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Healthcare Resource Guide: Malaysia

 

Malaysia Statistics

Summary Market Entry
Current Market Trends

Main Competitors

Current Demand

Registration Process

Reimbursement
Barriers

Trade Events

FAQs

CS Contact

Best Prospects

Market Size

Capital: Kuala Lumpur

Population: 32.2

GDP 2015: $296.36 Billion Currency: Ringgit Malaysia

Language: Bahasa Malaysia

Summary

                              

Malaysia provides universal healthcare access to its citizens. Malaysia’s national healthcare expenditure historically is around 4-5 percent of GDP. In 2016, the government set aside approximately US$5.65 billion or 8.6 percent of the annual national budget for public healthcare. Malaysia’s 2017 annual national budget allocation for public healthcare is approximately US$6.7 billion. Out of this allocation, about 7 percent is assigned for development purposes.

Private healthcare services in Malaysia are predominantly used by the upper-middle to affluent segment of the population. As per capita GDP rises, demand for private healthcare consumption is expected to increase in tandem. There has been a shift in healthcare expenditures from public toward private.

According to the latest available data (2015), the number of hospital beds for both public and private healthcare sector combined is around 58,050 and public hospital beds accounted for 78 percent of total hospital beds

                                        

Market Entry

Most exporters find that using a local distributor or agent is the best first step for entering the Malaysian market. A local distributor is typically responsible for handling customs clearance, dealing with established wholesalers/retailers, marketing the product directly to major corporations or the government, and handling after-sales service. Exporters of services generally also benefit from using of local partner.

Sales to the Government of Malaysia, Government Linked Companies (GLC), or for procurement in certain priority sectors identified by the government require local agents and/or a joint venture partners that are classified as a Bumiputra (Malay) company.

The Malaysian government and GLCs make use of offsets and other measures to encourage technology transfer, particularly for procurement in the priority sectors. The Government of Malaysia and GLCs also look favorably on U.S. companies that have a long-term presence in the local market. Therefore for strategic or large-scale market entry, U.S. companies typically find they are treated more favorably when they are willing to establish a local office, hire Malaysians, engage in training, undertake some amount of local assembly or production, or at least plan regular and frequent trips to maintain relationships and presence.

In sectors that are not government dominated, companies, agents, or distributors should be selected based on competitive considerations (e.g. technical grounds or product knowledge). Since the Malaysian market is a relationship-oriented market, having a local presence or local agent can influence the final outcome.

Exporters of medical devices and pharmaceuticals need approval from the respective regulatory authorities prior to market entry. As of July 1, 2016, all medical devices imported into Malaysia would first need approval from the Malaysian Medical Device Authority (MDA). The National Pharmaceutical Regulatory Agency (NPRA) of Malaysia oversees the implementation of pharmaceuticals and nutritional supplements registration and cosmetics notification.

Current Market Trends

The Malaysian Economic Transformation Program (EPP) intends to upgrade internet connectivity for 500 hospitals and 8,000 clinics and provide five million patients with direct access to the Health-net platform. The platform provides a gateway for information sharing among healthcare providers and insurance companies, while offering patients better access to healthcare-related services and education. Public healthcare facilities will be connected to MedikTV, the official broadcast channel of the Ministry of Health (MOH), which aims to educate the public on major healthcare issues. With close to 3,000 health facilities now connected, the rollout of cloud-based health applications will enable all Malaysian to enjoy a higher standard of service at these facilities.

Malaysia is the world’s largest medical gloves producer. Major Malaysian export categories are: surgical and examination gloves, other medical instruments, apparatus and appliances, catheters, syringes, needles and sutures, electro medical equipment, ophthalmic lenses including contact lenses, dental instruments and appliances, medical and surgical X-ray apparatus and medical furniture.

The government of Malaysia has designated the Medical Device sector as high growth potential in the 11th Malaysian Economic Plan (2016-2020). According to the Malaysian Ministry of International Trade and Industry (MITI), from 2010-2014, foreign medical device industry investments into Malaysia totaled RM11 billion (US$2.9 billion), while domestic investments were RM1.2 billion (US$316 million).

Improving and achieving universal access to quality healthcare will be the focus of the Malaysian government for the next five years. The major thrusts will be in improving healthcare quality to underserved populations, as well as ensuring efficient and effective expansion of the healthcare delivery system. In addition to upgrading healthcare facilities, a government priority is to reduce communicable and non-communicable diseases. E-Health Information and Communications Technology (ICT) strategy will be implemented concurrently to track and support these measures.

Consolidation is the key word for public healthcare resources and facilities. The government of Malaysia is implementing a hospital cluster concept. Hospitals within a similar geographic region will serve as one unit sharing assets, amenities and human resources. Additionally, existing healthcare facilities and assets will also be upgraded. Healthcare services to the rural and remote areas will be expanded via mobile healthcare teams and flying doctor services, where a doctor will visit patients by aircraft in a sparse, scatter or rural areas.

Implementation of the e-Health strategy will include incorporating existing ICT systems into one system-wide module. The goal is to improve health data management, and support research and development and commercialization initiatives.

Pre-hospital care such as ambulance services, and accidents and emergencies (A&E) services will also be a key focus area. Ideally, collaboration between private sector and non-government organization ambulance service providers will improve response time and better resource utilization.

Public budget allocations for developmental projects:

  • $1 billion operation costs for rural, urban and mobile clinics.
  • $900 million for the supply of drugs, vaccines, reagents and consumables to all public healthcare system.
  • $122 million upgrade to cardiology treatment equipment and purchase of 100 ambulances.
  • $18 million prevention and control of contagious diseases (Dengue, Zika).
  • $16 million underprivileged patient’s medical assistance program.

Demand for private healthcare has been increasing exponentially due to its speedy service delivery and quality healthcare. In 2015, private hospital outpatient attendance was 6.4 percent of overall outpatient care provided in-country. However, private hospitals command 40 percent of total hospital admissions. In 2015, approximately 28 percent of the doctors, 37 percent of dentists, and 37 percent pharmacists and 30 percent of nurses were in private practice.

Executive health screening service is increasingly popular as a preemptive approach, especially for the upper middle income and affluent population. Hence, clinical diagnostics services will see increase market demand. Aged-care services is also seeing increasing market demand.

As for dental market trends, we are seeing subspecialties in the area of orthodontics, implant and esthetic procedures increasingly being offered in private dental clinics. The United State is one of the leading suppliers of orthodontics products in Malaysia.

Medical aesthetics procedures are also gaining ground in Malaysia.

 

Main Competitors

In 2016, the total trade for Malaysia’s medical device industry was approximately US$2 billion and it imported $585 million of medical devices. U.S. products represented 18.4 percent of the import market and the U.S. was the top exporting country of medical devices to Malaysia in the same year. Singapore followed as the second largest exporter of medical devices with market share of 17.2 percent. This was followed by Germany (13.6 percent), Japan (12.5 percent), China (10.7 percent), and South Korea (3.3 percent).

 

Overall, Malaysian imports of medical devices decreased 10.5 percent over 2016/2015 duration. The type of medical devices Malaysia imports and exports differ significantly. Malaysia usually imports higher classification/ category of medical devices not manufactured locally.

Exports to the world for the same category of medical instruments and devices from Malaysia increased 8.1 percent from 2015 to 2016 to US$1.4 billion. Top export destinations for Malaysian products are the United States (22.9 percent), Belgium (22.6 percent), Germany (15.5 percent), Japan (11 percent) and Singapore (4 percent).

Current Demand

Wellness

Increasingly, more Malaysians are taking the approach of wellness and disease prevention rather than treatment. Consumer medical devices are used to self-monitor one’s health condition to maintain optimal health. Blood glucose and pressure monitors are gaining popularity. The United States is one of the largest suppliers of consumer health monitor devices to Malaysia. U.S. brands are both trusted and well received by Malaysian consumers.

Dental

As for dental market trends, we are seeing subspecialties in the area of orthodontics, implant and esthetic procedures increasingly being offered in private dental clinics. The United State is one of the leading suppliers of orthodontics products in Malaysia.

Private healthcare services

Private healthcare services in Malaysia are predominantly used by the upper-middle to affluent segment of the population. As per capita GDP rises, demand for private healthcare consumption is expected to increase in tandem. Health screening is increasingly popular. Medical aesthetics procedures are also gaining ground in Malaysia.

Other healthcare services

Similar to other increasingly affluent countries, non-communicable diseases (NCDs) such as diabetes, high-blood pressure, cardiovascular disease, oncology cases, and obesity are on the rise in Malaysia. The major vector-borne disease that Malaysia is having a difficult time containing is Dengue Fever. Tuberculosis (TB) is an increasingly infectious disease in Malaysia, with a high mortality rate. Although Malaysia has been BCG-vaccinating its citizens from birth, along with booster vaccinations administered for school age children for many decades, we are seeing resurgence in TB cases. The main cause is the influx of migrant workers into the country. Hand, Foot and Mouth Disease is also prevalent, but there is no associated mortality with this disease in Malaysia. Recently, there are incidences of rabies in select states with fatalities. There is an estimated half a million Malaysians that are infected with Hepatitis B and C. Many new born babies were given free Hepatitis B vaccines since 1989, nonetheless, the incidence rates of Hepatitis B increased from 2.13 percent in 2009 to 12.6 in 2016. Hepatitis incidence rates increased from3.71 percent in 2009 to 8.57 percent in 2016. Malaysia saw a marked increase in the number of non-alcoholic fatty liver dieseases. HIV/AIDS is the third main infectious disease in Malaysia with a high mortality rate.

 

Registration Process

The Malaysian Medical Device Act 2012 (Act 737) governs all medical devices imported into the country. This regulation specifies requirements and procedures to medical device registration, conformity assessment body (CAB) registration, establishment licensing, export permit and appeal.

All medical device manufacturers in Malaysia will need to register their medical devices with the Medical Device Authority (MDA). Importers and distributors will also need to obtain an establishment license to import and distribute medical devices locally in Malaysia.

Class A medical devices are subject to registration requirement by using Registration of Class A Medical Device Module. This can be done online at the Malaysian Medical Device Authority’s website: www.mdb.gov.my. A registration fee of RM100.00 applies. A registration certificate will be issued upon approval and it will be valid for five years, renewable thereafter.

There are steps to be taken prior to establishment license application for all other Class B, C, and D medical devices. These steps can be determined by the following diagram. If all requirements are fulfilled, then proceed with establishment license application. Complete guidance can be located on MDA’s website.

On certain instances, exemption from registration can be requested if the device is used for the demonstration, education, clinical research and performance evaluation purposes, are custom-made or for special access medical device. Exemption is subject to MDA approval issuance of a No Object Permit on importation and/or device market placement.

  • to be taken before making an application for an establishment license

Establishment license application requirements and process

Step

Preparation/criteria

  • Determine if your establishment handles medical device.

Must conform to “medical device” definition under Section 2 of Act 737.

  • Determine the type/ category of establishment.

As defined in “establishment” under Section 2 of Act 737.

  • Establish, maintain and implement quality management system (QMS).

As per Third Schedule of Medical Device Regulation 2012:

(a) A manufacturer will establish, maintain and implement QMS based on MS ISO/ ISO 13485 standard.

(b) An authorized representative, an importer and a distributor is to establish, maintain and implement appropriate QMS based on Good Distribution Practice for Medical Devices (GDPMD).

  • Appoint Conformity Assessment Body (CAB) to perform conformity assessment on QMS.

Establishment shall appoint pre-approved CAB registered under Section 10 of Act 737 to conduct conformity assessment according to Third Schedule of MDR 2012.

  • CAB issues report and certificate of conformity.

Upon completion of conformity assessment and satisfactory fulfilment of requirements, CAB is to issue a report and certificate of conformity according to the Third Schedule of MDR 2012.

  • Apply for establishment license via MeDC@St

(a) Application for establishment license can be made after criteria fulfillment. It must be supported with relevant information and documents.

(b) Applicant will create an account before making application via MeDC@St.

*Diagram and table courtesy of Malaysian Medical Device Authority.

Reimbursement

Malaysians have access to universal health coverage on the public healthcare front. Annual national budget determines the level of funding for public healthcare systems. Typical Malaysian public healthcare expenditure is around 4-5% of GDP.

Malaysian citizens and residents have access to subsidized healthcare services by the Ministry of Health, university hospitals, Ministry of Defense hospitals and various local health authorities. Malaysians pays a nominal fee for these public healthcare services. Senior citizens enjoy an additional 50% discount on these nominal fees. This includes primary, secondary and tertiary care, including hospitalization and surgery. In the case of implantable and artificial limbs etc., the general public would purchase these out of pocket. Federal public service personnel and pensioners and their immediate family members have access to reimbursement from the Public Services Department.

Private health insurance coverage and/or out of pocket are typical ways of paying for private healthcare services. Obtaining private health insurance coverage is entirely voluntary. Private sector employers generally have some form of health insurance cover for their employees. Benefits and coverage is usually directly negotiated with managed care organizations.

 

Barriers

Malaysia's ease of trading across borders remains highly ranked in international comparisons. However, is it not a totally free and open market. Malaysia’s import barriers are aimed at protecting the environment and strategic sectors as well as maintaining cultural and religious norms.

In January 2012, the Malaysian Department of Standards implemented MS2424:2012 General Guidelines on Halal Pharmaceuticals, a voluntary certification system. The guidelines enabled manufacturers of pharmaceutical products to apply for halal certification and established basic requirements for manufacturing and handling. Currently, halal certifications are voluntary; however, halal requirements are gaining in prominence.

 

Procurement & Tenders

Malaysia is not party to the WTO Government Procurement Agreement, and as a result foreign companies do not have the same opportunity as some local companies to compete for contracts. In most cases foreign companies are required to take on a local partner before their bids will be considered. In domestic tenders, preferences are provided to Bumiputra suppliers over other domestic suppliers. Procurement often goes through middlemen rather than being conducted directly by the government. The procurement can also be negotiated rather than tendered. International tenders generally are invited only where domestic goods and services are not available.

Ministry of Health Publications:

http://www.moh.gov.my/english.php/pages/view/56

Ministry of Health Tender Procurement (only available in Malay): http://www.moh.gov.my/index.php/database_stores/store_view/9

 

Trade Events

Name of event: South East-Asian Healthcare and Pharma Show, May 14-16, 2018

Location: Kuala Lumpur City Center, Kuala Lumpur, Malaysia

English language website: http://www.abcex.com

Description: The South East Asian Healthcare and Pharma Show in Kuala Lumpur is one of the region’s more established trade shows covering the entire healthcare industry. Visitors come from Malaysia, Singapore, Indonesia, and other neighboring countries.

Name of event: APHM International Healthcare Conference, July 2018

Location: Kuala Lumpur Convention Center, Kuala Lumpur, Malaysia

English language website: http://aphmconferences.org/

Description: The Association of Private Hospitals of Malaysia (APHM) annual conference and exhibition is a key annual medical event.

FAQs

Malaysian Medical Device Authority FAQ section:

 

U.S. Commercial Service Contact Information

Name: Tracy Yeoh      

Position:     Commercial Specialists      

Email:         tracy.yeoh@trade.gov

Phone:         60 3 2168 5089

Best Prospects

  • E-Healthcare products – ICT systems that focus on healthcare data management.
  • Clinical Diagnostics products and equipment- diagnostics growth due to increase clinical demand
  • Nutritional Supplements - For Wellness
  • Orthodontics – Implant and Esthetics procedures

Market Size

Healthcare spending (including investment)

4-5% of GDP

... as percent of GDP

4.2% (2014)

4.54% (2014)

Hospitals, Procedures, Healthcare Professionals UN:

Number of hospitals

340

…Public

143

…Private

197

Number of hospital beds

Public and Private: 54,402 (2015)

1.9 beds/1000 population (2012)

... available beds per capita

18 (2010)

...of which in general hospitals

Public: 36,447; Private: 13,013

...of which in specialized clinics and rehabilitation centers

Public: 4, 942 (2015)

Number of surgical procedures

4283 (2012)

...of which [top procedure]

Public: Pregnancy, childbirth and puerperium, 23.85% (2015)

Private: Certain Infectious and parasitic diseases, 15.28% (2015)

...of which [second highest procedure]

Public: diseases of the respiratory system, 12.34% (2015)

Private: diseases of the respiratory system, 14.79% (2015)

Physicians

1.28 physicians/1000 population (2012)

Profession: population ratio 1:656 (2015)

Dentists

Total 3810 (2010)

4.76/1000 population (2015)

Demographics

Population

30,949,962 (July 2016 est.)

Life expectancy men/women

Men: 72.2 years; Women: 78 years (2016 est.)

5.8% (2015 est)

Infant mortality

12.9 deaths / 1000 live birth (2016 est.)

6.2 per 1000 live births (2015 est)

Percent of population older than 65

5.86% (male 861,151/female 953,091) (2016 est.)

Population proportion over 60, 8.21% (2012)

Annual deaths

5.1 deaths/ 1000 population (2016 est)

...caused by [highest disease burden]

Diseases of the circulatory system (2015)

Ischemic heart disease 20.1% (2012)

...caused by [second highest]

Diseases of the respiratory system (2015)

Stroke 10.6% (2012)

Prevalence of [fastest growing disease burden]

Neoplasms (2015)

Lower Respiratory infections 8% (2012)


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