Capital intensive flooding into the medical technology field, traditional medical institutions can not sit still
Capital is flooding into the medical technology sector, but that doesn't mean that the medical technology companies that are in it can enjoy it.
Evaluate, a research organization focused on the global healthcare market, pointed out in the "Future Medical Technology Outlook 2014-2020" report that by 2020, the global sales of the global medical technology market will reach $514 billion.
In 2015, just three days after March 30, the medical sector announced three mergers and acquisitions: the world's largest health insurance company, United Health Group, said it would acquire the prescription management company Catamaran for $12.8 billion in cash; Horizon The pharmaceutical company reached a $1.1 billion acquisition of Hyperion Medical Inc.; Teva, Israel's largest manufacturing company, will spend $3.2 billion to acquire Auspex, a rare disease drug development company.
On the surface, the situation is indeed gratifying.
However, PwC’s report “Medical Technology Company is committed to innovation and reform†released on April 16 pointed out that the growth of the medical technology market relying solely on product innovation is slower and slower, and the profits of traditional medical technology companies are shrinking. Shareholder returns continued to decline. As non- medical companies continue to join, traditional medical technology companies face serious threats.
Among them, there are many powerful external intruders. On January 21, 2015, Tencent released the "Teng Ai Sugar Doctor" which looks like an old WeChat mobile phone. This medical intelligent device is mainly used for blood glucose detection. Although there is no breakthrough in measurement technology, it can be opened with the WeChat public account. Managing your own blood glucose records on WeChat, and sending health warnings to family members; On April 14, 2015, Foxconn announced that it will cooperate with US medical device manufacturer Varian Medical Syste to sell radiotherapy equipment in the Chinese market; on April 12, KPMG (KPMG) announced the acquisition of a US medical consulting company, which is the fourth time in six months that KPMG has acquired the medical-related field, and IBM announced on April 14 that it has acquired two companies before the Watson Health Project. Medical technology company...
PwC found in the survey that medical technology companies are slow to innovate compared to other industry companies that are skilled in using social media, mobile media and cloud technologies. In the next three years, the industry will usher in a new round of innovation. . Because non-medical companies invest heavily in patient behavior research, they can respond more quickly to consumer needs and manage innovation more effectively, making it possible to replace traditional medical technology companies in competition.
But investors are not rushing, and their choice of medical technology projects has become more cautious.
“Unless the new technology has commercial potential, we won’t invest.†Steve Van Nurden, former president of the Mayo Medical Innovation Fund, said, “There are a lot of innovative technologies that surprise us, but the profitability of these new technologies is unclear. So we won't invest in these technologies.†KPMG partner Walsh has also said that it is very laborious to choose the target in this area. “You have to find a company that is stable enough and mature, and at the same time small enough that there is no room for development.â€
The PricewaterhouseCoopers survey found that relying solely on financial investments to achieve innovation is not robust, as most traditional medical technology companies do not invest in innovation in business models. Many large medical technology companies, such as GE Healthcare, Kehui and Medtronic, invest in venture capital funds within the company's innovative projects and external start-ups. 81% of medical technology company executives plan to work with strategic partners over the next three years.
Most medical technology companies believe that open innovation is the fastest way to develop innovative ideas and commercialize them externally and internally. In this regard, Medtronic has explored a lot of experience.
After Medtronic entered the Chinese market, it innovated its core business to increase the user's use of its products, such as establishing a 7*12-hour diabetes business call center in China, providing timely services for patients who rely on insulin pumps to control blood sugar for a long time. Wait. Medtronic also plans to spin off the service sector from its operations and transform it from a cost center to a profit center to provide more innovative services. Medtronic's training center in Zhangjiang, Shanghai has trained more than 7,000 cardiovascular doctors from all over the country. Medtronic also established an internal incubation department, BMI, to develop different products, services and business models for different regions.
Many multinational companies, like Medtronic, are beginning to design products and services for the needs of Chinese users, rather than simply selling their globally successful products. Another similar approach is that they have begun to build new ecosystems through venture capital, namely, the establishment of a healthcare ecosystem through mergers and acquisitions, equity investments, etc., from equipment suppliers to solution providers.
After acquiring the orthopedic medical device company Kanghui Holdings and the equity investment in the cardiovascular equipment company Xianjian Technology, Medtronic further enriched the product line in the Chinese market and obtained local R&D resources and sales channels. At the same time, Medtronic actively sought cross-border Cooperation provides a comprehensive solution for the management of some chronic diseases.
The involvement of companies outside the industry and the advances made by multinational companies in innovation have put pressure on traditional medical technology companies. PricewaterhouseCoopers recommends that Chinese medical technology companies conduct a comprehensive survey of user needs and experiences, get rid of excessive reliance on sales and simple imitation of competitive products, in order to link sales and R&D to achieve sustainable innovation.
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