As awareness of healthcare among residents continues to grow, the demand for medical device products in China is expected to rise significantly. This article provides an analysis of the current state of China’s medical device industry in 2018. It explores the scale of market development and highlights the gap between China and developed countries in this sector.
Medical devices vary greatly in complexity, ranging from simple items like hemostatic sponges and disposable syringes to advanced systems such as magnetic resonance imaging (MRI) equipment. These products involve multiple technological fields, including electronics, computer science, sensor technology, signal processing, biochemistry, clinical medicine, precision machinery, optics, automation, and fluid mechanics. Therefore, the development of medical devices is closely tied to the level of basic industrial infrastructure in a country. The United States, Europe, and Japan have long dominated the global market due to their strong industrial foundations and extensive technical experience.
On October 28, 2017, the "China Medical Device Industry Development Report (2017)" was officially released by the China Drug Supervision and Management Research Institute, the Social Science Literature Publishing House of the Chinese Academy of Social Sciences, and the Editorial Board of the Medical Devices Blue Book. According to the report, the Chinese medical device industry has experienced rapid growth over recent years. The growth rate of main business income for enterprises above designated size ranged between 11.66% and 22.20%, far outpacing the national economic growth during the same period. High-end medical device R&D shows promising potential, with innovative products emerging at an accelerated pace.
The industry market size has maintained rapid growth, with a compound annual growth rate (CAGR) exceeding 18% from 2011 to 2017. As living standards improve and health awareness increases, the demand for medical devices continues to expand. Supported by national policies, the domestic medical device industry has entered a phase of significant growth.
In 2017, the market size of China’s medical device industry reached 523.34 billion yuan, with a CAGR of 18.21% over the previous six years. However, per capita medical device expenditure in China remains much lower than that in developed countries. For example, per capita spending on medical devices in developed countries exceeds $100, with Switzerland reaching as high as $513. In contrast, China's per capita medical device expenditure is only around $6. With an aging population, rising disposable incomes, and continued policy support, there is still considerable room for future growth in the medical device industry.
Chart 1: Trend of China's medical device industry market size from 2011 to 2017 (unit: hundred million yuan, %)
[Image: The status quo of the medical device industry in 2018. Localization still needs to be improved, still in the low-end]
The gap between China and developed countries remains significant, and the localization of medical devices in China still needs improvement. While many medical devices that are produced in developed countries can also be manufactured in China, high-end medical equipment still lags behind in terms of overall quality and technical performance. There is a need for substantial efforts to catch up with the technological levels of developed nations. Additionally, some products suffer from serious homogenization issues. For instance, more than 200 companies produce infusion sets and syringes in China, with little difference in product quality or performance across different manufacturers. As a result, the localization rate of high-end medical devices remains low.
To address these challenges, the localization of medical devices and import substitution have become key priorities for national policies. In May 2015, the State Council issued the "Made in China 2025" initiative, which emphasizes improving the innovation capability and industrialization of medical devices. It focuses on developing high-performance equipment such as imaging systems and medical robots, and encourages the decommissioning of high-value consumables like stents and wearable medical devices. Several policies have also been introduced by the Health Planning Commission to promote the localization of medical devices in China.
Chart 2: Partial list of medical device localization policies in China since 2015
[Image: The status quo of the medical device industry in 2018. Localization still needs to be improved, still in the low-end]
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