Chinese Healthcare Reform and the Medical Device Sector

An important element of China’s 12th Five Year Plan is reforming the country’s healthcare system. With the objective of establishing basic healthcare coverage for 90 percent of its citizens by 2020, China’s healthcare reform, along with other elements of the 12th Five Year Plan, creates immediate opportunities for U.S. medical device manufacturers (MDMs). While China is more than capable of meeting local demand for low-end devices such as dressings, sponges, drapes and gowns, more than 80 percent of high-end medical devices, i.e. durable goods, equipment, implants and drug eluding stents, are imported. However, China’s healthcare reform plan also has the potential to strengthen the position of Chinese MDMs. To protect their position in the long run, U.S. companies must develop strategies designed to capitalize on the opportunities and navigate the challenges of this increasingly important and competitive market.