Dental implants The Russian market overview Dental implants

Dental implants The Russian market overview

Dental implants market volume • According to market research conducted by Discovery Research Group, the total market volume of dental implants was 109, 4 mln USD in 2015 • 61% of the total market are implants itself, $66, 3 mln USD • The rest amount is 43, 1 mln USD - artificial teeth and other dental orthopedic products Source: Discovery Research Group http: //www. drgroup. ru/531 -analiz-rinka-stomatologicheskih-implantov-v-rossii. html; FTS Russia

Market volume dynamics Total annual import, top 10 countries, USD 250 000 Total Market 220 492 814 Others 189 347 004 200 000 Austria 160 845 183 160 846 387 Israel 150 000 Switzerland 109 428 873 100 000 Japan France Ireland United Kingdom 50 000 USA Germany 0 2011 2012 2013 2014 2015 • The amount of dental implants import has been decreasing since 2013, the market in 2015 is half as much as in 2013 • The trend is negative and it’s not expected to become an opposite in the nearest future Source: United Nations Trade Statistics https: //comtrade. un. org/data/, code HS 902139

Market volume dynamics Total annual import in USD vs physical terms 250 000 Total Market USD trade value 1 000 900 000 220 492 814 189 347 004 200 000 2 -years market dynamics for top 10, Net weight 160 845 183 160 846 387 800 000 Others 700 000 Ukraine 600 000 150 000 Switzerland 500 000 109 428 873 100 000 Total Market Net weight, kg 206 202 205 622 50 000 192 277 186 405 155 986 Costa Rica 400 000 France 300 000 200 000 Netherlands 100 000 Ireland 0 0 2011 2012 2013 2014 United Kingdom 2015 • In spite of the fact that the market decreased by 2 times in USD, the number of units or net weight of imported products has slightly increased. Significant drop of USA import was compensated by Germany, UK, Ireland, Costa Rica and Nederland growth Source: United Nations Trade Statistics https: //comtrade. un. org/data/, code HS 902139 USA Germany 2014 2015

Market volume dynamic 2016 Monthly dynamics by countries 60 000 Others China 50 000 Mexico United Kingdom 40 000 Rep. of Korea France 30 000 Israel Switzerland 20 000 Ireland 10 000 Germany USA 0 February April May June July August September • FTS provides customs data for the code 9021 - orthopedic appliances including artificial dental products. But the Russian customs data does not match the UN data dramatically – there is a difference of at least 3 times. • According to FTS, the main importers in the category are USA, Germany, Ireland, Switzerland Israel Source: FTS Russia, http: //www. customs. ru/opendata/, code 9021

Import structure by country types World Bank classification, USD 250000000 UNCTAD trade matrix, USD thousands 100% 90% 20000 80% 70% 150000000 60% 50% 10000 40% 30% 50000000 20% 10% 0 0% 2011 2012 High income Upper middle income 2013 2014 2015 Lower middle income 2011 2012 2013 Developed economies 2014 2015 Transition economies Developing economies • The vast majority of dental implants Russia imports from high income countries, main partners in 2015 – Germany, USA, UK, Ireland, France, Netherlands. Nevertheless the share of them is slightly decreasing in favor of developing economies or upper-middle income countries as well. Source: United Nations Trade Statistics https: //comtrade. un. org/data/, code HS 902139 UNCTAD http: //unctadstat. unctad. org/EN/Index. html , code 541 (Medicinal and pharmaceutical products)

Barriers and standardization • Duties, taxes, excises • This category is not a subject to import duty or excise • Import VAT rate is 18% • Documents required for import • Registration certificate of Ministry of Health • Federal Service on Surveillance in Healthcare and Social Development, contacts: • +7 (495) 698 -45 -38, +7 (499) 578 -02 -30 • http: //www. roszdravnadzor. ru/ • Declaration of conformity with technical regulations of the Customs Union • Rosstandart • http: //www. gost. ru/wps/portal/

Market structure. Target audience • Primary professional audience – dental clinics making a purchase decision (buyers) and dentists who become influencers for the customer • Customers • People who make a decision to install implants • Men and women aged 25 -60, with upper-middle income and above

Market structure. Competitors The most popular implants on the market, av prices $586 Xive $703 Straumann Germany $406 Impro $1 172 $500 Adin Israel $430 MIS $313 Alpha Bio Korea, rep Russia Sweden Switzerland $578 Implantium $703 Osstem $570 Niko $1 250 Astra Tech $813 Camlog $1 016 Nobel Biocare $1 367 Biohorizons USA $820 Biomet 3 I $742 Bicon $500 Prodigy 0 Source: stomatologija. su • This market is rather saturated, mostly imported products • The lowest price offers Alfa Bio – 313$, the most expensive is Biohorizons • The most popular implants on the Russian market are the cheapest – Alfa Bio, about 50% of sales (experts estimation) $313 Ankylos Dentack 500 1000 1500

Market structure. Sales channels • The largest network of dental clinics in Russia are Masterdent, Unident, Medi. Networks operate mainly in Moscow, St-Petersburg and big cities (1 mln+ population) • Masterdent • • http: //www. masterdent. ru, +7(495)6741001 30 clinics in Moscow and other regions as well Market share is 8 -10% according to experts Target audience is wide but basically upper-middle class • Unident • http: //www. unident. ru, +7(495) 6750000 • 15 clinics in Moscow • Targets families and individuals with upper middle and high income • Medi • http: //medi. msk. ru, +7(495) 3636360 • 22 clinics in Moscow and St-Petersburg • Targets people with upper middle and high income

Recommended specialized conferences and exhibitions • Health Care (Zdravookhranenie) 2016 - conference and exhibition • One of the most significant event for health care, medical engineering and pharmaceuticals • 5 -9 December 2016, Moscow, Expocenter • Includes large dentistry section (materials, equipment, instruments) • http: //www. zdravo-expo. ru/ • Dental Expo 2017 • Moscow International Dental forum and international exhibition • 25 -28 September 2017 • http: //www. dental-expo. com/dental-expo/eng/ • Stomatology St-Petersburg • International exhibition of equipment, instruments, materials and services for dentistry • 16 -18 May 2017 • http: //www. stomatology-expo. ru

Market entry suggestions • Appropriate positioning is the key factor for successful entry to the market – price matters but the most important factors are quality, service, loyalty & discount system and information • Agreements with local dealers of dental equipment • Directions for communication • Buyers and influencers • The best way to cover buyers and dentists are professional conferences, exhibitions and forums, commercials and PR in specialized press and internet media • Direct sales and special offers for clinics • Consumers • PR and commercials, owned digital media

Data • This research is based on free distributed data, sources: • United Nations Commercial Trade Database • https: //comtrade. un. org/data/ • Unktad Statistics • https: //comtrade. un. org/dat • FTS Russia data • Open source market researches