Brazil:Medical Technology Market

Brazil is the largest market in South America for Medical Technology and Healthcare equipment with sales in 2013 expected to be worth USD$ 8 billion for Medtech technology. Brazil imported USD $3.6 billion worth of medical products in 2012. Brazil is a major producer and exporter of medical equipment but these tend to be of lower quality. In 2012 the Brazilian market for Medical equipment grew by 15% overall and for 2013 it's expected to increase by a similar amount. Companies from the US are the leading exporters to the Brazilian market with a 30% market share follow by Japan, Germany and the UK. Total EU sales to this market accounted for 17% of sales in 2012. The Typical route to market for Medtech suppliers to hospitals, clinics and medical institutions in Brazil is through distributors, local agents and specialised medical importers. The total market for electro medical equipment was estimated to be worth USD$ 285 million in 2012 which represented over half of the total sales in Latin America. Brazil has the 2nd largest private health insurance sector in the Americas after the US.

Entering the Market

Local Partners are key to developing business in any emerging market and this is especially important in Brazil with an experience Medical products distributor or local agent imperative for sustainable business in this market . Brazil is a vast country with difficult infrastructure, wide economic disparities between the region and a range of other issues so it's important that if you select one partner then they will need a comprehensive national coverage to sidestep these issues. Brazil has huge Urban centers such as São Paulo, Rio de Janeiro, Brasília and Recife Other key cities include Curitiba, Porto Alegre, Belo Horizonte and Salvador but again there are disparities of wealth between all of these Urban centers. 

There are three other routes to market for Medical Technology and Healthcare equipment manufacturers such as setting up their own company, acquiring an existing Brazilian company or a joint venture with a Brazilian company. The main difficulty in setting up as a new venture in Brazil is Government regulation, legal requirements for International companies and tough legislation especially for Medtech companies, but the Brazilian Government (Ministry of Development) is making moves to simplify the whole process. Joint Ventures with local companies are another route to market which helps with facilitating product assembly and packaging. This eliminates the need for documentation and import duty charges that are required on the finishing products and most importantly bringing local knowledge to the venture. Acquiring an existing Brazilian company also helps to overcome problems a company has set up on their own but this can come at a premium to the Joint Venture option.

Current Market Trends

The Brazilian market for medical equipment is likely to expand as the private health sector expands with the increased wealth of the local Brazilian population. Exporters to Brazil can take advantage of the new opportunities, including in the following areas:
•    Demand for healthcare-related IT, including investing in secondary opinion programs. There is also demand for IT education to healthcare workers and health IT in hospitals
•    Expanding of dental services and dentists since the country is one of those with the highest number of these professionals and one of the most popular countries for dentist tourism particularly for US clients.
•    Private and public hospitals are using disposables and surgical at a higher rate
•    Demand for innovative technology, quality but competitively priced devices for monitoring and diagnostic use.
•    High demand for products in orthopedics and implants both locally and from Medical tourism, Brazil has a higher sanitary requirement for these products but still, imports are in demand.
•    Laboratory equipment - Investments in Research and Development.  
•    Drugs, Pharmaceuticals, Nutrition Supplements and Sports Nutrition- high dependency on imported products. New rules to facilitate imports of supplements. The high demand for modern life products from Brazils growing middle class. 
•    New technologies are demanded in the areas of advanced medicine, biomedical, clinical chemistry and new modern advanced medical devices.
 
Main Competitors
 
There are not many high quality Brazilian medical product manufacturers of advance technology so therefore Brazil relies on imports. Buyers in the local market favour imports from US, Japan, Germany, UK, Canadian and other European suppliers because they regard them as better quality and of greater reliability. Price and Financing can often be the difference in making a sale in the Brazilian market.

Current Demand

Brazil has experienced dramatic market growth for home health care products in the last few years. While United States has 1,440 home health care companies and the EU average of 998 home health care companies Brazil is far behind with only 150. In Brazil, these companies are seen as an opportunity to cut costs for hospitalization and also to provide a better level of service. In Brazil 99% of home health care products are met by insurance companies which therefore market analysis expect this to be an area of growth in the coming years. Procedures to control this market are currently being developed by the Brazil’s Regional Nursing Council and these laws will also dictate the standards to be met by a health professional/practitioner.
Companies should also consider Brazil as a good stepping stone for opportunities in the other Latin Americas countries (Mercosur group) such as Argentina, Uruguay, Paraguay, Venezuela and Boliva as an experienced local Brazilian Partner will often have a network in these countries. Exporters need to take advantage of the Mercosur group and the large size of the Brazilian medical market. Companies need to seek assistance of a local lawyer before they can engage an agent/distributor, because the legal framework governing Mercosur countries require that a product must be registered before it is sold.

Barriers

Anvisa is the Brazilian Medical regulatory body, and it regulates products in the medical field. Before products can be commercialized, the law requires that they be registered or notified in order for them to be commercialized in Brazil. In addition, one might require having additional local clarifications and data from the international market before they can transact in the Brazilian market if the product has a higher grade risk. In some cases, manufacturing plants of the same seller may need to be inspected.