Philippines Import Regulations for Pre-Owned (Used and Refurbished) Medical Devices - Customs Forum

**admin** · 07-23-2011, 18:11 PM

General Market Condition: No Restrictions, but Public Institutions Cannot Buy
Market Highlights and Best Prospects:
The average total market size of the radiology equipment market from 1999 to 2001 is approximately US$13 million. Industry players project that market demand will grow by fifteen percent in the next three years due to hospital expansion, development of Department of Health projects and population growth. Private hospitals in Metro Manila and its suburbs, which have the financial resources for upgrading will drive demand in this sector. Imports account for 98% of total radiology equipment; prototypes and locally assembled equipment from surplus materials account for the remaining 2%. Prototypes, however, are not sold commercially and are used only in Department of Health equipment laboratory tests and training centers.
There are locally produced equipment parts but their value is insignificant. More often, it is cheaper to import parts from China than to manufacture locally. France, Germany, the Netherlands and Hong Kong also supply radiology equipment parts and accessories (high-tension generators, control panels and desks, screens and examination tables).
The period of 1999 to 2001 also saw the completion of the much-touted Asian Hospital in Alabang, Muntinlupa. The hospital is managed by the Singapore-based Vista Healthcare Asia Pte. Ltd. GE Medical Systems, the largest US company in the medical business in the Philippines, outfitted the Asian Hospital's various specialty departments. This 250-bed hospital showcases the best technology that US companies can offer – from hospital design and administration, to healthcare service delivery and medical/laboratory equipment. GE dealers also report that they installed 12 out of the 17 X-ray machines in 2001—7 new equipment and 5 refurbished—an accomplishment despite what many businessmen considered "hard times." There is a growing market for refurbished medical equipment. Private hospitals and clinics outside metropolitan Manila tend to purchase used/refurbished equipment, whether x-ray, cardiology or surgery. To date, about 55% of all medical equipment supplied to hospitals and clinics are refurbished, according to equipment dealers.
D. Market Access:
The Philippines imposes a 3% tariff duty and a 10% value-added tax (VAT) on imported medical equipment. The Bureau of Radiation Health Services, Department of Health, requires that radiation emitting devices be registered before introduction to the local market. Local testing is required only for certain radiation equipment. There are no import quotas for products in this sector, including used and refurbished medical equipment.
Medical Device Regulatory Requirements for the Philippines, July 1, 2002
There are no special restrictions on the importation of medical equipment provided these are imported by duly authorized and licensed medical equipment importers and distributors. Importers/Distributors must secure this License to Operate (LTO) from the Department of Health.
The Bureau of Health Devices does not impose any restriction on used medical equipment except that these should be comparable in safety with new equipment. Refurbishers of used equipment must obtain a clearance from the original equipment manufacturer and must conform to good manufacturing practices. Refurbishers are also not allowed to distribute commercially, any device that has not been produced in conformity with such requirement.
Only X-ray machines and other radiation-emitting devices require registration before introduction to the local market. Local testing is required only for certain radiation equipment like the Linear Accelerator.
The validity period for initial registration of a medical device is one year. Under Bureau of Food & Drug Administration (BFAD) Circular #05, series of 1998, length of renewal registrations has been extended to five years.
The Bureau of Health Devices and Technology under the Department of Health is the primary agency that monitors medical equipment (ionizing and non-ionizing, radiation dosimetry, radiation, non-radiation, laboratory, medical physics, etc.)
The Philippines imposes a 3-percent tariff duty and a 10-percent value-added tax (VAT) on imported medical equipment, including used and refurbished. As a policy, however, the government can only procure new equipment.
The Department of Health or the health units under the local government supervision may, however, accept used equipment if these are donated, provided the equipment includes an operation manual to ensure its safe operation. The government discourages Philippine importers from buying used equipment without proper documentation and operation handbook.
There are good opportunities for used/refurbished medical equipment: it accounts for 40 percent of the Philippine market. Like new equipment, the most promising sub-sectors are X-ray equipment and medical/surgical instruments. Major end-users are the primary and secondary hospitals in Metro Manila and the provinces.
There are 3 classifications of Philippine hospitals:

Primary Hospitals—capable of handling general medicine, pediatrics, obstetrics and minor surgeries;
Secondary Hospitals—can handle all services available in a primary hospital including gynecology, general surgery, and other ancillary services;
Tertiary Hospitals—fully departmentalized hospitals that can handle more specialized services than secondary hospitals.

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