Since every one of us has been to a dental clinic, I believe it is relevant to include the dental care segment of the health care sector in Saudi Arabia as part four of my articles series on health care investment opportunities.
Although it is the biggest market in the GCC with the highest population, the Kingdom has been ranked third among GCC countries in terms of dentists per 10,000 residents in 2016. Having said that, the market has seen a considerable growth due to interrelated factors that include: Rising oral care awareness, improved technologies and modern health care infrastructure, growing demand for cosmetic dental services and targeted promotion of dental tourism.
It has also been observed that government expenditure on health care has increased at a compound annual growth rate (CAGR) of 7.6 percent during 2011-2016.
Even though the government supplies dental care services free of cost for Saudi citizens, the majority of the Saudi population choose to be treated in private clinics, increasing the demands for private clinics.
Most patients believe that with paid care they can get a better time with doctors and expect an enhancement in the way they look rather than just treating a dental problem.
The research report “Saudi Arabia Dental Care Market Outlook to 2021” highlights that health care expenditure in Saudi Arabia will rise from $25 billion in 2017 to $33.7 billion during 2021 at a CAGR of 7.7 percent during 2017-2021. This increase will result in the improvement of overall health care infrastructure — good news for suppliers of dental equipment and owners of dental clinics.
The dental segment is gaining more importance to investors. Not too long ago, there was a huge acquisition transaction by an investment banking firm acquiring a major stake in a large integrated network of dental clinics in Saudi Arabia that currently owns 32 clinics across four major cities and plans to further expand over the next five years.
From my own personal observation of the past 18 years since I came back from London, I can confirm the noticeable enhancement of the dental private clinics’ offerings, in Jeddah at least. As for the country as a
whole, I believe that the Saudi dental care service market is still underserved and is forecasted to continue growing in the years to come under the overall health care plan in Vision 2030.
This will be driven mainly by the increase in dental care awareness, growing penetration by the insurance sector and an increase in the per capita income, among other factors.
(Courtesy: Arab News)