)
Prevalence of [fastest growing disease burden]
N/A
Source: Ministry of Health Malaysia - Health Facts 2021
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Main Competitors
In 2020, Malaysia spent over $175 million on medical equipment imports from the United States. According to Global Trade Atlas, the United States maintained its position as the top exporter in the cumulative category for instrumentals and appliances used in medical, surgical, dental, or veterinary sciences (HS Code 9018) from 2018 to 2020. Despite the U.S. position as the leading supplier, Malaysian providers are also familiar with medical technologies from Europe, Germany, the United Kingdom, France, Australia, and Japan due to their long-standing historical, education, and socio-economic connections. Increasingly, China and South Korea are gaining significant footholds in the market, with ASEAN trading partners Singapore and Thailand also gaining market share. The top ten major exporters to Malaysia for HS code 9018 are the United States, Japan, China, Germany, Singapore, Mexico, South Korea, Thailand, Hong Kong, and Ireland.
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Current Demand
Even though Malaysia is a large global exporter of medical devices and medical products such as surgical gloves, Malaysia imports around 88% of all medical device equipment, primarily high-tech medical devices. US products are generally popular in Malaysia.
The medical device prospects in Malaysia are mainly divided into the following categories:
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Registration Process
All medical devices sold in Malaysia need to be registered with Malaysia’s Medical Device Authority (MDA) via the Medical Device Centralized Online Application System (MeDC@St). MDA is a statutory body under the Ministry of Health Malaysia, which was appointed to control and regulate medical devices, and enforce medical device law under the Medical Device Act 2012 (Act 737). Foreign manufacturers who wish to bring medical devices into Malaysia need to appoint a local Malaysia Authorized Representative (a company registered in Malaysia) to handle their medical device registration with MDA if they don’t have a local presence in Malaysia.
Medical devices are classified based on the risk associated with the vulnerability they present to the human body, the technical design, and the manufacture of the medical device. There are four categories: A, B, C, and D. Those risk categories range from low to high. Low-risk examples include oxygen masks and walking aids, while high-risk examples are pacemakers and neurological catheters. MDA regulates the four market players, mainly authorized representatives, importers, distributors, and manufacturers. The companies involved in the supply chain of medical devices must establish, implement, and maintain a quality management system. The Good Distribution Practice for Medical Devices, or GDPMD, ensures an establishment’s ability to maintain a medical device’s quality, safety, and performance. Authorized representatives, importers, and distributors are required to have GDPMD certification to maintain the quality, safety, and performance of the medical devices in its custody. The GDPMD will be assessed and certified by the Conformity Assessment Body (CAB), while manufacturers need to comply with the ISO13845.
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Reimbursement
Malaysia provides universal healthcare for all citizens and legal residents. Instead of providing a national insurance program, the Government heavily subsidizes the cost of treatment through public facilities. Patients pay small fees for their medical appointments with the public hospital and clinics.
Upper-middle-class patients who wish to receive quicker access to treatment can visit private facilities. Private health insurance coverage and/or fully self-funded payments are typical ways of paying for private healthcare services. Private health insurance coverage is optional, although private sector employers generally have some form of health insurance coverage for their employees.
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Barriers
Malaysia’s ease of trade across borders remains highly ranked. However, some challenges come with doing business in Malaysia, namely:
- The pricing of the products might be a challenge for U.S. companies. Even though U.S. products are well received in Malaysia, pricing is a key factor in the buying decision. The USD exchange rate in October 2022 raised the price for imported U.S. products.
- To be considered Halal under the Malaysian system, medical devices and pharmaceutical products must be made from materials or ingredients allowed under Sharia law. While it is not compulsory for all manufacturers who market their products in Malaysia to get their devices/pharmaceuticals products Halal-certified, those products with Halal certifications would be preferred over other non-certified products.
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Procurement & Tenders
Malaysia is not part of the World Trade Organisation (WTO) Government Procurement Agreement. As a result, foreign companies do not have the same opportunity as local companies to compete for government contracts. In most cases, they are required to take on a local partner before their bids will be considered for procurement by the Malaysian government. Generally, any company that seeks to supply goods or services to any Malaysian government agency must first register with the Ministry of Finance (MOF) as a supplier through an electronic registration system via the “ePerolehan” website. For supplies and services, quotations and tender notices are published on the “ePerolehan” website (https://www.eperolehan.gov.my/ ).
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U.S. Commercial Service Contact Information
Name: Ms. Bethany Tien bethany.tien@trade.gov
