ChinaMedistatCountryProfilesJuly2002Author:BrianMcLeanDate:December20,2002EASTMANKODAKCOMPANYRESTRICTEDINFORMATIONRESTRICTEDTableofContentsExecutiveSummary4Introduction6Background6Geography7Population.7EconomicStatus9HealthCareExpenditure9OrganizationandAdministration10MinistryofHealthRegulations11MedicalRegulations11Hospitals12HospitalBeds14MilitaryHospitals15MedicalPersonnel15TraditionalChineseMedicine15HealthCareDevelopment16HealthInsurance16RuralHealthcare17CommunityBasedHealthcareSystem17CommercialMedicalInsurance18MarketAccess18Importing18BUSINESSRESEARCHReportTitle:China:MedistatCountryProfilesAuthor:BrianMcLean2Date:December20,2002RESTRICTEDMarketforMedicalEquipmentandSupplies19SecondHandEquipment19DomesticProduction20MultinationalProducers20Exports21Imports21TobaccoUsage23TradeFairs23ChineseHolidays24AppendixA(MapofChina)25AppendixB(HospitalsandHospitalsBedsbyRegion)26AppendixC(ExportStatistics)29AppendixD(ImportStatistics)30AppendixE(BalanceofTradeStatistics)31AppendixF(TariffsandDuties)32BUSINESSRESEARCHReportTitle:China:MedistatCountryProfilesAuthor:BrianMcLean3Date:December20,2002RESTRICTEDEXECUTIVESUMMARYChina:MedistatCountryProfilesBACKGROUNDTheChineseCommunistPartyfoundedthePeople’sRepublicofChinain1949.Aftermanyyearsofisolation,thedoorstotheChinesemarketwereopened.Today,Chinaisoneofthelargest,yetmostdifficult,marketstomanage.Withapopulationaround1.3billionpeople,Chinamakesupalmost20%oftheworld’spopulation.Thisfigurealonedisplaysthemagnitudeofthismarketintermsofcustomerbase.OBJECTIVEByusingMedistat,theintentistodeterminethecurrentandfuturestateoftheChinesemedicalequipmentmarket.ThisincludedageneralreviewofChina’spopulationbase,healthcarespending,medicalregulations,medicalfacilities,andforeigninfluencesonthemedicalmarket.KEYFINDINGSPopulationo1.3billionpeople20%oftheworld’spopulationoImportanttodifferentiatebetweenurbanandruralpopulationo2/3ruralresidentso1/3urbanresidentsHealthcareExpenditureoChinaspends6%ofGDPonhealthcareestimatedUS$70billiono1993spent3.8%ofGDPo2010predictedtospend10%ofGDPoBycomparison,theUnitedStatesspendsabout13%ofGDPGovernmentControloPrincipalauthoritywithintheChinesehealthcaresystemistheMinistryofHealth(MoH)oRecentlyimplementedpoliciesinanattempttocontrolhospitalspendingoTheStateDrugAdministration(SDA)isresponsibleforregulatingmedicaldevicesHospitalsoCurrently,thereareapproximately66,500hospitals23%ofwhichareatthecountylevelandaboveBUSINESSRESEARCHReportTitle:China:MedistatCountryProfilesAuthor:BrianMcLean4Date:December20,2002RESTRICTEDoFocusonthesehospitalsbecausetheyarewillingtospendmoneyonmedicalequipmento300to400militaryhospitalsoVerylittledataaboutthesehospitals,butknowntobemajorpurchasersofadvancedmedicalequipmentCurrentMarketStatusoBesttodescribethemarketasacollectionofsmallmarketseachmajorcityrepresentsamarketoEachcitycanestablishitsownregulatorypoliciesasidefromthecentralgovernmentoThreeoptionsforbestmarketaccess:oSellthroughadistributoroEstablishajointventureMostpopularoptionoEstablishawhollyownedventureoForcedtoimportmostofitshigh-techequipmentbecauseveryfewdomesticmanufacturershavethosecapabilitiesMarketBarriersoSizeofthecountryoOverlappingpoliticalmakeupcentralgovernmentversuscityregulationsoLanguageCONCLUSIONS/RECOMMENDATIONSChinaisoneofthemostdifficultmarketstopenetrate.Atthispointintime,itisonlyim...