Widening waistlines spell opportunity – Nikkei Asian Review



Mount Elizabeth Medical Center in Singapore, destination for medical tourists from around Asia (Photo: Simon Roughneen)

Mount Elizabeth Medical Center in Singapore, destination for medical tourists from around Asia (Photo: Simon Roughneen)

SINGAPORE  –  With “Western-style” ailments such as obesity and diabetes on the increase in Asia, health-related businesses are ramping up their efforts to keep those diseases at bay.

Asia’s spending on health care has been soaring. By 2017, the region’s expenditure will reach $2.1 trillion, 24% of the global total, according to a report by The Economist Intelligence Unit. “As incomes rise, education levels also improve, creating much greater awareness of health issues,” the report said.

But as Asians earn more, they are becoming not only better educated but also more susceptible to so-called “lifestyle” diseases — afflictions the World Health Organization classes as “noncommunicable” and “chronic.”

Chronic maladies such as heart disease and diabetes are the No. 1 killers in Southeast Asia, accounting for 62% of all deaths, according to the WHO. Growing Asian affluence and the spread of fast-food chains have led to increasingly unhealthy eating habits, as foods high in fat, salt and sugar are consumed in greater amounts. This, in turn, has caused a spike in conditions previously more common in Western countries.

Malaysia-based IHH Healthcare is among the hospital operators responding to the region’s growing medical needs. “Rapid growth, rapid rise in affluence and the development of the middle income group, these are all very favorable factors for the health care industry,” said Tan See Leng, IHH’s managing director and CEO, speaking at the FT-Nikkei Asia300 Forum in Hong Kong on April 25.

According to Tan, “migration to a more Western lifestyle and unhealthier lifestyle” means that IHH and other hospital operators are able to expand their operations across Southeast Asia.

IHH, the region’s biggest hospital operator by market capitalization, announced in January that it will build a 250-bed hospital in Yangon, Myanmar, in a joint venture with local partners. The $70 million project is slated to be completed by 2020.

Myanmar’s health and education systems were neglected during the country’s five decades of army rule, but now the expectation is that a civilian-led government will spend more on those sectors as the country’s economy grows.

“Typically, health care and education are the last part of the jigsaw puzzle,” Tan said. “In the earlier stage of development, it is usually the power and infrastructure investment that comes first, followed by telecommunications, hospitality and banking. And eventually, when the economy reaches a certain [level of] critical mass, that is the time when nouveau riche start to say, ‘I need a solid health care provider,’ and that is where we come in.”

TECH WAVE   The greater demand for health care in Asia is prompting innovation. Scott Russell, president and managing director of SAP Southeast Asia, a software and technology business, said that “analytics can be used for research and predictive modeling for prescriptive care and the development of healthy behaviors.”

Russell gave an example of how wearable devices and health apps can connect patients to care providers for better monitoring. SAP developed with a partner an integrated package that includes a blood glucose monitor, a wearable fitness tracker and an app to help control diabetes. Known as Accu-ChekView, the package monitors a patient’s glucose levels and transmits this information to the doctor’s office.

As well as looking to high-tech health care models, Asians are moving back to their roots, showing an increasing interest in traditional Chinese medicine in their zeal to avoid extra pounds.

Eu Yan Sang, one of Asia’s largest health and wellness companies, has seen an increase in demand for traditional Chinese medicine, or TCM. “Since our TCM weight management started in 2011, we have seen around 60% growth in the number of patients seeking this treatment program,” a company representative said.

“We see a trend of more investors investing in the TCM weight management market,” the representative said. “In addition to clinics offering TCM weight management, we see an increasing number of spas and slimming centers using TCM methods for weight management.”

With diabetes and obesity on the rise, the Asia-Pacific region is one of the fastest-growing weight management markets in the world. The sector is expected to expand by 36% to $6.5 billion in 2020, from $4.7 billion in 2015, according to a Euromonitor International report.

The International Health, Racquet & Sportsclub Association says more than 28,000 gyms and fitness centers across the Asia-Pacific region take in an estimated $14.3 billion in revenue a year. Fitness First, a British gym chain with branches in Indonesia, Malaysia, the Philippines, Singapore and Thailand, has expanded across Southeast Asia in recent years.

A spokesperson for True Fitness, a Singapore gym business, said membership growth has been consistent since the chain opened in the city-state in 2004.

Some fitness companies are courting wealthier clients. California Management Group, a Vietnam-based health and fitness company, launched an elite club called Centuryon a few years ago. Depending on the services and benefits, membership starts at $8,000 and can go up to over $24,000 per year. Benefits include concierge personal trainers and imported Italian machines in the weights area.

HOLIDAY CURES   In the past, Asia’s medical tourism sector attracted well-off Westerners for treatment that is cheaper than costly private care in their home countries.

The demographics are changing, however, as the growing middle classes in China and India are increasingly traveling to medical tourism hubs such as Thailand and Singapore. The Asia-Pacific medical tourism market is expected to grow at a compound annual growth rate of 16.3% to $20.47 billion by 2019, according to a report by market research company Frost & Sullivan.

Mohit Grover, life sciences and health care industry leader at Deloitte Southeast Asia, is sanguine about the growth of medical tourism in Southeast Asia. Grover said that Thailand drew 2.4 million medical tourists in 2012, an influx that generated $439 million in revenue. The traffic could double by this year.

Malaysia’s medical tourism sector is less well-known than its Thai or Singaporean counterparts, but has become more prominent in recent years. “From 2003 to 2011, Malaysia’s medical tourism market has grown eightfold,” Grover said.

An expert at Singapore’s Mount Elizabeth Medical Centre said that half the patients attending his clinic — which treats people affected by noncommunicable diseases such as diabetes — come from abroad. “My clinic sees about 50% locals, which includes expatriates, and 50% foreigners. Our foreign patients come from Indonesia, Vietnam, Myanmar, Cambodia, Bangladesh, China, Russia and to a lesser extent Malaysia and Thailand and other countries.” Most come to Mount Elizabeth because they are seeking care that is reliable, efficient and up to date.

Overall, however, medical tourism in Singapore “has been on the decline due to rising costs,” Grover said, noting that a heart bypass surgery can cost 41% more than in Thailand.

Referring to an independent study that he commissioned, IHH’s Tan revealed that Myanmar’s wealthy spend close to $450 million annually on medical tourism. Some of them go to India, but “the bulk of them” opt for Thailand. IHH hopes its Yangon hospital will persuade these travelers to stay at home.

Waiting area inside the traditional Chinese medicine section of Tung Shin Hospital in Kuala Lumpur (Photo: Simon Roughneen)

Waiting area inside the traditional Chinese medicine section of Tung Shin Hospital in Kuala Lumpur (Photo: Simon Roughneen)

By JUSTINA LEE, Nikkei staff writer, and SIMON ROUGHNEEN, Asia regional correspondent. Nikkei deputy editor Kenji Kawase contributed to this report.

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