Healthcare Technologies

Trade Mission

The Czech Republic, Hungary, and The Slovak Republic

September 13-17, 2004

Mission Description:

The United States Department of Commerce, International Trade Administration, U.S. Commercial Service, Office of Export Promotion Services, is organizing a Healthcare Technologies Trade Mission to The Czech Republic, Hungary and The Slovak Republic, September 13-17, 2004. The Trade Mission will target a broad range of sectors within the healthcare industry. The focus of the delegation will be to match participating U.S. companies with qualified agents, distributors, representatives, licensees, and joint venture partners in these markets, which are all slated to become European Union (E.U.) member countries in May 2004.

Commercial Setting:

The Czech Republic

The Czech Republic's medical devices market was valued at U.S. $450 million in 2002. Domestic production accounts for only 35 percent, providing excellent opportunities for U.S. exporters of medical products. Germany accounts for 25 percent of the medical products imported into the Czech Republic, followed by the United States, which claims a 17 percent share. Syringes, needles, catheters, electrical diagnostic equipment, x-ray equipment, irradiators, and orthopedic aids account for the largest volume of medical products exported to the Czech Republic. Best current sales prospects include computer-processed visual systems, laser equipment, retinal tomography technology, defibrillators, implants, medicine infusion pumps, mammogram systems, endoscopes and laparoscopes, although there is demand in the Czech Republic for an even wider range of medical products.

The home healthcare sector has been growing since its introduction to the Czech Republic in 1991 to reduce the demand for hospitalization and improve the quality of life of patients, usually the elderly. Further expansion of home healthcare is inevitable, given the high costs of hospital healthcare delivery and the shortage of financial resources in the Czech healthcare system. Since the Czech home healthcare sector is still in its infancy, there is potential for U.S. firms, especially those offering a wide variety of home care products, high-quality mobility equipment and other high demand products, including thermometers, blood pressure monitors, stethoscopes, glucometers, and aids for daily living.

Hungary

The Hungarian medical market, estimated at U.S. $200 million, is very competitive and is dominated by imports, with about 85-90 percent of the market comprised of foreign products. U.S. medical products account for approximately 10-15 percent of this market and are very well received in Hungary due to their high quality. The Hungarian medical market is expected to grow five percent annually for the next three years. There are few barriers to entry for medical products into Hungary.

Currently most purchases are by publicly owned institutions, but Hungary's new health care privatization law is designed to create more public-private healthcare facilities.

Privatization of health services has proceeded most rapidly in the delivery of healthcare services by family physicians, and in the pharmaceutical and dentistry areas. Private sector development has moved relatively quickly for ambulatory and diagnostic imaging services, and has been negligible for outpatient and in-hospital care (areas where both costs and reimbursement mechanisms have thus far remained largely within the public sector). In 2001 about 20 percent of the total expenditures of the National Health Insurance Fund (NHIF) went to private service providers.

Medical products are marketed in Hungary through authorized distributors. Major foreign companies have their own offices while others operate through local distributors. Most distributors handle several brands of the same type of equipment and/or several lines of medical equipment. There are small firms, however, that represent only one or two foreign companies. Pricing is a key factor in selling a medical product in Hungary, as the market is very price sensitive. When purchasing medical equipment, customers also look for established companies with reliable after-sales service and customer support.

Hospitals and other health care providers usually buy equipment directly from
distributors.

The Slovak Republic

In 2003 The Slovak Republic, more commonly known as Slovakia, imported U.S. $135 million of medical/healthcare products and equipment, an eight percent increase from 2002. This trend, combined with a $69 million World Bank loan for modernization of the Slovak medical sector, provides increased opportunities for U.S. medical/healthcare exporters.

The Slovak health care system consists of the National Health Service, including 141 home healthcare agencies and a large number of private medical facilities. The home healthcare sector in Slovakia was launched in 1996 and has been growing by 28 percent on an annual basis. Since home healthcare agencies in Slovakia provide better quality care and more comfort to patients at only a slightly higher cost than hospital-based care, and since healthcare delivery from theses agencies is also partially covered by health insurance, the Slovakian home healthcare sector is expected to continue growing. This trend bodes well for U.S. firms offering home care products, including general hygiene products and aids for daily living.

In Slovakia, medical products are sold through sales representatives or through distributors. There are local distributors who represent only one or two foreign companies, but usually they market several brands of the same type of medical equipment/devices. Price, service, training and overall customer support are factors that are considered by Slovak consumers of medical products and services, with cost competitiveness and after-sales service being the key factors.

Mission Goals:
The Trade Mission's goal is to gain first-hand market information and provide access to key government officials and potential business partners for new-to-market, and/or new-to-export U.S. healthcare firms desiring to enter these three promising markets.

Mission Scenario:

The trade mission will spend two days in Prague, one day in Bratislava, and two days in Budapest. At each stop, the U.S. Commercial Service will:

• Provide a market briefing highlighting opportunities in the healthcare technologies sector;
  
• Schedule one-on-one appointments with potential business partners for each participant;
  
• Arrange hospitality events to introduce participants to key business and industry officials (with the possible exception of Bratislava, the spin-off stop).

Tentative Timetable:

Criteria for Participation:

• Relevance of the company's business line to the mission scope and goals
  
• Potential for business in the selected markets
  
• Timeliness of the company's completed application, participation agreement, and payment of the mission participation fee
  
• Provision of adequate information on the company's products and/or services and communication of the company's primary objectives to facilitate appropriate matching with potential business partners
  
• Certification that the company's products and/or services are manufactured or produced in the United States or if manufactured/produced outside of the United States, the product/service must be marketed under the name of a U.S. firm and have U.S. content representing at least 51 percent of the value of the finished good or service.

The mission will be promoted through the following venues: Export Assistance Centers and the healthcare team; industry newsletters; the Federal Register; relevant trade publications; relevant trade associations; past Commerce trade mission participants; various in-house and purchased industry lists, and on the Commerce Department trade missions calendar - www.ita.doc.gov/doctm/tmcal.html.

Any partisan political activities of an applicant, including political contributions, will be entirely irrelevant to the selection process. The trade mission participation fee will be $2,500 for The Czech Republic and Hungary, and $500 for the optional spin-off to Slovakia. Participation fee does not include the cost of travel and lodging. Participation is open to the first 10 qualified U.S. companies. Recruitment will begin immediately and will close on June 30, 2004. Applications received after that date will be considered only if space and scheduling constraints permit.

Contact Information:
Bill Kutson, Project Manager
U.S. Commercial Service
Export Promotion Services
U.S. Department of Commerce, Room 2117
Washington, D.C. 20230
Tel: (202) 482-2839
Fax: (202) 482-2718
E-mail: William.Kutson@mail.doc.gov