Greater Public Funding Combined with Increasing Private Healthcare to Boost Imaging Market in CEE and Russia

Mounting disease incidence and growing awareness about health issues will spur demand for medical imaging services across Central and Eastern Europe (CEE). However, the installed base of imaging devices in the region is insufficient, particularly in the high-end segment, such as magnetic resonance imaging (MRI), computed tomography (CT), and positron emission tomography (PET). At the same time, a large percentage of lower-end imaging modalities remains outdated and requires replacement. The availability of European Union (EU) funds and governmental financial support, as well as the increasing role of private healthcare, are set to help overcome this hurdle.

New analysis from Frost & Sullivan (Palo Alto, CA, USA), an international growth consultancy firm, revealed that the market earned revenues USD 1.42 billion in 2010 and estimates this to reach USD 2.34 billion in 2015. The research covers general X-ray, MRI, CT, ultrasound, molecular imaging, mammography, and picture archiving and communication system (PACS) segments across Russia, Hungary, Poland, the Czech Republic, Romania, and Bulgaria.

“The availability of EU funds for member states in the CEE, paralleled by governmental programs in Russia, will be an important source of financing for new equipment purchases and will contribute significantly to the development of the medical imaging market in CEE,” explained Frost & Sullivan industry analyst Dominika Grzywinska. “Even though budgets are planned until mid-term in cases of both Russia and CEE countries, their extension is highly likely in the long-term as well.”

In Russia, the 2020 Healthcare Development Program and National Project “Health” focus not only on bringing sophisticated technologies to the country and equipping healthcare facilities with expensive, high-end devices, but also on purchasing mid-range and low-end devices that are highly needed in regional hospitals. The total budgets for 2010-2012 allocated in these programs are approximately USD 16 billion.

At the same time, accession to the EU has provided countries such as the Czech Republic, Hungary, Poland, Bulgaria, and Romania, access to funding sources planned in the EU budget for 2007-2013. As a result, both private and public facilities can apply for EU funding support, which can subsidize the purchase of new medical equipment.

Affordability of medical imaging equipment in CEE countries and Russia is limited, which poses a challenge, particularly to private end-users. Private end-users have established their presence in less costly imaging segments, such as X-ray or ultrasound, and are expanding their presence into more costly, imaging diagnostics. Nevertheless, public healthcare facilities are the main purchasers of medical imaging equipment, especially in more expensive segments, such as PET, CT, or MRI.

“Furthermore, private facilities are frequently interested in refurbished equipment since they are more concerned about ROI [return on investment] than public facilities,” added Ms. Grzywinska. “Refurbished systems are in most demand for higher-priced modalities, such as MRI or CT. This situation is likely to limit the dynamics of medical imaging market growth in CEE countries and Russia.”

Alternative financing methods offered by the medical imaging vendors, as well as governmental support for public-private partnerships could contribute to more rapid market growth. “As end-users of medical imaging equipment do not always have sufficient financial resources to purchase the required device, alternative methods of financing, such as loans or leasing could help overcome this challenge,” advised Ms. Grzywinska. “Also, flexibility in payment of installments could be well-appreciated by the end-users. Another way to meet the growing demand for medical imaging services is by promoting public-private partnerships.”

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