WALLONIA FOREIGN TRADE AND INVESTMENT AGENCY Healthcare in Kazakhstan The Government owns 80 % of medical institutions in Kazakhstan, thus the Government plays a significant role in medical issues. The Government expenditures on health were increased threefold during the 2004-2010. Since, the Unified National Health System was introduced in the country. It allows people to choose policlinics and doctors. The Unified Medicine Distribution System providing poor people with free medicines and medicines on reduced price was introduced as well. Following its appointment as a WTO member, Kazakhstan has brought its local medical regulations in line with international standards. The Government of the Republic of Kazakhstan approved a program of reforming and development of public health called «Salamatty Kazakhstan» for 2011-2015 that aims at improving effectiveness of the healthcare sector and health of the people of Kazakhstan. It should be noted that in the framework of the program the Ministry’s activity in 2012 was focused on prevention of the main causes of mortality and disability of people. The life expectancy increased by 0.6 years (68.4) comparing with 2010 and made 69.01 years. The maternal mortality reduced by 19% and infant mortality reduced by 8%. The mortality made 8.7% over 1000 people against 8.97 in the previous year. The mortality from circulatory diseases reduced by 27%, from incidents, intoxications and injuries - by 5%, from tuberculosis - by 10%. The sanitary epidemiological situation in the country remains stable. The spread of the HIV infection in the age group 15-49 is at the level of 0.2%. Besides, the work on attraction of non-governmental organizations to implementation of the public social order continues. Within this order 18 projects were implemented in 2011 and 25 - in 2012. The Ministry of Healthcare jointly with the Akimats (local town halls) of the regions completed construction of 13 healthcare facilities including 4 facilities built within “Construction of 100 schools and 100 hospitals” project and “Construction of 350 healthcare facilities” project at the expense of the national and local budgets in 2012. The National Screening Program was introduced in the country in 2012. Presently, more than 500 psychologists and 2100 social workers work in the country. The National Scientific Cardiac Surgery Center opened on the initiative of the President of Kazakhstan successfully functions in Astana. Unique operations and research work are conducted in the Center. During the work of the Center, more than 2000 operations have been performed there. The transplantation of a donor here and artificial left ventricle was successfully held there for the first time. The operation on transplantation of a liver from a family member was held in the Scientific Surgery Center named after A. Syzganov in Almaty as well as the first operation on transplantation of a kidney and pancreatic gland. Business Center "Nurly Tau", building 2A, office 501 Al-Farabi avenue 5, Almaty, Kazakhstan Tel: +7 (727) 2777608, Fax: +7 (727) 2777609 E-mail: almaty@awex-wallonia.kz WALLONIA FOREIGN TRADE AND INVESTMENT AGENCY Besides, the road rescue points were additionally opened at dangerous sections of the roads and the air ambulance service was established. Six medical and rescue points were opened in Kazakhstan in 2012. Emergency response teams, whose employees have been trained how to work with rescue equipment, were formed. All the necessary medical equipment and medicines were purchased. A contract for the supply of reanimobiles for 2013 was signed. 2.5 million USD1 was allocated for the creation of medical and rescue points. As of January 1, 2013, medical aid was provided to 899 victims, including 35 children. 399 people, including 27 children, were hospitalized. 1.8 million USD was allocated for the functioning of the medical and rescue points. In 2012 six EC-145 helicopters were purchased. Supply of two Ka-32 rescue helicopters, under the contract concluded with JSC "Russian Helicopters", was implemented in May 2012. In 2012, rescue helicopters carried out 1005 flights, provided aid to 1304 patients. 90 surgeries were carried out on the spot. Medical services became more available for people living in rural areas by means of 49 mobile medical complexes which, in turn, provided their services to more than 500 thousand people since the beginning of the year. Two health trains «Densaulyk» was also launched.The Ministry continues to introduce telemedicine, and presently 186 telemedicine centers are functioning in the country. Over 12 thousand consultations have been held so far with the help of these centers. As of January 1, 2013, there are 3587 health schools, 56 youth health centers in Kazakhstan. The youth health centers cover 196 544 people, 47% male, 53% female. The implementation of the WHO’s project “Healthy Schools” continues in Kazakhstan. Of the total 7465 secondary schools, 755 schools participate in this project. 57 higher education institutions participate in the project “Health Universities”. Astana has an independent family health center "Demeu” covering 19724 residents. In 2012, a new specialized chidren’s clinic and a new outpatient complex for 500 visits per shift were opened in Astana. It is planned to create three more independent family health center in 2013. To integrate the UNHS and Single Information Health System there were introduced portal formats such as "Bureau of hospitalization", "Register of attached population", "Electronic register of inpatients," "The add-on to the health care", "Electronic register of cancer patients." As part of the implementation of the Unified National Health System the portal "Bureau of hospitalization" operates in Kazakhstan. In order to create a centralized database of information about the number of people attached to the health care organizations that provide primary health care, the portal "Register of the attached population" continues to operate. 15,751 telemedicine consultations, 5173 videoconferencing sessions, 288 videoconferencing sessions as a selector at the request of the Ministry of Health and national health organizations were conducted during the 12 months of 2012. The atlas of spread of dangerous infections in Kazakhstan was developed in 2011, published in 2012. 1 Exchange rate on April 23, 2013 : 1 USD = 151.16 KZT Business Center "Nurly Tau", building 2A, office 501 Al-Farabi avenue 5, Almaty, Kazakhstan Tel: +7 (727) 2777608, Fax: +7 (727) 2777609 E-mail: almaty@awex-wallonia.kz WALLONIA FOREIGN TRADE AND INVESTMENT AGENCY This atlas gives characteristics of 12 high-risk and zoonotic diseases: plague, cholera, anthrax, tularemia, brucellosis, leptospirosis, yersiniosis, listeriosis, hemorrhagic fever, tick-borne encephalitis; describes the 12 major carriers and vectors. The atlas shows patterns of communicable diseases in space and time, risks to the population, to technical, economic, and recreational projects. Currently, the Ministry jointly with the World Bank implements an innovative project on transfer of technologies and conducting of an institutional reform in the sector of healthcare. The project provides for modernization of financing and management of healthcare, restructuring of the hospital sector, reforms of medical education and science, development of innovative system of healthcare, improvement of pharmaceutical provision, security of food products within the accession to the WTO. It should be noted that the quality of the implementation of the programs depends directly on effective management at all levels. The management serves as a conductor of modern methods of administration including new principles of remuneration. This principle is aimed at the final result of the work which implies the quality of treatment and patient’s satisfaction with it. The average salary with the consideration of incentives of doctors made 767 USD and 499 USD for paramedical workers. In conclusion, the Ministry will continue to work on the priority directions of the State Program including the events on reduction of maternal and infant mortality, mortality from circulatory diseases, oncology diseases, injuries and tuberculosis. Secondly, in 2013 the Ministry will open stroke centers in all the regions of the country, and thirdly, this year will focus on development of the transport medicine. The Ministry will also work on further improvement of ambulatory pharmaceutical provision, development of transplantation, introduction of common responsibility for people’s health, introduction of innovative projects and transfer of advanced technologies to the national healthcare system, etc. Drugs and Pharmaceuticals In 2010, the Government approved a draft Program for the development of the pharmaceutical industry for 2010-2014. According to the program, the Government’s priority task is to supply 50% of the market with locally produced medicines and healthcare products by 2014. To meet this goal, modernization of the existing and construction of new pharmaceutical production facilities are planned. In 2010, Kazakhstan joined the Customs Union (CU) with Russia and Belarus. Entrance to the Union has not yet affected the pharmaceutical market as Customs fees for imported pharmaceuticals from CU member countries and third countries will be still zero. However, as of 2014, customs fees for pharmaceutical imports from third countries will be increased first to 5% and then in 2015 to 10%. It is assumed that during these years local production will increase and new production lines adhering to international standards will be developed. This local production would help Kazakhstan’s pharmaceutical industry to compete with imported producers not necessarily in the modern, hi-tech segment but in a wide niche of generics which account for 85% of the market. Business Center "Nurly Tau", building 2A, office 501 Al-Farabi avenue 5, Almaty, Kazakhstan Tel: +7 (727) 2777608, Fax: +7 (727) 2777609 E-mail: almaty@awex-wallonia.kz WALLONIA FOREIGN TRADE AND INVESTMENT AGENCY There is not accurate 2010 data for funds allocated from State and local budgets for the purchase of pharmaceutical products. Based on figures from previous years, this amount accounts for approximately 50-60% of the total market. Local production is relatively insignificant, accounting for only 10-15% of the market. Local manufacturers produce basic pharmaceutical products that do not require innovative technologies. Market demand for specific complex pharmaceuticals is met entirely by imports. All imported and locally produced pharmaceutical products must be registered in Kazakhstan. The agency responsible for registration is the Committee for Pharmacy under the Ministry of Health. The National Center of Expertise under the Ministry of Health overseas the approval process for all pharmaceutical products to be registered. This process includes a number of physiochemical, biological and clinical tests, which verify efficiency, safety and quality of imported pharmaceuticals. Depending on the type of drug, a registration payment varies from $3,000 to $5,000. Generally, a manufacturer pays the registration fee. The pharmaceutical market is divided almost equally into two major segments: State procurement and retail sales. State procurement of pharmaceuticals is implemented through tenders announced by regional and city health departments. State procurement of oncology and diabetic medicines is funded by a Statefinanced program. The existing model of procurement is highly decentralized with about twenty distributers supplying hospitals with medicines. This has resulted in an increase of logistics expenses, interrupted supply and unjustified prices for pharmaceuticals. In 2009, the Ministry of Health set up SK-Pharmatsiya LLP2 as a single distributor for supplying pharmaceuticals to State health institutions. The share of pharmaceuticals bought through the single distributor system will gradually increase, reaching 70-80% by 2012. The remaining 20-30% of pharmaceuticals with a low consumption level will be directly purchased by hospitals. It is planned that the single distributor will buy pharmaceuticals in the amount of $270 million in 2011. Foreign companies producing the following pharmaceutical products have strong prospects: Vaccines and other immuno-biological medications for immuno-prophylaxis of population; Anti-tuberculosis medications; Anti-diabetic medications; Oncology medications; Antibacterial medications; Medications and dialyzers, and medical supplies for patients with renal deficiency and patients operated on for kidney transplantation. Generally, foreign suppliers participate in State-funded tenders through their local distributors. Despite Government attempts to improve and increase local production of pharmaceuticals, Kazakhstan is still attractive for foreign exporters because, as already mentioned, production of highly efficient and innovative medicines is not considered a priority task in the local program. Severe diseases such as CVD, cancer and diabetes still require advanced pharmaceuticals. 2 http://www.sk-pharmacy.kz/en/ Business Center "Nurly Tau", building 2A, office 501 Al-Farabi avenue 5, Almaty, Kazakhstan Tel: +7 (727) 2777608, Fax: +7 (727) 2777609 E-mail: almaty@awex-wallonia.kz WALLONIA FOREIGN TRADE AND INVESTMENT AGENCY Medical equipment Construction of facilities for production of medical equipment and devices is not included in the State program for the industrial innovation development of Kazakhstan for 2010-2014. This means that the market will badly be in need of imported medical devices and equipment. Local producers of medical equipment will in no way be able to fully supply the market with necessary equipment and there are no means to rapidly develop a strong local industry in the near term. Currently, there are about 60 companies in Kazakhstan registered as producers of medical equipment. Most of the “sonamed” producers are small businesses with very insignificant production volumes. The Ministry of Healthcare continues to work on the introduction of telemedicine and mobile medicine in the country’s rural regions. The goal of the project is to improve diagnostics and treatment in rural hospitals, improve access to quality healthcare for rural citizens, and further the professional development of medical personnel. In June 2008, the Government of Kazakhstan established the National Medical Holding. A joint stock company wholly owned by the government, the company comprises seven separate entities that include Kazakhstan Medical Academy, National Center for Maternal and Child Health, National Research Center for Emergency Care, Republican Center for Medical Rehabilitation, National Center for Neurosurgery, Republican Diagnostic Center and National Research Center for Cardiac Surgery. The mission of the National Medical Holding is to introduce international standards of quality and safety of care and to ensure financial sustainability and growth. The holding’s priorities and goals include the following: consolidation and efficiency of management processes, creation of a comprehensive hospital information system, development and integration of electronic patient records, establishment of RIS/PACS system, and design of financial and operational modules such as accounting, treasury, human resources, inventory management and purchasing. In January 2008, the World Bank approved a $117.7 million loan for the Kazakhstan Health Sector Technology Transfer and Institutional Reform Project which will be implemented by 2013 (based on unofficial data of the Ministry of Health). The total project cost is $296 million, with $178.4 million being co-financed by the Government of Kazakhstan. The project will help introduce international standards and build long-term institutional capacity in the Ministry of Health and related healthcare institutions in support of key health sector reforms pursued by the government. The project components include: Health Information System Development ($188.6 million) Health Care Quality Improvement ($59.9 million) Health Financing and Management ($20.2 million) Reform of Medical Education and Medical Science ($9.4 million) Food Safety and WTO Accession ($8.7 million) Project Management ($4.6 million) Pharmaceutical Policy Reform ($4.2 million) Business Center "Nurly Tau", building 2A, office 501 Al-Farabi avenue 5, Almaty, Kazakhstan Tel: +7 (727) 2777608, Fax: +7 (727) 2777609 E-mail: almaty@awex-wallonia.kz