At present, the Medtech industry is aiming to target revenues of about more than $10 billion with the Singaporean government targeting up to 1 million foreign patients a year which would contribute of about 1% to the GDP of the country.
- Definition / Scope
- Market Overview
- Top Market Opportunities
- Market Trends
- Industry Challenges
- Technology Trends
- Regulatory Trends
- Other Key Market Trends
- Market Size and Forecast
- Market Outlook
- Technology Roadmap
- Competitive Landcape
- Competitive Factors
- Key Market Players
- Strategic Conclusion
Definition / Scope
By the term Medtech or Medical Technology it consists of technologies that diagnose, treat or improve human health. At recent times, medtech is one of the most emerging industries in the world and plays an important role in diagnosing, monitoring and coming up with solutions for treating diseases that affect humans.
The overall global scenario of the sector is positive because consumers are taking proactive steps to seek better medical and health care facilities which is likely to keep up the demand of the sector.
Singapore is one of the most highly ranked countries in context of doing business because of the well-developed infrastructure, talented workforce which attracts multinational companies and startups.
Singapore in medical devices & technology is an emerging player at current times and strives to become the largest industry in the entire Asian region despite of the infancy phase that it is in at present.
The slowdown in economy of developed nations like USA and entire EU region has shifted the focus of global, manufacturers to ASEAN region and particularly Singapore as it has the most effective infrastructure providing healthcare access among population and due to its high spending on advance health care systems, the country is an ideal base for worldwide companies to expand their horizon.
At present, the Medtech industry is aiming to target revenues of about more than $10 billion with the Singaporean government targeting up to 1 million foreign patients a year which would contribute of about 1% to the GDP of the country. Singapore has a presence of more than 60 highly competent global medical technology companies who lead in manufacturing, operation and R&D activities related to medical technology.
The industry contributes about $3.1 billion and around 9000 jobs to the country’s economy. The industry continues to thrive as government support the growth through introducing inducement based schemes as Singapore has good scope in this industry in foreseeable future.
The number of employees to be hired for the sector is projected to grow with around 20,000 science and engineering graduates each year contributing directly to the sector and around 300,000 skilled employees in associated sectors, such as pharmaceuticals.
A high number is projected due to the demand that is likely to increase and these multi-disciplinary labor force are supported by particularly two government programs known as Medical technology IDEAS (Innovate, Design, and Engineer for Asia in Singapore) and Singapore-Stanford Bio-design Program.
- At present, 10% of the world’s total contact lenses manufacture, over 70% micro-arrays and 50% of world’s thermal cyclers and mass spectrometers are currently being manufacture in Singapore.
- The most popular and growing sectors within the Medtech of Singapore are cardiovascular, eye care, diagnostic, imaging, research tools, scientific instruments and orthopedics.
- Of about 50 of the regional headquarters from the Medtech multinationals around the world is based in Singapore. It is a hub for business model creation and also e-commerce to expand access to other Asian countries.
- It has a widespread presence of 25 Research & Development Centres established by Medtech companies operating in the country and also consists of a group of 220 Medtech startups and SME’s.
- The entire Asia Pacific region’s Medtech sector is expected to grow from $88 billion to $133 billion by 2020 at a CAGR of 8% and this will make it second largest market in Medtech in the world after USA. Within Asia, Singapore is becoming a regional MedTech center because of incentive based policies by government and advance manufacturing sector that contribute to its success.
- The medtech sector of Sigapore mainly focuses on areas such as cardiovascular, eye care, diagnostic, imaging, research tools, scientific instruments and orthopedics with support of outsorcing companies and integrating with the R&D cluster centres.
- At present, the Government of Singapore is committed to meet healthcare needs of the people spending up to 8% of GDP in this sector alone. The expected expenditure in the sector by 2020 is estimated to be $9.6 billion. Further, Singapore has strong infrastructure and good quality healthcare services that allow it to achieve high life expectancy making it home to fastest aging population and keeping up the demand for medtech and other similar industries.
- In 2017, imports of medical equipment and other medtech products was worth $9651 million which grew by 3% over the previous year. USA accounted 30% of the total market share of supplies of medical technology products coming to Singapore in the same year. The exports are almost double the imports and is expected to further rise after 2018. At present more than 75% of the products imported to country are re-exported.
- Over the next 10 years course period, Singapore is expected to create $190 billion worth sales which is also going to account one-third of the worldwide sales and will overtake the entire EU region.
Top Market Opportunities
- As of December 2017, the older population of the country has significantly increased which is why the opportunity to invest in health care and medical technology is high as most of the demand comes from the senior citizens. The particular areas in which the scope of success is high are personal health management, health screening, disease management, preventive care products, access to homecare resources and support, health IT solutions, data sharing and advanced technologies. The Asian region alone will comprise of 33% of the world’s healthcare market and market size will be around $521 billion and the clients are mostly demanding devices related to imaging, cardiovascular, and healthcare IT.
- The demand for the various kinds of medical equipment’s comes from both private and public healthcare institutions in the country. The health ministry alone purchases 70% of the total products manufactured. Since 80% of the local demand is met by the American medtech companies through imports, it is a very attractive opportunities for the American medtech companies to manufacture and conduct development activities within Singapore.
- Another striking investment could come in the form of primary care infrastructure such as community health centres which are equipped with digital technologies. For instance, Singapore’s Ng Teng Fong Hospital which is government owned has already earned fame because of integrating technology in its services and is highly credited for having efficient technology systems in place. The National Electronic Health Record (NEHR) project, launched in 2010, valued at US$144 million is close to becoming a reality with each citizen having his or her own electronic medical record. Thus, it is high time for all the IT based companies to venture into the med-tech field by tapping onto the opportunities to fulfill the purpose of transforming medical industry with the exploitation of technologies.
- The demand in the med-tech market is most likely to upsurge because of the number of healthcare centres opening across the country. These health centres are the major clients of the med-tech products. The Singapore General hospital is going through major revamp and this is a long term project expected to run from 2025 to 2030. Over the medium period, five public hospitals and twelve polyclinics will be built by 2030. A new 300-bed hospital mostly targeted at patients suffering from infectious diseases is in pipeline to be built. Similarly, $135 million worth building which will be known as National Heart Center building is currently under construction and is expected to complete by 2020. Other major construction projects include, Woodlands Health Campus and the existing Tan Tock Seng Hospital which are scheduled to complete by 2022 and 2036 respectively.
High- Value competencies
The foundation for the Medtech market to prosper in Singapore is the interest and involvement of numerous companies in the industry.
There are several reasons for the multinationals to enter Singapore and local companies within the country to venture into Medtech business such as Singapore is a hub for innovative business model, has R&D presence and produces high-value output through manufacturing. For instance, Singapore is an well known for the manufacture of the diverse range of medical technology products such as pacemakers and contact lenses among many others.
Mainly, the companies can take advantage of the Singapore’s innovative designs and engineering facilities which will provide a high quality output of the medtech products.
Similarly, Singapore has a integrated network of universities, research institutions and startups aiming to collaborate and create an exciting research based ecosystem with purpose to develop next-gen products and solutions within the industry.
Finally, with presence of internet and infrastructure that is extensive the companies can develop innovative business models through use of technologies such as big data and internet of things and apply it in various areas such as design consultancies, data analytics research and applied data analytics which will make the companies proficient in the global market.
Singapore has strong supply base
Since more than 3 decades, Singapore has been experienced in building skills related to electronics, precision engineering and materials science. These are also known as the EMS or electronic manufacturing services which also serve as a support industry to the medtech industry of Singapore.
They produce diverse range of components such as plastic components; metal forming and casting; ceramics; surface treatment and cleansing; packaging; and sterilization. Top four EMS companies in world have manufacturing services availability for medtech players.
Some of these companies are also able to provide complete suite of services such as product design and development, prototyping, precision plastic engineering, volume manufacturing and assembly. More than 15 companies who are suppliers for the medtech companies possess strong quality standards as required by healthcare regulators which has also led them to win the confidence of medtech consumers.
Singapore is well known for its strategic location as it has a wide logistics network and is also one of the busiest container port with Asia’s fifth largest cargo airport. The region has been linked with more than 200 shipping lines to 600 ports in 123 countries.
The airport is equipped with 78 airlines and more than 4000 flights with a network of 180 cities across 59 countries. Singapore has a contract of 13 Free Trade agreements with different countries. This FTA will definitely benefit the medtech sector as it will eliminate tariffs being charged on the medical devices such as contact lenses, electrocardiogram/ultrasound/magnetic resonance imaging equipment and heart valves. This makes Singapore perfect choice for the medtech firms to begin with the expansion to the entire Asian region.
The high-value production and growth of the Medtech sector within Singapore is contributed by the corporate tax rate which is as low as 18%. This is lower in comparison to the companies in US and European region.
Besides, competitive tax rates the government also provides extra incentives and fringe benefits to the companies having scope to succeed and notable investments.
At present, the Medtech sector of Singapore is in a nascent stage and faced with challenges such as rapidly aging population, growing middle class and increasing pressure on both pricing and availability.
Further ahead, there are more challenges such as lengthy processes from product development till commercialization and additional restrains for the new market entrants. For instance, Center for Medical Device Regulation of Singapore (HSA) which is the authority responsible for providing guidelines for the companies to maintain quality standards throughout the Medtech supply chain, the compliance with its policies is needed to effectively bring products to market in Singapore.
Second challenge especially for the foreign players are that the distribution channels could pose serious problems for these companies. For instance, the companies generally prefer to tie up with the distributors who are often engaged in marketing and operational logistics work but sometime these distributors engage in unethical business practices or which are generally non-compliant in the home country of the company.
Thus, it is very essential for the foreign companies to have good control over the distributors or partners and know about their ways of operation so as to avoid any risks or breaches in future.
The country Singapore itself has a cross-culture workforce and due to the differences that could arise in form of language, culture and business environment, the companies to become successful have to understand these differences.
Also, Singapore as a country has good operating environment and has good demand but the market alone is small and the domestic demand may not contribute to the profitability of the companies. Generally to address such issue companies opt for distributors but due to the lack of direct contact with the end consumers the companies ultimately fail to become competitive in the market.
This is the main reason Singapore becomes an ideal location for R&D and for logistics.
As of September 2018, the medical device company also known as Accuron Medtech group has officially launched a new Technology Centre worth $10 million in Singapore. The location of the Centre is Tuas and is spread across a 22,000 sq. foot with the access of incubator facilities and services for its clients. Further, the company is building its portfolio by partnering with similar world class firms.
Within the Centre the activities such related to research, development and manufacturing will be held. The portfolio companies under Accuron umbrella will be able to access to progressive manufacturing capabilities such as rapid prototyping, turnkey manufacturing, clean-room manufacturing and assembly, 3D printing, and medical device sterilization.
The main purpose of the establishment of the Centre is for the large corporate house such as Accuron Med tech to collaborate with the innovative startups to bring up new solution in Medtech industry to meet the global healthcare needs of people.
Recently, Anatomics which is an Autrlian start-up medtech company that creates customized products for individual patients needs announced that it would partner with Nanyang Tech University and aim to develop and research new 3D printing materials and smart implants for medical devices.
They are also conducting a joint venture with the Ultra Clean technologies and producing their own 3D- printed custom-made medical devices to commercialize in whole Asia.
Another company called Neurostyle that worked with A*Star institute of research is developing a system where it can help patients suffered from stroke to recover faster and especially targeted at regaining their limbs. Currently, the device is under clinical trial.
In Singapore the medical devices and related products produced within the medical technology industry is regulated by the Government act also known as Health Products Act and Health Products regulations.
The authority responsible for monitoring and providing guidelines to the suppliers and manufacturers of this sector is Health Sciences Authority (HSA) and aims to maintain quality, safety and efficacy of medical devices present in Singapore.
The medical devices are segregated into various class like Class A, B, C, D and are subject to product registration. Most of these that are supplied in non-sterile state are mostly discharged. The Classification is done according to a guideline called Global Harmonization Task Force (GHTF).
Being part of ASEAN, Singaporean Government has also adopted the ASEAN medical device directive shortly known as AMDD. This will ease the access of the foreign medical device suppliers in the market because of a unified directive in the entire region. It will be implemented in upcoming few years.
The Singapore Government is plays a proactive role in ensuring the advances in biomedical science as it is one of the most prominent economic sectors of the country. To make the availability of advance clinical treatments the Ministry of Health has partnered with A*STAR (Agency for Science, Technology and Research) and various other governmental bodies with expenditure allocation of about $53 million and $10.6 million for the development of these services.
The project has been initiated to recognize Singapore as a major medtech services hub and also foreign companies that are adept in providing next-gen technologies, laboratory and testing equipment will definitely enter Singapore as it will become one of the most worthwhile markets for them.
Other Key Market Trends
Singapore has the Asia Pacific Medical Technology Association which is responsible for catering to the different needs of the medical devices, equipment and diagnostics industry of the Asian region. It has also recognized for introducing its own flagship event called ‘ASIA PACIFIC MEDTECH FORUM’ and the recent one was held in 7 to 9 November 2017.
The theme of the event was “Transforming Healthcare through Innovation” which also provided insightful discussions led by global leaders of the medtech industry. Besides this Singapore is also becoming to play host to ‘MEDICAL FAIR ASIA’ which is going to be a global event as the previous one held in 2016 encountered 12,000 attendants with 800 companies from over 40 countries.
It is a three day event and is most essential in creating matchups between the various institutions directly or indirectly relating to the sector and make discoveries, ideas of innovation etc.
Market Size and Forecast
The total market size of the medtech market in Singapore is $2,557 million which is estimated to reach $1,881 million as of the end of 2018.
The total production in the sector is recorded at 9,469 million units which is expected to reach a figure of 10,416 million units by the end of 2018.
As of 2018, The total export value of the products is expected at a figure of $192.21 billion and import value is $106.16 billion respectively.
The projected growth for the Medtech market of Singapore is 11.1% since 2018 where the market size is expected to reach $2.72 billion by 2022.
Some of the startups in Medtech sector are coming up with next generation products with the use of latest technologies availiable at present. These technology integrated product offerings is going to change the future of Med tech in Singapore.
- Healint is a startup which mainly focuses in the area of digital healthcare analyctics. It has come up with a mobile application called Migraine Buddy which supposedly predicts migraines with accuracy of 90%
- Ospion which focuses on infant& elderly care related technology solution has recently come up with a snoozing mat that is able to monitor a baby’s breathing patterns via the fiber optic sensors attached to it. If there are any irregularities identified it can be queried to the Physicians through the associated app.
- ClearBridge Biomedics cultivates medical tools for creating advance cancer detection analytics and oncology patients’ care. IT mainly focuses on innovating devices that is focused on CTC or circulating tumor cell discovery for improving cancer treatment outcomes.
- LinCor Biosciences is developing a bioengineered cornea suitable for corneal transplantation to make it inexpensive and easy process.
- Medical imaging startup I3 Precision categorizes its MedSafe suite of products into three categories: systems, contents and mobile which mainly uses advanced imaging algorithms for seamless integration into legacy or new hospital information systems. These are applied on Singaporean healthcare and medical startups are making healthcare more affordable, convenient, and accessible to all citizens.
- At present, the four companies related to Medtech sector i.e. Clearbridge Health, Techcomp Holdings, Vicplas International and QT Vascular together comrprise a total market capitalization of $60 billion.
- Besides, there are other IT based companies which are currently generating revenues from the customers of Medtech industry. Particularly, 6 companies are directed towards providing their services to the Medtech and life sciences industries which are Venture Corporation which alone has a market capitalization of $6800 million followed by Valuetronics holdings, Memtech international, CEI, Avi-tech electronics and Trek 2000 international of which foremost 2 are electronic manufacturing services based and rest 4 companies provide electronic components or technology hardware.
- Becton Dickinson also known as BD is on the Fortune 500 list and it is a global MEdtech company which is based in Singapore. It is a company that provides innovative solutions in areas of diagnostics and delivery care. The company has been operating since three decades and is also one of the top three investors in Medtech of Singapore. It is currently engaging 1400 staffs in different regional headquarters but its largest manufacturing base is located in Singapore.
- Thermo Fisher Scientific is a world leader in area of Medtech. IT focuses on several sub sectors such as sciences research, patient diagnostics and lab productivity. It has its R&D center in Singapore and mostly focuses on engineering of the medtech devices. The Center has become the reason of the excellence as with the assistance and innovation ideas the company has been able to create more than 25 instrument models, all of which was launched from Singapore in a period of 5 years.
- The new player in the Singapore’s Medtech market is the company called Clearbridge Health, which made its entry December 2017 and it mainly provides services such as laboratory testing, operation of medical clinics and also has equity participation in other medtech manufacturing companies. It has a market capitalization of $241 million and is growing at a faster rate than any other companies in the sector.
- Venture Corporation which is also a global electronics services provider has finally extened its business line by venturing into medtech sector. The streamlined revenues from this sector to the company grew at a rate of 37.3% year-over-year.
- Some of the companies such as Valuetronics Holdings, Trek international 200 and CEI are also bringing up innovative medtech products such as temperature sensing devices and in-vitro diagnostic medical equipment, smart socks and smart sensors for diapers.
- There are industry leaders such as Affymetrix and Bio-Rad which tapping onto the opportunitied for setting up manufacturing opertions to meet the demand for varioud types of scientific instruments. Also companies like Qiagen and Hill-Rom have leveraged into the strong research resources in Singapore and used to set up centres to develop molecular diagnostics and healthcare products for patient care.
Key Market Players
The top players in the Singapore Medtech Industry as per the recognition, market share and revenues are follows:
- Applied Biosystems
- Baxter International
- Becton Dickinson
- Biosensors International
- Ciba Vision
- Thermo Fisher Scientific
- Hoya Healthcare
As Singapore intends to become a leader and an innovator in the Medtech sector and there are foreign companies targeting for to enter Asia or expand Asia operations, they should look for Singapore to expand activities related to the sector because of its excellent infrastructure, well-educated labor force and strategic access.
Whereas, regarding the few obstructions that the sector faces such as population getting older and market entry barriers which can be considered as opportunities with the help of government and building friendly policies for the companies operating within the scope of the sector.
As a matter of fact, The ASEAN synergy through the integration is expected to lead to greater regulatory harmonization within the region. This will not only reduce the costs but also help companies to register their products and launch them into the Singapore market at a faster rate.
On the other hand the patients will also benefit and will be able to enjoy healthcare services. This will lead to a win-win situation for all the stakeholders in the industry.