Starting in 2017 and onwards, the sector has been undergoing a market-based transformation seeking to modernise and relatively commercialise the industry, and make it more transparent. Investors, including from the real estate and private equity, have been expanding their shares in the private (independent) healthcare that has evidenced a 5-7% annual growth and exceeded 5000 private companies. The total market value tops US$ 5 billion, whilst the private sector is valued at US$ 1 billion. As the medical infrastructure, currently valued at US$ 500 million with a 10% increase per annum, requires substantial upgrading, plenty of room for financial service companies has emerged, too. A series of iconic M&As have been taking place, with the latest deal closed between an international drug manufacturer and a leading local pharma producer. The country also follows the global trend and has included to its agenda the legalisation of medical cannabis, which could unlock additional investment opportunities.

Ukraine’s redesigned laws set a foundation to boost competition in the public healthcare. This also brings budget autonomy and new financing capabilities.

Among others, budget (public) healthcare institutions may reorganise into non-commercial municipal entities with broader decision-making, including in respect of leasing and buying medical equipment, and KPI-based compensations.

The country has undertaken digitalisation of the industry creating opportunities, including for software developers and service providers delivering big data solutions. The sector further generates feasible opportunities for infrastructure and project financings seeking to replace the medical infrastructure that needs improvement.

In view of the consistently growing demand from the 40+ million population for high-quality healthcare services, a series of M&As took place in the past couple of years.

The market has also witnessed overseas investments from large European and American medical operators and development agencies. The freshest deal includes a landmark M&A transaction in late 2019 where a global manufacturer of high-quality generic drugs and consumer healthcare products aiming to expand and integrate its business in the European market acquired a Ukrainian cutting-edge pharma producer, including its manufacturing facilities.

Our team has worked with investors into the healthcare, including with the international producers of medical supplies that would also encompass medical cannabis, and has carefully monitored the ongoing legal developments and business trends.

INVESTING

IN UKRAINE