Page 292 - 2023 White Paper on the Business Environment in China
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3 White Paper on the Business Environment in China
at least 95% of the Chinese population. Another Pharmaceutical Industry
goal is to further decrease the proportion of
medical expenses incurred by patients to below China's pharmaceutical firms saw their
27% of the treatment cost. To achieve those goals, combined business revenue climb 18.7% year
financial subsidies shall continue to increase, and on year in 2021, the highest growth rate in five
cost containment measures in medical supply years, official data showed. Companies in this
purchases shall expand. Universal healthcare sector together raked in 3.37 trillion RMB (about
coverage enables wider access to medical care 502 billion U.S. dollars) in revenue in 2021, Zhou
in China, thus, further bolstering China’s medical Jian, an official with the Ministry of Industry and
equipment market. Fourth, China’s healthcare Information Technology, told a press conference.
reform shall deepen, and health systems shall Their total profits stood at 708.75 billion RMB in
present a new outlook. Currently, China’s high- 2021, up 67.3% from 2021, Zhou said. The industry's
grade hospitals are overburdened with the value-added output rose 23.1% year on year, 13.5
majority of primary care. Low-grade and grassroots percentage points higher than the overall growth
healthcare centers are underutilized. The Chinese rate, bringing its share in China's total industrial
government has implemented policies to facilitate output to 4.1%. Research and development also
the growth of private hospitals. The massive yielded solid results in 2021. The number of new
growth of commercial insurance will also help the drugs and medical equipment approved to enter
growth of private hospitals. Fifth, new technologies the market was the highest in five years (Xinhua).
like telemedicine, medical Artificial Intelligence
(AI), and healthcare robotics will expand their China’s pharmaceutical industry has
applications in China. China faces challenges experienced rapid progress since the country
arising from fast-increasing medical demand entered the World Trade Organization. As of 2021,
alongside the shortage of healthcare resources. China holds 12% of the global pharmaceutical
The applications of telemedicine (remote clinical market, following the United States, responsible
services), medical AI, and healthcare robotics have for 40% of the total revenue worldwide. The
the potential to improve efficiency and clinical immense growth of China’s healthcare industry
results. Government-led initiatives, including has allowed it to begin the transition from being a
“Internet + Healthcare” and state-level AI strategy, pharmaceutical manufacturing base to a strategic
have propelled the new-tech applications in R&D hub. As a result, China has cemented itself
China’s medical sector and will continue to do so. as a strategic player in the global pharmaceutical
China’s medical AI and healthcare robotics markets market, both as a consumer country and as a
are also burgeoning. Startups are mushrooming, platform for establishing greater R&D. The local
attracting large amounts of international venture pharmaceutical sector is pushed to grow with
capital. It is estimated, in 2020, China medical AI government incentives and public insurance but
startups absorbed 33% of global venture capital is potentially hindered by IP laws and tedious
funding. Some Chinese companies are starting regulations. Currently, China is facing the problem
to take the lead in these innovative technologies. of promoting the growth of its pharmaceutical
One example is SenseTime, a company that is industry while ensuring affordable and easily
applying computer vision and AI to the merging of accessible drugs for its patient population. In
data from different scanning technologies (such as addition to investing heavily, the government
CT, MRI, and PET), allowing more precise analysis has rolled out a series of broad changes to the
of medical imaging. Sixth, more Chinese medical pharmaceutical regulatory environment. The policy
device companies will become global. The Chinese agendas outlined in China’s 14th Five-Year Plan
government’s 14th Medical Equipment 5-Year and Healthy China 2030 initiative each reinforce
Plan (2021–25) sets a goal to have more than six the importance of healthcare reforms such as
Chinese manufacturers among the top 50 global decreasing inequality in the insurance coverage
medical device companies. Therefore, the Chinese ranges and strengthening public services. Reform
government will continue to support the growth measures within the industry also aim at increasing
of domestic companies in various forms, including access to medicine, making medicine affordable,
granting subsidies and tax deductions (Ye). and developing silver economy products for
292
at least 95% of the Chinese population. Another Pharmaceutical Industry
goal is to further decrease the proportion of
medical expenses incurred by patients to below China's pharmaceutical firms saw their
27% of the treatment cost. To achieve those goals, combined business revenue climb 18.7% year
financial subsidies shall continue to increase, and on year in 2021, the highest growth rate in five
cost containment measures in medical supply years, official data showed. Companies in this
purchases shall expand. Universal healthcare sector together raked in 3.37 trillion RMB (about
coverage enables wider access to medical care 502 billion U.S. dollars) in revenue in 2021, Zhou
in China, thus, further bolstering China’s medical Jian, an official with the Ministry of Industry and
equipment market. Fourth, China’s healthcare Information Technology, told a press conference.
reform shall deepen, and health systems shall Their total profits stood at 708.75 billion RMB in
present a new outlook. Currently, China’s high- 2021, up 67.3% from 2021, Zhou said. The industry's
grade hospitals are overburdened with the value-added output rose 23.1% year on year, 13.5
majority of primary care. Low-grade and grassroots percentage points higher than the overall growth
healthcare centers are underutilized. The Chinese rate, bringing its share in China's total industrial
government has implemented policies to facilitate output to 4.1%. Research and development also
the growth of private hospitals. The massive yielded solid results in 2021. The number of new
growth of commercial insurance will also help the drugs and medical equipment approved to enter
growth of private hospitals. Fifth, new technologies the market was the highest in five years (Xinhua).
like telemedicine, medical Artificial Intelligence
(AI), and healthcare robotics will expand their China’s pharmaceutical industry has
applications in China. China faces challenges experienced rapid progress since the country
arising from fast-increasing medical demand entered the World Trade Organization. As of 2021,
alongside the shortage of healthcare resources. China holds 12% of the global pharmaceutical
The applications of telemedicine (remote clinical market, following the United States, responsible
services), medical AI, and healthcare robotics have for 40% of the total revenue worldwide. The
the potential to improve efficiency and clinical immense growth of China’s healthcare industry
results. Government-led initiatives, including has allowed it to begin the transition from being a
“Internet + Healthcare” and state-level AI strategy, pharmaceutical manufacturing base to a strategic
have propelled the new-tech applications in R&D hub. As a result, China has cemented itself
China’s medical sector and will continue to do so. as a strategic player in the global pharmaceutical
China’s medical AI and healthcare robotics markets market, both as a consumer country and as a
are also burgeoning. Startups are mushrooming, platform for establishing greater R&D. The local
attracting large amounts of international venture pharmaceutical sector is pushed to grow with
capital. It is estimated, in 2020, China medical AI government incentives and public insurance but
startups absorbed 33% of global venture capital is potentially hindered by IP laws and tedious
funding. Some Chinese companies are starting regulations. Currently, China is facing the problem
to take the lead in these innovative technologies. of promoting the growth of its pharmaceutical
One example is SenseTime, a company that is industry while ensuring affordable and easily
applying computer vision and AI to the merging of accessible drugs for its patient population. In
data from different scanning technologies (such as addition to investing heavily, the government
CT, MRI, and PET), allowing more precise analysis has rolled out a series of broad changes to the
of medical imaging. Sixth, more Chinese medical pharmaceutical regulatory environment. The policy
device companies will become global. The Chinese agendas outlined in China’s 14th Five-Year Plan
government’s 14th Medical Equipment 5-Year and Healthy China 2030 initiative each reinforce
Plan (2021–25) sets a goal to have more than six the importance of healthcare reforms such as
Chinese manufacturers among the top 50 global decreasing inequality in the insurance coverage
medical device companies. Therefore, the Chinese ranges and strengthening public services. Reform
government will continue to support the growth measures within the industry also aim at increasing
of domestic companies in various forms, including access to medicine, making medicine affordable,
granting subsidies and tax deductions (Ye). and developing silver economy products for
292
