The Mayo Clinic’s first clinic abroad, in the UAE’s emirate of Dubai, is closing its doors in Dubai Healthcare City. The HealthCare City, a $5.3 billion healthcare free zone, is facing delays as the emirate struggles financially. With too few patients for its one cardiologist in Dubai and barely able to break even, the Mayo Clinic is closing its medical practice there. The clinic will revert back to a regional office that attracts local patients to its Minnesota hospital, the Wall Street Journal reports.
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This article was listed in the 01 February 1, 2010 PHM Emerging Markets Healthcare News Feed.
This is a cautionary tale for all those investors who have sunk plenty in the panacea of the “healthcare city.”
The true story here is not that Dubai Healthcare City is struggling financially, which it is along with the rest of Dubai’s dubious projects. But rather, the true story is that even with a brand as strong as the Mayo Clinic, some delivery models do not replicate well, if at all.
It was an odd turn for “The Mayo” to open a medical practice in Dubai, shifting away from its long successful referral model. We believe two significant events forced the change:
- 1. September 11, 2001, and
- 2. An investment climate through the decade that ignored success.
The years 2002, ’03, ’04, and to a lesser extent, the years onward, proved to be costly to The Mayo’s international programme. The airfields in Minnesota, (home to the Mayo Clinic) were void of private jets from around the world. This period of restricted access to the USA for medical visas was costly to The Mayo – and others including the Cleveland Clinic.
But perhaps a greater impact was the push to expand a medical brand beyond reason. (See Vol. 2, No. 11 of the PHM Emerging Markets Healthcare Monitor.)
Delivering high value, high cost healthcare is expensive. And, all healthcare is local.
Two axioms the Mayo Clinic AND Dubai Healthcare City forgot……HK