Executive Summery

Market Overview

Although the global economy is experiencing downturn recent years, health care equipment market in China still growing despite the all the uncertainties in terms of the economy. According to the statistics, the compound annual growth rate (CAGR) is expected to grow to 14.4% for the five year period from 2009 to 2014, which will leads the market value grow to $44.2 billion1. In comparison, the projected growth rate is expected to remain at a stable level of approximately 4.4% for the five year period from 2009 to 2014, which represents a market value of $368.5 billion at the end of 20142. Although suffering from low growth rate recently, international health care equipment market still maintain attractive due to aging of the population in several developed and developing countries.

Major Issues

To Chinese health care equipment manufacturers, domestic and foreign market possesses both opportunities and challenges, and there are several major issues present to them.

Domestic Market

1. In April 2009, the Chinese government decided to launch the medical reform that involves the investment of RMB 850 billion in order to improve the accessibility of medical and pharmaceutical products and services. Within this investment, a large portion of it will be used to improve rural area and community-based heath care service condition3.

2. Been the largest economy engine in the world, China is witnessing the growth of the world largest middle class population.

3. In order to control cost and ensure fairness in the post-medical reform period, the government implemented the provincial-level tendering practices4.

4. After the medical reform, the government has formed a panel of experts develop guidelines and criteria to ensure that the medical devices and equipment is functionally appropriate for end-users5.

International Market

1. Major players in this sector are able to enjoy economy of scale. International conglomerates like GE Healthcare and Siemens...