Authored by: Vijendra Kargudri & Shilpa Manvikar
The emergence of the Healthcare Sector
It might be an understatement to say that over the millenniums, every global exploration route was followed closely by new trade opportunities. Over the last couple of centuries, healthcare products and services have been no exception to that concept.
Post industrialization era, the inventions & innovations in the healthcare sector have grown leaps & bounds. And, over the centuries the trading for the healthcare products & services has fueled the global population growth in spite of being stalked by various communicable & non-communicable diseases!
The globalization process has ushered the emergence of new forms of business opportunities, processes, and organizations. This has necessitated the foundation of international rules and regulatory frameworks in areas which were previously an exclusive domain of domestic policies. Even though healthcare has long been recognized as an integral part of the global development agenda, it has been significantly affected by globalization despite its public good and non-commercial nature.
Globalization of the Healthcare Sector
Various factors have contributed to the globalization of health care services. Some of the major ones include ―
- a gradual decline in public sector spending,
- a rise in private sector participation in health care within many countries,
- liberalization of related sectors like insurance & telecommunications,
- increased mobility of consumers & health service providers owing to falling travel costs & ease of travel,
- advance in medical device & drug technology
- enablement of cross-border delivery of many health services,
- differences in product & service costs,
- quality of health care across countries,
- the emergence of investment opportunities in the health care sector with the liberalization of foreign investment regulations,
- a general increase in demand for health services arising from rising income levels and aging populations, have also contributed to the globalization of health services, and
- epidemic nature of communicable and non-communicable diseases
Though on the one hand, increasing demand has revolutionized the provision of health services & products, on the other hand, it is putting pressure on national governments and policy-makers to supply quality health care facilities to populations at a time when governments across the globe are looking to reduce public spending on social services. This is especially the case in the European Union, where an aging population, strict patent laws and the growing production of generic drugs by emerging economies such as Brazil, China and India are pushing the boundaries of health policy-making.
Given the fact that the global healthcare industry is rapidly growing, removal of some of the regulatory barriers, such as trade at the regional, multilateral, and the national levels, will facilitate trade in health services that is modest at present.
The legal aspect to global trading by the healthcare sector
The healthcare sector is highly regulated and owing to the nature of its products/services, the businesses involved must keep pace with the ever-changing domestic & international legal regulations. The product landscape is vast and cross-border trading brings in challenges in the form of customs duty, sanctions, embargos, tariffs on import & export.
The challenges & key to minimizing operational glitches lies in integrating an appropriate solution that is measurable, scalable & reproducible across global supply chains. Having such a solution will help businesses to have complete visibility and adapt to the dynamic changes in a sustainable way.
Top 3 areas in which SAP GTS can help healthcare global trading
The healthcare industry global trading has its own set of challenges and specific needs. To mitigate these challenges and seamlessly execute trading across geographies, here’s are the top 3 ways SAP GTS can help healthcare businesses –
- handle accurate PRODUCT CLASSIFICATION of multiple products along with IMPORT & EXPORT CONTROL across geographies
- perform AUDIT of critical documents, processes, systems and trading partners along with CUSTOMS PROCESSING to determine the amount of duty levied on their products.
- carry out PREFERENCE CALCULATIONS that enables businesses to accurately calculate savings and enjoy preferential treatment in accordance with preference trade agreements across all locations.
With SAP GTS Compliance Management Functionality healthcare businesses can enhance trading compliance along with efficiency through seamless process and information flows, which helps them reduce costs and increase the return on investment.
As a preferred SAP Partner, Krypt has partnered in the success of global businesses by helping them implement SAP GTS. Any healthcare business globally trading and a part of a large supply chain can benefit from Krypt’s products/services. A one-off case study of Krypt helping a global medical device manufacturer comply to a stringent compliance mandate can be downloaded here.
If you wish to know more about our products/services, please request a DEMO or do contact us.
Follow us on:
Shilpa Manvikar | Vijendra Kargudri
Image Credit: Unsplash