Market Study Just Published: Oman Pharmaceuticals & Healthcare Report Q1 2010

For BMI’s Q309 Pharmaceutical and Healthcare report for Oman, we expect the total drug market to increase to US164mn, representing a respectable compound annual growth rate (CAGR) of 7.01% in both US and local currency terms. Drug spending accounted for 0.23% of GDP and annual per capita expenditure was US$42 by the end of 2008. While per capita spending will

rise to US$55 by the end of our forecast period, the proportion of GDP dedicated to total pharmaceutical spending will remain at 0.23%. Oman’s population are getting unhealthier. According to our Burden of Disease Database (BoDD), the number of disability adjusted life years (DALYs) lost to non-communicable diseases will increase from 67% of the total disease burden in 2008 to 74% by 2030. Communicable disease will fall from 18% to 11% over the same time period. We believe the drivers for growth in noncommunicable disease includes the prevalence of hypertension, obesity and diabetes.

 The government has decided to undertake preventative measures to address this problem, however BMI believes this still leaves an attractive opening for pharmaceutical firms that specialise in chronic diabetes treatment, including those that promote wound healing. The regulatory environment has not made any significant advances during this quarter and we maintain our view that the requirement for products to be commercialised in the country of manufacture for two years prior to registration are an ongoing deterrent to multinational pharmaceutical firms. Some drugs will be designed for country-specifics or regional diseases that will have no demand in the country of the origin. We welcome the regulatory conditions being drafted for traditional herbal medicines. This is by no means a large market, however it is important that the Ministry of Health recognise that its regulation will prevent adverse reactions and improve public favour.

Also, the Free Trade Agreement with the US has removed the country from the US Trade Representative (USTR)’s Special 301 Report, however we caution that its patent protection and intellectual property (IP) laws are weak, unclear and still need significant improvement to attract further foreign interest. The large patented drug market leaves room for generic pharmaceutical firms to enter Oman, however, prescribing practices and public awareness will need to change in order for this sector to realise its potential.

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More abour Oman Healthcare

Throughout the Five-year Plans, which began in 1976, the Ministry of Health has operated a range of programmes aimed at extending its services to improve the general health of Oman�s population.

In terms of healthcare, Oman is now one of the world�s advanced nations. The current Five-year Development Plan follows a results-based strategy and highlights the priorities of the Sultanate�s public health policy. The Plan operates in parallel with Gulf, regional and international trends, Oman�s own commitments and the UN Millennium Declaration, which sets out a programme to improve general healthcare in the global community to 2015.

Working on the principle that �prevention is better than cure,� the health care provided by the state includes education as well as treatment. A special initiative on non-communicable disease prevention and control designed to fight current and potential future problems such as obesity, cardiovascular disorders and diabetes is in place alongside programmes to provide physiotherapy rehabilitation services as an essential component of the country�s overall health care package.

The Ministry regularly monitors the incidence of all communicable diseases through its epidemiological and disease surveillance directorate and contributes to the safeguarding of national and global health by responding with alacrity whenever an international health emergency arises (e.g. SARS or Bird flu).

The Sultanate�s health care system operates at three levels. They are:-

1 � Effective, high quality primary health care provided by the health centres, polyclinics and local hospitals in all the Sultanate�s governorates and regions.

2 � Secondary health care provided by the referral hospitals in all Oman�s governorates and regions, as well as other hospitals in some of the main wilayats, which offer specialist healthcare requiring a higher level of specialised skills.

3 � Tertiary health care provided by the major hospitals in Muscat (the Royal Hospital, Khoula Hospital and al Nahdha Hospital), which operate as nationwide referral hospitals. Ibn Sina Hospital, in Muscat, is a tertiary hospital for psychological and nervous disorders.

The Sultanate operates extensive child immunisation programmes against tuberculosis, polio, diphtheria, whooping cough, tetanus and measles, as well as viral hepatitis, german measles, mumps, hemophilus influenzae B and other diseases.

A baby friendly hospital initiative promotes breast-feeding, proper nutrition, advocacy for birth spacing and other community-based projects. Free medical attention is available to Omani citizens throughout their lives but working on the principle that �prevention is better than cure,� the health care provided by the state includes health education as well as treatment.

In addition to the new clinics and centres, in March 2008 the Ministry signed agreements to set up further health centres at a cost of around RO4 million at Sumail in the Dakhiliyah Region, Wadi al Hiyul in the wilayat of Madha in Buraimi, al Dahareez in Salalah in Dhofar, Ras al Hadd in Sur in the South Sharqiyah Region and Wadi Bani Khalid in the North Sharqiyah Region.

Other agreements for a further RO4 million were signed in April 2008 for the construction of health centres in West Salalah in Dhofar, at Ibri in the Dhahirah Region, al Sawadi at Barka in the South Batinah Region, Wadi Minqal in Sur and at al Wafi in the al Kamil wa�l Wafi area of the South Sharqiyah Region.

Major social care services including rehabilitation support are provided by the Ministry of Social Development. The services of qualified physiotherapists are available in most national and regional hospitals.

To keep pace with the development of the health care infrastructure and minimize dependence on manpower import, the Ministry felt the need to accelerate human resources development to train medical and paramedic staff locally and abroad.

OMANISATION

The Omanisation level among the country�s nurses is expected to increase to over 80%, with several regions touching 100%. Over 80% Omanisation level may be reached by end-2010 in case of pharmacists (84%), physiotherapists (89%), radiographers (88%), assistant pharmacists (85%) etc. Physician Omanisation level is expected to increase to about 46% by end-2010. Omanisation level in physician specialists is expected to go up from 23% at end-2005 to 38% by end-2010. Specialty Omanisation is expected to reach reasonable figures (40-47%) in case of two key specialties viz. General Pediatrics and Internal Medicine. However, in two other major specialties, Obstetrics & Gynaecology and Anesthesiology, Omanisation levels are likely to continue to be low (10-30%) until at least 2010.

The Ministry of Health pursues an e-Health strategy, according to which Information Technology and Communication (ITC) will be used comprehensively in all health care institutions, with information shared across various concerned institutions. The use of ITC is already widespread in state health institutions and eventually, the Ministry plans to evolve a National e-Health Records Repository.

There are also a number of private medical facilities as well as those specialising in ayurvedic, Chinese and homeopathy, along with chiropractor centres