There is cause for optimism in Saudi Arabia’s health and life sciences sectors, with the rollout of key government programmes transforming the way the Kingdom approaches medical care and scientific research. This presents notable opportunities for private sector investment – both domestic and international.
Under the ambitious Health Sector Transformation Programme (HSTP), more hospitals and clinics are set to be built and existing facilities will be improved. An enhanced role for private health care is envisaged, with enhanced digitalisation expected to facilitate a rise in telemedicine services. Disease prevention and health awareness programmes are also a major part of the initiative. At the same time, the ongoing National Biotechnology Strategy (NBS) seeks to establish Saudi Arabia as a global centre for biomaufacturing and medical technology.
These new strategies dovetail with the Kingdom’s long-term economic development programme, Vision 2030, which sees the delivery of world-class health and science infrastructure across Saudi Arabia as a key pillar. An estimated $66bn will be invested in health care infrastructure during 2021-30, with the government aiming for between 40% and 65% of this to come from the private sector. “Vision 2030 is driving innovation in the pharmaceuticals sector, while also creating a favourable environment for investment and industry development,” Hisham Aljadhey, CEO of the Saudi Food and Drug Authority (SFDA), told OBG. “Managing the balance between rapid growth and regulatory compliance is essential to protect public health and ensure long-term sustainability.”
Structure & Oversight
The Ministry of Health (MoH) is currently responsible for regulating Saudi Arabia’s health care system and for delivering health care services. This comprises primary, secondary and tertiary provision, with the first operating through a network of primary health care centres (PHCs), the second via general hospitals and clinics, and the third through specialised hospitals providing services such as transplants and cancer treatments.
Data from the MoH for 2023 indicates 287 MoH hospitals in operation nationwide, along with 56 other government hospitals. The latter group includes facilities dedicated to the military and other security services. There were also 167 private hospitals, bringing the total number of hospitals across the Kingdom to 510. In addition, there were 2126 MoH PHCs, 12 MoH cardiology centres, 18 MoH oncology centres and 44 MoH dental centres in operation that year.
The MoH ensures the quality of care at all of these levels via initiatives such as the National Accreditation Programme for Facilities and the National Accreditation Programme for Health care Organisations. The Central Board for Accreditation of Healthcare Institutions also has a key role in ensuring quality provision. Moreover, the MoH has programmes for disease control under its umbrella, including the National Immunisation Programme and the Saudi Antimicrobial Resistance Surveillance System.
Roles & Supplies
Other organisations holding essential roles in the Kingdom’s health care include the Saudi Red Crescent, which provides ambulance services; the Saudi Health Council (SHC), which is responsible for regulations to improve coordination between health-related agencies; the Saudi Commission for Health Specialties (SCFHS), which ensures specialist practitioners are well qualified and certified; and the SFDA, which examines and certifies health care products, among other responsibilities.
In addition, the National Unified Company for Medical Supplies (NUPCO) is the Kingdom’s leading supplier of pharmaceuticals and medical equipment. The company, established in 2009, is owned by the Public Investment Fund, Saudi Arabia’s sovereign wealth fund. NUPCO purchases for and supplies to the MOH, National Guard, Ministry of the Interior, and university and specialised hospitals. Dispensing pharmacies are reimbursed by NUPCO when filling prescriptions authorised by public health care providers. NUPCO sources its pharmaceuticals, equipment and other medical supplies from a variety of companies – both local and international. To participate in its tenders, entities must register with the NUPCO system and supply products approved by the SFDA.
Universal Coverage
In October 2023 the minister of health, Fahad bin Abdurrahman Al Jalajel, unveiled a new national insurance programme, due to be implemented by 2026. This will provide all Saudi nationals with comprehensive, lifetime, fully government-funded health insurance coverage. The programme has no coverage ceilings and eliminates the need for any prior approvals. This will be operated by the National Health Insurance Centre, with nonSaudi workers in government jobs included if not already covered by another scheme. The Council of Cooperative Health Insurance (CCHI) controls the compulsory insurance initiative, in addition to its role accrediting and regulating insurers. The Saudi Central Bank oversees and regulates health insurance providers as part of its supervision of the financial sector.
This new scheme supersedes the universal health coverage Saudi citizens have benefitted from since 2019. Non-Saudis, meanwhile, have traditionally been catered to by the private sector. This has been conducted through insurance schemes provided by the individuals themselves or by their employers. MoH figures suggest that 67% of all private health care policies were provided by the latter in 2020. Since the implementation of the 1999 Cooperative Health Insurance Act, all non-Saudis working in the private sector have also been required to have health insurance, with the CCHI responsible for accrediting and empanelling health care providers. The requirement for health insurance has also now been extended to include Saudi citizens working in the private sector. Non-Saudis can obtain treatment in Saudi public hospitals and facilities – as fee-payers.
According to the 2022 census the Kingdom had a population of 32.2m, of which 13.4m – or 42% – are foreign residents. This has positioned the private sector as a key part of health care provision for some time. Top-ranking private hospitals include the International Medical Centre hospital and the Dr Soliman Fakeeh Hospital, both in Jeddah; the Saudi German hospitals in Jeddah and Dammam; the Dr Sulaiman Al Habib Medical Group hospitals in Riyadh and Khobar; and the Arrayan Hospital in Riyadh. All of these featured in the 2022 Newsweek magazine list of the world’s best hospitals. A number of public hospitals were also represented in the list, including the King Faisal Hospital and Research Centres in Riyadh and Jeddah, the King Abdulaziz Medical Cities in Riyadh, Jeddah and Makkah, and the King Abdullah Medical City in Makkah. A third category, military hospitals, saw the Prince Sultan Military Medical City in Riyadh feature in the list. Private medical companies in the Kingdom include Al Hammadi, Dallah Healthcare, the National Medical Care Company, Mouwasat Medical Services, and the Scientific and Medical Equipment House – which are listed on the Saudi stock exchange, the Tadawul. Also traded on the Tadawul are local pharmaceutical, biotech and life science companies. This list includes Saudi Pharmaceutical Industries and Medical Appliances, Middle East Pharmaceutical Industries Company (Avalon Pharma) and Jamjoom Pharmaceuticals Factory Company.
Health Profile
Figures from the World Health Organisation (WHO) show a steady improvement in life expectancy in the Kingdom over the 20 years to 2021. For women, the average was 71.9 years in 2000, rising to 77.4 in 2021, while for men, the average rose from 69.4 to 75.7 over the same period. In 2019 the biggest cause of death was Ischaemic heart disease, responsible for 114 deaths per 100,000 people. Strokes were second, with 49 per 100,000, followed by traffic accidents, with 36 per 100,000.
In broad terms, the mortality figures indicate that non-communicable diseases are the main cause of death in the Kingdom, responsible for around twothirds of the total. Diabetes is a particular concern: around 18% of the population suffers from the disease, while over 40% qualifies as clinically obese. In consequence, in 2021, 25% to 35% of the country’s total health budget was allocated to cardiovascular, diabetes and obesity programmes. Preventive care and screening are thus major areas of medical resource deployment, further emphasising the key role of PHCs – and data collection and processing – in the Kingdom’s overall health care.
WHO figures indicate that the density of doctors per 100,000 people rose from 6.9 in 2000 to 31 in 2022. The density of nurses grew from 16.9 to 55.1. For pharmacists, the WHO’s figures run from 2008-22, when the density rose from 5.8 to 9.3. For dentists the figure was 0.7 in 2000, rising to 6.6 in 2022.
Plans & Visions
Saudi Arabia is currently undergoing a major transformation under the Vision 2030 development programme. The roadmap, which was launched in 2016, seeks to diversify the economy by incentivising private sector-led development in a wide range of economic sectors. “Saudi Arabia’s economic diversification strategy is catalysing growth in the health care sector, with the government increasingly positioning itself as a regulator rather than a provider,” Dr Fouziyah Al Jarallah, CEO, Hayat National Hospital Group, told OBG. “This shift unlocks new avenues for private investment, particularly in the development of advanced medical infrastructure and services that align with Vision 2030’s goals.”
Under the Vision’s National Transformation Programme, a series of Vision Realisation Programmes (VRPs) has been launched, covering topics ranging from privatisation to quality of life. One of these VRPs is the HSTP. This programme, which is being rolled out with the participation of 18 different entities, has four objectives: to facilitate access to health care facilities, improve the quality and efficiency of those services, promote the prevention of health risks and enhance traffic safety. In 2018, under the scheme, the Ministerial Committee of Traffic Safety, the Saudi Patient Safety Centre and the Health in All Policies initiatives were launched. In 2019 the Private Health Institutions Law came into effect, allowing foreign entities to own, operate and manage hospitals and health centres via public-private partnership (PPP) and build-operate-transfer models. In 2020 the Shefaa platform was launched. This project of the Health Endowment Fund, an independent outfit under the MoH, gives charitable aid via a crowdfunding platform to patients without health insurance – or in other cases of dire need. In 2023 Shefaa treated 7233 cases and donated SR196m ($52.3m).
In 2021 the Public Health Authority (PHA) was established, while the King Faisal Specialist and Research Centre was transformed into an independent institution. The Private Sector Participation Law was passed in July of that year, providing a key legal underwriting of PPP contracts and the privatisation of government services, including health. Nine priority areas for PPPs have since been identified: primary care, hospitals, medical cities, laboratories, radiology, pharmacies, rehabilitation, long-term care and home care. The MOH expects to see 100 PPP health projects launched during 2022-27, worth an estimated $12.7bn. By the first quarter of 2024, 19 such initiatives were under way.
In 2022 the SEHA Virtual Hospital (SVH) was established under the HSTP. This provides the e-Sehha platform for health information technology, simplifying health data collection and storage, referral and retrieval across the sector. The year 2022 also saw a reorganisation of the MoH. Under this, the MoH retained its role as the health sector organiser and regulator but redirected its service provision role to the Health Holding Company (HHC) and its financing role to the Centre for National Health Insurance. In 2023 the HHC launched the health clusters initiative, as well as the Saudi National Institute of Health (SNIH). The institute is tasked with overseeing and supporting transitional research and clinical trials.
Hitting The Target
In tandem with other elements of Vision 2030, the HSTP sets targets for the programme to achieve, relative to a 2016 baseline. According to the 2023 HSTP annual report, these goals are all roughly on target or exceeding their targets thus far. The programme appears on track to meet a specific goal of Vision 2030 itself: raising the average life expectancy of Saudi citizens from 74 years to 80 years. In 2023 the average was 77.6 years.
Improving Access
Facilitating access to medical care involves increasing both the number of health professionals and their availability. Regarding the former, the ratio of qualified nurses per 100,000 of the population was 581.6 in 2016. The 2023 target was 738; the number achieved was 733. In terms of the percentage of the population covered by basic health care services, the 2016 baseline was 84.1%, with a 2023 target of 88%. That year, however, the percentage reached 96.4% – far exceeding the goal.
User satisfaction with their experience of hospitalisation also overshot its target. Starting at 82.4% in 2016, the 2023 target was 84.9%; the actual score that year was 87.5%. In addition, ambulance services have seen a major increase in provision since 2016. In 2023 the number of ambulance centres was 391, rising to 514 by the end of 2023. The Red Crescent had 24 emergency centres across the Kingdom in 2023, with coverage extended across the security sector in cooperation with the Ministry of Interior and Ministry of Defence. Health services for Hajj pilgrims have also been widened and deepened under the HSTP.
The MoH, SVH, Red Crescent, PHA and a further service, Health Volunteering (HV), were all mobilised to meet the possible health-related challenges presented by 1.8m Hajj pilgrims visiting the Kingdom in 2023. The HV service, run under the MoH, provides volunteer opportunities across the Kingdom, with Hajj a particular focus. In 2023 health care was provided to some 400,000 pilgrims. In addition, the number of health volunteers nationwide increased by 10% that year, rising to 86,943. The year 2023 also saw the opening of the Specialised Hospital for Women’s Health. Affiliated with King Abdulaziz Medical City, the new hospital provides 416 beds, making it the largest specialised women’s hospital in the Middle East.
Telehealth
Increasing the use of technology to manage appointments, perform teleconsultations and deliver other remote services is a widely-used means of boosting accessibility, with the HSTP making good progress on this front. Indeed, the Kingdom’s tele-adoption rate in early 2024 was around 70%, with 34% of young physicians using artificial intelligence (AI) to aid in diagnosis. Saudi Arabia also has a National Strategy for Data and AI, which highlights health care as a priority area for the development and implementation of digital and AI solutions. At the same time, since April 2023, the Kingdom has operated a revised Personal Data Protection Law to guard confidential patient information.
The Sehhaty app, provided by the MoH, allows users to schedule appointments for themselves and their dependents, monitor their health status, keep records of vaccinations and other treatments, and conduct remote doctor’s appointments, among other services. In 2023 some 30m beneficiaries used the app – 15% more than in 2022. Some 1.6m remote consultations were carried out via Sehhaty in 2023, while 9.2m appointments were booked. In total, approximately 36% of all consultations and appointments available in the Kingdom are now offered virtually. Moreover, under its Healthy Lifestyle function, the app offers services such as the early warning of dusty climatic conditions to asthma sufferers.
The SVH, meanwhile, benefitted around 123,000 people during its first year of operation in 2022. The first of its kind in the Middle East and the largest in the world, it supports 130 hospitals across the Kingdom with over 30 specialised services. The SVH pools expertise in areas such as heart disease, diabetes and psychology, providing expert panels to review cases online. Specialised medical teams can also monitor patients at home using virtual tools, referring the data to local health practitioners or other specialised teams. AI and augmented reality, along with internet of things technologies, are all mobilised in the SVH’s work. In addition, the Wasfaty online pharmacy service connects community pharmacies, PHCs and hospitals with NUPCO to enable access to drugs, medical equipment and supplies. In 2023 Wasfaty handled 99.3m online prescriptions in 172 cities and provinces across the Kingdom.
Improving Quality & Efficiency
The HSTP’s second key objective involves organisational change and granular change for monitoring and improving day-to-day practices across the Kingdom’s health services. Regarding organisational reforms, the establishment of a series of 20 health clusters by the HHC has been a notable move. The clusters are divided into five regional sectors, with five clusters in the western sector, four in each of the northern, southern and central sectors, and three in the eastern sector. Each cluster serves around 1m people and includes health services by providers spanning PHCs to specialist hospitals – under a single administration. Community health promotion, disease detection and prevention, and chronic and critical health care are all provided under this single authority, aiding in the integration of health care programmes and care packages.
Public and private health care data is now being integrated under the National Platform for Health and Insurance Exchange Services (NPHIES). This electronic service brings together the MoH, SHC and CCHI to exchange information and provide a comprehensive database for patient care. The platform is led by Sehati, which seeks to leverage technology to advance health care provision in the Kingdom. Sehati also developed the UniPlat national e-health programme, designed to facilitate the transmission of patient health information. Under this system, a medical practitioner will have access to all the health records of a patient, both from public and private hospital databases. Meanwhile, the NPHIES programme will incorporate digital standard insurance services. In addition, the National Health Command Centre has been established to provide a central, digitalised overview of the Kingdom’s health services in real time. This is the first of its kind in the world to operate on a national scale, underscoring the Kingdom’s progress and innovation within the medical segment. “The health care and pharmaceuticals sector in Saudi Arabia is rapidly evolving, driven by strategic initiatives that align with Vision 2030,” Ayman Tamer, chairman of Tamer Group, told OBG. “These advancements are boosting economic diversification, ensuring long-term resilience and positioning the Kingdom as a centre for high-tech medical solutions in the Middle East.”
The promotion of nursing as a career amongst the Saudi population has been another HSTP strategy to improve quality and efficiency. This has involved the Ministry of Education, along with the SCFHS, raising the number of qualified local nurses from a 2016 baseline of 40,000 to 90,000 in 2023. Health staff, in general, have received a boost, with Saudi Board Certification programmes expanding by 50% during 2016-23. The Health Leadership Academy and Health Academy have been established under the SCFHS to provide qualifications for a range of sector professionals, from practitioners to administrators.
Preventive Measures
The third objective of the HSTP has also made progress. Actions have included promotional campaigns targeting salt reduction in food and reduced hydrogenated oils, as well as those encouraging practices that promote public health, such as physical activity. Early detection services for obesity, diabetes, and breast and colon cancer have been rolled out, beginning with the Alhasa and Riyadh First health clusters in 2023.
The establishment of the SNIH is a milestone in the Kingdom’s research and clinical trial infrastructure. The institute provides funding and postgraduate research facilities, with annual awards for outstanding research. This helps to build the intellectual and scientific infrastructure necessary to run nationwide health programmes. A rapid response laboratory under the MoH and PHA provides testing capabilities, a DNA manufacturing unit and early warning systems for health authorities in an era of pandemics and epidemics. The National Immunisation Register is key in that regard, with 30m people vaccinated in 2023 under MoH schemes. In light of Covid-19, nine new centres were set up to manage crises in different parts of the Kingdom. Meanwhile, 21 hospitals are prepared to handle potential disasters such as radiation and other nuclear-related emergencies. Knowledge and awareness campaigns form a major part of this objective, with over 40 health-related campaigns launched in 2023 under the HSTP. The SFDA has established the Halal Centre to issue halal certification to both local and international organisations for food, cosmetics and other products.
Safer Travels
One factor partly assisting in rising life expectancy is a dramatic decline in traffic accident deaths, which shrunk from 28.4 per 100,000 population in 2016 to 13.1 per 100,000 in 2023. The decline also earned a commendation from the WHO. The design and construction of safer roads has been key to this, as well as public awareness campaigns.
Life Sciences
Saudi Arabia has long been a centre for the sciences within the Arab world. In 2023 it produced 64% of the region’s research output in chemistry, earth and environmental science, and life and physical sciences. The government has invested greatly in research and development (R&D), spending $3.9bn on R&D nationwide in 2021. In 2018 the Kingdom launched the pioneering Saudi Genome Programme, which, by capturing the genetic blueprint of Saudi society, should spearhead personalised medicine in the years to come. The King Abdulaziz City for Science and Technology, the King Abdullah University for Science and Technology, and the King Faisal Specialist Hospital and Research Centre are the lead institutions for much of this research.
Since February 2020 the Saudi Authority for Intellectual Property has been the body responsible for assessing patent claims in the Kingdom. Saudi Arabia is a party to the World Trade Organisation agreement on Trade-Related Aspects of Intellectual Property Rights, along with the Trade Marks Law of the GCC. This legal basis and existing high-end R&D infrastructure stands the Kingdom in good stead for its NBS, launched in January 2024. This aims to make Saudi Arabia a biotech leader in the Middle East by 2030, and an international biotech centre by 2040 (see analysis). By the latter date, around 2.5% of GDP will be invested in biotech and genomics innovation. Localisation and biomanufacturing are key to the strategy, with target areas ranging from the local production of vaccines and pharmaceuticals to the development of new plant strains and genomics.
Outlook
The Kingdom’s biotech strategy establishes a clear intent for medical authorities, based on sound foundations in R&D, biomanufacturing and pharmaceuticals. Progress in the years ahead will depend on attracting R&D investment and venture capital, while also developing innovative domestic start-ups and research groups. Meanwhile. the HSTP presents wide-ranging opportunities for players within the segment, including local and international insurers, pharmaceutical companies, hospital groups, medical equipment suppliers, digital players, training and education providers, and doctors and nurses.
The strategic shift from public to private, coupled with continued economic and population growth, equates to the organic expansion of demand for private health services. With a clear government commitment to establishing a leading global position in health care and life sciences, Saudi Arabia looks set to remain an attractive growth market for health care and medical R&D in the years following 2024.
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