Eight Characteristics of China's Medical Device Market in 2010

Business News Agency January 12 The medical device market in China has jumped to the second place in the world, surpassing the 100 billion yuan mark for the first time. Especially in a variety of low-end medical device products, the output ranks first in the world. However, high-end products accounted for only 25%, while low-end products accounted for 75%. This shows that China's medical devices are still dominated by products with lower technological content.

The year 2010 is the last year of China's "Eleventh Five-Year Plan". Despite many unexpected difficulties, our country's medical device industry has achieved remarkable market performance. In spite of this, the author believes that the problems existing in China's medical device industry in 2010 are still not small, such as the small number of small businesses (about 90%), the low level of technology of most manufacturers, lack of investment in new product development, most companies engaged in low-end products Production, low price competition in the international market, some products are highly homogenized and so on. In short, China's medical device industry must face up to the existing problems, increase investment, and develop new products urgently needed in the international and domestic markets in order to maintain the orderly development and potential of the industry. In 2010, China's medical device industry mainly exhibited the following characteristics:

The market exceeded 100 billion for the first time

At present, China's medical device market has leapt to the second place in the world, second only to the United States. Especially in a variety of low-end medical device products (such as sanitary materials, disposable hospital consumables, infusion sets, B-mode ultrasound, ventilators, general surgical instruments, and laser surgical instruments, etc.), China’s output ranks first in the world. Last year, China's medical device market exceeded the RMB 100 billion mark for the first time. After experiencing the economic crisis and the lack of demand, in 2010, China's medical device industry finally ushered in a situation of large export growth. In the first half of the year, based on the total import and export of medical devices exceeding US$10 billion, the import and export trade continued to show a growth trend in the second half of the year. Among them, exports were nearly 15 billion U.S. dollars and imports were 7.6 billion U.S. dollars, with a significant surplus. It is understood that the medical equipment products that China exported a large number last year were mainly: electronic and mercury sphygmomanometers, B-ultrasound, CT, MRI, patient monitors, disposable hospital consumables (such as infusion sets, infusion pumps, syringes, needle catheters, etc.) Products), massage equipment, medical dressings, manual wheelchairs, and handicapped vehicles, and other products (such as first aid kits, denture materials, rehabilitation equipment, hearing aids, etc.).

Still based on low-tech products

The basic composition of China's medical device market in 2010 is as follows: High-end products account for only 25%, while low-end products account for 75%. In contrast, in the international medical device market, high-end products generally account for 55% of the market, and low-end and mid-range products only account for 45%. This shows that China's medical device market is still dominated by products with lower technological content. Among the high-end equipment products exported by China, nearly 80% of foreign-funded companies in the United States such as GE, Philips, and Hitachi in China accounted for nearly 80 percent of their products. This reflects the lack of manufacturing capacity of high-end products of local Chinese companies. Although China has ranked first in the world in the production of disposable consumables, denture materials, wheelchairs, sanitary materials and medical dressings, there is no doubt that these products are low-value-added, high-energy-consuming products. Since China's cotton prices have skyrocketed since the second half of last year, hundreds of domestic enterprises engaged in the export of sanitary materials processing businesses are afraid to accept orders from foreign companies (orders mean losses). This reflects the enormous risks that many Chinese companies have engaged in for many years in the processing and export business of low-end products. The long-term dependence on low raw material prices and low labor costs to take the road of processing trade can no longer continue.

In the sanitary materials of China, the low-grade sanitary materials of cotton fabrics and non-woven fabrics still account for the majority, and high-grade medical dressings such as transparent film dressings, liquid bandages, alginic acid dressings, sponge dressings, silicone dressings and silver ion antibacterial dressings are hot selling in the international market. The product still cannot be produced in China, and the export price of such products is several to ten times higher than that of traditional cotton sanitary materials. It is imperative to vigorously develop new types of medical dressings.

Disposable consumables are very similar to sanitary materials. As the price of imported plastic particles such as PE and PP has soared, and disposable consumables are mostly plastic processed products, the price of imported raw materials has the greatest impact. As early as 20 years ago, China has become the world's largest producer and exporter of disposable syringes and other hospital consumables. In the past two years in Europe, due to the cold spell of the economic crisis, the import of low-price injectors produced in China has increased. It is reported that on the basis of the export of 7.883 billion sticks in 2009, China exported a total of nearly 9 billion disposable syringes in 2010, indicating that China’s position as the world’s largest producer of disposable syringes has remained unshakable. The quality of syringes in China has been recognized by developed countries in Europe and America. However, due to the rapid growth in the number of export syringes in recent years, it has led to anti-dumping investigations involving some developing countries such as Brazil, India, Ukraine, and Argentina. According to sources, the total output of disposable syringes in China last year exceeded 13 billion, with a ratio of 3:7 between domestic and international sales. This shows that our disposable syringes are mainly export-oriented products.

Free Trade Agreement Heats ASEAN Market

Last year, another hot market for medical device exports in China was the ASEAN countries. This was due to the fact that China signed a free trade agreement with ASEAN two years ago. According to the agreement, both parties should exempt the tariffs on import and export products. Therefore, the number of medical devices exported to ASEAN in China soared in 2010. According to analysis, apart from Singapore and Malaysia, the industrial base of ASEAN countries is acceptable, and other countries (including Indonesia, Vietnam, and the Philippines, etc.) have not established a complete industrial system for medical devices. Most of the ASEAN countries can only produce some primary products (such as latex gloves, gauze cotton, and other sanitary materials, etc.), which opens the door for China's low-end medical device products to enter the ASEAN market. According to relevant reports, last year ASEAN has become China's fifth largest export market for medical device products. In the past three years, the annual growth rate of China's medical device products to ASEAN has been as high as 25%. In 2010, the five countries with the highest export value to ASEAN countries were Singapore, Vietnam, Thailand, Malaysia and Indonesia. The main medical device products for export are hospital disposable products such as disposable infusion sets, infusion bags, and needle catheters, B ultrasound (black and white and color), CT machines, MRI, X-ray machines, electronic blood pressure monitors, patient monitors, and ventilators. Anesthesia machines, various endoscopes, acupuncture needles, etc.

High-end diagnostic imager export breakthrough

From the perspective of export value, Europe, the United States, and Japan are still the major export markets for medical device products in China. The vast majority of developing countries, including countries in the Middle East and Latin America, accounted for only about 10% of China's exports of medical device products. This shows that developed countries in Europe and the United States have huge import strength despite the economic crisis. In recent years, China’s exports of high-end diagnostic instruments to Europe, the United States, and Japan have continued to increase. Last year, China’s exports of medical devices to countries such as Russia, Brazil, and Ukraine soared by 43%, making these countries a new hot market for medical device products in China.

On the whole, China’s exports of small and medium-sized medical device products enjoy greater advantages, while the export volume of high-end products is small, and its competitiveness is much weaker than that in Europe, America, Japan, and other developed countries. The good news is that in recent years, China has begun to make breakthroughs in the export of a number of high-end diagnostic imagers such as black-and-white B ultrasound, color B-mode ultrasound, domestic CT scanners, X-ray machines, and MRI. Not only Central Asian countries, India and ASEAN countries, but also the United States and Europe have become China's major export market for diagnostic imagers.

It is reported that the total annual sales of CT machines, MRIs, and other high-end diagnostic imagers produced by Chinese local companies such as Shenyang Neusoft, Wandong, and Shenzhen Mindray have exceeded 200 million yuan last year. This shows that China's high-end medical device product market is no longer dominated by foreign-funded enterprise products.

Home medical equipment development space is huge

Last year, the share of home medical device products in the medical device market in China was too low. According to statistics from relevant domestic agencies, the total sales of home medical device products in China was only 14 billion yuan in 2010, and the market is mainly concentrated in coastal economically developed provinces and cities. The vast regions including the central and western regions only account for the home medical device market. Small share. This reflects the disparity in the degree of economic development in our region. At present, home medical device products only account for 14% of the total sales of the domestic medical device market. In foreign countries, this proportion is generally around 25%. It can be seen that there is still huge room for development in China's home medical device products. The exciting news is that some universities in our country, such as Tsinghua University, have developed a number of new electronic medical device products that are suitable for home use, such as the “Biochine Brain Health Monitor” and “spectrum analyzer”, and have begun to be marketed. Best-selling. This shows that China's long-delayed development of new products for home medical devices has begun to accelerate.

Domestic cardiovascular stents are favored

In 2010, the cardiovascular stent products achieved an unprecedented breakthrough, with annual sales of 15 billion yuan. The ratio of imported stents to domestic stents retail sales was 1:1, indicating that the domestic stents have been implanted in this high-end device. A firm foothold in the market. Moreover, the prices of stents developed and produced in China are only 1/3 to 1/2 of that of imported products, so domestic stents are favored by more patients.

Orthopedic materials sales soared

Orthopedic materials include conventional materials such as fixed plates for fractures, bolts, and bone cement. In 2010, domestic orthopaedic materials completely overwhelmed imported materials and for the first time prevailed. This is because local health departments and hospitals have strengthened the control of medical insurance costs. In addition, imported orthopedic materials are too expensive (usually 2 to 4 times that of domestic orthopaedic materials). Therefore, more and more patients actively choose domestic orthopedic materials.

Diagnostic reagents emerge

In 2010, medical diagnostic reagents made domestic and imported goods evenly divided. The imported reagents are too expensive. For example, the contrast agent used in MRI requires thousands of dollars each time, while domestic reagents only cost tens to hundreds of yuan. In comparison, the patient is more likely to choose homemade reagents. At present, the quality of diagnostic reagents produced by our companies, such as Kehua and Fosun, has become comparable to that of imported reagents. Therefore, domestic reagents have begun to emerge in the domestic market. In short, the situation in which high-end diagnostic reagents are dominated by imported products has been broken.

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