A recent report from PricewaterhouseCoopers provides evidence that China is a market that medtech multinationals just cannot ignore.
As growth has stymied in mature markets like the U.S. and Japan, executives need to look eastward in emerging economies for growth, the report urges. And while the prospect of navigating an emerging market with different culture, language and regulatory regimes is daunting, the data that PwC presents makes the market very attractive.
For instance, PwC estimates that between 2013 and 2017, China'e medtech market is expected to grow at an compound annual growth rate of 20% reaching nearly $50 billion by 2017. In 2013, the Chinese medtech market was valued at $23.7 billion.
Which sub segments are poised for the greatest growth? As the chart below reveals, imaging products:
So, medical equipment - such as MRI machines, Xray machines, ultrasound devices and other imaging equipment will make up the lion's share, or one-third the overall value of the Chinese market.
While the opportunity is large, there are several challenges. Medtech regulation in this populous nation is still being formulated. When it comes to purchasing decisions and the motivations that guide them, they are made at the province level - as the report notes, there is no national tendering system used to buy capital equipment.
Further, regulatios will likely follow the path of the phramaceutical industry where things have gotten tighter in recent years. That makes it imperative for companies interested in China to stay a step ahead and anticipate changes instead of simply responding to them. Report authors advise companies to be "proactive in implementing robust process review in concert with ever-changing regulations."
-- By Arundhati Parmar, Senior Editor, MD+DI
[email protected]
