Malaysia - Commercial Guide
Healthcare

This is a best prospect industry sector for this country.  Includes a market overview and trade data.

Last published date: 2020-08-19

Overview

Malaysia is an upper-middle-income economy with the third highest purchasing power per capita in the 10-member Association of Southeast Asian Nations (ASEAN). Malaysia’s healthcare expenditures are expected to double to $28 billion by 2028. The U.S. maintained its position as the top exporter of medical and dental equipment to Malaysia for three consecutive years (2017-2019), exporting $267 million in 2019. Despite the U.S. position as the leading supplier, Malaysian providers are most familiar with technologies from the United Kingdom, Australia, and Europe due to long-standing historical, education, and socio-economic connections. For 2019, the US is the leading exporter of medical instruments and appliances including electro-medical and sight-testing, and dental fittings and accessories. It is ranked second for x-rays, dental cement, fillings, bone reconstruction cement, and medical lubricating gel for operations and physical examinations. Cameras for the medical and surgical field, forensic and criminology use is ranked third.

Malaysia has a two-tier healthcare system: public (universal care) and private. Access to quality healthcare and social welfare protection is the central theme of the 2020 national budget. In Malaysia’s 2020 annual national budget, approximately $7.3 billion (10 percent of the total) is allocated to public healthcare, including funds for a holistic public-private electronic medical record system with RM31 million (US$7.4 million) allocation for 2020. Out of that sum, RM2.9 billion (US$690million) is set aside for development, maintenance, and upgrading work of existing public healthcare facilities, the procurement of medical equipment and medicine. Under this year’s allocation is RM60 million (US$14.3 million) set aside for pneumococcal vaccines for all Malaysian children. Budget 2020 also has an allocation of RM227 million (US$54 million) to upgrade medical equipment. On the medical treatment side, non-communicable diseases medicines and therapies, oncology treatment and therapies, and disease prevention vaccines for infants and children vaccines form the bulk of public sector purchases.

Although Malaysia’s public-to-private healthcare consumption ratio is almost equally distributed, spending is shifting to the private sector. This shift is spurred by the development of mid-tier to high-end private hospitals and clinics to support both the domestic market as well as the Malaysian government’s increased focus on attracting medical tourism. Basic health screening is the typical first experience a health tourist has with the Malaysian private healthcare providers. From there, these medical tourists would advance to the next level of care, depending on needs. Towards this, the health tourism industry as a whole has set priority focus areas in cardiology, oncology, fertility treatment, and hospital partnerships. Aesthetics medicine is gaining market interests. Aesthetics medicine involves surgical and non-surgical procedures to alter the skin, facial, and body contour condition of a patient. The purpose is to improve the patient’s positive self-image and psychological wellbeing to improve their quality of life and social engagement. In Malaysia, only private healthcare providers are allowed to cater to health tourists. 

Purchasing behavior differs from public and private sector. Although price sensitivity is inherent in both sectors, however, public procurement tends to incentivize local companies and manufacturers if they supply similar products, sometimes at the expense of higher pricing, and/or lower quality in tenders bids. In the first half of 2020, like many other countries worldwide, the Malaysian public healthcare system purchased many ventilators and patient monitoring systems, and personal protective equipment. It also spurred public investment to improve Malaysia’s ICU and infectious disease capabilities. Concurrently, emergency preparedness, and the treatment of non-communicable disease treatment spending continues. As a result of the pandemic, the public healthcare system realizes the importance and the need for telemedicine, a better patient monitoring and tracking system, and electronic medical records with a functional hospital information systems.

The private sector purchasing behavior is dependent on many factors. Market positioning of private hospitals plays a key role in many of the purchasing decision processes. Doctors' familiarity with the equipment is another factor. This sometimes is due to doctors’ historical and/or direct linkage and familiarity with the equipment and systems from where the doctor was first trained. In addition to the home country, most Malaysian doctors have their basic medical degrees from these countries: the United Kingdom, Ireland, Australia, India. Egypt and Indonesia. Hence, most general practitioners are more familiar with European and Australian equipment. A small percentage of Malaysian specialist doctors are trained in the United States. In most cases, best in class in terms of equipment, pricing, and after-sales service and continuing medical education and training provided by the distributors are key considerations for hospitals in their decision making process. Malaysian hospitals note that European competitors have established strong sales and after-sales service channels in Malaysia and the region. It welcomes the opportunity to engage with U.S. suppliers who are committed to increasing their presence and after-sales support in Malaysia.

A number of public hospital development projects are in the works. The allocation for this is RM1.6 billion. (US$381 million). Focal areas are for the development, and expansion of health and dental facilities, the procurement of medical equipment, pre-hospital care such as ambulances, and trauma care. Pre-hospital care such as ambulance services and Accidents and Emergencies (A&E) services will also be a key focus area. In Malaysia, ambulance service is mostly provided by Non-Profit Organizations and smaller for-profit organizations. It is mostly a public-private partnership format. Specific to funding to increase the number of ambulance services, RM59 million (US$14 million) was set aside for this initiative. A separate RM319 million (US$76 million) is set aside to build or upgrade public primary care health and dental clinics. These new clinics will be set up in smaller towns. Other hospital development and construction includes a pathology laboratory and a cardiology center.  

As of December 2018 (latest available data), there are 135 public hospitals and nine specialized medical institutions with 42,302 official beds under the Ministry of Health (MOH). Additionally, there is a total of 2,881 MOH managed health and community clinics. Furthermore, there are 217 mobile health clinic teams and four helicopters with ten teams of flying doctors services. A sub-brand MOH-run clinic has 342 clinics, seven mobile bus clinics with a group of 12, and 4 mobile boat clinics with a team of 8. The Ministry of Defense (MOD) has five army hospitals, while the Ministry of Education (MOE) has five university hospitals. There are 4,187 official beds under the combined MOD and MOE hospitals. On the dental side, there is a total of 1,692 MOH dental clinics with 3,485 dental chairs, plus 1,747 dental mobile teams. There are 22 sub-brand dental clinics with 44 dental chairs, one sub-brand mobile bus dental clinic, and two sub-brand mobile boat dental clinics under MOH. In the private sector for the same duration, there are 210 hospitals (15,957 beds), 18 maternity homes (56 beds), 21 nursing homes (797 beds), three hospice (29 beds), 117 ambulatory care centers (174 beds), five blood banks (28 banks/tanks), 479 hemodialysis centers (5,846 dialysis chairs), one community mental health center, and two combined ambulatory care and hemodialysis center (14 beds/21 dialysis chairs). There are also 7,718 registered private medical clinics, and 2,311 private dental clinics in the country.   

In 2019, Malaysia’s imports of the medical device industry were USD$1,13 billion, and U.S. products represented 23.5 percent of the import market and are the top exporting country of medical devices to Malaysia. In addition to the U.S., other top exporters of medical devices to Malaysia are Japan, Germany, Singapore, China, Mexico, South Korea, France, Switzerland, Netherlands, and Thailand. In Malaysia, the type of medical devices imported and exported differ significantly while the import and export countries are similar. Malaysia usually imports higher classification/ category of medical devices not manufactured locally.     

There is a slight decrease in exports from Malaysia in 2019 due to the U.S.- China trade war. Top export destinations for Malaysian products are the United States, Germany, Japan, Netherlands, Belgium, China, Singapore, Australia, Ireland, South Korea, Indonesia, and Brazil. Malaysia is the world’s largest medical gloves producer. Major Malaysian export categories are: surgical and examination gloves, other medical instruments, apparatus, and appliances, catheters, syringes, needles and sutures, electromedical equipment, ophthalmic lenses including contact lenses, dental devices and appliances, medical and surgical X-ray apparatus, and medical furniture. 

               Medical and Dental Equipment

              Note that this table does not include any values attributed to the trade of services.

Unit: $US millions

2017

2018

2019

CAGR

’17-‘19

Total Exports

5,360

6,407

6,375

9%

Total Imports

762

946

1,131

22%

Imports from the US

138

195

266

39%

Malaysian Exports to the US

1,634

3,460

2,098

13%

Exchange Rates

4.0

4.15

4.2

 

    Source:  Department of Statistics Malaysia

Leading Sub-Sectors

Wellness

Increasingly, more Malaysians are taking the approach of wellness and disease prevention rather than treatment. Consumer medical devices are used to self-monitor one’s health condition to maintain optimal health. Blood glucose and pressure monitors, and digital health wearables are gaining popularity. The United States is one of the largest suppliers of consumer health monitor devices in Malaysia. U.S. brands are both trusted and well received by Malaysian consumers.

Dental

As for dental market trends, there are subspecialties in the area of orthodontics, implant, and esthetic procedures increasingly being offered in private dental clinics. The United States is one of the leading suppliers of dental fittings and accessories, dental cement, fillings, and bone reconstruction cement in Malaysia.

 Private Healthcare Services

Private healthcare services in Malaysia are predominantly used by the upper-middle to the affluent segment of the population. As per capita GDP rises, demand for private healthcare consumption is expected to increase in tandem. Health screening is increasingly popular and is usually the first line of service requested by medical tourists. Medical aesthetics procedures, especially the non-invasive treatments are gaining wider acceptance both by local consumers as well as medical tourists. Cardiology, oncology, fertility treatment, and specialist hospital partnerships are key opportunities for US companies. 

Senior Assisted Living

Senior assisted living is another area that is gaining market interest. The  senior care segment is not reimbursable under the current health insurance scheme in Malaysia and it is a totally out of pocket expense. Despite this, due to the country’s development, demand is increasing for quality and affordable care. While there are many standalone private old folks homes in Malaysia, with a small number publicly funded, by and large, the standard of care is not uniformly regulated and provided.  The market trend now is to establish senior assisted living near the vicinity of a healthcare facility for ease of monitoring and care provision. This purposed built compound is currently mostly available for the well-heel society. Many stakeholders in this market segment are seeking collaboration in affordable concepts. Any digital devices, solutions, or systems such as digital monitoring systems for the senior care segment of the population are welcomed.  

 eHealth

Consolidation is the keyword for public healthcare resources and facilities. The government of Malaysia is implementing a hospital cluster concept. Hospitals within a similar geographic region will serve as one unit sharing assets, amenities, and human resources. Additionally, existing healthcare facilities and assets will also be upgraded. Healthcare services to the rural and remote areas will be expanded via mobile healthcare teams and flying doctor services. Implementation of the e-Health strategy will include incorporating existing ICT systems into one system-wide module. This strategy will hopefully improve health data management and support research and development, and commercialization initiatives. Ministry of Health (MOH) recognizes that a fully functional EMR system can increase the efficiency in managing information of patients. At the same time, it will reduce storage space in keeping physical medical records. The main challenges were due to the fast-changing technology and obstacles in securing sufficient funding. MOH is committed to EMR usage expansion in all government health facilities nationwide.   

The ministry approved an allocation for a pilot project to expand the EMR, which involves nine district hospitals in various states. This project is now known as EMR national implementation project phase one. The proposal to implement the first phase involves all government health facilities in the state of Negri Sembilan, comprising seven hospitals, 44 government clinics, and 12 dental clinics. The EMR system in each facility will be integrated with the Health Information Exchange (MyHix). The MyHix platform hopes to share a patient’s information in a safe, secure, and easy manner. As of July 30, 2020, 10 hospitals and one government clinic are integrated into the MyHix platform. The outcome of the pilot project and funding model will determine the nationwide EMR deployment.

Web Resources