Individual medical samples in PCR machine

Local production of viral transport media.

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Local production of viral transport media.

Country
Sector
Most major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Health Care
Sub Sector
Most major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Medical Technology
Indicative Return
Describes the rate of growth an investment is expected to generate within the IOA. The indicative return is identified for the IOA by establishing its Internal Rate of Return (IRR), Return of Investment (ROI) or Gross Profit Margin (GPM).
> 25% (in GPM)
Investment Timeframe
Describes the time period in which the IOA will pay-back the invested resources. The estimate is based on asset expected lifetime as the IOA will start generating accumulated positive cash-flows.
Short Term (0–5 years)
Market Size
Describes the value of potential addressable market of the IOA. The market size is identified for the IOA by establishing the value in USD, identifying the Compound Annual Growth Rate (CAGR) or providing a numeric unit critical to the IOA.
< USD 50 million
Average Ticket Size (USD)
Describes the USD amount for a typical investment required in the IOA.
USD 500,000 - USD 1 million
Direct Impact
Describes the primary SDG(s) the IOA addresses.
Good health and well-being (SDG 3)
Indirect Impact
Describes the secondary SDG(s) the IOA addresses.
Decent Work and Economic Growth (SDG 8)

Business Model Description

Manufacture in vitro diagnostic medical devices as an input to be used in clinical laboratories for the transport of samples.

Expected Impact

Productive capacities strengthening in countries that import medical suppliesdevices becomes relevant as they complement State security.

How is this information gathered?

Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.

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Country & Regions

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Country
Region
  • Panama: Central Region
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Sector Classification

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Sector

Health Care

> 2/3 of low-income countries do not have a national health technology policy capable of ensuring efficient use of resources through appropriate planning, evaluation, procurement and management of medical devices.

> USD 995.8 billion were the total world exports of medical products in 2019, of which four countries stand out with the highest production, that is, 14% correspond to Germany, the main supplier of these products, followed by the United States United States (12%) and Switzerland (9.9%).

Medical devices offer economic returns that are significantly higher than cost, and also not only help people tremendously, but also have a better economic future for countries in general. In the short term, some innovations increase direct healthcare costs. However, long-term costs are minimized by reducing the need for hospitalization, medication, or other treatment.

Industry

Medical Equipment and Supplies

Pipeline Opportunity

Discover the investment opportunity and its corresponding business model.
Investment Opportunity Area

Local production of viral transport media.

Business Model

Manufacture in vitro diagnostic medical devices as an input to be used in clinical laboratories for the transport of samples.

Business Case

Learn about the investment opportunity’s business metrics and market risks.

Market Size and Environment

Market Size (USD)
Describes the value in USD of a potential addressable market of the IOA.

< USD 50 million

CAGR
Describes the historical or expected annual growth of revenues in the IOA market.

< 5%

Critical IOA Unit
Describes a complementary market sizing measure exemplifying the opportunities with the IOA.

>1M annual medical devices are consumed by Government and private Hospitals in Panama.

Hospital consumption 15k-35k, MINSA, CSS, OPS 500K-1M, Clinical Laboratories 12k-30k

Indicative Return

GPM
Describes an expected percentage of revenue (that is actual profit before adjusting for operating cost) from the IOA investment.

> 25%

The profitability of more than 25% is due to the low cost of raw materials, personnel costs and the production that is carried out in non-own facilities.

Investment Timeframe

Timeframe
Describes the time period in which the IOA will pay-back the invested resources. The estimate is based on asset expected lifetime as the IOA will start generating accumulated positive cash-flows.

Short Term (0–5 years)

Given its low operating costs since its first year in production, it is generating returns. Coupled with the captive market with the formalization of agreements with government entities as well as with the private market.

Ticket Size

Average Ticket Size (USD)
Describes the USD amount for a typical investment required in the IOA.

USD 500,000 - USD 1 million

Market Risks & Scale Obstacles

Business - Business Model Unproven

Unique national production in the country which has affected its formulation, permits, production and distribution.

Capital - Limited Investor Interest

The project is developed in impulse facilities (INDICASAT-AIP) which is limiting the attraction of long-term investor resources.

Impact Case

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Sustainable Development Need

<4% of the production of medical supplies required in Latin America and the Caribbean are produced in the Region, creating a large dependence on imports.

> 4 main suppliers for Latin America and the Caribbean restricted their exports of medical products for the year 2020 due to the COVID-19 pandemic.

The production of medicines and other medical and health supplies is highly concentrated in industrialized countries and a small number of developing countries, mainly in Asia.

Expected Development Outcome

Medical devices are considered a fundamental component of health systems; the benefits they can provide continue to increase as they are essential to safely and effectively prevent, diagnose, treat and rehabilitate disease.

The local production of in vitro viral transport media contributes directly to non-dependence on imports and reinforces health insecurity in times of viral instability.

Gender & Marginalisation

Primary SDGs addressed

Good health and well-being (SDG 3)
3 - Good Health and Well-Being

3.d.1 International Health Regulations (IHR) capacity and health emergency preparedness

Current Value

Strategic objectives to mitigate the high dependency of Latin America and the Caribbean in order to strengthen their productive capacities in the pharmaceutical and medical supplies and devices industries, in order to face future health crises in a situation of less vulnerability than the one experienced.

Target Value

Continue strengthening the Network for contact with all the National Liaison Centers of the IHR member countries, with the aim of maintaining active surveillance in the face of any public health event of international importance.

Secondary SDGs addressed

Decent Work and Economic Growth (SDG 8)
8 - Decent Work and Economic Growth

Directly impacted stakeholders

People

Self-efficiency in the production of medicines and supplies will guarantee a constant supply flow for people's health needs and especially in times of crisis.

Public sector

Private investments to be made in the health sector in relation to the production of medical equipment and supplies become a great ally of governments, giving the health system more options.

Indirectly impacted stakeholders

People

Contribution to employment given its manufacturing profile where many families will benefit.

Corporates

Consolidation of economic activities related to the production cycle which replaces the import cycle.

Outcome Risks

Global overproduction of medical supplies, which will directly affect the profit projections of the initiative.

High cost levels in relation to foreign production which will directly affect sales.

Impact Risks

Biological risk due to low quality of the device or its anticipated and unexpected expiration.

Impact Classification

B—Benefit Stakeholders

What

Local production of devices complements the health system and contributes directly to non-dependence, providing health security in times of instability.

Who

Directly, people guarantee due attention in a timely manner given local production.

Risk

Biological risk due to low quality of the device or its anticipated and unexpected expiration.

Impact Thesis

Productive capacities strengthening in countries that import medical suppliesdevices becomes relevant as they complement State security.

Enabling Environment

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Policy Environment

National Secretariat of Science, Technology and Innovation of the Republic of Panama, autonomous institution (SENACYT)

National Science, Technology and Innovation Policy by 2040. Addresses the three great challenges of the country: sustainable development, social inclusion and sustainable competitiveness.

National Strategic Plan for Science, Technology and Innovation (PENCYT) 2015-2019.

Financial Environment

Financial incentives: Financing under normal conditions with local private banks, as well as management in international financial markets or with more favorable options with multilateral entities in the region.

Regulatory Environment

INDICASAT: The Institute of Scientific Research and High Technology Services of Panama

Gorgas Memorial Institute. It leads and promotes scientific research in health, a reference in public health and contributes to teaching for the benefit of the population.

Official Gazette No. 28765-A, Executive Decree No. 83 of April 26, 2019 was published, which regulates Law 90 of December 26, 2017, in relation to medical devices and related products that exist and may exist in the national territory.

Knowledge Foundation, Through Decree Law No. 6 of 1998. Innovative community that imagines, investigates, learns, teaches, experiments, invents, creates and inspires.

MINSA, Ministry of Health of Panama

Marketplace Participants

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Private Sector

Capital or local private equity contribution, bank financing under normal conditions of local and international banks, foreign investment.

Government

MINSA, INDICASAT, SENACYT, GORGAS MEMORIAL INSTITUTE, KNOWLEDGE FOUNDATION

Multilaterals

BID-LAB: innovation laboratory of the Inter-American Development Bank Group.

Target Locations

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Panama: Central Region

It is developed properly in the facilities of the Institute for Scientific Research and High Technology Services in order to monitor its progress and subsequent growth to its own facilities.

References

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    • (1) INDICASAT August 2022, https://indicasat.org.pa/historia-y-objetivos/.The Institute for Scientific Research and High Technology Services of Panama (INDICASAT) promotes the development of science, based on the premise that the scientific development of a country is decisive for its economic and sociocultural development.
    • (2) IDB LAB, August 2022, https://bidlab.org/es/nosotros.IDB Lab is the innovation laboratory of the Inter-American Development Bank Group. It seeks to empower poor and vulnerable populations and activate new and sustainable drivers of inclusive growth in Latin America and the Caribbean (LAC).
    • (3) SENACYT, August 2022, ttps://www.senacyt.gob.pa. National Secretariat of Science, Technology and Innovation of the Republic of Panama, autonomous institution
    • (4) IESA August 2022, https://www.iesa.edu.pa/,training of leaders, managers and entrepreneurs