New Market Report: Kuwait Pharmaceuticals & Healthcare Report Q2 2016

Despite continued pressure to raise revenues i n the face of a protracted oil crisis , increased strategic cooperation with neighbouring Gulf stat es and ongoing government investmen t will provide Kuwait's pharmaceutical sector with continued growth momentum.

Headline Expenditure Projections

Pharmaceuticals: From KWD300mn (USD997mn) in 2015 to KWD316mn (USD1.03bn) in 2016; +5.2% in local currency terms and +3.2% in US dollar terms. Forecast unchanged from Q2 1 6 .
Healthcare: From KWD1.67bn (USD5.54bn) in 2015 to KWD1.79bn (USD5.83bn) in 2016; +7.2% in local currency terms and +5.2% in US dollar terms. Forecast in line with Q 2 1 6 .

Risk/Reward Index

In our Q216 Pharmaceutical Risk/Reward Index Kuwait scores 54.5 out of 100. Increasing from a Q116 score of 52.9, the country has now surpassed Lebanon and Qatar and is the sixth most attractive market in the region. The burden of diabetes will continue to expand in the region as the population ages and adopts increasingly sedentary lifestyles. Increasing insurance coverage and rising income levels will lead to greater spending on diabetes, and commercial opportunities will be sought by multinational pharmaceutical companies, health insurers and providers.

Full Report Details at
- http://www.fastmr.com/prod/1130936_kuwait_pharmaceuticals.aspx?afid=301

Latest Updates

In November 2015, The Kuwaiti Economics Committee in the Supreme Council for Planning and Development proposed a two-layered alternative health plan for expatriates. The proposal would see expats working in the public sector receive treatment in expat-only hospitals after purchasing a health insurance policy, with private sector workers treated in private medical facilities.

In February 2016, the Kuwaiti government entered into an agreement with Armenia on cooperation in the areas of health and medicine. This will see the increased sharing and analysis of health sector experiences as well as establishing close contacts between countries' respective health institutions.

In a controversial move, the Ministry of Health announced plans to impose a health insurance fee on visitors during a November 16th health committee meeting which would see fees either added to the price of visitor's air tickets, or paid directly at the border.

BMI Economic View

Lower oil prices will have a detrimental effect on Kuwait's economy; weighing slightly on the government's expenditure plans but more notably on business confidence and consumer spending. We forecast real GDP growth of 1.2% in 2016 and 1.9% in 2017, from an estimated 1.5% in 2015.

BMI Political View

Kuwait's decision to break diplomatic ties with Iran represents only a slight deterioration in the country's political risk profile and we see little to no economic impact. Generally, Kuwait faces few external risks, especially given improving relations with Iraq.

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