Healthcare boosts GDP growth

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Peggy Farley of the Ascent Group.

The Middle East's healthcare sector could amount to a quarter of Gross National Product (GDP) by 2020, industry figures have predicted, up from its current share of 10%.

With sufficient investment in medical manufacturing, said market experts Dr Karl Broth and Peggy Farley, Arabia stands to rival India and China as an outsourcing destination for product companies.

Globally, an estimated 65% of medical equipment components are outsourced at some level.

"There is increasing competition among medical firms in India and China, providing low cost alternatives," said Farley. "However, Arabia has the right ingredients to rival any region in quality medical manufacturing, business practices and forward-thinking environmental strategies."

Farley is the co-director of Ascent Medical Technology Funds, which was co-founded by Broth. The two funds were established by The Ascent Group to provide venture capital for enterprises in the healthcare industry.

To date, the initiative has financed US$50,000 of the Philadelphia Biological and Medical Technology Product Development Centre in Jordan and also invested $3.5m towards the growth of the Salalah Medical Device Manufacturing facility in Oman.

Groth, a long-time promoter of medical innovation, said healthcare had the potential to outpace Arabia's current commercial areas such as oil.

"Enhancing innovation in healthcare will create knock-on effects in jobs, increase wealth and improve the overall health of the population," he said. "The wealth of the Middle East is not solely its oil and gas. Its more important wealth is the capability of its people, especially in science and technology."

Previous investments by Ascent include the Minnesota-based firm InStent. The device firm floated on the New York Stock Exchange for $210m and was eventually sold for more than $700m.

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