MINISTRY OF INVESTMENT,

TRADE AND INDUSTRY

NEW INDUSTRIAL
MASTER PLAN 2030

MEDICAL DEVICES
INDUSTRY
NIMP 2030 Sector 5
Sectoral Plan Medical Devices Industry

e ISBN No. : 978-967-0020-15-0

PUBLISHED BY:

MINISTRY OF INVESTMENT,
TRADE AND INDUSTRY

Menara MITI, No. 7, Jalan Sultan Haji Ahmad Shah,

50480 Kuala Lumpur, Malaysia.

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© MINISTRY OF INVESTMENT, TRADE AND INDUSTRY

MITI, 2023

All rights reserved

No part of this document may be reproduced, stored in a retrieval system or transmitted, in any form or by any means,
electronic, mechanical, photocopying, recording or otherwise, without prior permission from Ministry of Investment,
Trade and Industry (MITI). The information in this document has been updated as accurately as possible until the date of
publication.

MINISTRY OF INVESTMENT, TRADE AND INDUSTRY

 Sector 5 NIMP 2030
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TABLE OF CONTENTS

Preface i

Introduction 1

Overview of the Document 4

Section 1 Background 5

Areas Covered 5
Value Chain 5
Market Players 6
Policies, Laws and Regulations 7

Section 2 Performance 8

IMP3 Focus and Performance 8

Investments 9
Exports 9
Imports 10
Value-added 11
Employment 11
Labour Productivity 12
Research and Development 12

Section 3 Trends and Opportunities 13

Data Management and Security 13

Global Presence and Regulatory Advantage 14

Section 4 Challenges 15

Local Participation in Global Value Chain 15

Global Presence for Key Growth Products 15
R&D Ecosystem 16

Section 5 Strategies and Action Plans 17

NIMP 2030 Focus 17

Action Plans 17

Appendix 1: Incentives 18

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 NIMP 2030 Sector 5
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PREFACE

Malaysia’s strength in the manufacturing sector has been significantly driven by the
implementation of robust and forward-thinking Industrial Master Plans, first launched in 1986.

The success of the IMP3 (2006-2020) was anchored on innovation, research and development
(R&D) and human capital development to drive high value-added industries to transform Malaysia
into a knowledge-based economy.

The journey towards formulating the NIMP 2030 is underscored by the need to build a robust
industrial sector as an important prerequisite to achieve socioeconomic prosperity. Three previous
iterations of the Industrial Master Plans have driven industrial development in Malaysia, with the
Government adopting industrial development strategies relevant to the period to transform the
economy. Malaysia flourished from a low-productivity agrarian-based economy and is heading
towards achieving developed nation status, underpinned by robust manufacturing and services
sectors. The strategy has successfully raised the living standards of the Rakyat and propelled
remarkable growth in Gross National Income (GNI) per capita, increasing 34 times between 1967
to 2019, making Malaysia one of the fastest growing economies in modern history.

Industrial policies have since become more diverse and complex, incorporating new imperatives
including the integration into the global value chain (GVC), development of indigenous capabilities
in a knowledge economy, evolution of environmental, social and governance (ESG) criteria and
disruptions from the new industrial revolution. The question is not about the necessity of such
policies, but rather what new policies are required and how to proceed.

Given the current challenging environment, benchmarking and learning from other country’s
experiences are no longer sufficient. Malaysia needs to embark on its own path into unchartered
territory, to steer the nation into the challenging future. The combined impact of the new
imperatives and the recent pandemic has compelled the Government to rethink Malaysia’s
industrial strategy.

With the NIMP 2030, Malaysia intends to transform the industry into greater heights, capitalising
on emerging global trends, supply chain disruptions, current geopolitical landscape, digitalisation
and ESG considerations. These trends are moving at an unprecedented pace and Malaysia has to
act fast.

Therefore, the NIMP 2030 is designed to achieve the aspirations in a span of seven years and
takes on a Mission-based approach for industrial development. This approach unites Malaysia by
encouraging collaboration between the Government and the private sector to rally the industries.

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Purpose of the NIMP 2030

The NIMP 2030 sets forth Malaysia’s future direction in industrial transformation. It provides a
national integrated plan for resilient industrial development until 2030 – setting the fundamentals
for future policy development and enabling the industry at all levels. It articulates Malaysia’s
position and participation in the global economic environment.
The NIMP 2030 serves to:

• Provide national strategic direction to lead the industrial development policies;

• Be a conversation piece for investors and other economies on Malaysia’s position and direction;
and
• Feature the role of the Malaysian Government in shaping the economy.

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INTRODUCTION
New Industrial Master Plan 2030
The Missions and Enablers identified will Projects (MBPs) have been identified to catapult
be executed through 21 Strategies and 62 the mission-based implementation. The NIMP
Actions Plans to unlock the needed enabling 2030 strategic framework is illustrated below:
ecosystems. Several catalytic Mission-based

Our vision for Malaysia is to have:

VISION Competitive industry with High income and skilled Strong domestic linkages
high economic complexity workforce

Increase economic Create high-value Extend domestic

GOALS complexity job opportunities linkages

MISSION 1 MISSION 2
MISSIONS Advance economic Tech up for a digitally
complexity vibrant nation

1.1 Expand to high value-added activities of the 2.1 Accelerate technology adoption
value chain 2.1.1 Enhance Industry4WRD programmes to
1.1.1 Create global IC design champions from increase technology adoption
Malaysia 2.1.2 Accelerate digital infrastructure rollout
1.1.2 Attract global leader to establish wafer (JENDELA)
fabrication in Malaysia 2.2 Shift away from low-skilled labour model
1.1.3 Shift from basic to specialty chemical 2.2.1 Introduce multi-tiered levy mechanism for low-
1.1.4 Build Malaysian champions for game changing skilled labour to accelerate automation
advanced materials 2.2.2 Introduce automation condition in new
1.1.5 Identify high value-added opportunities in the Manufacturing Licence
aerospace, pharmaceutical and medical devices 2.3 Spur technology innovation
sectors 2.3.1 Nurture local technology solution providers to
1.2 Develop entire ecosystem to support the high support Technology Adoption Programme
value-added activities 2.3.2 Develop generative and industrial AI solution
1.2.1 Build strong local SMEs in manufacturing and leaders and system integrators
related services to support the industry 2.3.3 Drive data analytics through a national digital
champions platform for manufacturing
1.2.2 Integrate value chains between: 2.4 Accelerate government digitalisation and
• M&E and Medical Devices integration
• Semiconductor and EV 2.4.1 Digitalise end-to-end government touch points
• Chemical and Pharmaceutical across business life cycle
1.3 Establish cooperative ‘vertical integration’ for
STRATEGIES global value chain
1.3.1 Leverage alliance with ASEAN countries
AND ACTION to integrate the semiconductor, advanced
PLANS materials and clean energy value chain
1.3.2 Develop vertical integration programmes
21 Strategies through IndustryConnect conferences
62 Action Plans 1.4 Foster Research, Development,
Commercialisation and Innovation (RDCI)
ecosystem
1.4.1 Assign specific topics and KPIs to universities for
industrial-linked R&D
1.4.2 Digitalise IP application and launch enhanced
National IP Policy
1.5 Increase manufacturing exports
1.5.1 Implement national trade advocacy campaign
to increase industry utilisation of FTAs
1.5.2 Rejuvenate “Made in Malaysia” branding
1.5.3 Address trade restrictive non-tariff measures
(NTMs) and compliance of standards
1.5.4 Update FTA based on geopolitical conditions

5 Strategies, 15 Action Plans 4 Strategies, 8 Action Plans

Mission-based Projects: Mission-based Projects:

MBP 1.1 Create global IC design champions in EV, MBP 2.1 Transform 3,000 smart factories
RE and AI MBP 2.2 Establish Malaysia as Generative AI Hub
MBP 1.2 Attract new advanced wafer fabrication in
Malaysia
MBP 1.3 Deepen to specialty chemical vertical
MBP 1.4 Groom champions in 4 game changing
advanced materials

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 Sector 5 NIMP 2030
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New and existing industry Balanced and inclusive Sustainable development

clusters participation

Develop new & Improve Enhance ESG

existing clusters inclusivity practices

MISSION 3 MISSION 4
Push for Net Zero Safeguard economic ENABLERS
security and inclusivity

3.1 Accelerate transition towards 4.1 Develop resilient supply chain E.1 Mobilise financing ecosystem
sustainable practices 4.1.1 Identify specific supply chain E.1.1 Introduce NIMP Industrial Development
3.1.1 Develop sectoral decarbonisation resilience strategies for critical Fund and NIMP Strategic Co-Investment
pathways to guide transition sectors Fund
3.1.2 Decarbonise “hard-to-abate” 4.1.2 Establish supply chain E.1.2 Boost financing for digitalisation and
sectors cooperation and collaboration decarbonisation transition
3.1.3 Introduce carbon policy, through G2G and G2B E.1.3 Establish green sukuk to facilitate transition
accounting and tax programme E.1.4 Establish supply chain financing for SMEs
3.1.4 Launch iESG framework and 4.1.3 Introduce National Mineral Policy E.1.5 Increase utilisation of the capital market
transition programmes for downstream processing of E.1.6 Expand the imSME platform to show
3.2 Transition to renewable and critical minerals all available funding options including
clean energy 4.2 Foster climate resilient government funding and capital market
3.2.1 Enhance adoption scheme for development E.1.7 Review government funding for
energy efficiency or renewable 4.2.1 Develop sectoral adaptation consolidation
energy pathways E.2 Foster talent development and attraction
3.2.2 Accelerate availability and 4.2.2 Foster an adaptation industry to E.2.1 Leverage mynext and MYFutureJobs for
accessibility of renewable energy provide adaptation products and strategic workforce planning to address long-
source for the industry services (including exports) term demand-supply requirement
3.3 Catalyse new green growth 4.2.3 Instil climate resilience E.2.2 Introduce progressive wage system policy
areas measures for critical economic E.2.3 Improve policy to enable fast and hassle-free
3.3.1 Catalyse EV as a key growth infrastructure access to high-skilled foreign talents
driver 4.3 Strengthen industrial clusters E.2.4 Expand TVET programmes for high-skilled
3.3.2 Grow carbon capture, utilisation for regional development jobs in critical sectors
and storage (CCUS) as a new 4.3.1 Expand clusters for spillover E.2.5 Raise profile of high-tech manufacturing
sector regional impact career to attract interest in STEM subjects
3.3.3 Develop circular economy 4.3.2 Align industrial development E.3 Establish best-in-class investor journey for
framework for the industry plan between Federal and States ease of doing business
3.4 Shift towards green 4.4 Empower Bumiputera E.3.1 Establish a unified investment strategy
infrastructure participation and create and align investment evaluation to new
3.4.1 Accelerate transformation of inclusive workforce parameters under NIA
industrial estates into eco- 4.4.1 Uplift capabilities of Bumiputera E.3.2 Harmonise and streamline functions and
industrial parks companies in manufacturing KPIs across IPA landscape
via Tindakan Pembangunan E.3.3 Review and design competitive, agile and
Bumiputera 2030 relevant incentives
4.4.2 Develop programme to E.3.4 Improve One-Stop Portal for seamless
increase women participation investor experience
in high-skilled manufacturing E.4 Introduce whole-of-nation governance
employment framework
E.4.1 Establish public-private collaborative councils
E.4.2 Set up NIMP 2030 Delivery Management Unit
E.4.3 Develop NIMP 2030 dashboard system

4 Strategies, 10 Action Plans 4 Strategies, 10 Action Plans 4 Strategies, 19 Action Plans

Mission-based Projects:
MBP 3.1 Create decarbonisation
pathway role models
MBP 3.2 Launch locally-
manufactured EV
MBP 3.3 Deploy large-scale CCUS
solutions

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 NIMP 2030 Sector 5
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NIMP 2030 SECTORAL PLAN

There are individual enclosures of 21 sectors included as a supplementary reference to the main
NIMP 2030 document.

They provide a view of the respective sectoral perspective in the context of the main NIMP 2030
document, and were developed with reference to individual sectoral roadmaps, where applicable.

The 21 sectors are:

Category Industry

1. Aerospace
2. Chemical
Priority
3. Electrical and Electronics (E&E)
Sectors
4. Pharmaceutical
5. Medical Devices

6. Digital and Information and Communication Technology (ICT)

7. Automotive
8. Food Processing
9. Global Services and Professional Services
10. Halal
11. Machinery and Equipment (M&E)
12. Manufacturing-Related Services (MRS)
13. Metal
Sectors
14. Mineral
15. Palm Oil-based Products
16. Petroleum Products and Petrochemicals
17. Rail
18. Rubber-based Products
19. Shipbuilding and Ship Repair (SBSR)
20. Textile, Apparel and Footwear
21. Wood, Paper and Furniture

This document is the NIMP 2030 Sectoral Plan – Medical Devices Industry.

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OVERVIEW OF THE DOCUMENT

This NIMP 2030 Sectoral Plan – Medical Devices Industry (Document) provides insights into the
sector and its prospects during the NIMP 2030 period.

This Document offers a comprehensive understanding of the industry’s direction during the
NIMP 2030 period based on its historical performance, opportunities and strategies to overcome
existing challenges and achieve its targets.

The Document is presented in five sections:

1. Background

• This section sets the foundation to help readers understand the industry.
• It delves into the industry’s focus area, encompassing its sub-sectors, for a comprehension of
the industry’s breadth.1
• Readers will find details about the industry’s value chain and its key players, including the
relevant industry associations, in this section.
• The section lists the policies that are related to the industry.

2. Performance

• This section reports the industry’s performance during specific periods.

• There are two notable periods for the review of the industry’s historical performance:
– the IMP3 period (2006 to 2020); and
– from 2021 to 2022.
• The performance review of the industry’s development includes its investment trends, export
and import dynamics, employment figures, value-added and productivity measures.

3. Trends and Opportunities

• This section highlights the opportunities and potential avenues for growth that the industry
can leverage during the NIMP 2030 period.

4. Challenges

• This section provides insights into potential obstacles that could impact the industry’s growth
and development.

5. Strategies and Action Plans

• The final section of the document outlines the future trajectory for the industry.
• This section provides the Strategies and Action Plans that are intended to catalyse the industry
during the NIMP 2030 period.
• The Strategies and Action Plans set in this Document have been aligned to the Missions set in
the main NIMP 2030 document.

1
Incentives available for this industry as of time of writing can be found in Appendix 1

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SECTION 1 BACKGROUND
Areas Covered
1. The focus areas of the medical devices industry for this NIMP 2030 are as follows:

Table 5.1: Focus Areas of Medical Devices Industry

Focus Areas Examples (Non-exhaustive)

Consumables Single-use devices such as • Personal Protective Equipment
• Medical gloves (PPE)
• Catheters
Surgical • Orthopaedic implants • Dental implants
instruments, • Bone grafts
implants and clinical
devices
Health equipment • Ultrasound devices • Blood management devices
• Magnetic Resonance Imaging
(MRI)
Point of care • Pulse monitors • Pregnancy tests
• Urine dipsticks • In-Vitro Diagnostics (IVD)
Non and minimal • Blood glucose monitoring • Smart surgical devices or tools
invasive products systems • Intervention devices
Medical devices • Drug-eluting stent (DES)
from convergence
of technologies (e.g.
biological science,
nanotechnology)

Source: Ministry of Investment, Trade and Industry (MITI)

Value Chain
2. The medical devices value chain can be divided into five key areas (Figure 5.1):
i. research and product development – collaboration among universities, research
institutes and companies to integrate emerging technologies (e.g. information and
communications technology (ICT) and Internet of Things (IoT));
ii. component manufacturing – local players and MNC manufacture parts and components
to be used as medical parts for the manufacture of medical device products;
iii. manufacture and assembly of medical devices;
iv. sales and distribution in domestic and foreign markets; and
v. post-sales services including training and maintenance for products (e.g. healthcare
equipment).

Figure 5.1: Value Chain of Medical Devices

Upstream Midstream Downstream

Value
Chain Research
Component Manufacturing Sales and Post-sales
and Product
Manufacturing and Assembly Distribution Services
Development

Services Supporting Industries and Services

within Medical (e.g. Medical packaging, testing, machinery and engineering support, electronic manufacturing
Devices services, sterilisation services, education and training, accreditation bodies and regulatory body)
Industry

Source: MITI

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3. The industry is supported by services and other infrastructure, which includes but are not
limited to:
i. sterilisation;
ii. clean room services;
iii. medical packaging;
iv. testing, calibration and maintenance;
v. engineering support services;
vi. electronic manufacturing services (EMS);
vii. plastic injection moulded parts;
viii. latex and rubber parts;
ix. warehousing and logistics;
x. distribution;
xi. education and training;
xii. accreditation bodies (i.e. Department of Standards Malaysia); and
xiii. regulatory bodies (i.e. Medical Device Authority (MDA).

Market Players
4. In 2022, 536 medical device manufacturers were approved the Manufacturing Licence (ML)
by MIDA. Of these, 329 (61.4 per cent) companies were in production (CIP).

5. In 2022, there were 199 local manufacturers licensed by MDA. Any establishment2 is required
to apply for the license under Medical Device Act 2012 before it can import, export or sell any
registered medical device in the local market.

6. Currently, the industry players in Malaysia are concentrated in consumable products such
as medical gloves and catheters, followed by surgical instruments, implants and clinical
devices (Figure 5.2).

7. The industry was undergoing a transition as more players are involved in the production of
higher value-added and technologically advanced products such as cardiac pacemakers,
stents, orthopaedic implantable devices, electro-medical, therapeutic and monitoring
devices.

2
Refers to a person who is either a manufacturer, importer or distributor who is responsible for placing any medical
device in the market but does not include a retailer; and an authorised representative appointed by a manufacturer
having a principal place of business outside Malaysia

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Figure 5.2: Presence of Industry Players along the Value Chain of Medical Devices
Value Chain

Research
Component Manufacturing Sales and Post-sales
and Product
Manufacturing and Assembly Distribution Services
Development

Consumables High Presence High Presence High Presence High Presence High Presence

Surgical
Instruments, Medium Medium Medium Medium Medium
Implants and Presence Presence Presence Presence Presence
Clinical Devices
Sub-Sectors

Health
Low Presence Low Presence Low Presence Low Presence Low Presence
Equipment

Point of Care Low Presence Low Presence Low Presence Low Presence Low Presence

Non and
Minimal Invasive Low Presence Low Presence Low Presence Low Presence Low Presence
Products

Medical
Devices from
Low Presence Low Presence Low Presence Low Presence Low Presence
Convergence of
Technology

Source: MIDA

8. Apart from industry players, industry associations in Malaysia’s medical devices industry
play a vital role in promoting the interests and growth of the industry, including:
i. Malaysian Medical Devices Manufacturers Association (PERANTIM);
ii. Association of Malaysian Medical Industries (AMMI);
iii. Malaysia Medical Device Association (MMDA);
iv. Malaysia Dental Industry Association (MDIA); and
v. Malaysian Rubber Glove Manufacturers Association (MARGMA).

9. MDA is a federal statutory agency under the Ministry of Health Malaysia (MOH) which
regulates Malaysian medical devices. MDA is entrusted to enforce the Medical Device Act
2012 to address public health and safety issues related to medical devices and facilitate
medical device trade and industry.

10. Ministries and Government Agencies which play important parts in developing the industry,
including:
i. Ministry of Health (MOH);
ii. Ministry of Investment, Trade and Industry (MITI);
iii. Malaysian Investment Development Authority (MIDA); and
iv. Malaysia External Trade Development Corporation (MATRADE).

Policies, Laws and Regulations

11. Law related to the medical devices industry is Medical Device Act 2012.

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 Sector 5 NIMP 2030
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SECTION 2 PERFORMANCE
IMP3 Focus and Performance
12. During the period of the IMP3 (2006 to 2020), the medical devices industry was focused on
several areas including:
i. broadening the range of products towards the higher-end category;
ii. promoting Foreign Direct Investments (FDI) and Domestic Direct Investments (DDI) in
the industry;
iii. expanding range of supporting industries and services for the industry; and
iv. strengthening the institutional support to enhance human resource development,
research and development (R&D) and compliance to international standards and
regulations.
v. Malaysia was the largest producer and exporter of rubber gloves, contributing 67.0 per
cent of global supply, and the world’s second largest producer of condoms and rubber
thread.

13. During this period, the medical devices industry experienced significant growth driven by
the:
i. ageing population;
ii. increased health awareness and willingness to spend on healthcare from the middle-
income class;
iii. rising number of chronic diseases such as cardiovascular diseases; and
iv. emergence of a strong manufacturing ecosystem which includes EMS and engineering
supporting services.

14. Malaysia emerged as Asia’s leading manufacturer and exporter of consumables during this
period as:
i. Malaysia contributed to 80.0 per cent of catheters and 60.0 per cent of rubber gloves to
the global market; and
ii. the production of rubber gloves increased from 55 billion pairs in 2019 to 102 billion pairs
in 2020, growing at a rate of 85.0 per cent.

15. Apart from that, Malaysia became one of the region’s top offshore manufacturing hubs for
medical devices, producing a broad range of high value medical devices such as:
i. orthopaedic products including implants;
ii. pacemakers;
iii. endoscopy;
iv. advanced medical systems; and
v. stent and balloon for angioplasty.

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Investments
16. The investment performance of the medical devices industry for the period of 2006 to 2022
is recorded in Table 5.2 below.

Table 5.2: Approved Investments of Medical Devices Industry

IMP3
Items Units 2021 2022 2021-2022
2006 2020 2006-2020
Total Investment RM billion 1.1 6.1 33.4 7.7 8.2 15.9
Domestic Investment RM billion 0.4 3.9 16.2 4.7 3.2 7.9
Foreign Investment RM billion 0.7 2.2 17.2 3.0 5.0 8.0
Number of projects # 29 51 478 38 39 77
Employment persons 3,788 11,409 100,085 12,498 10,452 22,950

Source: MIDA

17. During the IMP3 period, a total of 478 projects were approved in the medical devices industry
with a total investment of RM33.4 billion. These investments committed a total of 100,085
job opportunities.

18. In 2021 and 2022, a total of 77 projects were approved with a total investment of RM15.9
billion. These investments committed a total of 22,950 job opportunities.

19. The investment trend was attributed to the:

i. presence of global multinational corporations (MNC) in Malaysia;
ii. strong supporting industry clusters including EMS, engineering supporting services,
plastics and rubber; and
iii. harmonised medical device regulation, as well as standardised technical documents
and classification system.

20. From 2006 to 2022, 465 (83.8 per cent) of the 555 approved projects were implemented.

Exports
21. The export performance of the medical devices industry during the period of 2006 to 2022
is recorded in Table 5.3 below.

Table 5.3: Exports of Medical Devices Industry

IMP3 2006-2020 2020-2021 2021-2022

Item 2021 2022
2006 2020 2006-2020 CAGR Annual Growth
Exports
7.1 30.3 227.7 41.4 31.1 10.9% 36.6% -24.8%
(RM billion)
Source: MATRADE

22. During the IMP3 period, the industry’s total exports grew by a CAGR of 10.9 per cent, from
RM7.1 billion (2006) to RM30.3 billion (2020).

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23. In 2021, exports grew significantly by 36.6 per cent to RM41.4 billion. Exports normalised to
RM31.1 billion in 2022.

24. Overall, the growth in export was driven by the increased global demand of medical devices
such as gloves, face masks and PPE – especially during the COVID-19 pandemic. As countries
started to recover with the increasing vaccination rates, the demand for these products
normalised in 2022.

25. In 2022, top export destinations were:

i. United States (US) (RM9.0 billion, 28.8 per cent);
ii. Germany (RM3.5 billion, 11.2 per cent);
iii. Belgium (RM2.7 billion, 8.7 per cent);
iv. Singapore (RM2.0 billion, 6.4 per cent); and
v. Japan (RM2.0 billion, 6.4 per cent).

26. In 2022, top exported medical devices product were:

i. gloves, mittens and mitts for medical, surgical, dental or veterinary purposes (RM6.9
billion, 22.2 per cent);
ii. needles, catheters and cannulae (RM5.2 billion, 16.9 per cent);
iii. rubber gloves (RM4.8 billion, 15.5 per cent);
iv. orthopaedic and other appliances (RM3.5 billion, 11.3 per cent); and
v. instruments and appliances used in medical or veterinary sciences (RM3.0 billion, 9.8 per
cent).

Imports
27. The import performance of the medical devices industry during the period of 2006 to 2022
is recorded in Table 5.4 below.

Table 5.4: Imports of Medical Devices Industry

IMP3 2006-2020 2020-2021 2021-2022

Item 2021 2022
2006 2020 2006-2020 CAGR Annual Growth
Imports
1.8 6.8 58.0 6.7 8.2 9.7% -1.4% 22.5%
(RM billion)
Source: MATRADE

28. During the IMP3 period, the industry’s imports grew by a CAGR of 9.7 per cent, from RM1.8
billion (2006) to RM6.8 billion (2020).

29. Imports declined by 1.4 per cent to RM6.7 billion in 2021 and increased by 22.5 per cent to
RM8.2 billion in the following year.

30. Malaysia was highly dependent on high-tech medical devices from other countries. As such,
increased healthcare demand resulted in higher imports.

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 NIMP 2030 Sector 5
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31. In 2022, top import destinations were:

i. US (RM1.4 billion, 17.4 per cent);
ii. China (RM1.2 billion, 14.1 per cent);
iii. Singapore (RM1.0 billion, 11.9 per cent);
iv. Germany (RM0.8 billion, 9.7 per cent); and
v. Japan (RM0.7 billion, 8.9 per cent).

32. In 2022, top imported medical devices products were:

i. instruments and appliances used in medical or veterinary sciences (RM1.6 billion, 19.0
per cent);
ii. needles, catheters and cannulae (RM1.2 billion, 14.7 per cent);
iii. electro-diagnostic apparatus (RM0.7 billion, 8.2 per cent);
iv. orthopaedic and other appliances (RM0.5 billion, 6.1 per cent); and
v. contact lenses (RM0.5 billion, 6.1 per cent).

Value-added
33. The value-added (Gross Domestic Product (GDP)) of the medical devices industry for the
period of 2006 to 2022 is recorded in Table 5.5 below.

Table 5.5: Value-added of Medical Devices Industry

IMP3 2006-2020 2020-2021 2021-2022

Item 2021 2022
2006 2020 CAGR Annual Growth
Value-added3
1.5 2.0 2.4 2.0 2.2% 17.6% -14.0%
(RM billion)

Source: Department of Statistics Malaysia (DOSM)

34. During the IMP3 period, the industry’s GDP grew by a CAGR of 2.2 per cent from RM1.5
billion in 2006 to RM2.0 billion in 2020.

35. In 2021, the industry’s GDP grew significantly by 17.6 per cent to reach RM2.4 billion. The
GDP normalised to RM2.0 billion in 2022.

36. Throughout the period, the GDP growth was driven by the increased demand for medical
devices – accelerated by the pandemic. As the nation recovered, the demand normalised
and returned to pre-pandemic level.

Employment
37. The employment in the medical devices industry for the period of 2019 to 2022 is recorded
in Table 5.6.

3
Value-added is measured by the GDP of the industry; 2006 GDP data is based on constant 2005 prices, while 2020 to
2022 data are based on constant 2015 prices

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Table 5.6: Employment in Medical Devices Industry

IMP3 2019-2022
Item 2021 2022
2019 2020 CAGR
Employment4
13,359 12,909 12,927 13,120 -0.6%
(persons)

Source: DOSM

38. The medical devices industry’s employment remained relatively constant across four years,
from 13,359 persons (2019) to 13,120 persons (2022).

39. The industry employment, which was affected by COVID-19 pandemic was slowly recovering
to its pre-pandemic level in 2022.

Labour Productivity
40. The labour productivity of the medical devices industry is recorded in Table 5.7 below.

Table 5.7: Labour Productivity of Medical Devices Industry

IMP3 2019-2022
Item 2021 2022
2019 2020 CAGR
Labour
Productivity5 163,234 155,528 182,710 154,775 -1.8%
(RM)

Source: DOSM

41. The industry’s labour productivity declined by a CAGR of 1.8 per cent from RM163,234 (2019)
to RM154,775 (2022).

42. The decline in labour productivity was attributed to reduced output resulting from the
short-term surge in demand caused by the pandemic in 2021.

Research and Development

43. The R&D activities undertaken by companies in Malaysia include design and development
which encompass improvement in the manufacturing process, raw materials and product
design.

44. The prominent R&D focus areas were directed towards cardiac rhythm management which
included pacemakers, defibrillators, leads and parts and components.

45. The Malaysian Research Accelerator for Technology and Innovation (MRANTI) set up the
National Technology and Innovation Sandbox (NTIS) initiative in 2020 to encourage more
local R&D activities.
i. The initiative was carried out in collaboration with the MOH.
ii. Five hospitals have been identified as health technology hubs to accelerate the
development, application and commercialisation of local technology and innovation in
the healthcare sector.
iii. The initiative is currently ongoing to spur local start-ups and innovators to develop
innovative solutions and venture into new key focus areas.

4
This employment data is based on Monthly Manufacturing Statistics December 2022. Due to the change in methodology
for employment statistics tabulation in 2019, industry’s employment breakdown from 2006 to 2018 is not available
5
Annual labour productivity is derived from value added per employment

MINISTRY OF INVESTMENT, TRADE AND INDUSTRY

 NIMP 2030 Sector 5
13 Sectoral Plan Medical Devices Industry

SECTION 3 TRENDS AND OPPORTUNITIES

46. By 2030, the global market size of medical devices industry is expected to reach nearly
RM3.4 trillion6, with an annual growth of over 5.0 per cent.7

47. This will be driven by the industry moving up the value chain to focus on production of
higher value-added medical devices, such as:
i. robotics surgical equipment;
ii. cardiovascular devices; and
iii. point-of-care products (e.g. wearable devices).

48. As part of focusing on high value-added devices, there are opportunities to improve global
presence by enhancing data sharing and the cyber security of these devices.

Data Management and Security

49. Preventative and personalised care is the new way of treatment due to the ageing society,
rising health awareness and increasing chronic diseases.

50. The demand for personalised care medical devices such as wearable and other connected
devices is expected to grow. By 2030, the global wearable technology market size is expected
to hit RM833.7 billion8, with a growth rate of 15.0 per cent.9

51. Technology advancement promotes the adoption of these medical devices.

i. Storage and sharing of patients’ personal health data are facilitated by digital health
technologies such as patient portals, online platforms and mobile applications.
ii. Healthcare providers can access patients’ information, track vital signs and monitor
patients’ condition in real time.
iii. The data collected can be used for continuous product improvement.

52. However, as these devices collect a wide range of personal data, the widespread adoption of
these devices raises the importance of data management and security.
i. All users should be fully aware about how their data is collected, used, shared and stored.
ii. A necessity for cybersecurity and risk management measure exists to safeguard users
against unauthorised access, use or disclosure.
iii. It is essential to establish mechanisms to ensure accountability on organisation or
healthcare providers that collect and utilise the data.

53. Malaysia has opportunities to explore further in areas including:

i. standardisation and interoperability of data to allow seamless data sharing and analytics
across different systems; and
ii. data security and privacy.

54. Refer to Action Plan 4 (AP4) and Action Plan 5 (AP5) in Section 5 for strategies and action
plans related to data sharing and security.

6
USD745.0 billion, converted based on exchange rate USD1 to RM4.48
7
Source: Research and Markets
8
USD186.1 billion, converted based on exchange rate USD1 to RM4.48
9
Source: Grand View Research

MINISTRY OF INVESTMENT, TRADE AND INDUSTRY

 Sector 5 NIMP 2030
Medical Devices Industry Sectoral Plan 14

Global Presence and Regulatory Advantage

55. Malaysia has a strong global presence in the global medical devices industry and this is
attributed to its harmonised standards that align to the global requirements.

56. Regulatory harmonisation has expanded market access for local medical device
manufacturers. Malaysia is recognised globally as one of the world’s leading manufacturers
for selected medical devices such as gloves and catheters.

57. MDA plays a vital role in regulating the safety and quality of medical devices and ensuring
products with global requirements.

58. A regulated environment provides strong foundation for local manufacturers to compete
with foreign industry players, especially while tapping into new emerging markets.

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 NIMP 2030 Sector 5
15 Sectoral Plan Medical Devices Industry

SECTION 4 CHALLENGES
Local Participation in Global Value Chain
59. BMedical devices are highly regulated due to their impact on human health and life. As
such, strong emphasis on regulatory compliance are critically required.

60. However, this may pose as a challenge for SME to enter to the market as they have limited
resources and expertise to meet the regulatory requirements.

61. Malaysian companies are still facing issues in exporting overseas as several countries such
as Japan and Australia do not recognise Malaysia’s regulatory approval for medical devices –
Malaysian companies are unable to export their products despite being recognised by MDA.

62. Apart from that, the emergence of e-commerce has increased the distribution of unregulated
and unauthorised medical devices in Malaysia – especially during COVID-19 when there was
an increase demand for oximeters and test kits.

63. To address this challenge, the country can empower a regulatory body like MDA to support
local companies in fulfilling both the local and global regulatory requirements. There
regulatory bodies can support local companies by:
i. streamlining regulatory processes;
ii. providing guidance on regulatory compliance and quality standards; and
iii. tackling issues on unregulated and unauthorised distribution of medical devices.

64. Refer to Action Plan 2 (AP2) in Section 5 for strategies and action plans related to empowering
the regulatory body for regulatory compliance.

Global Presence for Key Growth Products

65. Despite Malaysia being one of the largest exporters of medical devices, the production of
high-tech and advance medical devices such as health equipment, non and minimally
invasive products are still limited among companies in Malaysia.

66. However, the production of these medical devices are gaining traction reflected by the
growth in orthopaedics, in-vitro diagnostic devices and cardiac minimally invasive products
globally.

67. Several areas must be addressed to support the access of Malaysia’s medical devices to the
global markets. These include:
i. mutual recognition of requirements; and
ii. awareness and knowledge in new global regulations.

68. The following efforts are critical to address the challenges, which include.
i. Forming mutual recognition agreements with key markets.
ii. Engaging global organisations such as World Health Organization (WHO) for cross-
border partnerships with MNC and local industry players.

69. Refer to Action Plan 3 (AP3) in Section 5 for strategies and action plans related to strengthening
international relations and supporting industry participation in global events.

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 Sector 5 NIMP 2030
Medical Devices Industry Sectoral Plan 16

R&D Ecosystem
70. Currently, most of the R&D activities by MNCs are conducted in their home countries. The
imposition of the global minimum tax would make it less attractive for MNCs to invest in
other countries, including Malaysia, as investors would no longer be able to benefit from the
lower tax rates offered by these countries.

71. Apart from that, the innovation support system in Malaysia faces structural issues in form of
limited funding, insufficient skilled talents and lack of industry exposure.
i. The funding and grants are limited to support the development of new product and
innovation. The funds may be fragmented across various organisations, agencies and
programmes, causing confusion among companies on the funds that can be accessed.
These funds are also given based on mutual exclusivity to avoid duplication for the same
R&D activities.
ii. There are insufficient collaborative research activities between the public and private
sectors, limiting data and knowledge sharing for R&D purposes.
iii. Talent pool is limited as there is shortage of students pursuing science, technology,
engineering and mathematics (STEM) related fields in local universities.
iv. In terms of institutional support, pre-clinical testing laboratory is limited domestically.
Local players are required to conduct pre-clinical testing overseas to ensure safety and
standards of their medical devices.

72. A more comprehensive support system is required to address these limitations and support
local innovation, including:
i. provide more alternative financing options such as private equity and debt financing at
low interest rate for FDI and DDI that conduct innovation;
ii. build a stronger talent pool by increasing the awareness of students and attracting
skilled researchers and engineers; and
iii. enhance integration of research institutes, regulatory body and health technology
assessment (HTA) as well as other industry partners to allow data and knowledge sharing
as well as to strengthen the ecosystem.

73. Refer to Action Plan 1 (AP1) in Section 5 for strategies and action plans related to developing
a stronger structural support for industry players.

MINISTRY OF INVESTMENT, TRADE AND INDUSTRY

 NIMP 2030 Sector 5
17 Sectoral Plan Medical Devices Industry

SECTION 5 STRATEGIES AND ACTION PLANS

NIMP 2030 Focus
74. During the period of the NIMP 2030, the industry will continue to:
i. expand the local market and ensure self-sufficiency by developing higher value-added
product and services;
ii. increase exports by producing product and services with standards in line with global
requirements and regulatory compliance; and
iii. adopt the latest technology and systems for product improvement and development.

Action Plans
75. Strategies and Action Plans relating to the NIMP 2030’s Missions and Enablers are applicable
to this industry (Figure 5.3).

Figure 5.3: Strategies and Action Plans for Medical Devices Industry

Strengthen structural support to ensure Alignment to NIMP 2030

AP1 Missions
self-sufficiency in development and
promotion of local innovative products
and brands

MISSION 1:
AP2 Empower regulatory body (MDA) as a Advance economic complexity
referral centre and to tackle unregulated
1.2 Develop entire ecosystem
and unauthorised distribution of medical
to support the high value-
devices as well as ensure the development
added activities
of products and services which meet
global requirements 1.5 Increase manufacturing
exports

AP3 Strengthen international relations and

support industry participation in global
events to increase awareness of global
regulatory compliance

AP4 Strengthen the security of anonymous

MISSION 2:
data collection between users and Tech up for a digitally vibrant
providers of medical devices for continuous nation
product improvement
2.3 Spur technology
innovation
AP5 Streamline data management, 1.5
2.4 Accelerate government
governance and interoperability within digitalisation and
the healthcare ecosystem through data integration
management standards

MINISTRY OF INVESTMENT, TRADE AND INDUSTRY

 Sector 5 NIMP 2030
Medical Devices Industry Sectoral Plan 18

APPENDIX 1 INCENTIVES
There is an array of incentives offered for key players of the medical devices industry, these include
the following:

Incentives Agency
Incentives for General Investment Malaysian Investment
Development Authority
Incentives for High Technology Projects
(MIDA)
Incentives for Strategic Projects
Incentive for Research and Development (R&D):
• In-House R&D
• Contract R&D Company
• R&D Company
Commercialisation of Public Sector R&D Findings in
Resource-based and Non-Resource-Based Industries
Incentive for Automation Capital Allowance (Automation CA)
Special Tax Incentive (Relocation)
Import Duty and/or Sales Tax Exemption on Machinery/
Equipment/ Raw Materials/ Components
Reinvestment Allowance Inland Revenue Board of
Malaysia (LHDN)

MINISTRY OF INVESTMENT, TRADE AND INDUSTRY