Overview of the Healthcare Market in China · Overview of the Healthcare Market in China ® Information to Insight® ® The Chinese Government released its new Healthcare Reform Plan

Information to Insight®

®

1

April, 2009

Overview of the Healthcare Market in China

®


®

The Chinese Government released its new Healthcare Reform Plan in April, 2009, setting

groundwork for new opportunities• Make healthcare services more

accessible and affordable, especially in rural areas

• Control drug costs• Build many county and township

medical centers• Build more community clinics in

cities• Privatize some Level 2 and Level 3

hospitals

• Medical Technology Sales• Healthcare Services

2

Overall Objective

Actions by the Government

New Opportunities


®

China is an increasingly important healthcare market with tremendous opportunity for growth

3

• Population: 1.3 billion• 44% urban; 56% rural• Over age 65: 8.1% (was 4.9% in 1982)

• Healthcare Expenditures: USD 157 billion• Medical Equipment: USD 7 billion

• Healthcare Market CAGR last 5 years: 17%• Medical Equipment CAGR last 5 years: 25%

• Number of hospitals: ~20,000• Number of beds: 3.7 million

• Government has been reforming the healthcare system since the 1990s

• Movement from government subsidy to social welfare and commercial insurance payers

• Large potential as economy develops, particularly in rural areas

• Aging society contributes to increasing healthcare needs

• Healthcare Expenditures: 4.5% of GDP compared to 15.3% in the US and 7-9% in Japan and Europe

• China is positioned to become the second largest healthcare market after the US by 2020

• Public hospitals in major cities are well equipped

• Healthcare resources are still scarce outside of major cities

• Private and foreign healthcare organizations are encouraged

• Economic stimulus includes rural healthcare infrastructure buildup


®

China’s national healthcare expenditure is 4.5% of GDP and growing

4 Source: CIA, OECD 2005, MHLW 2005, Ministry of Health P.R.O.C. 2008

Europe: Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland, United Kingdom

National Healthcare Expenditure - % of GDP

5% 10% 15% 20%

4.5%

7.1%

8.7%

15.3%

China

Japan

Europe

United States

$272.6B

$1,791.9B

$1,286.7B

$157B


®

China’s medical technology market is expanding 25 - 30% per year

5 Source: Ministry of Health, P.R.O.C. 2008

China Medical Technology Expenditures 2003 - 2007

US$2,000M

US$4,000M

US$6,000M

US$8,000M

US$2,257MUS$3,049M

US$3,964M

US$5,346M

US$7,026M

20032004

20052006

2007


®

China represents 3% of the current total worldwide medical technology market

6 Source: MHLW 2006, Eucomed 2005, Ministry of Health P.R.O.C. 2008, Junicon Estimates

Europe: Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland, United Kingdom

42%

10%

34%

3%10%

$23.4B

$24.3B

$98.8B

$79.1B

Worldwide Medical Technology Company Sales = $232.6B

$7B

USJapanEuropeChinaROW


®

Designations of China’s 20,000 Hospitals

7 Source: Ministry of Health P.R.O.C.

Level (#) and Grade (A, B, C) # of Hospitals %

Level 3 (Any bedsize, Comprehensive, National) Total 1,182 6%

3A Subtotal 704 4%

3B Subtotal 348 2%

3C Subtotal 130 1%

Level 2 (100+ beds, Community 100,000+) Total 6,608 33%

2A Subtotal 4,260 21%

2B Subtotal 1,650 8%

2C Subtotal 698 4%

Level 1 (20+ beds, Community < 100,000) Total 4,687 24%

Without Level 7,370 37%

Total 19,847 100%

Bedsize # of Hospitals

< 100 12,071

100 - 199 3,700

200 - 499 2,868

500 - 799 814

800+ 394

Total 19,847

(100+ Beds) 7,776


®

Healthcare companies need to know where their targets are in China

8

2,500 5,000 7,500 10,000 12,500 15,000 17,500 20,000

19,847

7,870

4,927

3,533

2,820

1,615

1,435

846

China

Japan

US

France

Germany

Italy

UK

Spain

Source: MHLW, AHA, Walnut HER, Ministry of Health P.R.O.C.

Number of Hospitals in Key Countries


®

Junicon delivers healthcare market research and consulting in major worldwide markets, including China

9

Junicon International Holdings, Inc.

Junicon K.K.Tokyo, Japan

Juniper Consulting Group, Inc.

San Francisco, USA

Junicon Europe S.L.Barcelona, Spain

• Internal capabilities in 8 languages• Extensive network beyond our own physical locations• Please visit us on the web at www.junicon.net• For more information or a quote for China research, please

email Rob Claar at [email protected] or Sabrina Tam at [email protected]

http://www.junicon.net

http://www.junicon.net

mailto:[email protected]





®

Thank you for your interest in Junicon

10

Management team works collaboratively to deliver maximum client value

Premium and principled client

services

Junicon believes in making

a reasonable profit as long as benefits to the client

significantly outweigh our costs to deliver

5% annual profit to improve opportunities for children around the world


®

We deliver value by transforming client and market information into actionable insight

Vision

• To be the premier global business-to-business marketing research-based consulting services partner to our valued clients

Mission

• Deliver client value by enhancing our clients’ ability to excel in worldwide markets

• Create an environment for employees to fully realize their potential

• Continuously improve internal processes through effective collaboration and training

• Create shareholder value• Dedicate a portion of our resources and expertise to improving

opportunities for children around the world

11


®

Junicon enables clients to identify and maximize opportunities in global healthcare markets

12

Ongoing

Support

Pre-Launch

& Re-Launch Strategy

New Business

Feasibility & Development

Portfolio and

Franchise Strategy

•!Market research

•!Strategy development

•!Ongoing support


®

Our programs are customized to meet the needs of the client at every stage

13

Customized

Program Design


®

Since 1992, Junicon has developed expertise in a wide range of medical technology markets

14

Cath Lab

ICU OR Specialty Clinic / Surgery Center

Central Processing

Hospital Wards /

Recovery

Long Term Care / Home Health

Medical Imaging

Diagnostic Laboratory

Disposable Equipment

Capital Equipment

Implantable Devices

Electronic Drug Delivery

Wound Closure, Drainage, Care

Vascular Access (CVCs, PICCS, PACs, Ports)

Surgical Tools

Patient Monitoring Systems Ventilators

Stents

(Coronary and

Peripheral)

Vena Cava Filters

MRI

Angiography

Kits

Balloons

Guidewires

Tension-free meshes and slings

Mitral /

Aortic valves

Sterilization Systems

Wound Care Infusion Equipment

Dialysis Equipment

Syringes

Tubes, Catheters

Pacemakers and ICDs Orthopedic Implants

Intra-Ocular Lenses

Endoscopes Microbiology

Analyzers

Point-of-Care Diagnostics

Clinical Chemistry

Analyzers

Ultrasound

X-Ray

Automatic Endoscope Reprocessors

Trays

Labware

Reagents

Disinfectants

Test Strips

Glucose Monitors

Glucose Testing Strips

Defibriillators

Defibriillators

Ophthalmic Surgery Equip.

Dental Implants

Radiotherapy Equipment

Vascular

Radiology/CT

CT/PET

Medication Management and Patient IT Systems

Lenses Invasive and Non-Invasive Monitor Probes

Anesthesia Delivery Telemetry &

Low-end patient

monitors

Medical Furniture


®

- Confidential - 1

®

Thank you very much for your interest and support

Documents

Overview of the Healthcare Market in China · Overview of the Healthcare Market in China ® Information to Insight® ® The Chinese Government released its new Healthcare Reform Plan