Exploring Healthcare Investment Opportunities in Central and Eastern Europe
The healthcare sector in Central and Eastern Europe (CEE) has been transitioning and showing positive signs of growth over the past two decades. This has largely been fueled by the reform of health services becoming a priority on the political agenda. As a result, CEEs healthcare sector is rapidly emerging as an attractive healthcare investment destination for domestic and international investors alike. So, what are the key factors that are creating attractive healthcare investment opportunities in Central and Eastern Europe?
To begin with, rapid demographic changes and rising disposable income across the region is resulting in increased government and individual spending on healthcare facilities. Furthermore, the highly fragmented healthcare market in Central and Eastern Europe provides investors with attractive healthcare investment opportunities such as pursuing a buy-and-build strategy in the region.
In this blog, experts at Infiniti explores the key factors fueling healthcare investment opportunities in Central and Eastern Europe.
Looking for an ideal healthcare investment strategy? Request a free proposal and learn how our solutions can help you identify an effective strategy and areas of investment that can help you maximize ROI.
Rising healthcare spend
Experts at Infiniti are of the opinion that at the current rate, CEE countries will soon grow leap and bounds in terms of healthcare investments. The healthcare investment opportunities created in the region through increased spending are attracting more and more investors each year. In Poland for instance, total healthcare spending including government and individual spend has surged by over 20% in the last two years. The healthcare spending in CEE regions are primarily increasing due to the aging population due to low fertility rates, the emigration of younger population, and the rising life expectancy. Apart from this, the increasing demand for better and more expensive treatments are fueling demand and more healthcare investment opportunities in Central and Eastern European countries.
Scope of consolidation
The vast potential for consolidation in the region gives better healthcare investment opportunities in CEE. Unlike Western Europe, the ownership of healthcare companies in CEE is highly fragmented, giving plenty of opportunities for consolidation through buy and build strategies. In Western Europe, there are only a few dominant players with regional monopolies in the healthcare market. The rest are mostly dispersed independent family clinics. This means that in Western Europe, even if investors acquire some independent firms, it wouldnt move the needle in terms of market share. On the other hand, in the case of CEE, buying few independent firms can make investors grow rapidly.
Healthcare companies will be required to develop new and different operating models in order to tap into new opportunities.