Ten major development trends in China's medical device industry!

Looking forward to 2018, the public's demand for medical devices will further increase, the industry will continue to maintain a rapid and healthy development trend, and the regulatory policies will be further improved. In the next decade, the future of China's medical device industry will be bright.

 

Top Ten Development Trends in 2018

 

1. The new cycle of medical device industry development has started

 

In 2017, we predicted that the “golden development period” of the medical device industry has arrived. In 2018, the medical device industry will continue to develop healthily in the policy dividend, and a new cycle for the development of the medical device industry has started.

 

(1) The government has simplified the administration of power, implemented the “distribution service”, and clarified the main responsibility. The reform of the government's large-scale system has redefined the responsibilities of various government departments. The policies have also repositioned the responsibilities of R&D, registration, procurement, production, distribution, sales, quality, and agency. The pilot and implementation of the Medical Device Listing Permit Holder System (MAH) clarifies the responsibility of the product listed holders from the perspective of “responsibility”.

 

(2) Encouraging innovation will surely become a new driving force for future industry development. The country has put medical device innovation at an unprecedented height. “Product innovation, model innovation, regulatory innovation” has become a new feature of industry development in the new era. The establishment of a green channel will enable more new products to be launched quickly. CRO (Clinical Research Organization) The R&D contract outsourcing service organization) and the CMO (Contract Manufacture Organization) will also make great strides. In the past, medical device manufacturers mainly provided value services for medical institutions by manufacturing and selling products. The future medical service model will undergo major changes, and the industrial value chain will change from functional to service, and it will undergo major changes. Medical device innovation will develop at an unprecedented pace in 2018.

 

(3) The market structure has been reshaped and a new competitive landscape has emerged. In the new era, the medical insurance mechanism is diversified, the price formation is complicated, the centralized procurement is fragmented, and the price reduction and control fees become the normalization, which makes the medical organization organization form, medical insurance payment method, product structure, channel structure, marketing model, product benefit distribution, etc. The changes, doctors' diversion, patient diversion, prescription diversion, medical insurance diversion, circulation and diversion will lead to the formation of a new market structure, and the new market competition pattern is about to begin.

 

2. The medical and health industry will lead a new wave of economic development

 

In 2015, the policy proposed to focus on “combination of medical care and maintenance”; in 2016, “Healthy China 2030” was introduced, and “Healthy China” was promoted to the national strategy; in 2017, the 19th National Party’s “Healthy China Strategy” was written into the report and implemented. Made in China 2025, pushing China to accelerate from manufacturing to manufacturing. In the future, the medical and health industry will face unprecedented opportunities and challenges. The medical and health industry based on “health, health, and medicine” is expected to become the fastest growing industry in the development of the national economy and become the pillar of China’s economic development. new momentum.

 

3. "Two-vote system" brings opportunities for industry consolidation, and the concentration is increasing.

 

The medical device industry as a whole is more dispersed and will tend to concentrate in the future. With the implementation of the "two-vote system", "battalion reform and increase", "94", "industry rectification" and other policies, as well as the new GSP to make higher requirements for enterprise procurement, inspection, storage, distribution, etc., industry integration Intensified, the concentration will increase rapidly in the next two to three years.

 

4. Supply side structure adjustment, clearing "inventory", new supply brings new demand

 

 

 

 

First, clear the variety. In 2017, the State Food and Drug Administration officially resolved the backlog of approvals, accelerated the approval of innovative devices, cracked down on the fraud of clinical trial data, strengthened the process consistency check (see related topics in this report), and eliminated the approval of medical device zombies. Second, clear excess capacity. At present, more than 16,000 production enterprises have low technical level, serious product homogeneity, and backward production capacity is in urgent need of elimination. Once again, clear out the "small, scattered, poor, chaotic" business enterprises. Eliminate the old marketing model through two-vote system and GMP/GSP flight inspection. The new supply will bring about changes in new demand, and the industry will face tremendous changes.

 

5. Regulation is becoming more stringent and non-standard enterprises are eliminated

 

A large-scale flight inspection will eliminate the unhealthy trend of the industry. In 2018, the intensity of policy compliance control is increasing. Standardizing operations and finance has become a test for traditional marketing models. Combating monopoly, administrative intervention, and commercial bribery policies continues to exert strength. We assert that compliance companies are the hope of the future, illegal enterprises will gradually be eliminated, and the industry environment will gradually improve.

 

6. New technology expands the role of enterprises in the clinic, the traditional model is subverted

 

The new technology not only improves efficiency and saves costs for medical services and patients, but also enables medical device companies to play a greater role in prevention, diagnosis, treatment and care. We predict that in the next three to five years, the medical device industry will introduce more innovative products, and traditional diagnosis and treatment will be fundamentally subverted.

 

7. The degree of informatization has generally improved, and the "Internet +" has accelerated development.

 

The information of the products can be traced back. The use of information technology to supervise the whole process of medical device production and circulation is the focus of the New Deal on the requirements of the medical device industry. The information traceability mechanism, system and coding in the field of medical devices are still not perfect enough. Further improve. The development trend of intelligent medical devices has also put forward higher requirements for the popularization and improvement of information technology.

 

8. "Medical and Mechanical Integration" guides enterprises to develop two-wheel drive

 

 

 

 

Drugs and devices play a synergistic role in the diagnosis and treatment of medical institutions and patient health care. In recent years, some manufacturers have explored the fusion marketing model of “pharmaceutical-integration” and achieved success, such as Lepu Medical, AstraZeneca, etc.; some pharmaceutical commercial enterprises are also looking for breakthroughs in development from devices, forming “drugs+” The mode of common development of devices.

 

9. Capital helps the development of the medical device industry

 

 

 

In 2017, the total report of the Blue Book of Medical Devices counted 45 Chinese medical device listed companies, Wang Baoting and Qi Hongwu, editor of China Medical Device Industry Development Report (2017), Social Science Literature Publishing House, 2017, p. 11. In 2017, another 12 medical device companies filed IPOs (see Table 2). According to PricewaterhouseCoopers, PricewaterhouseCoopers: Review of China's Medical Device Industry M&A in 2017, April 2018. In 2017, the amount of M&A in the medical device industry was US$4.94 billion. Although the M&A amount decreased by 36%, the annual M&A volume increased by 9%. Strategic investors and financial investors remained relatively active in the number of transactions (see the topic of this report). content). According to experts' judgment, Deloitte: "The 2018 Global Life Science Industry Outlook." In 2018, the volume of M&A transactions, the amount of transactions, and the number of huge transactions will increase. Capital will give unlimited power to the development of medical device companies.

 

10. The development of artificial intelligence medical is in the ascendant

 

In recent years, the state has issued a series of documents such as “Internet” + Artificial Intelligence Three-Year Action Implementation Plan, “13th Five-Year Plan for Health and Health Science and Technology Innovation” and “New Generation Artificial Intelligence Development Plan” to plan the development of artificial intelligence. In 2017, CFDA added a category corresponding to AI-assisted diagnosis in the new edition of the Catalogue of Medical Devices (see the special report content of this report for details). On April 25, 2018, the "Opinions on Promoting the Development of "Internet + Medical Health"" (Guo Ban Fa [2018] No. 26) was issued by the General Office of the State Council, clearly proposing: "Promoting the 'Internet +' artificial intelligence application service. Research and development of clinical diagnosis and treatment decision support system based on artificial intelligence, carry out intelligent medical image recognition, pathological typing and multidisciplinary consultation, and application of intelligent speech technology under various medical health scenarios to improve the efficiency of medical services"; "Strengthen clinical and scientific data integration Sharing and application, supporting the development of medical health-related artificial intelligence technologies, medical robots, large medical equipment, emergency medical equipment, bio-three-dimensional printing technology and wearable devices." From the policy level, it provides a guarantee for the development of artificial intelligence medical care.

 

 

Three major impacts of new regulations on clinical trials

 

The Blue Book summarizes and stipulates the regulations, departmental rules and regulatory documents issued by the administrative department including the State Food and Drug Administration from 2017 to the medical device clinical trials, and analyzes these policies and regulations for the Chinese medical device clinical trial industry. Impact. According to the Blue Book, 2017 is a year of rapid update of medical device regulations. The national administrative department has issued a large number of new regulations and guiding principles, which will have a multifaceted impact on clinical trials of medical devices.

 

1. Purify the legal environment of clinical trials of medical devices in China

 

From 2016 to 2017, CFDA carried out four times of medical device clinical trial supervision and spot checks. Among the total of 40 spot checks, 11 projects were judged to have authenticity problems, and a large number of enterprises took the initiative to withdraw their registration applications. The introduction of the “two highs” and “interpretations” in 2017 undoubtedly played a decisive role for enterprises, non-clinical research institutions, clinical trial institutions, and contract research organizations. The falsification of the registration application materials will not only face the administrative punishment of the drug supervision department, but also the procuratorate and the court will intervene in time to criminalize the fraud. This series of measures has undoubtedly greatly promoted the implementation of the "Opinions of the State Council on Reforming the Approval System for Drug Medical Device Evaluation and Approval", purifying the scientific research environment and improving the research and development level of drugs and medical devices in China.

 

2. Guide and release hospital resources for clinical trials of medical devices

 

According to the CFDA website medical device clinical trial organization record management information system statistics, as of April 2018, there have been 89 medical institutions that have successfully obtained medical device clinical trial institutions for filing, of which 21 have not obtained the qualifications of drug clinical trial institutions. Directly filed through the clinical trial organization of medical devices. It can be seen that a considerable number of medical institutions that have never conducted clinical trials of drugs and medical devices are very keen to join the industry through filing. In the future, how to quickly improve the clinical testing technology level of medical devices under the premise of ensuring the quality of medical device clinical trials will become an important issue for the drug regulatory department, sponsors and medical device clinical testing institutions. .

 

3. Further scientifically standardize clinical trials of medical devices in China

 

In 2017, CFDA released the "Guidelines for the Design of Clinical Device Clinical Trials" for the first time. This is a comprehensive technical document that combines clinical medicine, statistics, clinical epidemiology, evidence-based medicine and other multidisciplinary studies on clinical trials of Chinese medical devices. Proposed scientific guidelines. CFDA's two interpretations of GCP-related issues in medical devices indicate that the relevant departments of CFDA have been paying attention to the problems in the implementation of the "Quality Management Standards for Clinical Devices Clinical Trials", and timely discovering and resolving the implementation of medical device clinical trial sponsors. The problem is coming from the nuances to promote the development of the medical device industry.

 

Products have competitive advantages along the “Belt and Road”

 

 

According to China Customs data, the trade volume of medical equipment between 64 countries along the “Belt and Road” in 2017 reached US$6.361 billion, an increase of 7.70% compared with the same period, accounting for 15.12% of the total foreign trade of medical equipment in the world during the same period. Among them, China's exports of medical equipment along the “Belt and Road” countries totaled 4.476 billion US dollars, up 4.98% year-on-year; the import of medical equipment along the “Belt and Road” countries was 1.886 billion US dollars, an increase of 14.75% year-on-year, and the trade surplus was 2.59 billion US dollars. The trade competition index is 0.4, indicating that medical device products made in China have certain competitive advantages in countries along the “Belt and Road”.

 

Since the “One Belt, One Road” major initiative was launched in 2013, the demand for medical device products in China along the “Belt and Road” has increased, especially in 2013-2014. In 2016, the global economic recovery has not been fundamentally improved, resulting in a sluggish demand in the national market. It has also led to a significant slowdown in the growth of China's medical device foreign trade. China's exports of medical device products along the “Belt and Road” have declined, and exports have fallen year-on-year. The lowest point in the past five years. Judging from the quantity and price of exports, in the past five years, the number of exports has increased to varying degrees, but the competition in the export market has intensified, mainly due to the increase in the number of exports, which cannot compensate for the decrease in the amount of exports generated after the price decline. In 2017, China's exports of medical device products along the “Belt and Road” countries increased slightly year-on-year, which changed the market competition trend of “quantity increase and decrease” in 2016.

 

In 2017, the four major regions of China's medical equipment exports to the “Belt and Road” are the 11 countries in Southeast Asia, the 18 countries in West Asia, the 7 countries in South Asia and the 16 countries in Central and Eastern Europe. The import and export share of these four regions accounts for the “Belt and Road”. "90% of the market. Especially in the eleven countries of Southeast Asia, the trade volume has accounted for 41% of the trade volume between China and the countries along the “Belt and Road”. Among the exports of China along the “Belt and Road” area, the fastest growth is in the sixteen countries of Central and Eastern Europe, an increase of 9.12% year-on-year. The fastest growth in imports was in Mongolia, Egypt and the CIS, with an increase of 829.52% and 30.55% year-on-year. The trade mode between China and the countries along the “Belt and Road” is general trade and processing trade, of which the general trade export volume is 3.059 billion US dollars, accounting for 68.34%; the processing trade export volume is 569 million US dollars, accounting for 12.71%, and the feed is The processing method is mainly, and a small part is the local border small-scale trade.

 

In 2017, China exported a total of 64 medical devices along the “Belt and Road” countries, with an export value of 4.476 billion US dollars, an increase of 4.98%. From the perspective of specific countries, the top five markets are India, the Russian Federation, Singapore, Malaysia and Vietnam, with an export value of 1.688 billion US dollars, accounting for 37.7% of China's total exports. The top ten markets for export were US$ 2.843 billion, accounting for 63.5% of the total. The market exports to India, Russia, Vietnam, Poland, Thailand, Indonesia, Saudi Arabia and Turkey increased to varying degrees, and the Singapore and Philippines markets experienced negative growth. In 2017, China exported the most medical equipment to India, with an export value of 556 million US dollars, accounting for 12.4%, much higher than other countries. In addition, it is worth noting that since 2017, the good momentum of Sino-Russian bilateral trade has stabilized and recovered. The export value has increased by 5.05% year-on-year, which is more than 12% higher than the same period of 2016.

 

In 2017, China's medical device import sources were mainly Singapore, Israel, Malaysia, Vietnam and the Czech Republic, accounting for 75.55% of total imports. The top ten importers of Thailand, Hungary, Poland and Indonesia all showed different degrees of growth. Hungary and Vietnam had the largest growth rates of 81.48% and 53.84%, respectively, while India and Malaysia had negative growth of 11.71% and 7.82% respectively.