According to data released on August 5, in the first half of 2015, China's medical device industry realized cumulative operating income of 10.829 billion yuan, total accumulated profit of 9.244 billion yuan, and accumulated operating income and profit growth rate of 12.05% and 4.71%, respectively. (Although this data may be sample data, it also reflects some specific conditions in the domestic medical device industry). The data details are as follows:

China's medical device industry started late, but with the development of the economy and the improvement of people's health awareness, from the hospital's high-end medical equipment to convenient home medical equipment will usher in a high demand growth, will be the domestic medical equipment industry Bringing broad development prospects. Especially recently, the “13th Five-Year” development plan for the pharmaceutical industry and medical and health has been basically completed, and high-performance medical devices have been identified as one of the key breakthrough areas, which will undoubtedly bring benefits to the future development of China's medical device industry. The following China Medical Device Innovation Network analyzes the development prospects of China's medical device industry. The details are as follows:

Analysis 1: The process of “localization” is accelerating

From the perspective of the degree of national policy promotion, the medical device industry is currently welcoming a rare policy-intensive “promotion period”. It is understood that since 2013, relevant ministries have issued 18 policy documents to support the development of the medical device industry, such as the "Regulations on the Registration of Medical Devices", "Administrative Measures for the Registration of In Vitro Diagnostic Reagents", "Management Instructions for Medical Devices and Labels" "Where, in particular, the release of the new "Regulations on the Supervision and Administration of Medical Devices" (referred to as "the new edition of the Regulations") implemented in June 2014 has, to a certain extent, achieved a policy loosening of the medical device industry and is expected to boost domestic medical care. The development of the equipment industry has taken a new step. There are indications that this year the government hopes to advance the “localization” process in the field of medical devices, especially high-end medical equipment .

Due to the expansion of the overall market and the rapid increase of the localization rate, it is the two core logics for the benefit of domestic medical device enterprises. From the perspective of the improvement of localization rate, the high-end image diagnostic equipment and in vitro diagnostic field with low market share of domestic enterprises still exist. Huge room for improvement, the stimulation of relevant policies will accelerate its localization process.

Analysis 2: Increase in domestic consumer market demand

Under the guidance of national policies and the replacement of domestic medical and health institutions, medical devices will have a huge domestic consumer market. Relevant information shows that at present, China's medical device market has exceeded 100 billion yuan, with an average annual growth rate of about 23%. Comparing foreign medical devices to 42% of the total size of the pharmaceutical market, the domestic medical device share only accounts for 14% of the total size of the pharmaceutical market, and there is still much room for improvement.

In 2013, the Ministry of Science and Technology released the special plan for medical equipment “Twelfth Five-Year Plan”, and the Ministry of Industry and Information Technology released the “Twelfth Five-Year Plan” for new materials industry. The "Health China 2020 Strategy Research Report" issued by the Ministry of Health clearly pointed out that for independent research and development of pharmaceuticals, medical consumables, medical equipment and large-scale medical equipment, the Ministry of Health will specifically launch a major national health industry project of 10 billion yuan. The acceleration of economic development has led to a comprehensive upgrade in demand for medical services, resulting in an overall increase in demand for health services. The gradual opening up of the medical service market has accelerated the speed of domestic and foreign capital investment in China's medical service industry, which has directly led to an increase in demand for the domestic medical device market.

Analysis 3: Industry mergers and acquisitions become the main direction of the future

As a basic support industry for the health service industry, medical devices show great potential and space for development. At present, the number of manufacturers in China is relatively scattered. There are more than 1,800 enterprises with a scale of 50 million, and there are about 20,000 small ones. The average output value of each family is about 1 million.

In recent years, the average annual transaction volume of mergers and acquisitions among medical device companies has reached tens of billions of dollars. This trend has led to the continuous optimization of the medical device industry structure and the emergence of large-scale enterprises. In general, medical devices are now a major direction of mergers and acquisitions, and domestic companies have been doing mergers and acquisitions. According to the analysis of the medical device industry format, the single variety of the equipment company and the non-extensibility of the technology have led to the bottleneck of the company's endogenous development. In the future, we will break through this bottleneck and build a multi-category platform-based company. Industry M&A is an effective way to quickly break through the bottleneck.

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