By: Anna Majavu
South Africa exports about R3 billion worth of locally made bandages, syringes, needles, catheters and other medical consumables every year, but imports over R7 billion worth of other medical devices. A recent Trade and Industrial Policy Strategies (TIPS) seminar in Johannesburg heard that the manufacturing of medical devices in South Africa was limited, with less than 5% of local players involved. About 76% of all medical devices were imported and they took up 90% of the market share of the industry, said TIPS senior economist Liako Mofo. Medical devices include any equipment used in dentistry, diagnostic imaging such as ultrasounds or X-rays, patient aids, prosthetics, and consumables like PPE, syringes and bandages.
The patient aids industry, which includes hearing aids, pacemakers and nebulisers, is worth R3.2 billion alone. But local companies are getting very little of that business with over 95% of patient aids used in the country imported from the USA, China, Germany and Switzerland. The orthopaedics and prosthetics sector is also worth R3.2 billion with “most if not all products in this category supplied by imports [from] the USA and Switzerland”, Mofo added. Most medical device companies in South Africa were small businesses with fewer than 50 employees. Covid-19 had clearly shown that it was vital that South African companies develop the ability to make medical equipment such as ventilators.
Dr Julius Mugwagwa, Professor of Health Innovation and Public Policy at University College London, told the seminar that small businesses were valuable in that they were adaptable and able to move quickly to make certain medical products in an emergency. “They can be deployed or partnered with to make certain lines – bandages, certain lines of generic medicines whether it is painkillers, oral rehydration salts,” said Mugwagwa. He added that SMMEs should also be given the task of manufacturing simple yet vital medical devices such as medical spatulas, syringes and needles. “It is really about how they are able to meet the demands that could be placed on their capabilities. They can be utilised as a key actor in this ecosystem,” he said.
Victor van Vuuren, director at medical consultants HolaVic Consulting, said most medical device manufacturers in South Africa had the capacity to expand their manufacturing. “So, what we can do is increase the manufacturing from existing small businesses by better managing the procurement processes,” said Van Vuuren. He proposed that medical aids and hospital groups enter talks with the small medical device businesses and new start-ups to make the “not-so-sophisticated medical devices that we are currently importing”. “We need access to finance and we need the preferential procurement or the ability to build in local content as a key aspect… there are opportunities to grow the industry if we can take care of those factors,” he said. If this happened, the estimated 50,000 people currently employed by the medical devices industry would grow tremendously. Mofo added that there was also a great need for local companies to start making diagnostic imaging equipment such as radiotherapy machines, and MRI and PET scanners for local public hospitals.