Chinese healthcare is quickly becoming recognised as an untapped market for companies operating in the biotech, pharmaceutical and medical device sectors.

The World Medical Tourism and Global Healthcare Congress Asia-Pacific 2015 was held in November 14-16, in Guilin, China. Spearheaded by the Medical Tourism Association and Beijing Great-Idea Business Resources Company Ltd, the event also included a five-day, three-city B2B trade mission, giving international visitors the opportunity to meet with leading Chinese executives and government officials, with a focus on creating new business partnerships and affiliations with Chinese and Asian companies.

Michael Zeng, CEO of Beijing Great-Idea Business Resources Company Ltd, said: “China’s healthcare reform policies and shifting economic and demographic trends are creating new opportunities for international companies seeking to invest or partner with local medical companies in fields such as hospital development, biotechnology and pharmaceutical. Our focus is to bring in the largest buyers of healthcare from China and private and public sector organisations seeking partners for investment, capacity-building and hospital affiliations.”

Growing the biotech sector features prominently in the Chinese government’s priorities for economic growth and development, with China’s Minister of Health pledging that the country will spend $11.8 billion to further biotech research in the next five years. Increasingly, Chinese medical biotech companies and pharmaceuticals are opting for in-licensing of Western-originated projects, and engaging in joint ventures and mergers and acquisitions with international firms. Mergers and acquisitions in China’s healthcare sector rose to a record $11.3 billion in the first 11 months of 2014, up 13 per cent from the $10 billion in the same period a year earlier, according to Dealogic data.

In China, digital healthcare – innovative technologies in telemedicine, wearable health-tech devices and mobile health – is expected to grow substantially, opening opportunities for international companies.  According to iMediaResearch, the size of the wearable health-tech device market – smart watches or wristbands, pedometers and bionic suits which can monitor health indicators – in China was 420 million in 2012, and it is estimated to reach 4.7 billion in 2017. The Chinese Mobile Health market is expected to reach US$3.7 billion by the end of 2018, according to a recent report by Chinese firm Huidian Research, as mobile phones and mobile enabled devices are used to improve the patient experience. China possesses nearly 1.2 billion mobile devices, nearly three-and-a-half times the number of mobile devices in the United States. Meanwhile, a report jointly authored by GSMA and PricewaterhouseCoopers suggests the Chinese medical monitoring services market will reach $1.2 billion by 2017, with more than 90 per cent of the revenues coming from chronic disease management solutions.

China is now the world‘s second largest medical device market, with a projected market size of US$48 billion. A recent report by the China Association of Medical Device Industry (CAMDI), found the country’s medical device market has grown at an average of 20 per cent annually since 2009 and is expected to continue to grow at the same rate through 2015. Many medical devices available in North America and Europe are not available yet in China, offering worthwhile opportunities for investment and partnerships.

 

New healthcare infrastructure is also required in China, including new hospitals. McKinsey & Company estimates that health care spending in China will grow to $1 trillion by 2020, up from just over $350 billion in 2011. China’s State Council has promoted the development of private hospitals, as well as investment opportunities for international firms. The end-goal is for foreign-owned hospitals to meet some of the healthcare needs of high-end patients, while at the same time spurring public hospitals to improve their technology and services. Chinese medical providers are also keen to establish partnerships with top-tier international hospitals to help with capacity building in different procedure specialties or with talent exchanges. Alongside healthcare investment there is also a need for academia and researchers to support fundamental research in healthcare quality improvement and to develop educational models for quality assessment and improvement in China.

Renée-Marie Stephano, president of the Medical Tourism Association, added that as well as the opportunities within China, the future would also include an increase in outbound medical tourism from China: “China is positioned to be one of the largest outbound medical tourism markets in the world, with rising income and a growing demand for the best medical treatments possible, coupled with the launch of health insurance for Chinese citizens that include travel benefits.”

(via WMTC Asia-Pacific)