Home Insider Vision for healthcare market An Interview with UMFCCI’s Vice President Dr Maung...

Vision for healthcare market An Interview with UMFCCI’s Vice President Dr Maung Maung Lay

Name: Dr Maung Maung Lay

Main Companies:

Ni Lay Naing Co., Ltd & Medical Busi- ness International Co., Ltd

Profession: Medical Doctor

Industry Role: Vice President of UMFCCI

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MI: Please tell our readers about yourself.

I was born in 1950. I started my medical ca- reer as a general petitioner as well as work- ing as a consultant to many medical multina- tional companies. After 1993, we established our company, Ni Lay Naing Co., Ltd. In 1999, I founded the Myanmar Pharmaceu- tical and Medical Equipment Entrepreneurs Association. I was the Association chairman for about 8 years; now I hold the advisor po- sition. Since 1999, I’m the Central Executive Committee Member of the Union of Myan- mar Federation of Chamber of Commerce and Industry (“UMFCCI”), the National APEC Organization and gradually became the Joint Secretary General then the Secre- tary General. Now I’m the Vice President of UMFCCI.

For the private business, I’m the Managing Director of Ni Lay Naing Co., Ltd as the fam- ily business and also the Executive Director of the Medical Business International. We are mainly involved with healthcare business and now diversifying in many areas related to healthcare.

MI: What roles do you play in your position as Vice President of UMFCCI?

As the Vice President of UMFCCI, I’m in charge of the International Division espe- cially in the area related to US Tax. My main role and responsibility is to look after the in- ternational affairs and to promote Myanmar Businesses worldwide to private and govern- ment agencies, who are actively playing the vital role in development of Myanmar.

MI: UMFCCI play a very crucial role in the process of promoting Myanmar to foreign business entrepreneurs. How does UMFCCI set its strategies on the future development of the country and help to improve the country man livelihood?

As the National APEC Organization representing the private sector, we understand that the private sector does play the vital role in developing the business environment in country. This sector is the main engine of growth for country and thus we are heavi- ly involved in promoting private sector, we build very good rapport with international organizations and businesses, while pro- moting our businesses at the same time also learning from them how to have an ethical and responsible business investment in Myanmar. First we focus on trading activi- ties, then investment, and finally the being a responsible investor who will not hamper the environment nor be an exploiters of the country natural resources. As Myanmar be- ing the late boomer, we wish to learn from other international players and avoid mis- haps that they had encountered before.

MI: You are also the Managing Director of Ni Lay Naing Co., Ltd; and Ex- ecutive Director of Medical Business International Co., Ltd. Could you tell us more about these companies activi- ties?

In fact, I was the first medical doctor to be in the business. I started as the consultant to many multi-national companies. In those days, under the socialist era trading with overseas is prohibited. And as years goes by, when private companies are allowed to trade with foreign countries, I founded Ni Lay Na- ing Company and start to import medicines, medical equipment and instruments for lo- cal distribution.

As for the Medical Business International, we provide healthcare services. We repre- sent many companies and try to disseminate knowledge of responsible healthcare to all

our customers. We wish to be a responsible and ethical medicines importer in order to save the lives of the public. We hope that we will play a role in development of the health- care standards in Myanmar. We use to say that “Buy one, get one free” which we means is if you buy one, you will get our Say Ta Nar (goodwill) free. We are trying our best for the society as well. As part of the corporate so- cial responsibility (“CSR”), I’m been treating patients for the past 25 years free of charge.

MI: Currently where are your main sources of medical supplies?

Our sources of medical supplies are from dif- ferent countries. Back in the days, because of the sanctions, we had to be complacent with the products from Asia such as India, Bangladesh and Pakistan. Now most of the European sanctions have been lifted and US sanction suspended, so we are looking for the products from the west. We also started registration of some of the products from US, Europe and Australia. Apart from the neighboring countries, we know that para- digm will change and people tend to carter to many western products which they seem as more superior in terms of technology.

MI: What are the challenges facing medical/pharmaceutical industry in Myanmar?

In the past 10 years, most of the private com- panies were forbidden to produce pharma- ceuticals locally. This was imposed by the previous government with the pretext of protectionist policy. However most of the products that are being produced by local entrepreneurs now were without any quali- ty assurance. We have also lost our chances due to the TRIP (Trade Related Intellectual Property Rights) agreement which is given to third world under-developed countries in order to produce the medicine they required.

Briefly, we are allowed to produce local- ly and the new molecules can be copied till 2016. But as a matter of fact, due to the gov- ernment’s policies in the past, the local phar- maceutical industry didn’t grow. The local industry cannot catch up with the regional industries. They are only focusing on Myan- mar but not the South East Asia or ASEAN market. That is the reason why they cannot compete in terms of economies of scale. Our pharmaceutical industry can be considered as the weakest in South East Asia. Now the present government administration allows private sector to manufacture medicines; but it will take some time to grow and infiltrate the regional market. The medicines have to be imported so it may not be cheap. We face foreign exchange risk as well. That is also one of the challenges to the medical/phar- maceutical industry.

Official records show that we import about US$ 300 million of medicine yearly. In- formal information indicates that the total import is around US$ 600 million. Many are coming informally and there can be sub- standard medicines coming in which means their quality is questionable. They are com- ing through our borders. This is the main challenge and who suffer? The patients, cus- tomers, our people suffer.

MI: Do you see any of your main business interests having to change or adapt to Myanmar’s new trends and its opening up to international play- ers?

Currently, I’m in the trading business and this is my main business. In Myanmar, trad- ing is “Kon Yaung, Kon Wae”, you buy from one source and you sell at a certain profit. Provided the price is competitive, you may be able to sell competitively. According to the Adam Smith of Free Market Economy, he said that it should be the free market economy for the development of the coun- try. But as a matter of fact, Myanmar has just opened up. Our system is still in the infancy just three-four years old. We cannot compete with multinationals. For the time being, the locals should be given four-five years’ pe- riod. According to the foreign investment law, government forbids the foreign entre- preneurs to be involved directly in trading. These are the major challenges of the local businesses. For example, Company A from US wants to give the agent authorization to the western ones rather than the locals.

MI: With the benefit of hindsight, would you have done anything differ- ently when you started your first busi- ness?

No, I won’t because I was trained as a med- ical doctor. I’m much interested in health- care and medicine. But I have to accumulate much knowledge up until now regarding the current events in healthcare treatments as well as the new molecules that has been discovered. In order to do so, I’m able to use that knowledge and expertise and trying to treat, even cure, the illness that has been harming our people. So I don’t have any re- gret to what I pursued. I will move forward, expand my knowledge and try to help the public as long as I live.

MI: How do you feel that foreign companies now entering into business here will affect the local workforce, and do you feel that they will bring new opportunities to existing local businesses?

Not only to the healthcare but as a whole, foreign companies are coming in. Some local companies will be concerned that they might be overwhelmed, and our Small and Medium Enterprises may suffer. These are the fears that we are encountering but it is part of the protectionist policy that they are afraid. But in reality if you open up and if there is more companies coming in, I think it is good that the knowledge, technology and investment can be brought by them and this could re- sult in more competitions. This will help us to grow, otherwise we will be complacent. If foreigners come, we have to compete with them in order to regain our former glory or else we will suffer.

I wish our country’s openness will continue but every country in the world had the pro- tectionist policy once. Even in the US, the steel industry and agriculture were protected back in the days. It should be looked out by the government. Always look out and relax- ation should be there or the local industry will be redundant and products will become obsolete.

The youth will have more coverage but there are always good and bad sides. They will be importing of culture and this is part of glo- balization. As the human beings, there will be more greed, hatred and delusion. They might become more materialistic and this could result in destruction of culture. If we can avoid that, we will learn the technolo- gy, standards and system from them. As a quote from Harvard, every educated person should know little of everything and must know something. We should use internet for the learning but not just waste on the so- cial networks, which we should use but not extremely. Youth should be dynamic and productive. Just don’t waste your time. You should surround yourself with winners. You can’t be wavering and must find a direction and objective. Don’t over impressed by the others. We are all human-beings and there’s always corruption as long as we are human.

MI: Currently what is your compa- ny workforce? How do you manage to keep the whole workforce happy and motivated at the same time?

We have about over hundred workforce. We treat them like family and we comply with the local and even international laws. We share our mission and vision. For the long run, we are aiming for the benefit of our employee for the long run just like US 401K or CPF in Singapore. We look for the future and take care of health, wellbeing and we also take care of the decent working environment. We give them competitive salary and incentives. It has to be conjunction with the performance and we train them for the skill development. We took them overseas for the training and further knowledge. We treated them not as employee but as associates. We never call them employees and we wish them to be happy.

MI: According to WHO, Myanmar health system still has a long way to reach the world standards. How do you see your company can play a role to improve the situation and help to improve the life of Myanmar citizen?Is CSR presently a key focus area?

CSR is presently the key focus area in Myan- mar. When we sign any sort of MoU (Mem- orandum Of Understanding), I always say that I don’t believe in Memorandum Of Un- derstanding and I only believe in Memoran- dum Of Undertaking. We should undertake not just understand. As I don’t believe in engagement but believe in getting married and having children. We signed again and again but nothing happened. Our healthcare system has long way to go. We need the will of the people, the will of the government and also the political willingness. The caring of the people by the government is vital and the policy to increase the healthcare budget. Many international institutions are watching us including IMF, World Bank, ADB, etc. We call them the well-wishers and development partners. They are watching us and even put their officers in many respective government agencies to see that we are on the right track. Even we still have a long way to go, we have the will and there must be a way with the participation of what we used to called PPP (Public Private Partnership). We will even- tually succeed if we do with partnership but will take time because the fundamentals are weak. We have to nurture the doctors about the system. It will take some time to learn be- cause you cannot let the freshman doctors to operate as soon as he or she finished school. I used to say not only for the medical industry but also for other PPP that the partnerships shouldn’t go the wrong way. Our present aim is to reach the regional standard. Even Thai- land and Singapore have become the region- al health hubs. Just imagine that thousands of Myanmar people are going for healthcare treatments in Thailand. Another 30-50,000 people per year are also going to Singapore for treatment. So according to the govern- ment statistics, nearly 200 million US$ have been used offshore. “That amount of money should be spent here.” We have good doctors and if we can provide them with necessary practical trainings, they will surely become great doctors. We have estimated 300 to 400 doctors who passed MRCP Part 1 and near- ly 200 doctors who passed MRCP Part 2. If we provide them with practical and clinical trainings, they will develop our healthcare industry. We should take that chance for the country’s development.

MI: Have you partnered with any foreign companies to expand and in- crease product range?

I’m not partnered with any foreign com- panies. We were not involved in the pro- ductions because government did the local production in the past. We never started production here in Myanmar. I don’t have the market. Our 60 million populations are not that economical because if 60 out of one million use our product, the capital is 10,000 for example. If we have the market of 3 mil- lion not just in Myanmar but of the whole regional market, the capital will be reduced. That’s the economy of scale. We cannot com- pete that much. Still I dare not to handle the manufacturing and production.

MI: Where would you like to your companies in 5 years’ time?

Being a trading company and a local distri- bution company, I wish my companies to reach furthest steps and further height in terms of physical distribution to the whole region. We have registered the company in Cambodia. So our aim is to increase our products further in the ASEAN region. We wish to be a world standard company. Even if we cannot do manufacturing, we can dis- tribute from multinational company and cover the whole area. If a foreign company exports 100,000 products to Myanmar with a price, we should try to import these prod- ucts into ASEAN region with the amount of around 500,000. This will reduce the buying price and will bring benefit to the country.

MI: What is the supply and demand situation like for the healthcare/medi- cal industry at present?

The demands are still great. The people yawn for good quality products from responsible ethical suppliers. Now many of the sanc- tions have been lifted and some have been suspended. Our country is able to experience and consume good quality products in term of healthcare and for the investigation of dis- eases with good quality devices, instruments and equipment which are now gradually be- coming available.

MI: Based on your experience, what  are the critical success factors in the healthcare industry?

Critical success factor in the healthcare in- dustry is that the public is able to receive the essential healthcare provided by the gov- ernment. They are now able to benefit from better healthcare system from the public sector and government. For the industry, we are improving many industrial standards. We have now started to see good quality products and instruments from reliable and trustworthy suppliers.

MI: In your opinion what is the best policy the country should adopt to ac- commodate the present demand on medical needs; especially in the rural areas where access to medical is very scarce and limited?

The best thing is that the prevention is bet- ter than cure. The prevention measures have to be taken. The health education standards should be promoted in the rural areas to upgrade the health standards. This is most essential otherwise the infections and the diseases will start spreading from that area and the mortality and mortality of the popu- lation will decline. The mishaps of the health education, primary health system and basic health hygiene should be taught extensively to prevent and avoid further damages to the public health. Mainly, we need basic health- care provision and public health education.

MI: From a business standpoint, what do you feel are the biggest chal- lenges facing you in the next 1-3 years?

In the next 1-3 years, it will be the ASEAN Economic Community which is the integra- tion of the ASEAN Free Trade. This is one of the biggest challenges because we may be facing the international competition and the paradigm changes of the certain areas. We have to stay abreast with the changes. People need to be more educated to be in the com- petition and they will yawn for better quality products. We have to be proactive and pre- pared in order to satisfy the customers in term of healthcare and other areas.

MI: If you were, hypothetically, en- tering into business for the first time in Myanmar, what business sectors would you consider as having the most growth potential?

I’m been confronted with this kind of ques- tion. The foreign companies will come in to Myanmar and when they come, the first thing I would like to suggest is that they should do step by step especially in the trad- ing business. There are manufacturing, trad- ing and services industries. It will depend on how you were trained and how you are prepared for it. The best starting point will be the trading and services. The next step should be manufacturing. There are so many challenges regarding with manufacturing be- cause the fundamentals and infrastructures are needed. My recommendation is to start with trading and services.

MI: How do you see Myanmar com- paring with its Asian neighbors in the short and long term future?

In short term, we know that from Thai- land to Myanmar or Bangkok to Yangon is one hour flight. Our time difference is only half an hour. We have to reset the watch 30 minutes back for getting actual time. But in reality, we must reset 30 years to catch up the development of the Thailand. That’s the difference. So our challenges are enormous and at the moment, we can’t compare with our neighbors because we are far behind in human development and even behind the Cambodia and Laos. We have to leap for- ward to catch up with them and take the late comer advantages. We also have to learn from others’ advantages and disadvantages to catch up with them. We couldn’t compare with our neighbors because we have our own strength and they have been opened up earli- er and ahead of us. Of course, the comparing and competing could help us grow. Our ad- vantage is our human capital although they are not skilled labour, at least we can learn. The talent is there. Our EQ (Emotional Quo- tient) is near with theirs, we can regain our past glory because we possess the biggest landmark in mainland South East Asia. Our land size is that of the UK and France com- bined. We have so many abandoned natural resources both up ground and below ground also at the long costal line. But we have to be aware of resource curse. We have the tenth largest gas reserve in the world. Our country has the potential for quick growth. We are in geopolitical area between China and India. We can partner with these huge neighbors.

MI: If you could make one major pol- icy change in the country for any of your business ventures, what would it be?

It should be sort of free market. We need to abolish all the red tapes and place the red carpet for businesses.

MI: What would be your advice(s) for aspiring young entrepreneurs in Myanmar?

As I said, all the young entrepreneurs should look, listen and learn. They should upgrade the knowledge and stay abreast with the in- ternational developments. You should sur- round yourself with winners so that they can improve you even if you fail. They all should have goals, objectives and aspirations. They should also be consistent with the direction they choose. They should be ambitious and stay abreast with the current international events and also should upgrade the knowl- edge in every sphere. Learn from others, learn from elders. Being as entrepreneurs, they should also take calculated risk.

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