Healthcare reform initiated by the Chinese government in 2009 has spawned a booming market for medical technology in China. The country’s medical market recorded a stunning 23% growth rate in 2010, according to Pharmnet.com. The medtech market, which is currently valued at more than 100 billion RMB (€10.3 billion), is forecast to double in value over the next five years, according to analysts cited by Pharmnet.com, and the high-end medical equipment sector, which includes CT and MRI equipment, is expected to benefit enormously from surging demand. Some manufacturers in China fear that this will disproportionately benefit multinational corporations, which have an approximate 80% market share of high-end medical equipment sales in China. Developers and manufacturers of home-grown systems want to change that dynamic.
China’s medical device industry is said to lag about 15 years behind foreign competitors in terms of advanced technology products. In the high-end spectrum of the medical markeplace, multinationals such as GE, Siemens and Philips have a dominant position. These multinationals represent a barrier to entry that has the potential to prevent China’s domestic device industry from competing in this sector, reportedly said Professor Dai Jianping, Vice Chairman of the Chinese Medical Association at the 2011 Sino-US Magnetic Resonance Summit in Beijing in March. A lack of competition will lead to high prices and increasingly higher medical expenses for Chinese citizens.
To counter this, Chinese medtech manufacturers are beginning to stress the importance of technological innovation, and not just cost, as a competitive tool. Time Medical Systems is one example of a Chinese company that is leading through innovation. It is the first company to develop and deploy High-Temperature Superconducting (HTS) coil technology for use in clinical MRI scanners. HTS coils improve the signal-to-noise ratio primarily through the use of more-efficient RF coil materials and design methods. Time Medical Systems was founded in 2006 and operates five regional offices in the United States, Singapore, Hong Kong, China and India.
Mr. Ma Qiyuan, CEO of Time Medical Systems, has called on the Chinese government to encourage innovation among domestic manufacturers and assist them in ramping up their R&D efforts for the design and production of high-end medical devices. China must champion national brands, says Qiyuan, adding that hospitals and other purchasing organisations should give priority to domestically produced medical equipment during the procurement process.
In the meantime, companies with intellectual property should seize the opportunity that healthcare reform has made possible, and convert technical advantages into market advantages, stresses Pharmnet.com.
China Medical Device Manufacturer