2022 China MedTech Industry Outlook (2023)

We recently released our annual China Medtech Outlook for this year, and highlighted three key trends for the industry. Industry players will need to better assess the trends and implications, proactively adapt to changes, and continue to innovate on multiple dimensions to survive and thrive.

Building on ongoing dialogues and in-depth discussions with leaders of the MedTech industry, our China Medtech Outlook is now out. In comparison to the results from last year, there are a few key themes emerging with important implications to the industry.

2022 China MedTech Industry Outlook (1)

Increasing policy pressure

Volume-based procurement (VoBP), import substitution, and payment reform are the major policy thrusts in 2021, bringing price pressure and growth challenges to the industry.

Among them, VoBP has the largest near-term impact on the high-value consumables industry:

  • In the first round of national VoBP last year, the average price cut of 93 percent for coronary stents sent shockwaves across the industry
  • In the second round of national VoBP this year, the average price cut of 82 percent for artificial joint products appears milder in comparison, but the signal of broadening scope and accelerating pace for VoBP is unequivocal
  • VoBPs at provincial level are rolling out in parallel, and the categories involved are also expanding, covering more categories – including trauma, spine, and IVD

At the same time, import substitution has become more salient in 2021. In part, as a result of a burdened global supply chain and tense geopolitical situation, bringing additional challenges to multinational companies and imported products.

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Payment reform has seen faster rollout than expected and will bring far-reaching impacts to the MedTech industry:

  • The Diagnosis Related Group classification system (DRG) was viewed with skepticism by the industry in 2020, but has been piloted in 30 cities across China in 2021
  • In parallel, the Big Data Diagnosis-Intervention Packet (DIP) – a home developed DRG tailored to regional differences in China – has seen pilots across 71 cities in 2021
  • The shift from the fee for service model to prospective payment models, like DRG and DIP, will fundamentally change how MedTech and consumables will be procured and used. In turn, bringing price and volume pressures to the industry as a whole

Ongoing market and channel shift

While the traditional strongholds for MedTech consumables are increasingly under pressure, new segments like non-public hospitals, broad market, and digital platforms are becoming increasingly important.

1. Non-public hospitals

In particular, non-public hospitals have shown rapid growth over the past decade, now accounting for two-thirds of total hospitals in number.

At the same time, this segment now accounts for 16 percent of outpatient volume and 19 percent of inpatient volume. It is seeing double digit growth and strong momentum compared with public ones.

More importantly, non-public hospitals have successfully carved up niches in certain specialties, especially in high value sectors, such as:

  • Dental
  • Ophthalmology
  • Medical aesthetics
  • As well as fertility, maternity and pediatrics – making it an increasingly important market for related MedTech and consumables

2022 China MedTech Industry Outlook (2)

2. Broad market

Broad market has long been a priority for MedTech and consumable majors, but capturing growth from the segment has not been as straightforward as many expected.

To fully tap into the opportunities from this segment requires knowledge of the unmet needs of hospitals and healthcare providers (HCPs) in the broad market, as well as understanding how to reconfigure and tailor products and services to that end.

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More importantly, enabling hospitals and HCPs is key to improving their capabilities in diagnosis, treatment, and surgical practices, and requires ongoing investments and long-term broad market commitments.

With the wave of digitalization, MedTech and consumables companies are also proactive in exploring online and digital platforms, which are reshaping the value chain to be more efficient, as well as economy of scale and scope.

Market access gaining importance

Market access is becoming key to winning in the Chinese MedTech market, with Unique Device Identifier (UDI), Health Technology Assessment (HTA), and Real World Evidence (RWE) as some of the major catalysts.

  • UDI

    The first batch of UDI was implemented in the National BMI Consumable Catalog in January 2021. The second batch will be implemented by June 2022, aiming to standardize the coding and nomenclature of MedTech and consumables. This will have major implications on the access and reimbursement for the entire industry.

    2022 China MedTech Industry Outlook (3)

  • HTA

    HTA has gained increasing importance over recent years for MedTech access.

    A few regions like Jiangsu, Guangdong, and Shanghai have made HTA a prerequisite for initial access and subsequent reimbursements. Going forward, the roles of evidence generation and health economics assessment will become increasingly important for differentiating value propositions and accelerating access.

  • RWE

    Meanwhile, RWE affords new opportunities for early access and accelerated approvals for innovative therapies.

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    With Hainan and the Greater Bay Area as pilot zones, a number of innovative therapies and devices approved overseas have landed in China for early access before their formal National Medical Products Administration (NMPA) approvals.

    RWE studies conducted in parallel to early access would help accelerate regulatory processes and eventual NMPA approval – as seen in the cases of Xen and Catalys.

    • Xen, a gel stent implant foropen-angle glaucoma surgery,in particular, received conditional approval from NMPA four months after it started its RWE study, paving the way for many to follow

2022 China MedTech Industry Outlook (4)

Winning in China’s MedTech industry

With both the headwinds and tailwinds in China’s dynamic environment, MedTech players will need to adapt and innovate more than ever.

To better adapt, MedTech and consumables companies would first need to have an in-depth understanding of the key trends and future outlooks, an objective assessment of the implications, and proactively adjust their strategic priorities and operational imperatives accordingly.

More importantly, innovation has been an important theme in the industry, and operates across multiple dimensions.

At product and portfolio level, there have been ongoing thrusts for China-fit R&D to better address China’s specific needs, while, at the same time, mitigating import substation risk.

In addition, customization goes a long way towards mitigating VoBP impact, as seen in the case of AK Medical. The company differentiates its offerings, taking advantage of 3D printing.

(Video) Section 1.3. Global outlook in the medical device industry

Philips, on the other hand, brings its teeth whitening offering directly to the consumer market through partnerships with non-public dental clinics. In so doing, it carved out a high value niche that is not subject to the cost containment pressure from DRG and DIP etc.

At access and GTM level, leading companies are striving to differentiate with their product and service offerings, and bring:

  • Better workflow solutions to customers
  • Cloud-based digital platforms for remote diagnosis and surgery
  • As well as big data, AI, and machine learning for better clinical decision support – spearheading many IVD, surgical consumables, and imaging majors

At the business model level, MedTech majors are stepping out of their comfort zones with cross sector partnerships with peers, pharmaceutical companies, providers, and payers alike for disease and health solutions.

Radiometer, for example, recently entered into a partnership with AstraZeneca towards total care for chronic kidney diseases patients. Illumina joined force with Sanofi to better identify, diagnose, and treat rare diseases patients in China.

On the commercial payer front, J&J explored partnerships with MediTrust and Taiping Insurance for breast prosthesis for breast cancer patients.

Innovation will always be the name of the game for the industry and will create true value by addressing unmet needs for customers and patients alike. In that regard, it will be the ultimate source for growth for the industry and bodes well for the ones with courage and determination to step out of their comfort zones, reinventing themselves and the industry in the process.

2022 China MedTech Industry Outlook (5)

For full report, please contact: Shanghai_LS@simon-kucher.com

(Video) The Growing Chinese MedTech Market | Med-Tech World

FAQs

What is the outlook for China's healthcare industry? ›

Revenue in the Health Care segment is projected to reach US$19.94bn in 2023. Revenue is expected to show an annual growth rate (CAGR 2023-2027) of 9.56%, resulting in a projected market volume of US$28.73bn by 2027.

What is the projected growth for Medtech? ›

The Global MedTech (Medical Technology) market is anticipated to rise at a considerable rate during the forecast period, between 2023 and 2028. In 2022, the market is growing at a steady rate and with the rising adoption of strategies by key players, the market is expected to rise over the projected horizon.

Is the medtech industry growing? ›

According to Statista, the Medtech market is worth approximately $19.65 billion. By 2027, the market is expected to reach $22.84 billion, growing at a CAGR of 3.83%. From telemedicine to 3D bioprinting, let's dive into the list of medtech trends creating new opportunities in this dynamic industry.

How is the medtech industry doing? ›

The global medical devices industry expected to reach a valuation of $612.7bn (£440.5bn) by 2025, growing at 5.4% CAGR. Thanks to growing consumer demand and technological innovation, we can expect to see high growth in product areas such as wearable healthtech, robotics nanotechnology, and extended reality devices.

What is the growth outlook for China? ›

China's economy is set to rebound this year as mobility and activity pick up after the lifting of pandemic restrictions, providing a boost to the global economy. The economy will expand 5.2 percent this year, according to our latest projections, versus 3 percent last year.

What is China's healthcare strategy? ›

China's healthcare paradigm has shifted from treatment to prevention, focusing on preventing lifestyle-related illnesses such as diabetes, cancers, and cardiovascular disease.In tandem with China's focus on prevention comes an emphasis on improving early screening and diagnosis.

What is the outlook for medtech in 2023? ›

Medtech industry outlook key takeaways

Capital markets remain volatile, but sector performance over the last decade relative to the S&P 500 remains ahead. Medtech M&A activity is expected to increase in 2023. Digital health tech investment remains high, but further research proving safety and efficacy is needed.

What are the 5 top trends shaping the medtech industry? ›

The two went in-depth on five that they see in the industry right now: AI, health equity, hospital care, talent and climate change.

What are the fastest growing segments in the medical technology industry? ›

The diagnostics centers segment is growing at a CAGR of 10.3% from 2022 to 2030.

How big is the MedTech market in China? ›

China's revenue in the Medical Technology market is projected to reach US$40.96bn in 2022. The market's largest segment is Medical Devices with a projected market volume of US$29.07bn in 2022.

What country has the most advanced medical tech? ›

The answer to the question, “what country leads the world in medical innovation?” is the United States.

Which country has the best MedTech startups? ›

United Kingdom, Germany, Italy, France and Switzerland are the countries with the most significant number of companies, amounts of investments in MedTech companies receiving early-stage investments.

What is world's biggest medtech? ›

Medtronic once again tops the list as the largest medical device company in the world. With a workforce of over 90,000, operating in 150 countries, Medtronic is at the forefront of medical technology.

What is the failure rate of medtech? ›

One article states that 75% of US-based medical device start-ups fail, and 98% of digital health startups fail.

Is medtech Indemand? ›

Do I recommend studying Medical Technology: There is a very high demand for medical technologists nowadays, local or abroad, so the employment opportunities are always up for grabs - may it be in the practice of the profession in hospitals and clinics, fields of research, sales, or business.

What is China's growth forecast for 2023? ›

Feb 8 (Reuters) - Rating agency Fitch has revised its forecast for China's economic growth in 2023 to 5.0% from 4.1% previously as consumption and broader activity are recovering faster than initially anticipated after the end of the "zero-COVID" regime. norms.

What is the market outlook for China in 2023? ›

New supply is forecasted to reach the pre-pandemic five-year average, while the rental decline will lose momentum. The relaxation of pandemic-related control measures, coupled with the economic recovery and measures to boost consumption, will help consumer goods sales log solid growth in 2023.

What is China's projected growth in 2023? ›

At its National People's Congress on Sunday, the Chinese government announced a target of “around 5%” growth in gross domestic product in 2023 — the country's lowest for more than three decades and below the 5.5% expected by economists.

What is the strength of China's healthcare system? ›

As of September 2020, more than 1.35 billion people (over 95% of China's population) are covered by one of the BMI programs, making it the world's largest healthcare security network. Among those covered, 337 million are covered by the EBMI, and 1.014 billion people are covered by the RBMI.

Does the US have better healthcare than China? ›

Per capita health spending in the U.S. is 60% higher than the average for all developed countries. These amounts to a 17% share of the U.S. GDP (US$3.3 trillion) compared to just 4.9% (US$690 billion) of China's GDP.
...
Health Care in the U.S. and China.
AttachmentSize
Health Care in the U.S. and China (PDF)334.37 KB
Dec 3, 2020

What are the top tech trends for 2023? ›

Top 10 Tech Trends 2023
  • Use of Low-Code or No-Code AI. ...
  • Curated Interactions like ChatGPT. ...
  • Digitally Immune Systems. ...
  • Hyper-Automation. ...
  • Growth of Green Technologies. ...
  • The Rise of Edge and Quantum Computing. ...
  • Genomics. ...
  • Digital Twins to Bridge the Gap Between the Digital and Physical Worlds.
Jan 23, 2023

What are the healthtech trends for 2023? ›

We believe in 2023 we will see innovation across unexplored therapy areas like pain management, weight loss, oncology, respiratory health, etc. Each of these segments individually has a large TAM (Total Addressable Market) and comprises patients with high LTVs.

What are the top 3 most important advances in medical technology? ›

Frank Short
  • 1 - LDL Cholesterol Reduction Treatment. ...
  • 2 - Type 2 Diabetes Drug.
  • 3 - Postpartum Depression Treatment. ...
  • 4 - Hypertrophic Cardiomyopathy Medication. ...
  • 5 - Severe Paralysis Curing Implants. ...
  • 6 - Personalized Medicine. ...
  • 7 - 3D-Printing Organs. ...
  • 8 - CRISPR Gene Editing Technology.
Oct 19, 2022

What are the top 10 technology trends that will transform healthcare in the future? ›

Top 10 Healthcare Technology Trends of 2023
  • IoMT ( Internet of Medical Things) ...
  • Cybersecurity and Data Privacy.
  • RPM (Remote Patient Monitoring)
  • Big Data and Analytics Improvements.
  • Cloud migration. ...
  • RPA (Robotic Process Automation)
  • CA (Cognitive Automation)
  • Artificial intelligence.
Jan 2, 2023

What are 3 recent trends and upcoming developments in the healthcare sector? ›

Machine learning, virtual reality, augmented reality, and wearable technology is all set to become critical tools for healthcare providers and organizations to perform more efficiently. Below are some insights from the healthcare experts on current and upcoming trends.

What are the top 5 fastest growing healthcare careers? ›

Here are some of the healthcare careers with the fastest growth rates in 2021.
  • Diagnostic Sonographer. ...
  • Medical Billing and Coding. ...
  • Medical Assistant. ...
  • Phlebotomy Technician. ...
  • Occupational Therapist. ...
  • Medical Administrative Assistant. ...
  • Dental Assistant. ...
  • Physical Therapy Assistant.
May 18, 2022

What is the fastest growing tech industry? ›

For now at least, technology for autonomous vehicle drive control systems is in the fast lane with a CAGR of 64%, hurtling into the number one fastest growing technology spot.

What is 1 major technological trend in healthcare? ›

Blockchain technology is one of the biggest health IT trends. It allows for more digital information to be stored while taking up far less space in the process. The demand for health care data will only increase with the advent of value-based care, predictive analytics and AI.

What are the biggest tech markets in China? ›

Top 10 Smart Cities in China
  • Shenzhen. ...
  • Hangzhou. ...
  • Chongqing. ...
  • Guangzhou. ...
  • Beijing. ...
  • Tianjin. ...
  • Shanghai. ...
  • Chengdu. Most often associated as the home of giant pandas, Chengdu has also become a leading city for China's digital economy, and was the first to implement a gigabit network.
Jan 19, 2023

What is the biggest tech company in China? ›

China's five biggest software companies based on annual revenue are Huawei, JD.com, China Mobile, Alibaba, and Tencent. Alibaba is known as the "Amazon of China" because of its popular online sales platforms, while Tencent is known for its mobile games and prominent social media and messaging app, WeChat.

What are the biggest Chinese medical device companies? ›

Biggest companies in the Medical Device Manufacturin industry in China
  • Shenzhen Mindray Bio-Medical Electronics Co., Ltd. Market Share: x.x% ...
  • Siemens Ltd., China Medical Solutions Group Market Share: x.x% ...
  • GE Healthcare Market Share: x.x% ...
  • Shinva Medical Instrument Co., Ltd. ...
  • Shanghai United Imaging Healthcare Co., Ltd.
Nov 2, 2022

Is Medtech in demand in USA? ›

“What we hear a lot from people who work in the clinical labs of large hospitals is that they feel unappreciated by those working in other departments.” According to Forbes, the US currently has a shortage of approximately 20,000-25,000 medical technologists.

Does the US rank first in health technology? ›

The United States ranked first in science and technology by a wide margin. That result stems from U.S. leadership in the number of new drugs and medical devices gaining regulatory approval.

What country is number one in medical technology? ›

31 countries ranked in the World Index of Healthcare Innovation in 2021.
...
Countries with the most advanced healthcare systems.
Position in the ratingCountry
3Germany
2Netherlands
1Switzerland
7 more rows
Apr 12, 2022

Who are Harvard MedTech competitors? ›

Who are Harvard MedTech 's competitors? Alternatives and possible competitors to Harvard MedTech may include Vitara Biomedical , Signature Medical , and Aidar Health .

Who are MedTech global competitors? ›

Who are Medtech Global 's competitors? Alternatives and possible competitors to Medtech Global may include Veradigm , GeBBS Healthcare Solutions , and Rittenhouse Ventures .

Which country is best for medical device manufacturing? ›

While many companies have looked for alternatives to China in the wake of the trade war, China is still the best option for low-cost manufacturing of complex medical devices. The country boasts a strong domestic supply chain and has a wealth of high-quality contract manufacturers.

Who is the father of MedTech? ›

Willa Hilgert-Hedrick is acknowledged as the Founder of Medical Technology Education in the Philippines.

Why is MedTech in demand? ›

Medical technologies enable the early and accurate diagnosis of health problems, facilitating timely intervention and improving outcomes. Innovative products can replace, repair and sustain failing body functions, while telemedicine and connected devices allow remote monitoring of patient's conditions.

What is the hardest part of Medtech? ›

What Are Examples of the Major Challenges We Face in the Med Tech Sector?
  • Biomedical Complexity. ...
  • Personalized and Bespoke Medicine. ...
  • Early Diagnostics. ...
  • Precision and Robotic Surgery. ...
  • Rehabilitation and Assisted Devices. ...
  • Stem Cells for Regeneration and Therapy. ...
  • The Regulatory Environment and Standardization. ...
  • Big Data.

What is the highest salary for Medtech? ›

The best Medical Technologist jobs can pay up to $188,500 per year.

What is the projected growth for MedTech? ›

The Global MedTech (Medical Technology) market is anticipated to rise at a considerable rate during the forecast period, between 2023 and 2028. In 2022, the market is growing at a steady rate and with the rising adoption of strategies by key players, the market is expected to rise over the projected horizon.

What is the med tech market forecast? ›

India's medtech market is estimated to be at 7.8 billion dollars in 2020. The country's expenditure on medical devices is at 4 dollars per person, the lowest worldwide (the global average is 66.3 dollars per person). By 2022 the volume is expected to be 9.6 billion dollars.

What is the future outlook for medical technologist? ›

Employment of clinical laboratory technologists and technicians is projected to grow 7 percent from 2021 to 2031, about as fast as the average for all occupations. About 25,600 openings for clinical laboratory technologists and technicians are projected each year, on average, over the decade.

What is the future outlook of healthcare industry? ›

The hospital industry in India is forecast to increase to Rs. 8.6 trillion (US$ 132.84 billion) by FY22 from Rs. 4 trillion (US$ 61.79 billion) in FY17 at a CAGR of 16–17%.

Has healthcare investment gone up in China? ›

China's healthcare expenditure has had double-digit growth for the last 10 years. Cui Cui thinks that spending on health matters will grow as rising income levels translate to the Chinese individuals placing greater emphasis on well-being.

Is there Outlook in China? ›

Yes and no. Outlook may be blocked in China, but there are conflicting reports of the accuracy here. Although Microsoft has a good working relationship with the Chinese government, some email services are blocked in China. In particular, Google's Gmail service has been blocked since 2015.

What are the trends in the healthcare industry 2023? ›

The healthcare industry is constantly evolving, and 2023 is no exception. As technology advances, healthcare trends are changing to keep up with the times. In 2023, we can expect to see a focus on preventive care, increased access to telemedicine, and the use of AI to improve patient outcomes.

What are the future trends in healthcare 2023? ›

Wearables, mHealth, telemedicine, and digital health solutions, all of these technologies have the potential to transform the healthcare system in 2023 and the coming years.

What is the fastest growing sector of healthcare? ›

5 out of 20 fastest-growing industries from 2019 to 2029 are in healthcare and social assistance
IndustryAnnual rate of changeNet change
Support activities for mining2.8111,100
Home health care services2.6456,000
Outpatient care centers2.6276,600
Other personal services2.497,100
37 more rows
Sep 4, 2020

What is the main health problem in China? ›

The biggest cause of death in China is strokes, followed by heart disease, chronic pulmonary disease and then lung cancer, according to the global burden of disease study produced by the US Institute for Health Metrics and Evaluation.
...
Smoking 'disaster areas'
RankCountry%
76China14.1
13 more rows
Sep 20, 2022

What is China investment Outlook 2023? ›

Fitch Ratings-London/Hong Kong-08 February 2023: Fitch Ratings has revised its forecast for China's economic growth in 2023 to 5.0%, from 4.1% previously, reflecting evidence that consumption and activity are recovering faster than initially anticipated after the authorities moved away from their “dynamic zero Covid-19 ...

Is investing in China still a good idea? ›

There's no doubt that the potential is huge. China is home to about one-fifth of the world's population, and its economy is massive and keeps growing at a fast pace. A low correlation with other major world markets also makes it a great diversifier.

Which country invests the most in healthcare? ›

The United States is the highest spending country worldwide when it comes to health care. In 2020, total health expenditure in the U.S. exceeded four trillion dollars. Expenditure as a percentage of GDP is projected to increase to around 20 percent by the year 2028.

Will China rebound in 2023? ›

BEIJING, Feb 24 (Reuters) - China's economy is expected to generally rebound in 2023 and monetary policy will be precise and forceful, the central bank said in its quarterly policy implementation report released on Friday.

What China is in high demand? ›

Products with high demand: according to Diario COMEX, products profiting most in the Chinese market are meat, dairy product, fresh and processed fruits, oil, fish preserves, sugars and liquors. The market grew from US$ 77 million to over US$ 1 billion dollars in the past decade, in other words, 13 times.

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