Medical Devices Production

Medical Devices Production

Photo by Economic Development Board (EDB)

Medical Devices Production

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.
Medium Term (5–10 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.
15% - 20% (CAGR)
Average Ticket Size (USD)
Describes the USD amount for a typical investment required in the IOA.
> USD 10 million
Direct Impact
Describes the primary SDG(s) the IOA addresses.
Good health and well-being (SDG 3) Industry, Innovation and Infrastructure (SDG 9)
Indirect Impact
Describes the secondary SDG(s) the IOA addresses.
Reduced Inequalities (SDG 10) Decent Work and Economic Growth (SDG 8)

Business Model Description

Design and manufacture medical devices such as catheters, medical balloons and stents that are utilized in various branches of medicine, including cardiology, radiology, gastroenterology and urology, which are competitive across global markets, including North America, South Eastern Asia and Western Europe.

Expected Impact

Increase self-sufficiency of the health care system, accessible at affordable costs, and expand regional supply chains to advance export potential.

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

Explore the country and target locations of the investment opportunity.
Country
Region
  • Mauritius: Countrywide
  • Mauritius: Moka
  • Mauritius: Port Louis
Learn more

Sector Classification

Situate the investment opportunity within sustainability focused sector, subsector and industry classifications.
Sector

Health Care

Development need
Prevalence of noncommunicable diseases (NCDs), aging population with increasing needs and ensuring well-being of non-nationals living, working or visiting Mauritius urge improvements in country's well-developed healthcare system. Cost and supply chain vulnerabilities arise from dependency on medical equipment and pharmaceutical imports and specific treatments abroad (1, 2).

Policy priority
Mauritius aims to sustain provision of free healthcare services to an aging population with higher specialized treatment needs and quality expectations, through Five-Year Health Sector Strategic Plan 2020-2024 (3). Government agenda foresees positioning Mauritius as a medical hub, improving the independence of the sector and enhancing local production to serve wider Africa market.

Gender inequalities and marginalization issues
Serving Rodrigues and Agaléga and enhancing the well-being of the population in remote islands are strategic actions for the government (3). Self-perceived health is higher among men as only 67% of women rated their health status as ‘good or very good’ compared to 76% of men (4).

Investment opportunities introduction
Economic Development Board (EDB) Mauritius directs the efforts in situating the country as a medical hub (5). Government offers free healthcare services and allocate some MUR 14.5 billion (USD 300 million) to health budget (6). Various incentives, Extensive Exclusive Economic Zone (EEZ) and untapped marine resources stand as prospects for the sector (7).

Key bottlenecks introduction
Growing burden of noncommunicable diseases (NCDs) and high reliance on medical equipment and pharmaceutical imports are the key challenges. Certain specialized treatment cannot be undertaken in Mauritius and patients must be sent abroad. Absence of a central computerized data repository for health and lack of strong regulation limit the development of the sector (3).

Sub Sector

Medical Technology

Development need
In 2020, Mauritius spent MUR 10,233 (USD 250-300) per capita on health and USD 30.5 million on medical equipment imports (8,9). Considering the growing medical needs and the need for enhancing industry’s competitiveness, developing an innovative, export-oriented sector, based on technology and research and development is key for achieving the knowledge hub national objective.

Policy priority
Mauritius government is committed to promote medical equipment industry with issuing tenders on a regular basis and aims to create regional value chains for medical devices (2, 11, 12). In 2021-2022 budget, the government allocated USD 52.4 million for the construction of multiple healthcare centers as well as for the acquisition of medical equipment for local hospitals (6).

Gender inequalities and marginalization issues
In Mauritius, more female than male are affected by cancer, and elderly represent one third of patients. Improving medical technology will reduce women's exposure to the risks of delayed diagnosis and increase the likelihood of early detection in noncommunicable diseases (NCDs), which disproportionately affect women (3, 44, 43).

Investment opportunities introduction
Advanced IT infrastructure, sectoral experience, and exporting potential to SADC and COMESA enhances medical device industry that medical devices export reached USD 24.5 million in 2021 (12, 56). In 2019, Indian government provided USD 23 million grant to open a new ear, nose and throat (ENT) hospital and a new cancer hospital was inaugurated in 2021 (8).

Key bottlenecks introduction
Burdensome and confining regulations and procedures for new medical device entry in the market, skill shortages and mismatch in the labor force, dependency on importing raw materials, weak intellectual property and patents protection, limited research and development are the key bottlenecks of the subsector (12).

Industry

Medical Equipment and Supplies

Pipeline Opportunity

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

Medical Devices Production

Business Model

Design and manufacture medical devices such as catheters, medical balloons and stents that are utilized in various branches of medicine, including cardiology, radiology, gastroenterology and urology, which are competitive across global markets, including North America, South Eastern Asia and Western Europe.

Business Case

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

Market Size and Environment

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

15% - 20%

Mauritius’ merchandise exports for instruments used in medical, surgical, dental and other practices were USD 30 million in 2018 with 15.8% CAGR (15 years). In 2019, the number of medical devices manufacturer companies reached seven with 600 employees and an export turnover of USD 27 million (19).

19 area health centers, 114 community health centers, 6 medi-clinics, and 2 community hospitals provided primary health care (PHC) services in Mauritius in 2019 (9).

Africa is expected to require physical healthcare assets’ investment of USD 25 - 30 billion by 2022 (20). In 2025, the global medical device market is estimated to reach USD370 billion (21).

Indicative Return

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

> 25%

Natec Medical, which manufactures angioplasty balloon catheters, recorded a gross profit margin of 45% from a turnover of MUR 682,215,343 (USD 16.9 million) in 2021 (40).

FCI-SUD, which operates in the medical devices sector and produces ophthalmic implants, recorded gross profit margin of 41% in 2020 (41).

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.

Medium Term (5–10 years)

Natec Medical, which manufactures angioplasty balloon catheters, set up their facility in Mauritius in 2000, achieved global certificates and accreditations in less than five years and generated returns to extend facilities in ten years (55).

Ticket Size

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

> USD 10 million

Market Risks & Scale Obstacles

Capital - CapEx Intensive

The cost of medical devices production has increased due to high raw material prices and exportation charges, as well as a heavy reliance on the export of primary resources (12, 22).

Market - High Level of Competition

Leading industrial firms from Europe and the United States dominate the sector (12). International brand names are preferred in public procurement over domestically produced medical devices (31).

Business - Supply Chain Constraints

Mauritius faces a shortage of the skills required in medical devices manufacturing in its labor market (12).

Impact Case

Read about impact metrics and social and environmental risks of the investment opportunity.

Sustainable Development Need

In 2016, noncommunicable diseases (NDCs) accounted for 89% of all deaths in Mauritius, and in 2019, 595 per 100,000 people died from chronic diseases, which were around 550 in 2018 (26, 27). MUR 16.50 billion was spent on treatment of NCDs in 2016 (34).

In 2020, the Mauritius government's import of medical devices amounted to USD 30.5 million and the healthcare sector remains heavily reliant on medical device imports, which are critical for an effective healthcare system (8, 23).

According to the government's household budget survey of 2017, 3.8% of the household budget was spent on health expenditures, reaching 5% in rural areas (29). Although health services are free in Mauritius, due to the high dependency on the import of medical diagnostic technologies for chronic diseases, health costs are rising (60).

Gender & Marginalisation

Women are generally more affected by cancer than male in Mauritius (1,421 cases out of 2,380 in 2018), with women breast cancer being the most common type of cancer in 2020 (44, 10). Thus, developing early detection and treatment tools is crucial to preserve women health (44).

The elderly represent a significant portion of patients in Mauritius, as one third of patients are aged 65 or older; they require specific attention, as well as enhanced integrated medical care (3).

Expected Development Outcome

Local medical devices production increase the resilience of Mauritius' healthcare sector to crisis, and provides self-sufficiency, which is key for efficiency, while reducing high health expenditures of households to achieve the objective of less than 3% incurring such costs by 2024 (12, 3).

Medical devices production, through its technology advancements, increases life expectancy while decreasing chronic disease mortality due to effective diagnose and treatment capabilities (3).

Medical devices production increases access to medical devices for the domestic market, develops regional value chains for the sector and generates profit from the export activities in the region (12).

Gender & Marginalisation

Medical devices production fosters enhanced access for women, which supports early cancer detection with greater ease for treatment solutions (42, 23).

Medical devices production fosters supports the elderly since they can have preventive, diagnostic or therapeutic usage and support the treatment of noncommunicable diseases or other diseases particularly current in this target population (43).

Primary SDGs addressed

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

3.4.1 Mortality rate attributed to cardiovascular disease, cancer, diabetes or chronic respiratory disease

3.8.2 Proportion of population with large household expenditures on health as a share of total household expenditure or income

Current Value

238.3 for cardiovascular disease, 129.6 for cancer, 176.6 per diabetes, 9.7 for chronic respiratory disease in 2020 (population aged 30 to 70 years, per 100.000 people) (28).

3.8% of household budget spent on health expenditures, which accounts for MUR 1,087 (USD 25) in 2017 (29).

Target Value

Mauritius government aims to reduce overall mortality from cardiovascular diseases, cancer, diabetes, and chronic respiratory diseases by 5%, in 2024 (3).

Private health expenditure surpassed general government health expenditure in Mauritius, and out-of-pocket expenditure on health accounted for 45.7% of the total expenditure (32, 33). By 2024, the target is less than 3% of the population incurring catastrophic health expenditures (very high amount spent on healthcare in relation to income that one must cut down on necessities such as food) (3).

Industry, Innovation and Infrastructure (SDG 9)
9 - Industry, Innovation and Infrastructure

9.b.1 Proportion of medium and high-tech industry value added in total value added

9.2.1 Manufacturing value added as a proportion of GDP and per capita

Current Value

Based on the World Bank collection of development indicators, medium and high-tech manufacturing value added was 4.65% in 2019 (30).

Manufacturing value added as a proportion of GDP was 12.1% and manufacturing value added per capita was MUR 36,086 (USD 810) in 2020 (28).

Target Value

Mauritius government's objective for manufacturing industry growth, including medical device production and pharmaceutical manufacturing, is to increase manufacturing gross value added to USD 3.6 billion (12).

Mauritius government targets to reach manufacturing GVA of USD 3.6 billion and 25% of GDP contribution by 2030 (12).

Secondary SDGs addressed

10 - Reduced Inequalities
8 - Decent Work and Economic Growth

Directly impacted stakeholders

People

Mauritius' patients suffering from noncommunal diseases, including cancer and diabetes, and private and public sector doctors benefit form medical devices production.

Gender inequality and/or marginalization

Women and the elderly benefit from early cancer detection and treatment solutions provided by medical devices.

Planet

The planet benefits from sustainable medical devices thanks to a reduction of GHG emissions during the manufacturing process and in logistic operations.

Corporates

Medical devices suppliers, manufacturers and distributers obtain alternative production sites and greater market shares.

Public sector

The government benefits from higher quality and resilience of Mauritius' health care system and a reduced burden from importing medical devices.

Indirectly impacted stakeholders

People

Doctors and patients in the region benefit from the advancements with medical device production in Mauritius, and the high- to mid-skilled workforce obtains employment opportunities.

Corporates

Medical devices suppliers in the region enjoy diversified medical device sector with increased alternatives of products.

Public sector

The government is provided with economic profits through export opportunities of medical devices from Mauritius to the region with the establishment of value added supply chains.

Outcome Risks

Medical devices contain hazardous materials, including toxic, flammable, and reactive raw materials, which may result in contamination of the environment during production and disposal (35).

Sustainable medical device manufacturing with increased energy efficiency and logistics optimization should be considered since the health sector accounts for 4.6% of global emissions (37, 38).

Impact Risks

Domestically manufactured medical devices may not address principal public health needs or may not be affordable for low-income communities, which may lower the expected impact.

The population may be hesitant to use the medical devices due to data privacy concerns (39), which may limit the uptake.

Patients, users and medical personnel may be exposed to use-related hazards, including those caused by mechanical failure, so that delivery do not result according to expected impact (36, 54).

Impact Classification

C—Contribute to Solutions

What

Medical devices production reduces Mauritius' dependency on imports and creates regional supply chains, lowers the cost of health care, and increases the quality and effectiveness in delivery.

Risk

Low-levels of domestic uptake, malfunctioning errors and the risk that medical devices are not produced according to public health needs may hinder the ability to deliver impact.

Contribution

While increasing access to locally produced affordable medical technologies, medical device production contributes to economic growth and exports, alongside manufacturing sub-sectors such as textiles and food processing.

Impact Thesis

Increase self-sufficiency of the health care system, accessible at affordable costs, and expand regional supply chains to advance export potential.

Enabling Environment

Explore policy, regulatory and financial factors relevant for the investment opportunity.

Policy Environment

Industrial Policy and Strategic Plan for Mauritius, 2020-2025: Supports the continued growth of Mauritius’ industrial capabilities. It develops a vision and strategic objective for eight sectors to be strengthened, including for medical devices (45).

Health Sector Strategic Plan 2020-2024: Promotes an enhanced access to better quality healthcare services and health technologies. It mentions that access to medical technologies is a human right and aims at a greater access to medical devices (3).

Financial Environment

Financial incentives: The Medical Credit Fund Africa, in partnership with the Bank of Mauritius, offers loans up to USD 2.5 million for capacity building and technical assistance for small and medium-sized healthcare businesses across Sub-Saharan Africa (51).

Fiscal incentives: 8-year income tax holiday, duty-free and VAT free on goods and equipment imported into freeport zones, exemption from corporate tax, sea freight rebate scheme (up to 25% of basic costs) for exports, tax incentives for research and development apply for medical devices production (52).

Other incentives: The Industrial Policy and Strategic Plan recommends the establishment of a Manufacturing Upgrading Fund (MUF) of MUR 1.9 billion (USD 43 million) over 5 years and a Modernization Investment Support Fund (MISF) of MUR 4.4 billion (USD 100 million) to 2025 (45).

Regulatory Environment

Clinical Trials Act: Establishes the Clinical Research Regulatory Council, Ethics and Pharmacovigilance Committees. It also states the conditions for the registration of Contract Research Organizations and the conduct of clinical trials (46).

Public Health Act, 1925: Regulates several aspects of life, including infectious or communicable diseases, epidemics, foods and water supply sanitation, as well as hospitals and dispensaries, and specifies that access to medicines and medical appliances shall be free of charge (47).

Human Tissue (Removal, Preservation and Transplant) Act, 2018: Establishes the legal framework for the removal, preservation and transplant of human tissue under appropriate medical supervision. It also creates the Tissue, Donation, Removal and Transplant Board (48).

Allied Health Professionals Council Act, 2017: Establishes the council which aims at regulating the professional conduct of allied health professionals and promoting the advancement of allied health professions. Its goal is to maintain discipline in the allied health professions (49).

Pharmacy Act, 1983: Establishes a Pharmacy Board, regulates the registration and examination of professionals, and regulates the trade of pharmaceuticals and their manufacturing in Mauritius (50).

Marketplace Participants

Discover examples of public and private stakeholders active in this investment opportunity that were identified through secondary research and consultations.

Private Sector

FCI-Sud, Lilmo, Natec Medical, Kasios, Envaste, Xtruline Ltd, HealthActiv. Abiolabs Ltd.

Government

Ministry of Health and Wellness, Economic Development Board, Central Procurement Board, Government of Japan, Government of India.

Multilaterals

World Health Organization (WHO).

Target Locations

See what country regions are most suitable for the investment opportunity. All references to Kosovo shall be understood to be in the context of the Security Council Resolution 1244 (1999)
country static map
semi-urban

Mauritius: Countrywide

Technology parks in Mauritius provide advanced digital technology and high-tech features, as well as a high bandwidth optic cable network and direct internet connectivity (57). Thus, technology parks around Mauritius are suitable for the development of medical devices.
urban

Mauritius: Moka

The Cote d’Or Data technology park plans to host companies that are involved in technology, healthcare, artificial intelligence, robotics, cloud computing and fintech (53).
urban

Mauritius: Port Louis

Industrial zones and export activities make Port Louis beneficial for medical devices production. Port Louis covers 99.5% of Mauritius’s total trading volume and manufacturing sector located around the district due to easy access to the port and port services (58, 59).

References

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