GlobalData02.28.20
The medical devices market in China is expected to grow at a compound annual growth rate of 8.4 percent, from $46.5 billion in 2019 to $75.5 billion by 2025. However, multinationals should adopt localization strategy to gain ground in the highly lucrative market, claims GlobalData, a worldwide data and analytics company.
Though China is experiencing an economic slowdown, the medical devices market will continue to grow, primarily driven by increasing aging population, rising burden of diseases and increasing demand for modern medical treatment together with government’s aim to improve the quality and accessibility of healthcare in the nation.
The company’s report, CountryFocus: Healthcare, Regulatory and Reimbursement Landscape – China, reveals that over 80 percent of domestic manufacturers supply low to mid-range medical devices such as syringes and needles, and multinational companies supply high-end products such as imaging equipment in China. The United States, Germany, and Japan represent the majority share of China’s medical device imports.
Pratibha Thammanabhatla, a medical devices analyst at GlobalData, said: “China presents large market opportunities for doing business across industries and medical device industry is not an exception to this.”
In the World Bank’s ‘2020 Ease of Doing Business’ ranking, China ranked 31st among 190 countries, up from 46th in 2019.
However, as part of its ‘made in China 2025’ strategy, China looks to increase the share of domestically produced medical devices in hospitals to 70 percent by 2025. In addition, as imported medical devices are costly and are mostly not covered under medical insurance, domestic medical device makers have started dominating the Chinese market.
Thammanabhatla concluded: “Domestic manufacturers in China are providing cheaper local alternatives. China aims to upgrade its medical device industry and transform itself into a ‘manufacturing power’ by reducing reliance on imported products from foreign companies and encouraging domestic players to produce innovative quality products. As Chinese medical device makers ramp up their research and development capabilities, they are bound to gain market share. Against this backdrop, besides keeping pace with the evolving regulatory system, foreign companies need to produce medical devices locally to stay relevant to the market and survive the competition.”
Though China is experiencing an economic slowdown, the medical devices market will continue to grow, primarily driven by increasing aging population, rising burden of diseases and increasing demand for modern medical treatment together with government’s aim to improve the quality and accessibility of healthcare in the nation.
The company’s report, CountryFocus: Healthcare, Regulatory and Reimbursement Landscape – China, reveals that over 80 percent of domestic manufacturers supply low to mid-range medical devices such as syringes and needles, and multinational companies supply high-end products such as imaging equipment in China. The United States, Germany, and Japan represent the majority share of China’s medical device imports.
Pratibha Thammanabhatla, a medical devices analyst at GlobalData, said: “China presents large market opportunities for doing business across industries and medical device industry is not an exception to this.”
In the World Bank’s ‘2020 Ease of Doing Business’ ranking, China ranked 31st among 190 countries, up from 46th in 2019.
However, as part of its ‘made in China 2025’ strategy, China looks to increase the share of domestically produced medical devices in hospitals to 70 percent by 2025. In addition, as imported medical devices are costly and are mostly not covered under medical insurance, domestic medical device makers have started dominating the Chinese market.
Thammanabhatla concluded: “Domestic manufacturers in China are providing cheaper local alternatives. China aims to upgrade its medical device industry and transform itself into a ‘manufacturing power’ by reducing reliance on imported products from foreign companies and encouraging domestic players to produce innovative quality products. As Chinese medical device makers ramp up their research and development capabilities, they are bound to gain market share. Against this backdrop, besides keeping pace with the evolving regulatory system, foreign companies need to produce medical devices locally to stay relevant to the market and survive the competition.”
