(source: Thailand Investment Review, May 2016)
Thai healthcare has seen a tremendous surge in popularity over the years and its booming medical tourism industry has contributed to the country’s fame as destination to receive affordable, world-class healthcare. The country aims to be the medical hub of Asia, drawing on its outstanding medical foundation that includes premium medical services, qualified healthcare specialists and various internationally accredited medical facilities. It is clear that Thailand has demonstrated its proficiency as a prospective international medical hub.
Government support and the increased demand in healthcare market has led to great opportunities for continued success in related fields, such as medical services, pharmaceuticals, and medical devices, that contributes to Thailand’s strong position as a potential Asian Medical Hub.
Leading Medical Tourism Hub of Asia with World-Class Medical Facilities
As the world leader for medical tourism, over a million international patients travel to Thailand every year on medical travel packages. The number of the foreign patients receiving treatment reached 2.35 million people in 2014 and their numbers are growing annually. With Thailand’s world-class medical facilities, premium healthcare services available at highly competitive prices and its global reputation for graceful and attentive service, it is not hard to see why the country is rapidly becoming the Medical Tourism Hub of Asia.
Thailand’s healthcare industry is largely driven by its world-class medical facilities. The country is among the first in Asian countries to have hospitals that have acquired the Joint Commission International (JCI) accreditation. With more than 1,000 public and 300 private hospitals nationwide and over 50,573 well-trained physicians, Thailand offers a diverse range of treatments that include: General examinations, Dentistry, Cancer treatments, Hip replacements, Kidney transplants, Cardiology Testing, Heart surgeries etc.
Dynamic Growth in Biopharmaceuticals Contributes to a Growing Pharmaceutical Sector
The pharmaceutical market in Thailand and ASEAN is growing at an unprecedented pace. Thailand’s export of pharmaceutical products has grown steadily over the past five years, demonstrating a growth of 6.12%. The import value of Thai pharmaceuticals has also constantly grown, reaching approximately THB 102 billion (USD 2.9 billion) in 2015. Thailand imports most of the active pharmaceuticals ingredients required, from a diverse base of pharmaceutical suppliers and manufacturers overseas, leaving sizable room for new pharmaceutical investors.
In addition to its growing market value, Thailand also demonstrates high potential in becoming the emerging biopharmaceuticals hub of the region. Given Thailand’s capabilities in clinical trial infrastructures and abundant biopharmaceutical-related trial subjects, the country has bright prospects for growth in this fast-growing industry.
A number of international contract research organizations (CRO) see Thailand as an attractive place to conduct clinical trials enhancing its reputation as an ASEAN pharmaceutical hub. Thailand has gained widespread acceptance for its well-developed clinical trial infrastructures thanks to its large target population, the qualification and credentials of its researchers, relatively low costs, and high standard clinical capabilities.
Thailand’s Medical Device Market Sees New Innovations
Thailand’s medical device market has continued to thrive due to several key factors. The growing influx of medical tourists along with the rise in the standard of living of Thai citizens and the government’s continued efforts to develop Thailand into a leading medical hub, have led to constant innovation in this area.
The Thailand Center of Excellence for Life Sciences (TCELS) is one of the organizations that constantly encourages innovation in Thai medical devices. The setup of the Thai Medical Device Cluster has led to the development of Thai medical robotics, the acquirement of CE marking and ISO 13485 certification for Thai hip prostheses, and the establishment of the Advanced Dental Technology Center (ADTEC).
These developments serve as a strong foundation to take the Thai medical device market forward. In addition to the wide variety of medical devices being manufactured domestically, a substantial number of high-grade and sophisticated medical devices are being imported to meet rising demand. This presents tremendous opportunities for new investment in the kingdom with respect to manufacturing high-end medical devices.
Putting It All Together
With great supporting measures, excellent human resources and strong investment incentives, Thailand’s medical industry demonstrates definite potential towards positioning the country as a true Medical hub of Asia. The country also aims to be a cost-effective production location for leading global pharmaceuticals and medical device companies.
The Medical Device Industry comes under the BOI's Super Cluster policy and projects are eligible for attractive incentives under the super cluster policy. Projects that meet the criteria will gain an 8-year income tax exemption and an additional 50% reduction on corporate income tax for five years. For future industries of significant importance, the Ministry of Finance will consider granting 10-15 years of corporate income tax exemption. Import duty on machinery will also be exempted.
Non-tax incentives include the consideration of granting permanent residence to leading specialists and permission for foreigners to own land to implement promoted activities. To receive all these incentives, projects must cooperate with academic or research institutions or a Center of Excellence to develop human resources and improve technology levels (Talent Mobility, Work-integrated Learning and other co-operative measures). Projects are required to apply for investment promotion by the end of 2016 and start operations within 2017 to accelerate investment.