Health and medical to the Philippines

Trends and opportunities

The market

The Philippines health and medical sector is composed of:

• pharmaceuticals
• hospital/medical equipment and supplies
• hospital sub-sectors

There is intense competition in the pharmaceutical sector because of the large number of companies carrying various brands and products. Pharmaceutical companies in the Philippines import active substances, semi-finished products and other auxiliaries, with the exception of three antibiotics – ampicillin, amoxicillin and cloxacillin – which are subject to government regulation and may only be purchased from a government-controlled company.

There are about 30 to 40 local fabricators producing basic hospital furniture and equipment. Approximately, 55 per cent of hospital furniture and equipment are imported by privately-owned hospitals. Acquisition of medical equipment and supplies by government hospitals is largely funded or donated by the US and Japanese governments.

There is an emerging demand for the construction of more state-of-the art medical facilities throughout the Philippines. One major hospital project that is nearing completion is the Asian Hospital project, a 250-bed tertiary hospital. This hospital is expected to have modern facilities and to use the latest technological developments in healthcare similar to those used in Australia and other Western countries.

There are approximately 1708 Department of Health (DOH) licensed hospitals in the Philippines, of which 1068 are privately operated, while the remaining 640 are either operated by the DOH or local governments.

Opportunities

Opportunities in the Philippines health industry include the supply of:

• Pharmaceutical products, such as vitamins, antibiotics, and organic and natural drugs
• Food supplements
• Medical equipment and supplies
• Professional management and project development services for hospitals
• Hospital equipment and fit-outs

Tariffs, regulations and customs

The appropriate tariff duties for medical products and equipment in the Philippines are as follows:

• Medical and surgical instruments – 3­ to 20 per cent
• Medical furniture – 3 to 20 per cent
• Electro-medical equipment – 3 per cent
• Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic use (not put up in measured doses or in forms or packaged for retail sale) – 3 per cent
• Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic use (put up in measured doses or in forms or packaged for retail sale) – 3 to 5 per cent
• 10 per cent Value Added Tax

Industry standards

The Philippines’ Department of Health requires the registration of all drugs, cosmetics and medical devices with the Bureau of Food and Drugs (BFAD) prior to their introduction into the Philippines health industry.

Local importers/distributors/manufacturers of pharmaceutical products are required to obtain a license to operate from the BFAD.

Marketing your products and services

Market entry

Australian companies wishing to enter the Philippines pharmaceutical and hospital/medical equipment sector should consider the following:

• Establish a local presence either through a representative office or by appointing a local agent with a network of contacts in the health and hospital industry. You should also make sure to provide your local agent with technical and promotional support.
• The more successful companies in the country are those that value relationships established with local clients over a period of time, as well as those with competitive pricing.
• For hospital projects, Australian companies should have the necessary technical and financing capabilities to enter into a joint-venture arrangement with the local hospital developers.

Distribution channels

There are specialised pharmaceutical distributors that have well-established sales, collection, warehousing, transport and communication networks who distribute for various principals. By establishing separate sales divisions, they are able to accept accounts from direct competitors.

Distribution fees range from 12 per cent to 15 per cent of product sales.

Links and industry contacts

Health and medical–related resources

Philippine Psychology Network - www.philippinepsychology.net
Health Directory - www.rxpinoy.com
Council for Health and Development

Government, business and trade resources for the Philippines

Bureau of Food and Drugs - www.doh.gov.ph/BFAD
Department of Health - www.doh.gov.ph
Board of Investments - www.boi.gov.ph
Department of Trade and Industry - www.dti.gov.ph
Bureau of Customs - www.customs.gov.ph

Pharmaceutical and Healthcare Association of the Philippines
Unit 502, One Corporate Plaza Condominium
845 Pasay Road
Makati City, Metro Manila
Tel: (63 2) 815 0325
Fax: (63 2) 819 2702
Email: phap7346@info.com.ph

Philippine Medical Association (PMA) - www.pmasite.org.ph
PMA Building, North Avenue
Quezon City, Metro Manila
Tel: (63 2) 929 4974 or 929 6951
Fax: (63 2) 929 6951
Email: pma@stat.net.ph

Chamber of Filipino Drug Manufacturers and Distributors Inc.
Rm 404 Jovan Condominium
600 Shaw Boulevard, corner Samat St
Mandaluyong City, Metro Manila
Tel: (63 2) 535 4835
Fax: (63 2) 535 4835
Email: cfmd@edsamail.com.ph

Service providers

Asian Hospital and Medical Center - www.asianhospital.com
Cardinal MRI Center - www.cardinalmri.com.ph
FortMED Medical Clinics - www.fortmed.com
Makati Medical Center - www.makatimed.ph
Medical City - www.medicalcity.com.ph
Philippine General Hospital - www.upm.edu.ph/pgh.html
Philippine Heart Center - www.phc.gov.ph
St. Luke’s Medical Center - www.stluke.com.ph

University of the East Ramon Magsaysay Memorial Medical Center - www.uerm.edu

Hospital, Medical, Laboratory Equipment and Supplies Importers Association of the Philippines Inc.
704 Aurora Boulevard, New Manila
Quezon City, Metro Manila
Tel: (63 2) 721 5211 or 721 8352
Fax: (63 2) 721 7012

Media

Health Action Information Network - www.kalusugan.org

Contact details

The Australian Trade Commission (Austrade) is the Federal Government agency that helps Australian companies win overseas business for their products and services by reducing the time, cost and risk involved in selecting, entering and developing international markets.

Austrade offers practical advice, market intelligence and ongoing support (including financial) to Australian businesses looking to develop international markets. Austrade also provides advice and guidance on overseas investment and joint venture opportunities, and helps put Australian businesses in contact with potential overseas investors.

A list of Austrade offices (in alphabetical order of country) is available.

More information

For further information please contact Austrade on 13 28 78 or email info@austrade.gov.au

(Last updated: 19 Jul 2007)