China imposes restrictions on the purchase of imported medical equipment for the first time

Recently, the Health and Family Planning Commission launched a selection process for domestically produced medical equipment, which is a public selection process for domestically produced medical equipment in China and forms a product catalog.

The reporter learned from the Chinese Medical Equipment Association that the selection list will provide reference for the future configuration of medical equipment in health and family planning institutions, which will inevitably increase the proportion of domestic medical equipment procurement. At present, Siemens, General Electric (GE) of the United States, and Philips of the Netherlands monopolize 70% of China's high-end medical equipment, while the proportion of domestically produced equipment is less than 10%.

Industry insiders believe that this move is a statement by the health regulatory authorities to actively promote the development and application of domestic medical equipment, and is also a practical measure to alleviate the problem of "expensive medical treatment". It is reported that the current high testing and inspection costs are closely related to the procurement and maintenance costs of medical equipment. Once the localization ratio of high-end medical equipment is significantly increased, related costs are expected to be reduced by two-thirds.

First selection

Recently, the Planning Department of the National Health and Family Planning Commission commissioned the China Medical Equipment Association to launch a selection process for domestically produced medical equipment products, targeting domestic independent brand products.

Zeng Kai, from the Technical Evaluation Department of the China Medical Equipment Association, told reporters that the preliminary research, selection procedures, and drafting of standards for this work began at the end of 2013. The selection scope includes three categories: instruments, equipment, and consumables.

At present, high-precision and advanced medical equipment, as well as large-scale medical equipment, have long been monopolized by foreign brands. The selection process will promote the development and application of domestic medical equipment

It is understood that the selection will be based on criteria such as meeting clinical needs, excellent product quality, market competitiveness, and development potential. After selection, a product catalog will be formed, and a scientific evaluation system for medical equipment application will be gradually established to provide reference for the configuration of medical equipment in health and family planning institutions.

Zeng Kai told reporters that there is no exact timetable for the subsequent selection, but the second batch of equipment selection will be carried out in the second half of this year.

According to the "2013 Blue Book on the Annual Development of China's Pharmaceutical Industry" released by the China Medical Supplies Association earlier this year, as of the end of 2012, the scale of medical device manufacturing enterprises in China had exceeded 170000. Among them, about 90% of medical device manufacturing enterprises are small and medium-sized enterprises with low production technology and annual income of less than 10-20 million yuan. However, there are not many enterprises that can produce high-tech products with independent brands such as electronic monitoring equipment and CT, and have a revenue scale of over 500 million yuan.

This means that competition among companies will be fierce during the selection process.

It is understood that the selection criteria include three parts: main technical parameters, evaluation, and basic information of the enterprise. A total score of no less than 80 points is required to be selected for the domestic medical equipment product catalog.

Among them, although the basic situation of the enterprise only accounts for 20% of the weight, company size, sales volume, market retention, financial status, and after-sales service will become important quantitative indicators.

The reporter noticed that in the reality of high-end medical equipment, especially large medical equipment such as CT, MRI, PET-CT, which have long been monopolized by foreign brands, the Health and Family Planning Commission's launch of the selection process for domestic medical equipment has caused considerable reactions in the industry.

This move will promote the development of domestic independent brand medical equipment and is also a statement from the health regulatory authorities that they are willing to promote the development and application of domestic medical equipment, "said Chen Jian, director, deputy general manager, and secretary of the board of directors of Yuyue Medical (002223, stock bar).

Monopoly of foreign enterprises

The development of CT (computed tomography), MR (magnetic resonance imaging), and PET-CT (molecular imaging) is a milestone in the history of medical diagnosis, and several scientists who have made outstanding contributions in this field have been awarded the Nobel Prize.

However, it has been 30 years since the birth of machines, and there are still only a few companies worldwide that can produce these products.

The 2012 market size analysis of CT and MR equipment released by the China Medical Equipment Association showed that Siemens Healthineers had a market share in CT and MR equipment, with over 70% of the high-end medical equipment market share in China shared with General Electric (GE) in the United States and Philips in the Netherlands. Industry insiders predict that by 2015, China will become the world market for high-end medical equipment.

From the perspective of hospitals alone, the proportion of domestically produced high-end medical equipment is quite low, less than 10%, "Chen Jian admitted.

In the opinion of Zhang Qiang, President of Shanghai Lianying Medical and CEO of MR Business Unit, in the high-end medical equipment market, the absence of China's own high-end medical equipment companies has directly led to the high sales and maintenance prices of large-scale medical equipment in China, which is one of the main reasons why Chinese people are "expensive and difficult to see a doctor".

It is reported that a 1.5t magnetic resonance system priced at $750000 in the United States is sold for about 12 million yuan (equivalent to $1.92 million) in China. Calculated based on 8 years of use, the post maintenance cost is equivalent to 50% of the equipment.

"High end medical equipment does not mean high price. Chinese people have the right to enjoy advanced diagnostic and treatment technologies at reasonable prices," Zhang Qiang said.

According to the reporter's understanding, the price of PET-CT examination, which is used for early detection and diagnosis of major diseases such as tumors, brain and heart diseases, is as high as 12000 yuan in some hospitals in Beijing and around 7000 yuan in some hospitals in Shanghai. Due to the fact that the cost of the examination is not covered by the basic medical insurance (reassuring insurance) reimbursement, the high price has deterred many patients.

We hope to reduce the inspection fee of PET-CT by two-thirds through independent research and localization, "said Zhang Qiang.

Chen Jian told reporters that compared with foreign equipment of the same type and level, domestically produced high-end large-scale medical equipment has a significant price advantage, which can be reduced by 40% to 50%. Accelerating the localization of domestically produced high-end medical equipment can effectively reduce the procurement cost of medical equipment. If domestically produced equipment can stand firm in the market, the prices of foreign brands will be reduced by at least one-third

At present, there are not many enterprises in China that produce large high-end medical equipment, such as Neusoft Group, CR Vanguard, Shenzhen Mindray, Shanghai Lianying Medical, etc., among which the first two are listed companies.

Industry needs improvement

In fact, in recent years, some supportive policies have been introduced for the domestic medical equipment industry.

The Chinese government has clearly stated in the 12th Five Year Plan the policy of enhancing the competitiveness of the local medical device industry through strengthening innovation, emphasizing the need to increase local research and development efforts, and establishing the goal of establishing 40 to 50 high-tech medical device companies.

In 2013, the Ministry of Industry and Information Technology allocated a special fund of 1.5 billion yuan to support the medical device industry, with the aim of "promoting the industrialization of new products and the application of new technologies in the field of medical devices, including medical equipment that master core components and key technologies".

But Chen Jian believes that companies do not have a deep sense of support at the policy level. He said that what companies need is market support, and the market for large medical equipment is hospitals. However, currently hospitals, especially hospitals, are more enthusiastic about purchasing imported equipment, and the market pattern has formed, which poses a great barrier to newcomers.

There is a saying that in the future, when dealing with the proportion of domestic equipment procurement for large hospitals, domestic equipment should be prioritized when the equipment is comparable to foreign standards, "said Chen Jian

During the interview, both the leaders of medical equipment companies acknowledged the gap between China and foreign giants in high-end large-scale medical equipment.

Overall, the innovation and research and development awareness of medical device enterprises in China are relatively weak, and the R&D investment is also low. Currently, many domestically produced medical devices are mostly at the low-end imitation level, which leads to a low overall level of medical device production in China. "Shi Lichen, Senior Pharmaceutical Partner of Peking University Zongheng Pharmaceutical Industry Center, said that there is a basic lack of R&D support for medical devices. Relying solely on enterprises to guide and conduct R&D not only has a long cycle but also has poor results. More importantly, so far, Chinese medical device companies have not formed their own research and development theoretical system, and are simply copying and copying.

But Chen Jian believes that in reality, the difference in technology between China's medical equipment and foreign countries is not as big as it was 10 years ago, and the technological level of high-end medical equipment is approaching the level.