PETALING JAYA: MIDF Research is optimistic on the healthcare sector despite anticipated changes and updates to existing policies and programmes for the private sector.
It said the United States’ withdrawal from the World Health Organisation is expected to place China as the next major funder of the organisation, opening opportunities for regional and local healthcare players to leverage on pharmaceuticals and medical device trades, advanced research and development, and Chinese medical tourists.
“The prevalence of Human Metapneumovirus (HMPV), while still below 1% in Malaysia, signals the need for more development of vaccines in preparation of any future endemics,” it added.
The research house said Malaysia’s call for a reduced dependency on vaccine imports, whilst developing and manufacturing local vaccines, is timely.
“HMPV could be the right catalyst to further improve our pharmaceutical sector.”
MIDF Research said the government is expected to continue seeking a sustainable system for both patients and providers by improving three key drivers, namely sustainable medical workforce, affordable and comprehensive payment system for patients, and long-term positive cost management.
“While we remain vigilant on diagnosis-related groups and hospital services’ outsourcing programme’s implementation on a larger scale, we are confident that the balance between public and private sectors can be reached, given the right timeline, framework and coverage.”
On the pharmaceuticals side, the outlook is expected to remain sanguine under the off-take policy (OTP) 2.0 programme, although higher competition may impact financial performance in the mid-term, in tandem with the need to reduce prices and dependency on one supplier, particularly for niche drugs.
The Health Ministry had recently proposed an updated OTP 2.0 to enhance medicine security, reduce drug prices and strengthen the local pharmaceutical industry. OTP 2.0 aims to reduce monopolistic pricing of medicines.
MIDF said private hospitals are expected to remain resilient on the back of surging inpatient visits and in-house treatments from both domestic patients and medical tourists.
The increased demand for inpatient treatments is anticipated to persist in the near term, fuelled by the continuous affordability of healthcare services and the safety of the country for foreigners and locals alike.
The research house’s top pick for the sector is KPJ Healthcare Bhd
. It maintained its “buy” call on the stock with a revised target price of RM2.75 per share.
