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Investing in Turkey's Medical Technologies Market

Dec. 6, 2013
For many years, the US has been in the number one position among countries exporting medical devices to Turkey with a 25% market share.

With a population close to 80 million people and healthcare spending per capita that has grown in the last decade from $330 to $780, Turkey has an expanding middle class willing to spend more on healthcare technology and service.

This spring, the U.S. Department of Commerce's International Trade Administration (ITA) will lead a trade mission of U.S. companies looking to do business in Turkey's medical technologies sector.

Manoj Desai,  Principal Commercial Officer at the U.S. Embassy Consulate General in Istanbul, Turkey, discusses the opportunities in Turkey.

Q: Why is now a good time for U.S. medical technologies companies to consider doing business in Turkey?

A: For many years, the United States has been in the number one position among countries exporting medical devices to Turkey with a 25% market share. With billions of dollars in healthcare projects driven by a higher demand for quality healthcare and growth in medical tourism, we expect to see continued and substantial opportunities in this sector.

There are also general factors that make Turkey an attractive destination for U.S. healthcare exports. With a population close to 80 million people and healthcare spending per capita that has grown in the last decade from $330 to $780, Turkey has an expanding middle class willing to spend more on health services. For the sake of comparison, OECD member countries overall spent an average of $2,386 per capita on healthcare in 2012. This shows a significant growth potential in this market.

Since 2002, Turkey's healthcare system has undergone a major transformation due to the Ministry of Health's initiatives to encourage private sector investments in healthcare and renovate or rebuild many of 900 Ministry-operated hospitals. Today, there are 500 private hospitals, 42 of which are JCI-certified.

In addition to fulfilling local demand, these hospitals attract many international patients. The government has unveiled a PPP (Public Private Partnership) initiative to build 29 integrated health campuses. A total of 45,000 beds will be integrated into the Turkish healthcare system through this model.

The Turkish Ministry of Health is also installing and expanding the Health IT infrastructure throughout the country. It has an ‘electronic patient record' system in place whereby each patient's health information is kept in a database. Prescriptions are issued electronically, and telemedicine services have begun to offer healthcare services to more remote parts of the country.

In short, this is a country that is progressive in its healthcare vision and is investing towards shaping a quality-driven, accessible and efficient healthcare system.

Q: Which medical technologies have the most potential in the Turkish market?

A: In general, public and private hospitals already own all major categories of medical equipment and are looking for state-of-the-art, minimally invasive or non-invasive solutions. Technologies with high potential include advanced imaging and diagnostics devices, point-of-care devices, surgical devices using robotics technology, oncological products, clinical chemistry and laboratory devices and reagents. There is also high demand for implants used in orthopedics and trauma, HealthIT and Mhealth systems, remote patient monitoring devices and telemedicine systems. Consumables such as adhesive medical dressings, safety syringes and cannulae as well as dental products, hearing aids and pacemakers are also areas with good prospects for U.S. companies.

Q: How will Turkey's ability to attract international patients impact demand for medical devices?

A: Turkey has established its reputation as a medical tourism destination, attracting most of its foreign patients from Middle East, North Africa and Europe. Turkish private and public establishments will serve one million foreign patients by 2015.

With Turkey as the sixth most popular tourist destination worldwide, the necessary infrastructure to support further growth in the medical tourism industry is present and continuously expanding. These patients mainly visit Turkish hospitals for cardiovascular, ophthalmological, plastic surgeries, radiation oncology, medical oncology and dental services.

Q: How is the regulatory environment of the healthcare industry in Turkey?

A: Because Turkey has a Customs Union Agreement with the European Union, it has adapted most of its medical equipment directives to fit with those of the EU. Thus, Turkey requires CE Marking for medical devices; FDA approval does not apply.

However, requirements for CE Marking are similar to FDA requirements, so a U.S. product that has FDA clearance has done most of the work required for CE Marking.

Many U.S. manufacturers get their CE Marking first, and then get FDA clearance. Another good feature of CE Marking is that if a U.S. medical device firm is already exporting to the U.K., for example, it has already met the regulatory requirements for exporting to Turkey, and vice versa.

Once a U.S. company chooses a Turkish distributor and completes the necessary certification and documentation for exporting to Turkey, the distributor must register the products in the National Databank managed by the Ministry of Health. Following this, if the U.S. company wants to be listed in the reimbursement system (SUT) managed by the Social Security Institute (SGK), it has to agree on the reimbursement price established by SGK for that product group.

Q: What is the objective of the trade mission?

A: In 2014, the Medical Technologies Trade Mission poses a great opportunity for U.S. medical technologies firms to discover new market opportunities in Turkey and its neighbors. The program includes an Embassy briefing, networking events with industry and business associations, and site visits to public and private hospitals. Business matchmaking appointments will be scheduled and tailored to each company's goals, including appropriate government meetings.

Participants will have the option to meet with CS officers and potential customers from the broader region, including Bulgaria, the Caucasus and Central Asia. CS Turkey has a proven track record in organizing trade missions.

The trade mission, scheduled for May 4-8, 2014, begins in Turkey's capital of Ankara, proceeds to the major Aegean port city Izmir, and concludes in Turkey's largest city, Istanbul. The objective of this trade mission is very straightforward: We want participating U.S. companies to meet with the right Turkish business partners so they can begin exporting or expand their current sales to the Turkish market.

The U.S. Commercial Service (CS), located within ITA, supports a number of trade missions every year. The last two Trade Missions to Turkey – Renewable Energy in 2011 and Aerospace & Defense in 2012–were highly successful, resulting in signed contracts totaling $34 million to date.

Q: What types of export assistance are available to help U.S. companies in Turkey and the region?

A: The U.S. Commercial Service connects U.S. companies with international buyers through its network of offices in 108 U.S. cities and U.S. Embassies and Consulates in more than 70 countries. These include three offices in Turkey, located in Ankara, Istanbul and Izmir, as well as partner posts in Azerbaijan, Georgia, Uzbekistan and Turkmenistan. Through this network, the U.S. Commercial Service provides export counseling, business matchmaking, trade events support, market research, advocacy and other services to help U.S. exporters.

The deadline for participation in the Technologies Trade Mission to Turkey is  Feb. 6.

Visit U.S. Commercial Service for more information.

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