Upcoming Major Conferences, Exhibitions & Missions

This section provides a listing of upcoming healthcare-related events in China, including industry shows and trade missions. While FCS China is directly involved with some of these events, the majority here have no direct relationship with the FCS and are listed solely as a convenience to our users.

The Healthcare Industry Team in China will support a number of events in different cities directly recruiting participation by American exporters or through the Trade Fair Certification program of the U.S. Department of Commerce. For more information on how to register to exhibit in events for which our official support is confirmed, please click here.

We cannot be responsible for availability and accuracy of event updates provided on each organizer's website, but we have sought to provide the best link to the English-language section of their websites. For more information, please contact the organizing group as listed in the event description. Verify the information before making any commitments - we are not responsible for accuracy of information or changes in events' schedules.

MEDTEC China
September 9-11, 2008,
Shanghai

60th China International Medical Equipment Fair (CMEF Autumn 2008)
Oct. 29 - Nov. 1, 2008,
Suzhou

Dental South China
March 9-12, 2009,
Guangzhou

China Med
April, 2009,
Beijing

61st China International Medical Equipment Fair (CMEF Spring 2009)
April, 2009
Shenzhen

The 14th China International Dental Equipment & Affiliated Facilities Exhibition
June, 2009
Beijing

Country Overview

Cities are Gateways to Opportunities

Beijing is China's capital and the gateway to the opportunities that exist in this country's healthcare products and services sector.  Companies that must register their products for sale and use in China, can only apply to the State Food and Drug Administration office in Beijing.  For more information, see below under Key Contacts. Other major markets are also directly served by the U.S. Commercial Service through our offices in Consulates in Chengdu, Guangzhou, Shanghai and Shenyang.

There's more to China than these five markets: Leading second tier markets for medical devices and equipment include Tianjin, Shenzhen, and Nanjing.  For more information, click to see any of the summaries of available market research reports co-released by The JLJ Group and the U.S. Commercial Service in China (below).

Demographics

China's population of more than 1.3 billion has a growing number of senior citizens among its affluent population.  Roughly 20% of the population is between 0 and 14 years old.  Nearly 69%, or 917 million, are between 15 and 60.  Another 144 million senior citizens are aged 60 or above, who account for 11%  of the total population. China's senior citizen population is growing 3.3 to 3.4 percent annually.

By 2010, China projects that there will be 174 million people over age 60.   By 2015, the number of young people entering the workforce at age 15 will be dramatically lower than the number of people retiring at age 60 in the same year. By 2050, 430 million people (30%) are expected to be over age 60. Mandatory retirement age is also 60. Increased pressure to provide living accommodation options for those living alone on pensions by choice or not cared for by children.

According to a UN Population Fund study published in April 2006, men outnumber women in the workforce and in the general population up to around age 69 or 70, but females tend to have longer life spans (averaging 74 years).   However, since women worked less, they often have significantly smaller pensions and less medical insurance than men. As a result, elderly, widowed females in ill health are statistically far more prevalent in China.

Health Issues

In many areas in China, respiratory illnesses caused by air pollution and smoking are wreaking havoc. Cancer is said to be the largest killer in China now with liver cancer reportedly the most prevalent.  Cardiovascular diseases are also increasing.  Obesity problems among Chinese youth could result in longer term illnesses such as diabetes.  Treatment required for these diseases puts tremendous pressure on China's evolving healthcare system.   China also faces the possibility of a future HIV/AIDS epidemic among sex workers, others exposed through such contacts, and among drug users. In addition, diseases such as schistosomiasis (snail fever from a parasitic worm) and childhood enteroviruses can affect or kill dozens in a single outbreak.   

Healthcare Reform Overview

The Chinese government's healthcare system reform policy is now being shaped as a result of discussion among relevant ministries and commissions. Each government organization with a key role, such as the Ministry of Health (MoH) and Ministry of Human Resoures and Social Security (MoHRSS), is presenting its plan. The National Development and Reform Commission (NDRC) plays a major policy oversight role. Also important is the Ministry of Finance.

In the past, all government employees and workers at state-owned enterprises enjoyed virtually free medical care for themselves and their dependents. A new urban medical insurance system was introduced in 2000, with the goal of offering basic health care to urban workers.  The ongoing reforms are not necessarily designed to expand the number of insured, but rather to replace government funding with enterprise/employee funding.

Urban Healthcare

Anticipated changes in healthcare coverage could include offering basic, wider coverage for people in urban areas. As of 2007, there were approximately 577 million people in China's cities which are largely concentrated on or near the east coast. 

Supplementary, private insurance is also available to offset the limitations of state or municipally-funded healthcare services. Currently, there are successful foreign and joint venture healthcare service providers already in the China. Their experiences point to growing opportunities for U.S. companies looking to invest in this segment of the market. Others are still seeking to enter the market.

Rural Healthcare

Expansion and a higher RMB-based level of government funding for the new countryside cooperative medical scheme is designed to cover the large population in the rural areas.  At the end of 2007, as much as 86% of China's rural population, or more than 737.4 million people, had some degree of basic insurance in place.  Reportedly, government per capita expenditures will rise from RMB40 to between RMB 80 and RMB100 this year.

The Uninsured

More than 150 million migrant laborers need some form of coverage. They are being brought into health plans organized in municipalities such as Shenzhen which is allowing more than four million laborers to register if they reside in the city for a specified period of time. However, female spouses of migrant laborers who remain behind at home still lack sufficient health coverage because service is based on individual registration and does not include unemployed adult family members.  Fortunately, children everywhere are increasingly receiving compulsory healthcare, though the age of coverage may vary in rural or urban areas.

Industry Overview

China's medical device market is the world's 11^th largest market for medical devices and equipment.  Market growth drivers include: increasing economic affluence; a large and aging population; compliance with tariffs and other WTO accession-related actions, and government focus on improving access to basic healthcare, especially in rural areas.  Positive indicators fueling imports and increased domestic production of medical devices include the desire to utilize a wider array of advanced technologies in more of China's over 19,246 domestic hospitals and clinics.  Currently, the largest amount of imports are acquired by Tier III-level hospitals.

The following list prepared in 2007 provides a complete overview (but is subject to change):

The number of hospitals:19,246

• General Hospitals:13,120
• Traditional Chinese Medicine (TCM) Hospitals:2,625
• Specialized Hospitals:3,022

The number of tertiary hospitals: 1,045 - categorized by levels

• Class A:647
• Class B:364
• Class C: 34

The number of second-level hospitals:5,151

• Class A:3,104
• Class B:1,929
• Class C: 118

Overall, about 15 percent of the medical devices still in use were made in the 1970s.  These are expected to be replaced by new ones.  An increase in government and hospital expenditures and a corresponding rise in the amount of equipment and devices available to outlying areas can be expected to create greater access to higher quality medical care.

Data compiled by different trade sources vary but all indicate strong potential for growth in the market. For example, research compiled by the China Association for Medical Devices Industry (CAMDI) indicates that the total size of China's medical equipment market topped RMB70 billion (about USD 9.3 billion) last year and the figure is expected to reach as high as RMB120 billion (or, about USD 16 billion) by the end of 2010.  All market projections concur that imports are expected to increase anywhere from 12 to 15 percent a year.   According to incomplete figures from the World Trade Atlas, China's imports of medical equipment accounted for over USD 4.4 billion in 2006 and USD 5.1 billion during the first 11 months of 2007.  Trade data compiled and reported by the U.S. Government, using our criterion, is more conservative. 

On an average annual basis, the U.S. supplies approximately 31 percent of all medical equipment and device imports, followed by Germany and Japan.  In 2006, the U.S. was the top supplier country with $1.6 billion worth of exports. Between January to November 2007, American exporters sold nearly $1.5 billion worth of equipment. During the same periods, German exports topped $837 million in 2006, and reached $878 million during January to November 2007.  In 2006, Japan came in a strong third with $827 million in exports but dropped to $790 million for 2007, while retaining the number three spot.  Companies from certain countries have also captured more market share in specific subsectors (according to import data, using HS code references). 

Although, the Chinese medical equipment market provides strong opportunities for U.S. exporters, it also presents its share of challenges.  Decisions expected concerning above-mentioned procurement for hospitals on a centralized basis, or by province, will likely have a significant impact on how companies will sell to healthcare institutions in the coming years because of the government’s efforts to address concerns over accessibility and affordability of healthcare.   Concerns for U.S. and foreign suppliers revolve around how the tenders will be conducted and the transparency of the multi-step procurement actions.  

Industry associations and the U.S. Government continue to monitor and pro-actively seek further changes in the evolving regulatory environment, which has been beset by extensive delays in registration and re-registration of products.  However, efforts are reportedly being made to reduce the large backlog despite staffing issues at the State Food and Drug Administration (SFDA). Intellectual Property Rights (IPR) is another concern companies should prepare for before registering their products for sale in China.

Industry Highlights

Market Segmentation

The high-end consists of multinational companies (GE, Siemens, Philips, and Toshiba) account for 95% of the market. In fact, among the industry’s top 10 manufacturers in this sector, seven are actually foreign invested firms or joint ventures.

The middle to high end market is relatively advanced and includes moderately priced medical equipment that use better technology than locally produced ones, but are two to three generations behind expensive cutting-edge technology adopted in U.S. or other developed countries. The domestic industry is consolidating and upgrading and beginning to compete more on medium level technologies.

On the low-end, China had over 12,243 medical device manufacturers as of October of 2006, of which only 60 have sales valued at over RMB100 million. Most are SMEs.

Subsector Highlights

The annual increase in sales of large, high-end medical equipment was reported at between 14% and 15%. The foreign share of this market segment increased by 20% last year. 

China's computed tomography (CT) market has seen a tremendous growth over the past two decades. In 1987, China only had 170 units of CTs in use throughout the country. By 2004, China's accumulated number of CTs increased to 5,236 units. Although no most recent official numbers available, many medical professionals estimate China's total CT scanners installed by 2006 at 6,500 units. Despite a slight market slow-down in 2006 and 2007 due to China's  regulations concerning rising medical costs and the effect on CT purchases, China's current low CT installation rate of 5 units per million people should still presents a great potential for foreign suppliers. Based on future CT installation rate at 10 units per million populations, China’s total numbers of CTs are projected to grow from 2006 number to 12,000 to 13,000 units within the next 10 years. Such a growing market should continue to generate business opportunities to U.S. suppliers of regular and high-end CT scanners, CT replacement parts, refurbish and maintenance services.

Sales of clinical laboratory equipment and reagent sales are growing at about 15 to 20% per annum. China is the second largest clinical laboratory market in Asia and one of the world's fastest growing. While still a small player in global terms, China's clinical laboratory instruments market is expected to experience an annual growth rate of around 20% over the next five years, far exceeding the predicted growth rate for the global clinical laboratory market. China's USD1.5 billion clinical laboratory market accounts for just 4% of the total worldwide market. Without a doubt however, China’s market potential is enormous. A number of regulatory changes taking place in China are expected to spur further growth in the market. Hurdles still exist however for U.S. companies looking to do business in China, and the clinical laboratory market should be approached systematically, as part of a company's long term goals and planning, and possibly, first, by way of partnerships and alliances.

China's gynecological devices and products market presents great opportunities for U.S. exporters.  Currently, 80 to 90 percent of medical devices and products in the hospitals and institutions are imported. In comparison, domestic manufacturers can only provide low technology products though they are expanding capability to move toward production and sale of price-competitive medium level technologies.  This report covers the medical equipment and products used in gynecological hospitals and the department of gynecology in general hospitals in China. The subsector can be basically divided into devices and products for diagnosis, treatment, family planning, and reproduction technology.

The pre-hospital medical equipment market includes telecommunication systems, ambulances, emergency cardiac equipment and respiratory equipment.  In 2003, during the SARS outbreak, the pre-hospital emergency service system came to the forefront of public attention and since then has made enormous strides in development.   According to the China Emergency Magazine, as of, 2004 there were 300 first aid centers in China with over 10,000 ambulances. After SARS, the central government injected 3.5 billion RMB (USD 467 million) to develop an emergency service system by enhancing emergency medicine, training emergency medical staff, developing emergency medicine prevention, and emergency medicine telecommunication.  The demand for EMS equipment has been increasing significantly. China imported USD 8.89 billion in medical devices in 2006, 5% of which were estimated to be EMS-related products such as ambulances. In the large cities, about 80% of the equipment is imported from the U.S., Germany, Japan and the Netherlands.  There is a wide gap in service levels between the large EMS centers in the major cities such as Beijing, Shanghai, and Guangzhou and the smaller-sized counties.

In its first formulated Health Informatization Development Plan for Healthcare Information Technology, Chinese officials now require all hospitals to increase investment in building digitized hospitals.  This requirement is expected to accelerate China's HIT market growth at about 25 -30% annually during 2006-2010.  The market size is expected to expand from RMB4.5 billion in 2005 to approximately RMB15 billion in 2010. This fast developing market should provide greater business opportunities to overseas HIT hardware vendors, system software developers and integrators, consultants, and high-end application systems providers.

In terms of the overall opportunities for sales of medical devices for care and rehabilitation, China is the fastest growing market in the world, second only to Japan in Asia.  The market for equipment and products for the aged and the disabled includes medical devices, as well as a far wider range of products that do not require registration by the State Food and Drug Administration (SFDA).  Imports of 400 types of products from the U.S., Germany, Japan, U.K., Australia, Singapore, Denmark (and elsewhere) account for 57 percent of the market and include higher-end equipment and devices. However, what is currently available from all foreign and domestic suppliers selling to China's elderly and disabled, and the institutions that serve them, reportedly addresses only a fraction of the overall demand for higher end equipment and products. China's aging population, many of whom experience debilitating illnesses and disabilities that restrict their lifestyle options and pose challenges to them and their offspring, need a broad array of equipment, products and services to improve their quality of life. China's physically and mentally disabled also require quality rehabilitation, orthopedic and assistive products.

Dental Equipment and Dental Laboratory Equipment: As China's economy develops, so does consumers’desire for better health care and higher quality dental services. This has resulted in a rapid expansion in the number of stomatology hospitals and dental clinics, many of which are expanding beyond basic dental care to offer higher value-added services, such as cosmetic surgery. The increasing number of dental hospitals and clinics providing basic dental care has led to a rise in the number of dental cases sent to specialized dental labs. According to China's State Food and Drug Administration, the total size of China's steadily growing dental equipment market is estimated at about US$ 150 million. As much as US$ 47 million was estimated to be supplied by imports; the vast majority of these imports are earmarked for the large dental labs, which possess the financial resources and the technical expertise the smaller dental labs lack.  Currently, there are more than 1,000 dental laboratories in China with production permits.  More than 50% of all dental lab equipment and materials are imported from overseas.

China's investment in hospital construction has increased by about 20% annually during the past decade. In 2003, China spent RMB28 billion from national revenue in the construction of healthcare facilities. But, when taking spending from local revenue into account, medical professionals believe that China's yearly investments in health construction should range from RMB 60 to 70 billion. Despite its increasing heavy financial input, China's healthcare system still falls far behind the world's standards.  China today has 18,396 hospitals with 2.4 beds per thousand people.  Although China's more than 1.3 billion people account for 22% of world's population, the nation only has about 2% of the world's total medical resources.  It is expected that 80% of China’s existing hospitals need to be reconstructed over the next 10 years. In addition, China's 300 Centers of disease control (CDC) at or above the prefectural level are facing the same situation and will have to be rebuilt within the next 3-5 years. Thus, the development momentum for China's healthcare construction should continue to remain strong.  Priorities are given to infectious disease control, emergency medical rescue and treatment, women, children, mental health, and the treatment of chronic diseases.

The pharmaceutical/drugs subsector offers opportunities and challenges. According to industry contacts, sales growth in 2007 in China was as high as twenty percent for some leading suppliers.  Although industry estimates for total market size vary considerably from USD 12 billion to USD 20 billion market in 2007, depending on the criterion used, there is no doubt that the potential is enormous.  Advanced western pharmaceutical products account for more than 50% of the Chinese market.   American imports and products made by local joint ventures account for over 30% of the market. Research and development by major American or other drug manufacturers is well underway and China is also a good market for conducting clinical trials. 

At the same time, critical IPR issues including counterfeiting, patent linkage and data exchange remain extremely troublesome s they try to bring products to market through the regulatory process and complete the lengthy clinical trials they must conduct here. Furthermore, as China seeks to overhaul its healthcare system and improve access to much needed drugs for various illnesses, complex issues such as hospital bidding procedures, government-regulated tiered pricing for a variety of drugs, limits on reimbursement levels for drugs available on prescription and dispensing practices such as over-prescribing of antibiotics at hospitals, as well as the lack of expansion of the National Medical Insurance Drug List despite government guidelines to increase the number every two years, are viewed as hampering access for Chinese patients to higher quality products.

The nutritional products and dietary supplements sub-sector has doubled from $3 billion in 1998 to a total sales volume of $6 billion in 2001.  Experts estimate that the industry will reach $10 billion in annual sales by 2010, and will continue as consumers seek products with curative weight loss and other health enhancing effects. Over 3,000 domestic manufacturers of dietary supplements produce more than 4,000 different types of products. Domestic manufacturers fail to develop product branding and credibility and rely heavily on advertising to generate sales. As such, most domestic products, due to loss of credibility amongst consumers, tend to have short life cycles. High quality imported products only account for 10% of total sales. Companies report that complicated product registration, expensive and time-consuming certification requirements, and inexperienced and inefficient distributors are common obstacles in China.

For complete market research reports on the above-mentioned subsectors, please see the list below under Market Research Reports.

The Regulatory Environment

There are primarily two Chinese agencies that have regulatory roles for imported medical equipment. Depending on the product being exported to China, a company will need to register with the State Food and Drug Administration (SFDA), which is now under the Ministry of Health (MoH). A firm may be required to receive approval from the General Administration of Quality Supervision, Inspection and Quarantine of the People’s Republic of China (AQSIQ).

Redundant testing still exists even though the U.S. government has similarly raised this issue with the Chinese government at different levels.  It is unclear when this regulatory and certification system will be streamlined though confirmation of a “one test, one fee” procedure was announced at the Plenary Session of the Joint Commission on Commerce and Trade (JCCT) in December 2007.

SFDA Registration Procedures: Companies are required to get their product registered with the SFDA in China for any FDA-approved or CE marked products. All products must come in Chinese labels with name, specifications, detailed descriptions, material made, country of origin, date of sterilization and expiry date. All products and devices must come with an "Instruction For Use" (IFU) in Chinese.

The process is complex and time consuming and it may take 12-18 months upon submission of all necessary documents and respective samples for testing. American companies are encouraged to register their products through their authorized distributors. The SFDA has a comprehensive system for medical device registration and inspection, including product testing and factory audits. A company is required to provide a testing report for the product conducted by a Chinese lab.  Cost estimates vary widely for the registration of each product.

In addition, the applicant is also required to submit a product standard according to China's “Product Regulation Standard”, for SFDA's record. The fee for application of administrative approval is RMB3000 per product and it takes 90 working days upon all required dossier is submitted.

WTO
In accordance with World Trade Organization (WTO) regulations, China has committed itself to cutting tariffs, liberalizing its domestic distribution practices, and restructuring its regulatory environment. Over the next three years, China will allow foreign enterprises to import products and engage in distribution services. Furthermore, China has also implemented new drug administration laws designed to streamline product registration and protect Intellectual Property Rights (IPR).  These new laws will likely have a negative effect on market growth and profitability during the transitional period, but over the next 5-10 years this market should be able to provide better returns.

Intellectual Property Rights
Since China’s accession to the WTO, many laws have been revised to address IPR protection requirements in TRIPS. China has agreed to six years of “data exclusivity” and has committed itself to implementing a patent linkage system. The SFDA has worked to crack down on counterfeiters but without greater resources and stricter legal consequences these actions alone will not be enough to curb this rampant problem.

Market Research Reports

The healthcare sector is well researched by the U.S. Dept. of Commerce and organizations such as the JLJ Group, an independent market research consultant, the China Association for Medical Devices Industry (CAMDI) and statistics are also compiled by the World Trade Atlas. That said, trying to understand the exact size of any market subsector in China can be complicated because of the different statistical tools, industry resources referenced and analytical methods used by different, reputable sources. Qualified U.S. exporters of products and services seeking to order any of the following reports, please click here

• Computed Tomography (CT) Market (01/2008)
• Gynecological Devices and Products Market (01/2008)
• Pre-hospital Emergency Medical Service and Equipment in China (08/2007)
• USC-JLJ Medical Equipment & Devices (07/2007)
• USC-JLJ Dental & Dental Lab Industry (02/2007)
• Health Information Technology Market (06/2007)
• Care and Rehabilitation Equipment Industry Overview (12/2006)
• Clinical Laboratory Market (09/2006)
• Dental Laboratory Equipment and Materials (06/2006)
• Health Food and Dietary Supplements Market Industry Overview (01/2006)
• Healthcare Construction Market (10/2005)
• Pharmaceutical/Drug Industry (08/2005) 

Key Industry Contacts

Ministry of Health (MOH)
Address: No.1 Nanlu, Xizhimenwai, Xicheng District
Tel: (86-10) 6879-2290
Fax: (86-10) 6879-2295

State Food and Drug Administration (SFDA) - now under MoH
Address: A38 Beilishilu
Tel: (86-10) 6831-3344
Fax: (86-10) 6831-5648

General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ)
Address: No. A10, Chaowai Dajie, Beijing
Tel: (86-10) 6599-3922
Fax: (86-10) 6599-4421

People's Liberation Army (PLA)
Bureau of Drugs & Medical Instruments
Address: 22 Fuxing Rd, Beijing 100842
Tell: (86-10) 6821-6117
Fax: (68-10) 6821-6628

U.S. Commercial Service Contact Information for Healthcare

The U.S. Commercial Service offers a broad array of market entry services to U.S. exporters of healthcare products and services. Please refer to the following relevant contacts for additional information on how we can help you expand your business in China.

Beijing Office:
Tel: (86-10)8529-6655
Fax: (86-10)8529-6558/9
Richard Craig
Shuyu Sun

Shanghai Office:
Tel: (86-21)6279-7930
Fax: (86-21)6279-7639
Kevin Chambers
Lynn Jiao

Guangzhou Office:
Tel: (86-20)8667-4011
Fax: (86-20)8666-6409
Sherman Li

Chengdu Office:
Tel: (86-28)8558-3992
Fax: (86-28)8558-3991
Misha Cao

Shenyang Office:
Tel: (86-24)2322-1198x8142
Fax: (86-24)2322-2206
Yang Liu