As originally asked by Joerg Heise.

There is no doubt that China will be one of the key growth geographies for international medical device companies. Public and private investments, lifestyle shifts and demographic changes will drive demand and already result in double digit growth rates which I believe will accelerate further.

Many international companies are now trying to enter the market. But only those that offer a true value proposition have a chance to succeed. That value proposition should be one that cannot easily be imitated by other market players but also one that is perceived to be innovative by the customer (hospitals or patients) which means that an actual problem has to be addressed.

I have my own thoughts on what those may be but I would like to know what you think.

On which medical device product categories should companies focus on when launching in China?

I hope for some good discussion and insight.

J D.
Oversea product & marketing manager
Sorry, a mistake I made. What I said shall be ‘Bribe’ instead of ‘Bride’..”-).

Joerg Heise
Managing Director at SOMATEX® Medical Technologies GmbH
I was talking to other industry and opinion leaders the other day. They also confirmed that wound healing was an area of opportunity.

J D.
Oversea Product & Marketing Manager
Hi all,
As a Chinese who has worked in the Medtech field for so many year both in China and Germany, I have some advice for new foreign companies who want to enter China.

China is a big country and every region has different life style. So there are some special medical requirements for some places, Which GE, SIEMENS, or Philips have still not focused on. So far as I know, most of their products are more or less the same and compete in the similar fields.
Though the above big companies have located in China so many years, they still have not develop the products meet the requirements. For example, people in Zhejiang Province and Shanghai like eat seafood. Every year, many people get Wound from it. As far as I know, the medical devices in this field are low-end and useless in some cases. Surely the western never eat such seafood with bones like Chinese.

The above is just one scenario. In fact, there are many products you could develop according to Chinese life style. To think about it, you could own the whole Chinese market. 🙂

Speaking of brides, it is true. But if your products have outstanding functions than those from other companies, who needs brides.

Joerg Heise
Managing Director at SOMATEX® Medical Technologies GmbH
i agree with that market potential comments…good quality products is the way to go. However some exclusivity (at least for a while) is required to avoid the stiff competition with local market rivals. Regarding, R&D – yes it is true. However, medical device companies are often smaller and don’t have the resources to build up R&D capacities.
From my experience, products that sell well with my partners are equipment and high values consumables (e.g. not standard bandages but bandages that last longer and don’t have to be changed daily)

Urs Mattes
Healthcare Executive in Life Science and experienced Board Member
Am since 1998 in China and managed Medtech companies first hand. I have written also some reports about the Chinese Medtech market. I agree with above comments on manufacturing, there are better places with better quality. China has traditionally a poor engineering traditional and quality is not what makes China famous. As far as the Medtech market in China is concerned, equipment sells better than implants. Reason is that Chinese hospitals are heavily under equipped, at least class 2 and 1 (class 3 are the best in China). High-end products are supplied by foreign companies while low-end products are manufactured by domestic companies. The big field to get in is the middle segment (between high and low end) of products which can be supplied to second tier cities with a big and rising middle class (is estimated by local banks to be 300 million people). In order to develop such middle segment products in Medtech you have to do be localized with R&D in order to find out what Medtech customers in China need. It is also important to know that you need in most businesses distributors which do quite some bribing. I sometimes wonder how US boards think about this or if they just ignore it? Chinese doctors are State employees and if a distributor bribes such a doctor, you are basically speaking violating the Foreign Corrupt Practices Act because everybody who has lived in China for a few months knows about corruption. On the Medtech Switzerland website is a comprehensive report about the Medtech market in China, but it costs CHF 120.

Joerg Heise
Managing Director at SOMATEX® Medical Technologies GmbH
I agree that China not only as a med tech manufacturing hub is not on the rise any more. Many med tech companies are pulling production out of the country – especially those that were manufacturing for other regions. But in turn, rising income and developing healthcare makes the country much more of a demand driven place, for products in public and private hospitals – e.g. in the area of high tech technology such as DNA analytics

James Stout
Vice President of Quality Systems at Excorp Medical, Inc.
China represents a good opportunity but only if you intend to manufacture in China, and market in China and Asia. The bloom is pretty much off the rose for outsourcing. China’s costs are rising, and the quality was never very good.