Business Monday

Export RX for success: medicine, medical devices

.com

One of the bright spots for South Florida’s trade in an otherwise unspectacular environment is healthcare related exports, a cluster of products that is rapidly approaching $6 billion in annual value.

The primary reason for this is simple: Access to healthcare is growing in Latin America as two decades of relative economic and political stability is paying dividends in most markets. South Florida, not surprisingly, has benefited.

The total for a basket of 15 exports from South Florida’s airports and seaports, valued at $5.61 billion in 2014, first crossed the $3 billion threshold just six years earlier, in 2008, according to WorldCity analysis of U.S. Census Bureau data.

Sure and steady growth

It is not dizzying growth like that experienced by gold exports beginning four years ago — before collapsing as financial jitters eased in the last two years — but it is solid growth in a Customs district where trade has fallen for two consecutive years.

In fact, two of Miami’s top 10 exports are medical devices and medicine, both having moved up one in rank last year and both setting records in 2014. They are the only two top 10 exports to set records in 2014. These two alone account for more than $3.1 billion of the total $5.61 billion.

Four other categories appear in South Florida’s top 50 exports as well: one that includes additional medical equipment, another that includes artificial joints and similar replacement body parts, a third that is dominated by the blood thinner heparin, and the fourth being fractions of blood.

At a time when the value of South Florida’s exports is falling — down 3.55 percent in 2014 — exports in the 15 categories shown in the chart increased 10.49 percent. Over two-year, five-year, 10-year and 20-year time periods, the trend is clear: Exports related to healthcare are growing more rapidly than the total of all exports. Over the past five years, it’s 60.48 percent for the healthcare-related exports and 32.43 percent for all exports.

By comparison, the divergence in the U.S. growth rate is slower — if it even exists. Overall U.S. exports grew 2.78 percent in 2014 while exports within the “healthcare basket” grew 4.81 percent from 2013; over the last five years, the “healthcare basket” actually underperformed all exports, 18.54 percent to 53.73 percent for all exports.

In South Florida, these exports are also becoming relatively more important, accounting for a record 8.56 percent of all exports in 2014, up from 7.48 percent in 2013, thanks to an increase of more than $532 million.

Medical instruments are tops

The medical instrument category is the largest, at $1.77 billion in 2014. Miami ranks fourth in the nation in this category, behind Chicago, New York City and Los Angeles, accounting for 6.74 percent of the nation’s exports. A decade ago, Miami ranked No. 10 and accounted for 4.39 percent. In that time, it has passed Boston, New Orleans, Atlanta/Savannah, Cleveland, San Francisco and Detroit.

Brazil has accounted for more than 30 percent of the Miami exports for four of the past five years, with Colombia, Costa Rica and the Dominican Republic all growing markets in 2014. Exports to Venezuela have fallen from a record $363.96 million in 2011 to $83.79 million in 2014.

For 10 of the last 11 years, the medical device export category has set a record. The $140.5 million increase over the 2013 was the second-largest gain of any South Florida export in 2014.

Medicine is also a big export from South Florida, ranking No. 6 overall with a value of $1.42 billion. In this category also, Miami ranks No. 4 nationally. Ahead of it are San Juan, Puerto Rico; Chicago; and New York City.

Miami’s track record in this export category is a little less steady, having topped $1 billion in value in 2001 and 2002 and then not again until 2011. It has established a new record each of the last four years. It was the nation’s 10th most important Customs district for exports just five years ago but No. 3 a decade ago.

As is the case with medical instruments, the top market for Miami exports is Brazil — only the dominance is more pronounced. Brazil didn’t account for more than 20 percent of South Florida medicine exports until 2004. It accounted for more than 30 percent in 2007. In 2014, it accounted for more than 40 percent for the first time; 45.36 percent to be exact.

There are subcategories but, as is the case with medical devices, half are not classified beyond fitting into a miscellaneous grouping. Those that are further defined include antibiotics, at about 25 percent of the total, followed by anti-convulsants and sedatives as well as medications for the eyes, ears and respiratory system.

Italy gets a boost

The largest gain of any South Florida export in 2014 was also in the healthcare space: Advancing from a rank of 210 in 2013 to No. 35 in 2014 is a category dominated by heparin, a blood-thinner. They are the only two top 10 exports to set records in 2014. The 2013 total was $40.20 million; a year later, in 2014, the total was $331.86 million, a 725.56 percent increase in one year.

Most of the exports are headed to Italy. Consequently, Miami’s trade with Italy grew at nearly five times the U.S. average, up 31.96 percent and topping $2 billion for the first time. It advanced from being South Florida’s No. 22-ranked trade partner to No. 18.

Ken Roberts is the founder and president of WorldCity, a Coral Gables-based company. He can be reached at kroberts@worldcityweb.com.

South Florida’s top medical-related exports

Change in rank

Overall

2014 rank

2014

1-yr. chge. ($)

1-yr. chge. (%)

10-yr. chge. ($)

10-yr. chge. (%)

Total Exports

$65,490,156,214

-$2,410,375,030

-3.55%

$35,422,128,053

117.81%

1

5

Medical instruments for surgeons, dentists, vets

$1,768,784,856

$140,500,826

8.63%

$1,301,212,569

278.29%

1

6

Medicine

$1,416,031,479

$32,148,764

2.32%

$678,783,506

92.07%

0

21

Medical equipment for physicals

$530,565,274

$8,510,626

1.63%

$346,313,047

187.96%

0

24

Orthopedic appliances, artificial body parts

$442,570,179

$24,380,056

5.83%

$379,026,038

596.48%

175

35

Misc. human glands, heparin

$331,864,497

$291,665,629

725.56%

$331,013,450

38894.85%

8

37

Plasma, vaccines, blood

$303,882,719

$53,463,280

21.35%

$217,859,168

253.26%

0

57

Medical technology

$200,082,336

-$11,050,286

-5.23%

$48,630,160

32.11%

-1

59

X-ray apparatus

$189,704,091

-$17,476,941

-8.44%

$60,079,618

46.35%

-3

91

Sutures, miscellaneous medical products

$112,944,966

-$6,403,438

-5.37%

$77,649,851

220.00%

0

97

Mechanized equipment, parts for psychological testing

$107,515,964

$4,627,822

4.50%

$78,126,201

265.83%

-10

161

Miscellaneous medicines, including hormones

$62,129,882

-$4,406,379

-6.62%

-$4,991,354

-7.44%

12

181

Thermometers, other devices

$49,512,845

$4,535,165

10.08%

$43,476,309

720.22%

12

238

General medical equipment

$33,473,559

$1,302,880

4.05%

$26,540,447

382.81%

38

240

Medical bandages

$33,290,252

$7,079,963

27.01%

$18,751,525

128.98%

20

274

Breathing appliances, gas masks, parts, etc.

$26,614,671

$3,528,350

15.28%

$16,564,243

164.81%

Source: WorldCity analysis of U.S. Census Bureau data

  Comments