In recent years, the emergence of innovative medical instruments has promoted the rapid development of surgical technology in China. With the improvement of Chinese people's living standard, the aggravation of aging, the increase of medical demand, the introduction of relevant industrial policies and the continuous advancement of medical and health system reform, China's medical device market has to expand rapidly. At the same time, with the high attention of the capital market, the medical device industry formally entered its golden development period.
It is mainly reflected in the following six aspects:
1. Large market size and high prosperity, with a compound growth rate of over 20%. The growth rate of China's medical device market is far higher than that of the global market, and it has become the second largest medical device market in the world, second only to the United States, with high prosperity.
2. The r&d and registration barriers of medical devices are low, and the enterprise development has inherent advantages. Compared with medicine, the lower barriers to r&d and registration of medical devices help more medical device enterprises to grow faster than traditional pharmaceutical enterprises.
3. China's market concentration is low, ten times the space: from the perspective of the competition pattern, due to the relatively late development of China's medical devices, many enterprises are still too much concentrated in the field with relatively low technical barriers. The overall competition in the equipment market is not sufficient, and there are many subdivided circuits. We believe that leapfrog innovative enterprises in many segmented fields can rely on the unique differences of their products to enjoy the policy benefits, and are expected to rapidly rise to become a potential stock with ten times the growth of ten years.
4. The import substitution rate is low, and the window for rapid development has arrived. The gap between China's medical equipment and international brands is rapidly narrowing. The guiding role of national policies and the high localization rate of some segments make us see the general trend and great potential of import substitution.
5. Improved policy environment provides good development opportunities for medical devices in China. The development of equipment in China lags behind that of medicine, and the current policy-oriented development path is often formulated by referring to medicine. With evidence to rely on, it is easier for investors to see the development direction of medical equipment, and investment prosperity continues to grow.
6. Buying by volume is not your friend. Purchasing with quantity is a fatal blow to import enterprises, and Chinese enterprises with cost advantage will get the dividend brought by import substitution. Although purchasing with volume will have a great impact on enterprise performance in the short term, we believe that we should pay more attention to the reshaping of enterprise's future pattern rather than worrying too much about short-term profit fluctuations. Especially in the sub-track with low import substitution rate and certain innovation barriers, the advantages of leading enterprises will be more obvious.
Post time: Feb-09-2022
