The international trading market is changing and how should China's medical device companies respond

Recently, the U.S. Trade Representative’s Office published a list of Chinese products to be imposed with tariffs, ranging from syringes, needles (guides), to hemostatic materials such as cotton wool, gauze, and bandages, to ultrasonic scanning electronic diagnostics, and surgical magnetic resonance imaging. Diagnostic instruments and other high-end imaging equipment, as well as artificial joints and other high-value consumables, almost covered China's major export and export faster medical device varieties.

Statistics from China Customs show that in 2017, China’s exports of medical devices to the United States reached 5.838 billion U.S. dollars, far exceeding Japan’s 1.478 billion U.S. dollars, an increase of 5.08% year-on-year, the year-on-year growth in total medical device exports rose by 5.84% compared to the same period in 2017.

  Then, in the face of the ever-changing international trade market, how should China's medical device companies respond?

 "Trade disputes will have a greater impact on foreign companies in China but will have little effect on ethnic enterprises.It will have a certain impact on the Sino-US trade conference in the coming period, but the mainstream trend of international trade communication and mutual benefit will not change. "Cai Tianzhi, secretary general of the China Chamber of Commerce for the Import and Export of Medicines and Health Products, believes.

  According to surveys by industry associations, the average R&D investment of China's medical device manufacturers only accounts for 2% to 3% of sales. Statistics show that the top 20 medical device manufacturers in China's main business revenue in 2016.The total operating income was 50.319 billion yuan, the R&D investment was 2.27 billion yuan, and the R&D input accounted for an average of 4.51% of operating revenue. More experts believe that most of China's medical device manufacturing companies are small in scale and have few R&D personnel. Therefore, most companies are researching imitation, weak original innovation capabilities, and few independent innovation products.

“Unsatisfactory level of domestic medical device technology and inadequate manufacturing level have been the pain points that have plagued China's medical device industry to a new level.” Jiang Haihong, director of medical product management at the Shanghai Health Medical University, believes that the lack of technology and talent is still a challenge for the innovation of the medical device industry in China.

  “International trade has many irresistible factors. Therefore, ethnic enterprises must first base themselves on the domestic market, stand firm on the domestic market, and speak with technology and quality in order to cope with the international market risks caused by such sudden and artificially irresistible factors.”Jiang Haihong suggested that domestic medical device manufacturers should pay attention to the improvement of research and development capabilities and technological levels, increase investment in R&D, change the concept of research and development, and achieve a double improvement in technology and quality.At the same time, it is necessary to increase the training of professional R&D talents and management talents, and establish think tanks for experts in related fields to provide intellectual support and manpower guarantee for the development of enterprises and the formulation of national policies. Finally, we must also pay attention to improving intellectual property protection and defense awareness.

  Xu Wanyu, deputy general manager of Beijing Fule Technology Development Co., Ltd., a high-tech enterprise engaged in the production of orthopedic consumables earlier, also stated that, fundamentally, it is a long-term plan for medical device manufacturers to work hard to catch up with R&D and innovation.At the same time, we must also change our ideological consciousness, change the previous thinking that only focuses on domestic patent applications, increase the holding rate of international patents, and launch a patent defense strategy. After all, the expansion of foreign trade is a general trend, and it is imperative that exports be expanded as soon as possible and ready.