The Purchase Of Medical Consumables Is Booming, And The Domestic Substitution Of Orthopedic Consumables Is On The Way

Coronary stent, as the first product of high value consumables in China, has aroused the imagination of medical consumables market expansion.

Recently, the joint procurement office of national organization for high value medical consumables officially released the procurement document of centralized coronary stent volume of national organization. In the first year, the total amount of intended purchase exceeded 1.07 million, reaching about 60% of the total direct demand for coronary artery in China, and even directly gave a price of 2850 yuan as a guide. Prior to this, high-value consumables with volume procurement has been carried out in Fujian, Zhejiang, Jiangsu, Anhui, Beijing, Tianjin and Hebei provinces and other regions. The market has certain expectations on the implementation of the national procurement with volume. However, coronary stents have the characteristics of high technology maturity, relatively few specifications and high substitution rate in China.

The publication of the procurement document has made the market value of domestic coronary stent enterprises fall by more than 40 billion yuan. However, orthopedic implants, as the high-value consumables, are second only to cardiovascular and cerebrovascular materials. It can be predicted that it is only a matter of time before the centralized procurement and landing nationwide.

"China's orthopedic field has experienced nearly 30 years of development, and has completed the transformation from small workshops to large-scale enterprises and innovative enterprises. Although there are many domestic leading orthopedic enterprises, in fact, in the field of orthopedic consumables, foreign enterprises still occupy a large leading position. The dominance of foreign enterprises is closely related to their leading technology and the first mover advantage of introducing the market On October 20, Wang Jun, investment manager of a health industry fund in Beijing, told reporters of the 21st century economic report.

However, Wang Jun also said that the current domestic products are increasingly recognized. With the promotion of policies that pay more attention to price, such as bulk purchase and medical insurance cost control, it can be predicted that domestic substitution will accelerate in the next few years.

Speed up domestic substitution

In the 1990s, before imported products came in, domestic orthopedic products were very scarce. Different from today's major agents trying to get products into departments, it was very difficult for doctors to use the required medical devices 30 years ago.

After the foreign capital entered the market, it quickly filled the gap in China's orthopedic medical device market, so it also gained a great first mover advantage in the competition of Chinese market. In this context, Chinese orthopedic medical device companies are far inferior to foreign enterprises in terms of product, technology and marketing. In the past 20 years, most of them have imitated and followed the imported products for R & D and production.

Different from the situation that nearly 80% of the market share of coronary stents in this centralized procurement are domestic manufacturers, the field of orthopedic implants is still dominated by imported manufacturers. At present, in different segments, the market share of domestic manufacturers is also at different levels. About 70% of the market share of orthopedic trauma belongs to domestic manufacturers, about 50% of the market share of spine belongs to domestic manufacturers, and about 30% of the market share of the joint field belongs to domestic manufacturers.

Wang Jun said: "the degree of import substitution is inversely proportional to the recognized technical difficulty of the products, indicating that there is still a certain gap in the technical level of orthopedic consumables in China compared with the imported products. However, after more than ten years of chaotic development, there are still a number of excellent leading enterprises in the field of orthopedic devices in China, among which Weigao, Weiwei, Dabo, Sanyou, Aikang, Chunli and other listed companies have made remarkable achievements in the market. "

According to the public data, the latest market value of Dabo medical, a leading domestic trauma industry, has reached nearly 40 billion yuan. In 2019, the revenue is 1.25 billion yuan, and the net profit is 480 million yuan. In recent years, the net profit has maintained a rapid growth of 25%, which is higher than the average growth rate of the same industry. The market scale of orthopedic implants in China is about 30 billion yuan, with a year-on-year growth rate of 10% - 15%.

"At the same time, the guidance of the current national policy is also conducive to domestic manufacturers to increase market share. Referring to the national procurement of coronary stents, the regulatory authorities are very demanding on the price, which is the biggest advantage of domestic manufacturers. What's more, because the national level procurement with volume will inevitably bring the top hospitals in various regions into the scope of centralized purchase, and these hospitals now mainly use imported products, the implementation of national level volume procurement is expected to break the dominant position of foreign orthopedic manufacturers in top hospitals. " Wang Jun pointed out.

"Although China's domestic orthopedic products still have some gaps compared with imported ones, they can better meet the clinical needs in terms of design, materials and safety." "At the same time, domestic manufacturers will actively use the emerging technologies in the world to enhance their own technical reserves, and constantly look for opportunities for foreign manufacturers to overtake in corners," said the technical director of a leading domestic joint manufacturer

Competition for innovation

The difference of technology level is closely related to the talent level, market development level and enterprise R & D accumulation. At present, China's medical device talent level has been in line with international standards, and the clinical level of orthopedics is also in the world's leading level. The main weakness of domestic enterprises is the lack of years of accumulated R & D experience.

In this context, in addition to vigorously introducing talents and establishing a sound R & D system, if we can focus more on emerging products in the industry, it may bring more development opportunities for domestic manufacturers.

For example, after tianzhihang completed 300 million yuan round D financing in 2018 and Israel mazor orthopedic surgical robot was purchased by tianzhihang at a price of 1.7 billion US dollars, the investment enthusiasm of orthopedic surgical robot began to show initially. After more than 20 years of development, the most successful enterprise of tiancob will only be able to achieve the highest market value of 30 billion yuan, which is similar to that of Tianke medical in 2020.

"In the past two years, the attention of the capital market for orthopedic surgical robots has been increasing rapidly. From 2018 to this year, tianzhihang has completely exploded." The founder of a domestic joint robot enterprise said, "now the competition in the track is very fierce. At present, the most important thing is to complete the product research and development, clinical and registration as soon as possible, and constantly improve the product performance. Only the best and fastest product can seize more market share."

In the field of traditional orthopedic implants, sports medicine is a hot subdivision in recent years. According to the data of global market insights, the market size of global sports medicine will exceed US $9 billion in 2025, with an average annual growth rate of nearly 8%, far higher than the 2% - 3% level of traditional orthopedics and 5% of orthopedic consumables.

Domestic industry giants such as kaliter, Dabo and Weigao are also in the field of sports medicine. Among them, kailitai has set up an independent company in vitro, and ligertai has specially developed sports medicine products, and has completed tens of million yuan of market-oriented financing. German American medicine, a leading domestic sports medicine enterprise, was also favored by high capital and completed a financing of 100 million yuan in September.

Both domestic leading enterprises and innovative enterprises have begun to pay more attention to emerging products with higher technology content and larger blank market in product selection and layout. "In the emerging subdivided fields, domestic manufacturers and imported manufacturers are almost in the same starting line. In these fields, domestic manufacturers have the same technical level and clinical experience as imported ones. With the continuous investment of domestic professionals and capital, this emerging field is bound to usher in more market opportunities." Wang Jun concluded.

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