Some time ago, the import tariff of more than 30 medical devices was reduced, and mostly would even be reduced to zero in the next 3 or 5 years. Concerns about the Chinese medical device industry have been raised instantly, and it is widely believed that it would be more difficult for the domestic medical device enterprises to develop towards the medium- and high-end market, and that the whole industry might face difficulties. Then, how is the prospect of the Chinese medical device industry? Here is the analysis from the lecture hall in the Report on Market Demand and Investment Consultation of Chinese Medical Device Industry 2016~2021.

No pains, no gains. Based on the report analysis, the impact of tariff reduction might be unavoidable, but fierce market competition could truly enable the medical device enterprises to grow up. In this regard, tariff reduction might be a good thing.

In addition, policy promotion of medical device domesticization and encouragement of domestic enterprise development towards the medium- and high-end market would also further promote the development of domestic medical devices. In the leading group working meeting of promoting the domestic medical device development and application jointly held in Beijing a few days ago, the Ministry of Industry and Information Technology of PRC and the National Health and Family Planning Commission of PRC made it clear that it was necessary to broaden and support the domestic medical device development and application, to strengthen and perfect the policy support systems for innovation, production, configuration and clinical application, to strengthen the combination of R&D and production with popularization and application, to mobilize the enthusiasm of the parties, to improve the domestic medical device market competitiveness, and to accelerate the promotion of domestic medical devices to "go out".

Based on the report, with the promotion of relevant favorable policies, the technical content of medical device enterprises would be significantly increased, the innovation consciousness would be constantly strengthened, and the development of domestic medical device market would be predictable. Moreover, tariff adjustment would also reduce the core element price, which would have certain promotion effect for the domestic medical device enterprises to research and develop the medium- and high-end products. After all, R&D of core technology cannot be separated from the core elements.

Based on the statistics, in January through April 2016, the added value of pharmaceutical industry above the scale was increased by 9.6% on a year-on-year basis. The enterprises above the pharmaceutical industry scale achieved the main operating income of RMB 867.923 billion, with an increase of 10.4% on a year-on-year basis, 8.1% higher than the overall growth rate of the national industry, and 0.89% higher than that in the corresponding period last year. The sub-industry of medical devices & instruments and Chinese herbal pieces achieved the fast growth in the main operating income.

In addition, the imported medium- and high-end medical devices are generally high in the price, which is difficult to afford by the patients in demand, even if the tariff is reduced to zero. It is no doubt that the domestic medical device enterprises have enough market demand and growth space.

However, the medical device enterprises focus more on the medium- and low-end products, and the start of industry development is late, resulting in the relatively weak market competitiveness. Meanwhile, it is difficult for the medical institutions to break the hard habit of "worshiping foreign things". For example, some high-quality and low-cost domestic medical devices could be exported to developed countries but could not enter into the domestic hospitals. The low trust can be imaginable.

Therefore, both the policy and the market hope that the domestic enterprises could break the situation of monopoly by foreign enterprises for a long time in the medium- and high-end market. The capital is also optimistic about the medical device industry, because the latter has kept the double-digit growth for many consecutive years. Based on the statistics, the industrial output was increased from RMB 67.735 billion in 2008 to RMB 217.591 billion in 2014, and the sales revenue was increased from RMB 63.949 billion in 2008 to RMB 213.607 billion in 2014, with strong growth.

In addition to the obvious growth trend, small risk and high profit would be also the reason for the capital to be optimistic about the medical device industry. As long as the medical device enterprises have enough core technology, the risk of failure is very low, and the cost in the later period mainly depends on the consumables, which has a great profit space.

More importantly, the short investment cycle and small capital demand of medical device industry are quite consistent with the appetite of capital. With the intervention of capital, the domestic medical device development would be accelerated, expected to break the situation of monopoly by foreign enterprises.

Previously, domestic medical devices should also fill the market of imported devices, and should focus on the R&D to improve their own technical strength, so as to enter into the golden decade of development. In the next 20 years, domestic medical device market is expected to become the world's largest medical device market.