Primary medical device market, multinational giants fire and ice

The "lower grassroots" road of multinational giants is not good. However, the first-line market is almost saturated, and the major multinational medical device brands are in the second, third and fourth-tier markets. For the grassroots market, the huge blue ocean has great temptations and they will not give up easily.

Release date: 2014-10-22

The "lower grassroots" road of multinational giants is not good. However, the first-line market is almost saturated, and the major multinational medical device brands are in the second, third and fourth-tier markets. For the grassroots market, the huge blue ocean has great temptations and they will not give up easily.

Since the new medical reform, the primary health care market has begun to be remembered. If China wants to change the current uneven distribution of medical resources, it must vigorously develop primary health care; the development of primary health care requires investment, building houses, buying equipment, Recruit talents...

"GPS" primary medical warfare

The volume of the primary medical device market brought about by “buy equipment” has attracted the competition of multinational medical device giants, especially “GPS” (GE, Philips, Siemens).

In May 2009, GE launched a “Health Ideas” strategy, announcing a $3 billion investment over the next six years to develop 100 new products that increase medical coverage, improve quality and reduce costs – the China program includes Launched a new rural basic medical product for China's grassroots market, and proposed in 3 to 5 years to adjust the 8:2 ratio of GE Healthcare's mid- to high-end and grassroots to 5:5 in the Chinese market. Philips launched the "Dandelion Project" for the grassroots market, involving product development, sales model adjustment, and a "zero interest rate" financing plan with a quota of 5 million yuan. Siemens introduced the SMART strategy for economical products earlier, and divided the medical business – 40% based on basic medical care and 60% in the middle and high end.

However, China's primary health care market is clearly different from the top three hospitals in the big cities, and these giants are well aware of this. “The needs of domestic large hospitals, the practice of doctors, and the application in the academic field are not much different from those of foreign large hospitals. Our advanced technology in the world is fully applicable to large hospitals in China.” At the time, he was the president of GE Healthcare Greater China. Duan Xiaoyu, who is also a CEO, said: "Primary care is more special in China. There is a relative lack of medical resources in the rural areas of the central and western regions. In essence, the lack of primary care is technology, talent and capital."

Therefore, when advancing the strategy of primary health care, the giants will take care of these aspects. For example, Philips established the China Healthcare Institute to provide workflow training for its clients, and to provide online training courses on a regular basis using the official website and the MOOC platform. In cooperation with the China International Medical Exchange Foundation, Siemens started the training program for primary hospitals that lasted until 2015. GE is working with the Chinese Medical Doctors Association to develop a grassroots physician training program. After completing the first three-year plan, the new three-year plan was launched in May this year. In addition, Siemens and GE Healthcare's factories have established customer service centers, and after-sales personnel have become passive to prevent hospitals from failing during daytime treatment.

Policy variable

However, the government no longer wants to see the emergence of foreign capital in primary care, which brings new uncertainties to multinational medical device companies.

On May 26 this year, Xi Jinping, the general secretary of the CPC Central Committee, had a speech on medical equipment during his inspection in Shanghai. He clearly stated that “it is necessary to speed up the localization of high-end medical equipment, reduce costs, and promote the continuous development of national brand enterprises.” Soon, the Health Planning Commission launched the selection of domestically produced excellent medical equipment, and clearly stated that “providing reference for medical institutions procurement”. In various places, the process of localization has been pushed faster. Xuzhou has made it clear that in the second half of 2014, the procurement of medical equipment in hospitals in the city must use domestically produced equipment.

The Ministry of Science and Technology has carried out support for key medical technology projects in 2012. At present, the three major parts of X-ray machine, ultrasound and biochemical analyzer have basically upgraded their technology. High-end equipment such as nuclear magnetic, color ultrasound and CT can also be made in China. Turn. The price of these domestically produced equipment is 30% lower than that of imported brands, and the grassroots market is the main battlefield of domestic equipment.

Obviously, the policy level does not support the multinational giants of GPS to occupy the primary medical market; not to mention, the price disadvantages of the products of the multinational giants still exist; and the grassroots market is originally the main battlefield of domestic equipment, and the local enterprises also have the channel resources. A considerable advantage.

All sorts of things seem to be that the “lower grassroots” road of multinational giants is not good. However, the first-line market is almost saturated, and the major multinational medical device brands are in the second, third and fourth-tier markets. For the grassroots market, the huge blue ocean has great temptations and they will not give up easily.

Just last month, GE released eight new ultrasound products, two of which were specifically for primary care; in the latest issue of Business Week, GE used two full-page versions of Interpretation of Primary Care. Marketing. After a few months of replay (July), the former GE Healthcare Greater China President and CEO Duan Xiaolu, who led the team in the Chinese primary medical market, was promoted to the president and CEO of GE Greater China Medical, becoming the first female CEO of GE China.

Source: New Kangjie

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