Healthcare Products & Services

Industry Overview (Opportunities / Best Prospects)

China’s Imports of Medical Devices during 2006-2008 in million dollars
*	2006	Share	2007	Share	2008	Share
World	4,831	*	5,657	*	7,196	*
US	1,648	34%	2,022	35%	2,447	34%
Germany	837	17%	1,033	18%	1,303	18%
Japan	828	17%	884	15%	1,151	15%

China is now the world’s third largest market for medical equipment. According to information from the China Association for Medical Devices Industry (CAMDI), China’s medical equipment market grows at 15% annually with a total size of USD 10.2 billion in 2008 and the figure is expected to reach as high as USD 17.5 billion by 2010. An annual growth of sales of large, high-end medical equipment was reported between 20-30%. Clinical laboratory equipment and reagent sales are growing at about 15 to 20% per annum. China’s imports of medical equipment accounted for about USD 5.7 billion in 2007 and USD 7.2 billion in 2008, showing an increase of over 27%.

Chinese end users consider U.S. products to be of superior quality and the most technologically advanced. China’s hospitals particularly welcome medical equipment and products with high-technology content. At the same time, domestic medical device companies are consolidating, upgrading quality, and beginning to compete in medium-level technology niches. According to the information given by CAMDI, China currently has over 12,600 medical device manufacturers, of which only 60 have sales valued over USD 14.6 million. Among the industry’s top 10 manufacturers, seven are foreign invested firms or joint ventures. Positive indicators fueling imports and increased domestic production include the desire to utilize a wider array of advanced technologies in China’s over 18,000 domestic hospitals & clinics. Currently about 15 percent of the medical devices in use were made in the 1970s and they are expected to be replaced by new ones.

The newly released Chinese government’s healthcare system reform scheme is expected to have a great impact on the market in China. The scheme released April 2009 is aimed at providing basic healthcare access and coverage for all population in China. To guarantee the implementation of the scheme, the government at various levels plans to invest USD 124 billion between 2009 to 2011, including USD 24 billion for 2009). The fund is directed to the construction of basic healthcare infrastructure. Although it is not clear how much will be used for medical equipment procurement for hospitals, on a centralized basis or by province, it will likely have a significant impact on how companies will sell to healthcare institutions in the coming years due to the government’s efforts to address concerns over accessibility and affordability of healthcare. Other concerns for U.S. and foreign suppliers center around the uncertain regulatory environment and extensive delays in registration and re-registration of products, although efforts are reportedly being made to reduce the large backlog.

Best Products/Services

Best selling prospects in the Medical Device sector include:

• In vitro diagnostic equipment and reagents:
  Clinical and diagnostic analysis equipment, diagnostic reagents, medical test and basic equipment instruments
• Implantable and intervention materials and artificial organs:
  Interventional materials, implantable artificial organs, contact artificial organs, stent, implantable materials, and artificial organ assisting equipment.
• Therapeutic products:
  Tri-dimensional Ultrasonic focused therapeutic system, body rotary Gamma knife, simulator, linear accelerator, laser diagnostic and surgery equipment, nuclide treatment equipment, physical and rehabilitation equipment.
• Medical diagnostic and imaging equipment:
  Black & white and colored supersonic diagnostic unit, sleeping monitor, digital X-ray system, MRI, CT, DR, and ultrasound equipment.
• Surgery & emergency appliances:
  Anaesthesis ventilation systems and components: high frequency surgery equipment, high frequency and voltage generators.
• Healthcare Information technology related equipment and products:
  Medical software, computer aided diagnostic equipment, and hospital informatization system (HIS, CIS, HLT).

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Care and Rehabilitation Equipment Market in China

The market for equipment and products for the aged and the disabled including medical is showing signs of growth and potential as the Chinese population ages and as the Chinese government provides more support for the elderly and physically challenged population. China has developed a legal framework protecting the rights of persons with disabilities covering basic rights as well as access to education and jobs and public facilities and is working on policies for barrier free access to transportation and information. Growing levels of personal wealth also provide families the means to purchase products and devices for improved mobility and quality of life.

Key Points

• China has about 83 million disabled persons with 80% of those requiring assistive devices; 65 million cannot live without assistive devices.
• Senior citizens in China account for 11.4% of total population, currently about 149 million. By 2050, number will increase to 400 million.
• A comprehensive legal framework protecting the rights of persons with disabilities has been developed over the last 15 years covering access to education, jobs and public facilities.
• To facilitate the importation of imported products, China plans to eliminate import duties for qualifying products.
• China announced in April 2009 that it will promote the construction of a barrier-free environment for the disabled in 100 cities by the year 2010. According to the plan, assistance techniques or substitute technologies such as Braille, sign language, captions and special communication facilities are to be adopted to pave the way for the disabled to participate in social activities. TV programs with sign language and special broadcasting programs for the disabled are to be launched, together with the subtitling of TV programs and films. Standardized community rehabilitation services will be carried out nationwide in 80 percent of urban districts and 70 percent of counties, which will benefit 2 million disabled people.

Market Entry

Chinese consumers lack information about many products available internationally, particularly those from the United States. Promotion at trade shows and working through well known organizations such as the China Disabled Person’s Federation (CDPF) can help to establish new to market firms. The major trade show in China for this sector is:

Care & Rehabilitation Expo China 2009
Date: Sep. 10th (Thursday)-12th (Saturday), 2009
Venue:China International Exhibition Center, (Beijing, China) Hall 2,3,4,5
Scale:16,000 square meters
Website: http://www.crexpo.com.cn/en/index.aspx

Major Shows & Exhibitions

SINO-DENTAL 2009

Date: June 10-13, 2009
Venue: China International Exhibition Center, Beijing, China
Contact: Sunny Yin, Project Manager
International Health Exchange and Cooperation Center, Ministry of Health of China
Room 703, B3 Wudong Building, No.9 Chegongzhuang Street, Beijing 100044
Phone: 86-10-88393922/88393923
Fax: 86-10-88393924
Email: info@N0SPAM.sinodent.com.cn
Website: www.sinodent.com.cn
Information about the U.S. Pavilion can be found at the U.S. Commercial Service’s website at: http://www.buyusa.gov/china/en/sd2009ovrvw.html

MEDTEC China

Date: September 8-10, 2009
Venue: Intex Shanghai
Contact: Pamela Yau, Manager/Exhibition Management Department e21 MagicMedia (Hong Kong)
Phone: 852-21897378
Fax: 852-29601830
Mobile:852-92372994
E-mail: pamela.yau@N0SPAM.e21mm.com

Useful Websites

China’s Health Care Reform (English)
China Business Information Center (U.S. Department of Commerce)
China Trade Show Events
American Chamber of Commerce, China
American Chamber of Commerce, Shanghai
US-China Business Council
China Government Web Portal
Guide to Investment in China