Mission Statement

CS Healthcare Technologies Trade Mission

Brazil and Chile

April 30 – May 4, 2007

Mission Description:

The United States Department of Commerce, International Trade Administration, U.S. Commercial Service, Office of Global Trade Programs, is organizing a Healthcare Technologies Trade Mission to São Paulo, Brazil and Santiago, Chile, April 30-May 3, 2007, with an optional one-day spin-off to Belo Horizonte, Brazil, May 4, 2007.

The trade mission will target a broad range of healthcare sectors including medical equipment and devices; diagnostics; the IT-healthcare sub-sector, e.g., electronic patient records, automated patient scheduling, telemedicine; and the healthcare services sectors.

The focus of the mission will be to match participating U.S. companies with qualified agents, distributors, representatives, licensees, and joint venture partners, and where appropriate, arrange for appointments with government officials, in these markets.

Commercial Setting:

Chile :

Chile’s medical equipment market is estimated at US $78 million for 2005.    The Chilean government spends 7 percent of its GDP on healthcare and the government’s budget allocation for healthcare has increased every year since 1990.  Chile’s healthcare budget for 2005 totals $2.8 billion, representing an increase of 8.5 percent over 2004. These funds are for primary and emergency medical services.

The U.S. has long been Chile’s most important supplier of medical equipment.  Many medical professionals study or receive training in the U.S. and prefer U.S. made equipment.  Chilean imports of medical equipment in 2004 amounted to $18.6 million and U.S. suppliers accounted for approximately 38 percent of the market, followed by Germany with approximately 14 percent.  Chile produces and exports a limited amount of medical products.

Medical imports, like all products foreign and domestic, are subject to Chile’s 19 percent Value Added Tax (VAT). However, after the signing of the Free Trade Agreement between the United States and Chile, most U.S. made medical equipment now enters Chile duty-free.

The Ministry of Health is conducting major improvements of its hospital infrastructure that will require an investment of about $US 600 in equipment and infrastructure over the next five years. Investment includes the construction of 22 new hospitals and 33 new medical attention units. The government will finance construction of most of these hospitals but will also allow private funding for some hospitals, providing more government resources to purchase needed technology.  

Brazil :

São Paulo:

Brazil represents the largest medical equipment market in South America.   The Brazilian market for medical devices and equipment in 2004 was approximately $US 2.1 billion and it is expected to grow at an annual rate of 10 percent for the next few years. The continued expansion of the private healthcare sector offers the greatest potential for U.S. exporters, particularly for advanced medical equipment, disposables, diagnostic devices and components.

Even with currency fluctuations, the Brazilian market presents excellent opportunities.   While Asian and European medical products manufacturers are aggressively targeting the Brazilian market, the United States accounts for 42 per cent of the total import market.   Since there are few high-quality Brazilian manufacturers of advanced medical products, reliance on imports in this sector is expected to continue.

U.S. sales have traditionally been made through Brazilian agents, distributors and importers who sell to hospitals and clinics.   Local buyers view U.S. and other foreign products (mainly Canadian and European) as having equally good quality and reliability, so price and financing often become the differentiating criteria in making the sale.   There are some 3,000 equipment and supply distributors in Brazil, but only about 3 percent of these firms can be classified as large companies.   Excluding the direct sales networks of individual multinational manufacturers, virtually all distributors are regional, rather than national.

In addition to the attractive size of the Brazilian medical market, U.S. exporters should consider the opportunities offered by Mercosul, the economic common market in the southern cone of South America, and use Brazil as a "spring board" for export into the region.   Since compulsory product registration before sale is required in Brazil, U.S. exporters should consult a local lawyer/consultant before signing a contract with any agent/distributor.  

An interesting trend in Brazil is the growing home healthcare market, valued at approximately US $90 million in 2003.   Brazil now has approximately 150 of these types of healthcare providers, compared to approximately 1,440 in the United States. Utilizing these organizations is viewed as a good way to cut hospitalization costs, while offering better services to patients.   The Nursing Regional Council is developing procedures on how to regulate this market in Brazil, including standards for health professionals.

Private entities such as universities and even religious organizations around the country offer new opportunities for both U.S. healthcare equipment and training/management services suppliers.   Interested U.S. suppliers should look for opportunities beyond the larger communities of São Paulo and Rio de Janeiro (both in Southeast Brazil).   In particular, opportunities exist in the northeastern states of Bahia, Ceará, Pernambuco, Paraíba and Rio Grande do Norte; the southeastern states of Minas Gerais (please see below) and Espirito Santo;   the central western states of Goiás and Mato Grosso do Sul; and the southern states of Paraná, Santa Catarina and Rio Grande do Sul.

Belo Horizonte:

Belo Horizonte is located in the midst of a little known yet dynamic economy.   The metropolitan area of Belo Horizonte, with approximately 4 million inhabitants, is the third largest city in Brazil and is the capital of the state of Minas Gerais.   Minas Gerais is Brazil’s second most populous state, with 18.9 million people and a GDP of nearly US $45 billion, representing approximately 10 percent of the country’s total economic output.

Belo Horizonte presents U.S. exporters of medical equipment and technologies with an excellent potential market due to the fact that the city serves as the region’s medical service hub.   As such, it has a disproportionately large number of public and private hospitals and clinics.  

Mission Goals:

The Trade Mission's goal is to provide market entry or increased sales into the Chilean and Brazilian markets for U.S. healthcare firms and/or IT firms with healthcare-related products or services, as well as first-hand market information and access to potential business partners.

Mission Scenario:

The trade mission will spend two days in Santiago and two days in São Paulo, with an option for companies to participate in a one-day optional spin-off to Belo Horizonte.

In each primary mission 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 a hospitality event to introduce participants to key business and industry officials.

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.

Any partisan political activities of an applicant, including political contributions, will be entirely irrelevant to the selection process.

The mission will be promoted through the following venues: Export Assistance Centers and the Healthcare Team; U.S.CS Trade Events List www.export.gov; 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

Recruitment will begin April 1, 2006 and will close on March 17, 2007.   The trade mission participation fee will be U.S. $3,500 per company for Santiago and São Paulo, and U.S.$685 per company for the optional spin-off to Belo Horizonte.   The participation fee does not include the cost of travel and lodging.   Participation is open to the first 10 qualified U.S. companies.   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
Global Trade Programs
U.S. Department of Commerce, Room 2012
Washington, D.C. 20230
Tel: (202) 482-2839
Fax: (202) 482-0178
E-mail: William.Kutson@mail.doc.gov