We all get it: the BRIC markets will be huge, and it's no secret. Medtech companies are hungrily flocking there, setting up manufacturing facilities, subsidiary headquarters, training centers, and R&D facilities. The medtech markets have exploded in size and show no immediate signs of slowing down, particularly in the two BRIC giants: China and India.
But let's take a step back for a moment and think about how sustainable this is. While at first the large international competitors were able to earn a strong advantage over their medtech colleagues by becoming the first companies to launch particular products in the region, more and more companies are now entering these markets. As a result, the big companies in the BRIC countries are finding themselves increasingly competing with more or less the same companies they do at home, with the added fun of battling against a whole slew of small domestic companies offering value products at very low prices.
I know that you're probably thinking that still, procedure volumes have so much potential in these countries after all, we've only been able to scrape the surface of the eligible patient population. But therein lies the problem: the "easy" target markets are already getting fairly saturated, with most of the large international companies having already made their way into the premium private health care sectors in these countries. To get at the general public in these countries though, companies will have to navigate a complex and generally underfunded public health care system. Consequently, one expert interviewed by Clinica suggested that the optimism in these markets may decline over the next few years, and that reaching the rest of these countries massive populations will be an increasingly difficult task.
These fears have been reinforced by slowing economic growth as well as currency depreciations economic growth in China sank to an unexpected 3-year low in Q2 2012 while the real, ruble, rupee, and yuan are depreciating rapidly, causing some multinational competitors to cut their profit forecasts so maybe the future of medtech in this region isn't as rosy as everyone initially thought.
But it's always been clear that current medtech sales growth levels in the BRIC countries can't be maintained forever the question is just when they will plateau, after reaching what proportion of the population.
What are your thoughts on when growth in the BRIC markets will peak? Let us know in the comments.