Summary Several countries have fertility rates of less than 1.5 births per woman.
SYDNEY (Reuters) - A looming crisis in Asia as women delay giving birth, leading to low fertility rates that have dire implications for economic growth, is opening huge opportunities for the fast-growing in-vitro fertilization (IVF) industry.
The successful debut of Australia s Virtus Health Ltd, which this week became the first IVF specialist to list on a stock exchange, is the latest sign that investors are eager to back fertility companies that have plans to expand into Asia s vast developing markets.
"The market is going to grow massively, there s no doubt, particularly in India and China we ve seen huge growth," said Robert Norman, fertility expert and president of Aspire, an Asia-Pacific industry lobby group.
Several countries such as Singapore, Japan and South Korea have fertility rates of less than 1.5 births per woman, a level experts consider very low. In contrast, the United States has a fertility rate of around 2.01 and Australia 1.9.
Governments in the region s more affluent countries are becoming concerned about the "low fertility trap", where fewer children leads to reduced spending on education and accompanying services, making it even more difficult to boost birth rates.
In the short term, very low fertility increases GDP per capita because households benefit from lower parenting costs. But in the longer term the size of the labor force falls as the population ages -- a situation already in evidence in Japan.
To avoid the trap, some countries have introduced financial support for infertility treatment, including South Korea, which has a fertility rate of 1.4 according to World Health Organization (WHO) figures. Singapore, which has a fertility rate of 1.29, increased its subsidies from January, covering up to 75 percent of the treatment costs for couples receiving IVF.
Developing economies such as Vietnam, Cambodia and the Philippines have higher fertility rates, but are still keen to boost births to counter ageing populations.
Regional giant China, with its increasing affluence and urbanization, is another IVF growth market because the technology is "not that widespread", said Gary Ng, a Singapore-based analyst at CIMB Research.
Indonesia, with a fertility rate of 2.1 but an ageing population of about 240 million people, was "virtually untapped" from an IVF-provider s perspective, said Norman of Aspire.
India is currently dominated by Fortis Bloom Fertility and IVF Center, part of the country s No.2 hospital chain Fortis Healthcare Ltd, and a joint venture with Spain s IVI Max Reproductive Medicine and part of healthcare group Max India Ltd.
The South Asian nation has one of the highest fertility rates in Asia, at 2.2, but it also has liberal laws on commercial surrogacy which make it an attractive destination for IVF services.
All of these factors are opening doors for companies like Virtus, whose home market in Australia is nearing maturity as IVF cycles drop due to improving technology and government funding for private services is reduced.
"(Asia) is certainly a market that is highly fragmented and fairly immature," Virtus Chief Executive Sue Channon said. "So we would look to be able to take some of the consolidation and corporatization that has occurred in Australia into some of those countries."
Channon said Virtus would look at acquisitions, joint ventures and technology transfer possibilities in Asia, likely through cash and equity deals.
