Health Industry in Colombia

Opportunities of the healthcare sector in Colombia.

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Safety120 1031008060 55 48,340 34 29,2 24 21,8 20,4 18,2 16 1220 60 Homicides per 100.000 inhabitants in 2007 Three of the main Colombian cities are safer than Washington D.C.Source: Crime Observatories

Colombia: A dynamic economy GDP Growth Rate Data: World Bank. Source: World Development Indicators. Google Public Data. Note: Last updated September 6, 2012

Trade indicators Of all the Latin American countries, Colombia´s economy was the least affected by the 2009 crisis. Exports (2012)Source: Ministerio de Hacienda y Crédito Publico Mexico Exports in 2012 Growth Colombia (US$ millones) (2011-2012) Argentina Chile 370.826.831 6,2% Peru 59.024.246 3,6% Brazil 80.927.108 -3,6% 78.276.984 -3,8% 45.228.600 -3,9% 242.579.776 -5,3% Source: Trademap

Foreign Direct Investment (FDI),Exports, and Tourism Us millon dolars Exports60.000 Exports increased 214%40.000 between 02/08; so far20.000 2011 increase in 70% 0 Us millon dolars Foreign Direct Investment (FDI)15.00010.000 FDI increased 397% between 02/08; so far for5.000 2011 increased in 64%0 The number of visitors 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 increased 120% between 02/08; so far this year have2000 Tourism increased 19%15001000 500 0 2002 2003 2004 2005 2006 2007 2008 2009 2010

Colombia is second in Latin Americaand 27th in the World Environmental Performance Index (2012) World Country Ranking Mexico 49,11 5 Costa Rica 50,29 27 Colombia Peru 30 Brasil 55,34 31 Ecuador Chile 56,48 50 Argentina 56 VenezuelaArgentina 60,9 58 Chile 62,33 81 Perú Brazil 84 Mexico 50 60 70 Colomia 0 10 20 30 40 Rating Source: Environmental Performance Index 2012, Yale University http://epi.yale.edu/dataexplorer/tableofmainresults

Media is starting to highlight Colombia'sImprovement…

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Structure of the Healthcare System inColombia Law 100 of 1993Contributory System POS Subsidized System Contributions by workers Obligatory For those who are unable and employers Health Plan to pay EPS SISBEN Health Management Identification and Companies Classification System for Potential Beneficiaries of Social Programs IPS Healthcare ProvidersLevel I, II and III Hospitals, Clinics and Laboratories

Healthcare providers (IPS)by Level of Care FIRST LEVEL OF SECOND LEVEL OF THIRD LEVEL OF CARE CARE CARE This level is associated withPromotion and prevention Medical exams, all health plan servicesactivities, basic care plan hospitalization, basic involving specialtiesactivities, general medicalexams, clinical laboratory, emergency care (cardiology, plastic surgery)radiology, hospitalization, specialties (surgery, and sub-specialties with aemergency care and labor pediatrics) and certain High Level of Complexity asand deliveries with a Low sub-specialties such as well as critical care for adults, laboratory work, dentistry Level of Complexity. and psychology with a children and newborns. Medium Level of Complexity.Fuente: Secretaria Distrital de Salud de Bogotá D.C.

Health Regulatory EntitiesThe Ministry is responsible for coordinating, The Superintendence is responsible for executing and overseeing public monitoring, controlling and overseeing all actions and activities of the General Health governmental policies related to health. Social Security System.Sector Associations

Law 1438 of 2011: Toward an equal,sustainable, quality healthcare system Provisions of the law address: Instruments for improving health quality. Instruments for ensuring better operation. An improved service delivery network. Public health, prevention, promotion and primary care. Instruments for ensuring better medication market operation. Additional financing resources. Better resource flow. Inspection, oversight and control. Human resources.

Healthcare system – World HealthOrganization.• Colombia ranks 22nd in the 1 -France 0,994world, being the best 2- Italy 0,991healthcare system in Latin 21 - Belgium 0,915America. 22 - Colombia 0,910 23 - Sweden 0,908 25 - Germany 0,902• World Health Organization 30 - Canada 0,881 ranks Colombian healthcare 33 - Chile 0,870 0,849 36 - Costa Ricasystem as one of the best 37 - United States 0,838among developing countries. 39 - Cuba 0,834 0,807 47 - Thailand 61 - Mexico 0,755• Colombia allocates 7.5% of its 75 - Argentina 0,722 GDP, and 13.9 % of its public 125 -Brazil 0,573expenditure in healthcare 0,000 0,200 0,400 0,600 0,800 1,000

Colombia has some of the greatest demands forhealth services in Latin AmericaIn the last decade, Colombia's variation in health service demand has remained positive, with one of the best growth perspectives for upcoming years. Variation (%) of Annual Health Service Demand in% Latin America (2006-2010)20 Group with the greatest15 regional growth1050-5 2006 2007 2008 2009 2010 2011* 2012*-10-15-20-25 Chile Colombia México Perú VenezuelaFuente: Organización Mundial de la Salud – EIU

Health expenditure in colombia90 Health expenditure, public sector (% of total health expenditure) (2002 – 2011)80 74,8 México70 Perú60 Ecuador 56,1 Brasil50 49,4 Chile 47,6 45,740 41 Colombia3020 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011Source: World Bank. Elaboration:Proexport

Health expenditure Health expenditure (% of total GDP) México (2002 – 2011) Perú Ecuador10 Brasil Chile 9 8,9 Colombia 8 7,5 7 7,3 6,2 6 6,1 5 4,8 4 3 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011Source: World Bank. Elaboración: Proexport

Health expenditure Since Law 100 of 1993 came into effect, health spending has increased significantly to make up for existing needs. As a result, Colombian life expectancy has grown steadily. Life Expectancy vs. Health Spending (% GDP)Expectativa de Vida (Años) 76 Health coverage at 88% 12 Gasto en la Salud (% PIB) and Life Expectancy at 10 74 8 74.6 6 Health 4 Balanced Spending 72 Leveling Spending 70 68 66 2 64 0 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 Expectativa de Vida Gasto en Salud % PIBSource: Organización Mundial de la Salud – EIU

Healthcare services in Colombia Colombia is experiencing a historic period of growth and development. Years of innovation and top quality medical care have strengthened the health sector here. Colombia is an attractive investment destination that offers a benefits package especially designed to improve business opportunities through tax and operational incentives. Colombia is a great opportunity thanks to our successes over the years, the experiences of those who already know us, and the benefits we offer for investment.

Colombia has a History of Innovation Colombia has a histoy of innovation and accomplishments that led to an international recognition of the country and its practitioners. Some of the accomplishments are: Válvula de Hakim. 1964 Dr. Salomón Hakim Marcapasos. 1963 Vacuna contra la Malaria. 1986Dr. Jorge Reynolds Pombo Dr. Manuel Patarroyo.

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Medical tourism in response to… Canada Europe • Long wait times • Aging population • Income decrease CaribbeanUnited States • Technology availability• High costs • Low capacity• Uninsured population Japan • Aging population • Hospitalization timesQuality AfricaAccesibilityTechnology • Low capacityWait times • Quality problems Fuente: ANDI Elaboración: Proexport

Top 20 destinations for medical tourism Top 20 destinations by number of patientsEstimated market value ofUS$15 billionApprox. 5 million patientsworldwideAverage spending persurgery is US$3,000Fuente: Patients without borders (Medical Tourism Facts). ANDIElaboración: Proexport

Global market (2008 – 2014) Market value (2008 - 2014) PROYECTIONS 2014 Curative medicine Wellness Esthetic medicine - 300,000 travelers Preventive medicine - US$4,000 million Preventive medicine Preventive and esthetic Income in US$ billion medicine - 1,200,000 travelers - US$2,600 million Wellness - 58,000,000 travelers - US$48,000 millionFuente: ANDI

Medical tourism expenditure by region Regional medical tourism expenditure In 2010, 3,5% of total tourism expenditure was in medical tourism. Colombia has high quality reputation in medical tourism, specially among Latin-Americans.Fuente: Euromonitor

Outbound patient flow for medical tourism isestimated have a growth rate over 10 times U.S. Outbound Patient Flow Projection (Million) (2007 – 2017)2520151050 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Base Case Lower Bound Upper Bound U.S. Medical Travel trend shows the tremendous potential for international arrivals seeking medical treatments in ColombiaSource: Deloitte LLC

Colombian Medical Tourism Exports Colombian medical tourism exports (2007 - June 2013) 134,0 140,0 115,6 120,0US$ million 100,0 77,0 75,2% 68,5 50,7% 151,2% 80,0 46,0 -39,4% 41,5 53,0 60,0 42,8 59,8% 27,8% 40,0 20,0 0,0 2007 2008 2009 2010 2011 2012 Ene - Jun 2012 Ene - Jun 2013Source: Productive Transformation Program (PTP)

Non-resident patients Non-resident patients* (2011 - Junio 2013) 29.170 30.000 24.477 25.000US$ million 20.000 63,8% 15.000 10.000 17.805 5.000 145,1% - 9.987 2011 2012 Ene-Jun 2012 Ene-Junio 2013*Information of total non-resident travelers from Migración ColombiaSource: DANE. Monthly hospitality survey- Non-resident guests that declared “health” purposes.

Percentage (%)Trend of non-resident patients Monthly share of non-resident guests that declared 4,0% “health” purposes among total travelers (2011 - Junio 2013) 3,5% 3,0% 2,5% 2,0% 1,5% 1,0% 0,5% 0,0% Source: DANE. Monthly hospitality survey- Non-resident guests that declared “health” purposes. ene-11 feb-11 mar-11 abr-11 may-11 jun-11 jul-11 ago-11 sep-11 oct-11 nov-11 dic-11 ene-12 feb-12 mar-12 abr-12 may-12 jun-12 jul-12 ago-12 sep-12 oct-12 nov-12 dic-12 ene-13 feb-13 mar-13 abr-13 may-13 jun-13

Country of Origin of international patients 2013 27,5% Curazao Aruba Country of origin of international patients for 25,0% Holanda medical travel to Colombia Venezuela 13,8% Estados Unidos700 (2011 – Jun 13) Ecuador 5,9% 13,8% Otros600 6,2% 7,8%500 Curazao400 Aruba Holanda300 Venezuela Estados Unidos200 Ecuador100- Ene - Jun 11 Jul - Dic 11 Ene - Jun 12 Jul - Dic 12 Ene - Jun 13Source: Migración Colombia, MinCIT

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Experience Fertility and Reproductive Procedures Oncology Cardiology Bariatric Surgery Ophthalmologic Surgeries Aesthetic Dental Work Plastic and Reconstructive Surgeries Comprehensive Medical Exams Stem Cells Studies and Procedures

The Productive Transformation ProgramA public-private strategy aimed to strengthen world-class sectors. The program intends todevelop and execute business plans to boost economic growth and generate skilled jobs. Thestrategy encompasses both established and emerging sectors.Stimulating the development of Promote the development of ESTABLISHED SECTORS world class performers of NEW into world class performers AND EMERGING sectors

Colombian Patient Safety PolicyRelates directly with the Progress of SUA(Mandatoryglobal trend on quality in System to Guarantee Patient healthcare Safety and Care) which relies on the results achieved with the patientPatient Safety PolicyThe professionalism in our Patient safety first. service providers

At the Forefront of International Medicine High-Tech Medicine with a Human Touch • Doctors and nurses are highly qualified, they have been trained in the best universities and medical centers in the world. • Colombia has invested in building modern hospitals and clinics equipped with the latest technology. • Colombia has one of the most modern and developed healthcare systems in South America. Easily Accessible • Colombia’s national air carrier, Avianca, connects with 22 international destinations • Delta, American, Continental and several US airlines offer more than 29 daily non- stop flights between the U.S. and Colombian main cities. • Colombia is 3 hours away from Miami, and less than 6 hours from New York and Washington by plane. Personalized Attention at an Affordable Cost • Most Colombian hospitals assist foreign patients with travel and lodging accommodations and provide guidance and translation services as needed. • In Colombia, medical procedures cost between 10% and 35% less compared to the USA costs • Our medical institutions have the infrastructure and technological resources to rank among the finest health centers in the world with JCI accreditation

Business plans include initiatives alongfour key strategies. HUMAN RESOURCE DEVELOPMENTPertinence, improved asbknuidlslcspa,rrroemadoitnieosnsoafnudnrievteernsittiyo-n in theindustry. Bilingualismindustry partnerships.LEGAL AFFAIRS & REGULATIONAdapt the regulatory framework to suit theindustry’s needs. INDUSTRY AFFAIRS ACTION PLANPut in place strategies to: attract foreigninvestment , strengthen the sector 184representation, boost management capabilities Initiatives. INFRASTRUCTURE Ensuring adequate infrastructure is in place to suit industry needs.

Competitive AnalysisMedical Tourism Index (MTI)Exporting strategy includesthe following key strategies Cost • Cost comparison • OpportunitiesCountry Medical Quality image Tourism • Hospital recognition• Travelers to Index • Accreditations Colombia (MTI)• International patients Human Infrastructure Source: McKinsey – PTP Talent Elaboration: Proexport • Hospitals • Quality and • Capacity availability • Accessibility

Medical Tourism Index Standard and score 1 Cost: 30% 10,0 1,0 1,6 2,0 6,0 5,8 7,3 5,4 3,74,0 3,8 1,5 2 Quality: 15% 3 Infrastructure: 15% 10,0 7,2 6,3 1,0 Medical Tourism 4 Human Resources 20% 9,9 9,9 Index 1,0 1 = Most atractive 3,4 10 = Lest atractive 6,9 StrengthSource: ANDI WeaknessElaboration: Proexport 5 Country Image: 20% 2,2 3,8 5,0

Recognition of Colombian hospitals inLatin America 45 Top hospitals in Latin America (Colombia) – 20132013 2012 Hospital Total No. No. of beds 19 Colombian hospitals inRank Rank City Doctors* 2013 2013 the ranking of the top 45 4 7 Fundación Valle del Lili Cali 309 473 hospitals in LatAm (3 6 more than in 2012) 8 Fundación Cardio infantil Bogotá 233 325 8 Fundación Cardiovascular de Bucaramanga 116 207 Bogotá has 8 of these 10 hospitals, Medellin has 7, 14 9 Colombia Cali and Bucaramanga 19 20 18 Hospital Pablo Tobón Uribe Medellín 248 371 have 2 each 23 25 20 Centro Médico Imbanaco Cali 334 121 Source: América Economía Intelligence. 26 27 26 Clínica las Américas Medellín 69 322 * Full-time doctors 29 ** La Fundación Santa Fe de Bogotá decidió no 30 19 Hospital San Ignacio de Bogotá Bogotá 245 314 participar en el ranking 2013. 32 *** La Clínica Universitaria Bolivariana de 34 24 San Vicente de Paul Medellín Medellín 279 656 (Medellín) entró en el puesto 42 al ranking 2013. 35 38 - Clínica Shaio Bogotá 181 274 40 30 Foscal Bucaramanga 304 294 29 Inst de Ortopedia Infantil Roosevelt Bogotá 23 118 44 Mederi Bogotá 494 782 31 Hospital General de Medellín Medellín 72 418 34 Clínica León XIII Medellín 275 641 35 Clínica del Occidente Bogotá 176 181 38 Clínica Medellín Medellín 33 187 - Clínica Reina Sofía Colsánitas Bogotá 96 133 36 Clínica Marly Bogotá 74 108

AccreditationsMéxico United Arab Emirates• Cost: 25%-35% of the US • 45 accreditations with JCI• High volume of tourists from the US• Dental and cosmetic surgery Saudi Arabia• 9 accreditations with JCI • 32 accreditations with JCI Turkey • 41 accreditations with JCI Singapore • Cost: 50%-60% of the USCosta Rica Brazil India • Focus on regional market• Cost: 30%-40% of the US • Cost: 50%-60% of the US • Cost: 15%-20% of the US • 17 accreditations with JCI• Dental and cosmetic surgery • Cosmetic surgery • Qualified doctors studied in the US• 3 accreditations with JCI • 23 accreditations with JCI • High technology Malaysia • 16 accreditations with JCI • Cost: 30%-40% of the US Colombia • Plastic surgery and • Cost: 25%-40% of the US Thailand alternative medicine • 3 accreditations with JCI • Cost: 30%-40% of the US • 6 accreditations with JCI • 9 free trade zones • Elective procedures • Attractive touristic destination • 12 accreditations with JCIQuality

Accreditations Voluntary process of internal and external Organization that certifies ainspection, that allows continuous delivery of healthy environment for their patients, visitors and staff. safe healthcare services with high quality. Moreover, it has to assure the continuous improvement of Quality customer service processes.

Free Trade Zones There are 11 Free Trade Zones for the healthcare sector in Colombia.COMPANY / HOSPITAL EMPLOYMENT LOCATION Clínica Portoazul S.A. 150 Puerto Colombia - Atlántico Clínica Hispanoamerica S.A.S. 159 San Juan de Pasto –Nariño 191 Clínica los Nogales S.A.S. 304 Bogotá – Cundinamarca Hospital San Vicente de Paul Rionegro – Antioquia Sociedad Clínica Cardiovascular Corazón 175 Neiva –Huila Joven S.A. 198 Floridablanca – Santander Fundación FOSUNAB 167 Pedecuesta – SantanderFundación Cardiovascular de Colombia S.A.S 86 Cúcuta - Norte de Santarder Medical Duarte ZF S.A.S. 50 Cúcuta - Norte de SantarderFresenius Medical Care Servicio Renal S.A.S. 202 Pereira – Risaralda Clínica Megacentro Pinares 75 Cartagena – Bolívar 1.757 Centro Hospitalario Serena del Mar S.A. TOTAL Infrastructure

Strategic Location Canada Toronto Frankfurt 6H05M 11H15M París Germany 10H40M FranceLos Angeles United States 8H20M New York Spain 5H35M Madrid México Miami 9H40M 3H00MMéxico D.F 4H45M Caracas Connectivity: 1H20M • More than 700 direct-flight Ecuador Brazil Sao Paulo frequencies. Quito 5H45M • Avianca-Taca: One of the main 1H30M airlines in Latin America. Peru • Easy access to main cities in Latin Lima America. 3H00M • More than 26 airlines travel to Santiago Chile Buenos Aires Colombia • GMT -5 hours 5H00M Chile 6H15M ArgentinaInfrastructure

Educational Opportunities in the SectorUndergraduate Undergrad in Health sciences, Medicine and Nursing school in Colombia (2001 – 2011)20.000 15.861 16.307 16.27915.000 17.18310.000 14.381 14.313 12.967 16.272 13.109 14.212 13.4225.000 3.626 3.779 4.376 4.296 4.314 4.178 4.661 4.689 4.809 5.698 5.228 2.389 2.976 3.164 2.909 3.173 3.051 2.460 2.675 1.854 1.934 2.3920 Medicina Enfermería Total graduados Ciencias SaludFuente: Observatorio Laboral para la educación. Elaboración Proexport.Human Talent

Educational Opportunities in the SectorGrad School5000 Grad school in Health sciences, Medicine and Nursing45004000 school in Colombia 3.792 4.2433500 (2001 – 2011) 1.84030002500 3.43320001500 3.1411000 2.720 2.808 2.727 500 0 2.341 2.404 2.076 2.147 1.350 1.482 1.120 1.065 1.184 1.012 1.165 1.065 1.165 999 128 198 221 396 194 176 239 2003 77 73 154 131 2006 2007 2008 2009 2010 2011 2001 2002 2004 2005 Total graduados Ciencia de la Salud Medicina EnfermeríaHuman Talent Fuente: Observatorio Laboral para la educación. Últimos datos posgrado Elaboración Proexport.

Famous International Clients “Australian singer Kylie Minogue received a teeth whitening treatment in Colombia from dentist Dr. Christian Salazar” Source: El Tiempo newspaper \"Renowned Puerto Rican sexologist Alexandra Rampolla underwent bariatric surgery in Colombia with excellent results.\" Source: www.eltiempo.comFormer Argentine soccer player Diego Armando Maradona underwent gastric bypass surgery in Colombia to reduce his weight.\" Source: BBC Mundo.Country´s Image Colombia has international insurance agreements that bring foreign patients to the country for high-quality procedures at lower costs.

Proexport facilitates your business withColombia Proexport has representatives nationwide to provide you with relevant information about the medical tourism industry . Our specialists can help you to get in contact with healthcare providers in Colombia, giving more information and access to our clinics.