We are pleased to announce that Boston Healthcare is now a part of Veranex, a new global solutions provider for MedTech and Life Sciences innovators. We are excited to share this news with you as it expands our range of services and enhances our ability to meet your needs.

ABOUT VERANEX

Veranex is the first concept-to-commercialization global service provider built for medical technology innovators. The Veranex platform is designed to provide the global medical technology industry with comprehensive, integrated, and technology-enabled product development and commercialization solutions.

Veranex brings together four complementary solution providers: Ximedica, Quartesian, Experien Group, and Boston Healthcare Associates. Bringing these companies together combines design and engineering, clinical development, regulatory, commercial strategy, and market access into a single-source solution.

The combined company brings deep experience in the areas of devices, in vitro diagnostics, precision medicine, digital health, and combination products/drug delivery among many other technology areas. Disease areas of focus include cardiovascular, orthopedic, women’s health, wound care, ophthalmology, neurology, oncology, and gastrointestinal among many others.

Veranex combines product development, regulatory, and market access expertise — globally in established and emerging markets — to help clients achieve their innovation objectives, accelerating time to market and optimizing clinical adoption and patient access.

For more information do not hesitate to contact us.

As healthcare consultants specializing in the Chinese market, we hear this question daily. This article generalizes the process to provide a hyper-simplified answer for investors and CEOs, and sales & marketing executives of MedTech companies, needing this crucial piece of information to make sound investment decisions or plan and allocate organizational resources.

It is a 2~3 year journey to register a medical device (including IVDs) with the CFDA* and for novel devices and tests, China clinical investigations likely will be required

Medical devices (including IVDs) in China are classified into Class I (lowest risk), Class II and Class III (highest risk) where Class II & Class III applications would receive rigorous technical reviews from the CMDE (Center for Medical Device Evaluation) of the CFDA.

A provincial CFDA can approve a Class I and Class II locally manufactured medical device, whereas all imported products, regardless of the classification, will be handled by the national CFDA, which generally takes a longer time, costs more, and has more stringent review processes.

It takes approximately 2-3 years to register a Class II or Class III medical device with the CFDA. The following graphic explains the various steps: the mandatory product testing, the clinical study (conditionally) purposely designed for the registration, and the technical review process.  These steps combined have resulted in a time- and resource-consuming exercise in launching a medical device or diagnostic product in China.

Timeline of registering a medical device/IVD product with CFDA

Understandably the most significant investment is the clinical study purposely designed for the registration purpose, which adds a few months if not years to the timeline. Before 2014¹, the registration regulations were quite relaxed about the “origin” of the clinical data and registration applications were approved based on the clinical evaluation report provided by the foreign manufacturers, which were done outside China. However, that changed in October 2014 as a result of the change of CFDA’s regulation on medical device registrations that all Class II and Class III registration applications are required to conduct clinical studies in China except for those that are on the clinical study exemption list. Although the exemption list approach is somewhat analogous to FDA’s 510(k) in the sense that both regulatory authorities have referred to the existence of an already marketed product as the foundation of their decisions, CFDA has much narrower definition for the predicate devices and is much more conservative in interpreting substantial equivalence to the extent that not only the intended use of the two devices is expected to be the same, the principle of operations, the key materials or even the appearances shall be “substantially the same”. Therefore, it is wrong to assume that because the product is marketed in the US under the 510(k) process, the registration process for China would be relatively simpler and quicker than for a PMA or de novo product. As a matter of fact, it is better to use the clinical study requirement as the baseline scenario in the initial or ballpark planning process so that the project does not get stopped halfway because of insufficient funding. It is also highly recommended to conduct a pre-registration analysis to provide more clarity and details to the registration plan before one rushes into the process blindly.

Although in 2018, the CFDA published a guidance document for acceptance of clinical data generated from clinical investigations conducted outside of China, the many conditions applied from the GCP requirements to racial/genetic differences make it practically impossible to be implemented. Boston Healthcare has experience in using this pathway to submit the foreign data as supplementary evidence to the CFDA’s review process and that first-hand experience only reinforced our analysis that foreign data alone is not going to lead to the CFDA’s approval.

The same issue applies to other CFDA initiatives and pathways, such as the fast-track pathway for innovative medical devices and IVDs introduced back in 2017/2018. Under the theme of promoting innovation, the rules were rather created and implemented to serve China’s political agenda to favor and support the local medical technology players. In 2019, a Boston Healthcare analysis showed that 90% of the fast-track designations had gone to products manufactured locally by Chinese companies.

So, our advice of using 2~3 years as the baseline scenario stands as general advice although we encourage companies that have a strong local presence and strong regulatory teams to exploit those exceptional pathways to get the approval process accelerated.

Latest Development

As this article is being written, China has started a new round of policy changes to the medical device and IVD regulations, unveiled by the revision of the Regulation on Supervision and Administration of Medical Devices that was published in March 2021, which will come into effect from 1 June 2021.

Boston Healthcare will closely monitor these ongoing policy changes and analyze the impact of the changes to help clients stay on top of industry trends and develop strategies and action plans to tap into the opportunities or tackle the issues. Please contact us to learn how we can help.

*CFDA is currently known as NMPA, the abbreviation for National Medical Products Administration.

[1] http://www.gov.cn/gongbao/content/2014/content_2758500.htm

Several recent national-level policy changes highlight an accelerating digital transformation of healthcare in Germany, building on the Digital Healthcare Act (DVG) of 2020.

In January 2021, the German Federal Government passed the draft of a law that aims to now include digital nursing and elderly care applications (DiPAs) into statutory health insurance coverage complementing coverage for digital health apps (DiGAs).  Coverage for DiGAs for patients under statutory health insurance was introduced in 2020.  DiGAs are healthcare apps intended to help identify, monitor, treat or alleviate diseases, and are considered low-risk medical devices that can be prescribed.  The German Medical Agency (BfArM) assesses the apps and specifies those that are approved in the DiGA directory for prescription coverage.

Regulations for reimbursement of the apps was finalized in March 2021. The prescription of DiGAs that are permanently listed in the directory of the BfArM will be paid on top of the budget. The prescription can be billed via a code in the fee-for-service scale EBM (2 Euros). In addition, specific higher-paid codes were added for apps that require more effort at the physician practice level. 10 DiGAs have been listed so far and the largest SHI fund estimates expenditures of about 5 Million Euro for digital health apps for its 10.8 million insured members in 2021.

Implications for Innovators

The introduced reimbursement of digital health apps was successful and expansion to apps for organizing and coping with everyday nursing and special nursing situations adds more opportunities for manufacturers of innovative digital health solutions. Germany is a forerunner for the implementation of health apps into the statutory healthcare system, and both apps and processes are watched closely by other countries. Favorable market access in Germany could ease the adoption in other markets.

The BHA European office in Berlin, Germany supports manufacturers and developers in market access of their digital health products and offers both strategic and operational guidance in the process. To learn more about the digital health app reimbursement and implications for innovators please contact us here.

The National Comprehensive Cancer Network (NCCN) 2021 Annual Conference convened virtually March 18-20, drawing attendees from more than 40 countries to discuss updates to NCCN’s Oncology Clinical Practice Guidelines, new and emerging therapies, best practices in oncology care, as well as keynote sessions on HPV vaccinations, racial disparities in guideline-adherent cancer care, and effects of the pandemic on cancer care.

Elevating Racial Equity in Cancer Care

Representatives from the Elevating Cancer Equity Working Group, a collaboration between the American Cancer Society Action Network (ACS CAN), the National Minority Quality Forum (NMQF) and NCCN, spotlighted racial disparities in guideline-adherent cancer care and outlined recommendations for reducing inequality in cancer screening and treatment. A growing body of evidence demonstrates that Black, Latinx, and Indigenous populations are less likely to receive guideline recommended cancer screening and face higher death rates and shorter survival rates compared to non-Hispanic white patients. Disparities in care in the U.S. have been documented in numerous cancer types such as ovarian, breast, prostate, and lung cancer. The NCCN Chief Executive Officer Robert W. Carlson, MD spoke to the urgency of developing ways to make quality cancer care more accessible and equitable.

One of the recommendations from the session was to review clinical practice guidelines to assess areas where disparities could be reduced or eliminated, as well as incorporate frameworks to account for health disparities. Along these lines, the United States Preventative Services Task Force (USPSTF) recently updated the lung cancer screening guidelines. These updates expanded eligibility to younger populations and to people who have smoked fewer cigarettes, which is particularly helpful in increasing screening eligibility among black and female populations. In addition, the Task Force is currently in the process of updating the breast cancer screening guidelines and has proposed contextual questions in the draft research plan that explore disparities in breast cancer screening. One of the contextual questions published in the draft research plan states: “How do structural racism, social inequalities, unequal access to high-quality healthcare, and other factors contribute to disparities in breast cancer screening, diagnosis, treatment, and health outcomes?” A growing focus on health equity will continue to influence and inform clinical practice both from the top down, as with USPSTF and ASCO, as well as bottom-up from growing awareness among healthcare providers.

Effects of the COVID-19 Pandemic on Cancer Care

The final keynote session of the conference convened five administrators and clinicians from leading cancer centers in the U.S. to discuss the impact of the pandemic on cancer care. The panel discussed how COVID-19 related restrictions and patient avoidance of healthcare settings resulted in delayed cancer screening, detection, and treatment during the peak months of the pandemic. As a result, cancer centers have looked for creative ways to safely increase screening volumes such as ramping up mobile-screening programs and moving cancer screening appointments into ambulatory care settings. Health plans have responded by launching or expanding programs for at-home cancer screening sample collection kits for colon cancer creating an opportunity for innovators that offer less invasive screening tests.

While the discussion focused on what providers are doing to facilitate cancer services during the pandemic, innovators in med tech also have a vital role to play in this effort. Less-invasive screening tests, such as those that reduce reliance on advanced imaging, and particularly those for which samples can be collected in an at-home test kit, are proving to be vital in the midst of the pandemic and will continue to play an important role in the future.

BHA is actively engaged in identifying key issues that will affect opportunities for our clients. For more than 25 years we have provided best-in-class strategic consulting services focused on value and access-related issues for emerging and established medical device, diagnostics, pharmaceutical, and health informatics companies. Contact us to learn how we can help unlock the value of your innovative products or services.

Background

A leading global medical device manufacturer faced a pricing strategy challenge and partnered with Boston Healthcare to identify appropriate prices for a suite of three products aimed at the low-end, mid-range, and high-end of the urology market.

The products, which included a capital component and disposables, had over 20 different features that could differ across models; some features were available only with certain products within the device family.

Competitors on the market provided low-tier and mid-tier offerings. The capital equipment was available for purchase or lease, and the manufacturer was interested in testing a wide range of capital equipment prices, with the highest tested price being over 750% larger than the lowest.

The client requested Boston Healthcare’s support to identify an optimal business model to drive adoption of a new next generation platform, customer willingness-to-pay, and key value drivers and differentiators.

Key Business Questions

• Who are the key stakeholders for the technology, with specific regard to stakeholders influencing purchasing and adoption?
• What are the main unmet testing needs by physician segment?
• What are the product characteristics that drive adoption, and what are key value messages?
• What is the optimal business model (buying or leasing) for encouraging product adoption?

Boston Healthcare’s Approach

We weighed the advantages and disadvantages of pricing methodologies used to determine optimal prices, including conjoint analysis and a Gabor Granger / Van Westendorp methodology involving open-ended questions and questions about specific test prices for different scenarios.

With conjoint analysis, we estimated that at least 100 participants per specialty would need to complete a minimum of 15 product choice tasks, each of which would require physicians to select a product from five hypothetical product designs (described in terms of seven to nine product features).

Advantages and Disadvantages of Pricing Methodologies for a Global Medical Device Client

BHA decided to employ open-ended questions to solicit unbiased pricing expectations, followed by questions about physician likelihood to purchase devices at specific prices of interest to the device manufacturer.

To determine product pricing expectations and identify key drivers to barriers to adoption, Boston Healthcare conducted primary research in two phases:

1. In-depth phone interviews with 10 clinicians and two hospital purchasers, and
2. Quantitative online survey with 150 clinicians

Boston Healthcare created a pricing simulator (Figure 1) to model clinician reaction to 54 different pricing scenarios to inform revenue potential at different price combinations.

Figure 1. The 54 scenarios presented are in order of revenue, with the revenue-maximizing scenario on the left. The orange boxes indicate the price levels tested, and the bar graph along the top indicates the share represented by each device in the product family.

Value to the Client

The simulator:

• Calculated the expected peak market share by physician specialty and by product type.
• Identified the revenue-maximizing price scenario and the market share-maximizing price scenario.
• Provided data on the price sensitivity of clinicians interested in each of the three options within the product family.
• Enabled a sensitivity analysis to determine how results might change based on different purchase likelihood thresholds.

Takeaway

For Medical Device companies that have large product families, the simulator, serves as an essential tool for guiding recommendations on the optimal price points across the suite of products.

By employing the chosen methodology, Boston Healthcare was able to:

• Confirm which types of individuals are crucial in device adoption decisions
• Understand how the devices are used, which product features are most important, and how institutions decide to buy versus lease
• Identify prices that would or would not influence a physician’s decision to recommend purchasing or leasing the preferred device.
• Develop a comprehensive pricing simulator that
  • Displays the revenue-maximizing price scenario and the market share-maximizing price scenario
  • Provides data on the price sensitivity of clinicians interested in each of the three options within the product family.
  • Facilitated a sensitivity analyses to determine how results might change based on different purchase likelihood thresholds.

Boston Healthcare’s work was foundational in building an effective pricing and contracting strategy for the client’s new product introduction, optimized within the context of the overall portfolio pricing management strategy.

For more than 25 years, Boston Healthcare has provided best-in-class strategic consulting services focused on value and access-related issues for emerging and established medical device, diagnostics, pharmaceutical, and health informatics companies. Contact us to learn how we can help unlock the value of your innovative products or services.

A reflection on the 2019 capability development progress report of the county hospitals in China

The Boston Healthcare China team has been developing a series of newsletters highlighting the Chinese government’s efforts to cut prices of pharmaceuticals and medical devices. It is important to understand that this initiative falls within the broader context of China’s healthcare reform that started back in 2009, the essence of which is to tackle the disparity between the poor and the rich by extending public healthcare coverage to the ~1 billion people born and living outside the cities.

For more background regarding China’s public health insurance schemes and their evolution, please refer to our previous article here.

Currently, there are approximately 2800+ county-level administrative regions in China, and over 70% of the total Chinese population resides in these counties, more commonly referred to as “the rural areas of China”. Healthcare facilities in these counties typically consist of a County General Hospital and a few specialty hospitals for women and children, for cancer care, orthopedics, Chinese traditional medicine, etc.

Recognizing that there are large competency and infrastructure gaps in these county-level healthcare providers compared to their peers in modern cities, the Chinese government developed a program in 2015-2016 as one of the healthcare reform priorities, to improve the service capabilities of the county hospitals currently serving rural residents.

In response, some of our clients have identified the county hospitals to be an emerging customer segment in their strategic market development plan. We analyzed a recent report published by the National Health Commission reviewing the capability building program’s progress in its first three years and would like to share some of the interesting and relevant findings.

• The scope of the assessment covered 1,837 County General Hospitals which, and according to the National Health Commission, accounted for 97.8% of all county-level general hospitals.
• Early indicators show that the capability building efforts in the county hospitals have been successful in terms of providing more care in the local setting.
  • The number of diseases that can be treated by the county hospitals had increased from 1,062 (2017) to 1,412 (2018), as well as the number of types of surgical procedures performed, 343 (2017) to 434 (2018), which are 33% and 26.5% increases compared to 2017, respectively.
  • Average annual patient visits: 312,000 per hospital, 20% increase from 2017
  • Average annual hospital admissions: 24,000 per hospital, 36% increase from 2017^*; average inpatient stay is 7.4 days and utilization of hospital bed is 88.3%
  • Average annual surgical procedures performed: 8,526, 39% increase (*2017 data as comparison)

The data have also been used to monitor the role of the county hospitals within the tiered care delivery system.

• County hospitals and higher-level hospitals: 194,800 patients were transferred from higher-level hospitals to the county hospitals whereas 2,580,500 patients were referred to higher-level hospitals in 2018.
• County hospitals and lower-level care facilities: 2,021,300 and 799,700 patients were respectively transferred from and to lower-level facilities.

The report has also revealed where the biggest competency gaps lie – specialties such as Psychiatry, Rehabilitation and Physiotherapy, Intensive Care, and Infectious Diseases are rarely established. For example, only 42.5% of the 1,837 County General Hospitals reported having a department of Psychiatry.

And even when there is a dedicated department, it does not necessarily mean that the staff are equipped or trained to perform diagnostic or treatment services beyond the most basic ones. For example, although 86% of the county hospitals have Pathology departments in their hospitals, only 40% of those are capable of performing special staining, immunohistochemistry, or molecular diagnostics in their histopathology labs.

When it comes to surgical procedures, examples of low adoption are:

• Ultrasound-guided radiofrequency ablation is only performed in 429 of the 1,837 hospitals (23.35%)
• Video-assisted arthroscopy is performed in 1,088 hospitals (59.23%)
• Surgical removal of tuberculosis in the spine is performed in 1,018 hospitals (55.42%)
• Pulmonary lobectomy is performed in 925 hospitals (50.35%)
• Video-assisted thoracoscopic procedures in lung bullous disease are performed in 923 hospitals (50.24%)

Undoubtedly, as the county hospitals continue to improve their infrastructure and service capabilities, they represent an emerging market segment for our clients, pharmaceutical and medical device companies, who typically supply to the 2,000 ~3,000 mega hospitals in big cities in China. While staff skills take time to build, it is not difficult to see the short-term equipment needs driven by the 2,000 or so county hospitals’ rush to improve their infrastructure, particularly the capital equipment. As the report revealed, the total asset value of hospital-based capital equipment has grown significantly by almost 30% from 2017 to an average value of 95 million yuan in 2018 (approximately $15million; exchange rate 6.5) per hospital largely driven by the acquisition of imaging modalities like MRI and CT scanners.

But the industry also recognizes that the county hospitals are very different from its current big-city-big-hospital type of customers. To begin with, affordability of the hospitals and affordability of the patients treated in the county hospitals. And this brings us back to the opening of this article how the government payer is responding as it finances this expansion in rural healthcare delivery – the Government is enacting aggressive price cuts through the national reimbursement process and national/provincial tendering.  So, the dilemma here is while the industry is being cautious as to the short-term business upside opportunity brought by these ~2000 county hospitals, the government payer has already used that theoretical volume in price negotiations.

Boston Healthcare Associates works with both large multinational corporations and SMEs specialized in innovative medical technologies. Whereas it may be a less relevant discussion for SMEs in the sense that one has to stay focused on the leading hospitals and national-level KOLs in China to drive early adoption, it is rather a challenge for established international companies in China to debate and determine whether this is the time to re-examine the potential of the market and the various strategies and models developed based on the traditional customer segments. Pricing likely will become the most pressing issue among all as the China governments’ negotiation mechanism becomes a norm in coverage decision and procurement process. Please contact us to see how we can help.

2020 has been a bit of a year, to say the least. It has also, though, been a year of invention, opportunity, and possibility for life science innovators. As the new year begins, we are looking ahead to four key megatrends that we expect to shape the landscape in the year to come.

As a result of Brexit, the In Vitro Diagnostic Medical Device Regulations (IVDR) will not apply to Great Britain (England, Wales and Scotland). Unlike Great Britain, the IVDR will apply in Northern Ireland from 26 May 2022.

Guidance issued by the Medicines and Healthcare products Regulatory Agency (MHRA) on December 31^st 2020, clarifies the regulation of medical devices (inclusive of in vitro diagnostic medical devices and active implantable medical devices) in Great Britain.

Of note for medical device manufacturers entering the Great Britain market, is the grace period for registering devices with the MHRA; grace period dates span from May 2021 to January 2022 for different classes of devices. CE marking will continue to be recognized in Great Britain until June 2023, from July 1^st 2023, a UKCA (UK Conformity Assessed) mark will be required. UK Approved Bodies, designated by the MHRA will conduct UKCA mark assessments; device manufacturers will also need to appoint a single UK Responsible Person who will be responsible for the product in Great Britain.

Boston Healthcare continues to track implications of Brexit and IVDR on the regulation of medical devices, ensuring manufacturers are equipped to factor in additional time and resources needed to comply with differing requirements between the EU and Great Britain.  If your plans include an EU medical device launch in 2021 or beyond, contact us for assistance during your launch planning.

Alcon, a global leader in eye care, collaborated with Boston Healthcare to conduct a Time-and-Motion Study to support the value communication of its novel swept-source optical coherence tomography biometer, ARGOS^®. In addition to superior acquisition rate compared to standard biometers, ARGOS features integration capabilities with Alcon’s VERION^® image-guidance and the Alcon Cataract Refractive Suite inside the operating room (OR). Boston Healthcare collected real-world observational data with Principal Investigator Dr. Lawrence Woodard and was able to demonstrate substantial time efficiencies using ARGOS.

BHA’s observational research team is made up of experienced individuals specializing in outcomes research including study design, patient identification, data analysis, and publication expertise. BHA planned and executed the Time-and-Motion Study and developed a customer-friendly value model, demonstrating the potential time savings to cataract surgery sites from the adoption of ARGOS. For this Time-and-Motion Study, BHA collected time measurements for 22 cataract patients in the reception area, clinic, LenSx room and OR. The model demonstrated that for 1,000 patients, ARGOS can save up to 74-hours and 24 minutes (~4.5 mins/patient). Alcon will utilize the results from the study and the value model as a sales aid, enabling practices to toggle between different practice-related scenarios and evaluate the time savings that can be achieved at their practice by adopting ARGOS.

BHA submitted two abstracts from this study – one to the American Academy of Ophthalmology (AAO) 2020 Conference (28% acceptance rate for posters) and another to the International Society for Pharmacoeconomics and Outcomes Research, Europe (ISPOR-EU) 2020 Conference. Both were accepted as poster presentations. The ISPOR abstract, titled, Time Efficiencies Associated with an Innovative Optical Biometer in Cataract Surgery Planning- A Time-and-Motion Study, can be found here, and will be published in the upcoming Value in Health Journal (December 2020 Issue, Volume 23 and Issue S2).

Please do not hesitate to contact us to see how we can support your team.

In previous newsletters (Aggressive National Programs To Drive Down Drug Costs, published in January 2019 and Medical Disposables & Consumables Players Face Challenge of Government-Initiated Price Cuts in China, published in September 2019), Boston Healthcare reported the mounting pressure that biopharmaceutical and medical device companies are facing in defending their prices in China.

In November 2020, two years following the implementation of the national centralized tender program that started with biopharmaceuticals, the first medical device was targeted – drug-eluting coronary stents. The tender results were jaw-dropping, with the average price of the ten stent products that won the national tender dropped to 700 Yuan ($100), down from 13,000 yuan (~) $1,857), an average price from prior provincial tenders.¹

Below, we would like to draw your attention to and share our insights on some other interesting findings in the process.

The market size of drug-eluting coronary stents, by annual volume, is in the 1.3 ~ 1.6 million range

Our medical device clients seek China’s market data in terms of annual procedure volume to understand the potential of the market and the competitive landscape. It has always been difficult as such data are not publicly available and industry analysts like us traditionally must make a bold estimate based on a mix of primary and secondary information, modeling, and, frankly, our years of Chinese industry experience.

Whereas this national tender has revealed that the current market size is in the 1.3~1.6 million range as the volume of this national procurement program, 1.07 million stents, is calculated as 65%~80% of the consolidated demand estimated by the public hospitals in China. Table 1 is the procurement plan by province that adds up to 1.07 million. To put the provincial market into perspective, BHA has also added the population and number of Class III hospitals in the province.

Table 1: Estimated Annual DES Procurement Plan Through the National Tender by Province 

Tender results: 10 winning products from 8 manufacturers, led by domestic players

The eight winning companies include two international players, Boston Scientific and Medtronic and six Chinese companies (JWMS, Essen Technology, MicroPort, Lepu Medical, Kindly Medical and Medfavour Medical).

The tender document has also revealed that there are currently 27 CFDA approved drug-eluting stents supplied by 12 manufacturers. Table 2 is the reported intended procurement volume by manufacturer, revealing the market share information.

Table 2: Reported Procurement Plan by Manufacturer (*indicates tender won)

As mentioned earlier, the average price to win the national tender was a 93% drop across the board. JWMS, who won the tender with the lowest price, slashed the price from 13,300 yuan ($1,900) to 469 yuan ($67); Boston Scientific went from 17,000 yuan ($2,428) to 775 yuan ($111) for two of its stents.

Apart from the immediate questions such as whether this is a sustainable business for these winning companies, how to ensure the quality of the stents is not compromised etc.,  we are just as interested in observing what is going to happen to those who lost the bidding war (e.g. Abbott Vascular). We know that this national tender is intentionally designed to leave some room for hospitals to purchase from outside the tender scope as instead of covering all the demand, the tender volume is only 65% ~ 80% of the estimated sum. So, it will be interesting to watch the competitive dynamics in the 20%~35% “free” space of the market, or 500,000 stents approximately by volume.

Although the sustainability of the national tenders has always been questioned by the industry and industry advocates, the practical advice we will give to the industry is to be prepared especially if you have products that fall into the following categories, which are defined as “High-Price Consumables” by a working document, called Tentative Guidelines for Centralized Procurement of High-Price Medical Consumables issued in 2012 by the Ministry of Health. These include intravascular interventional devices, non-vascular interventional devices, orthopedic implants, neurosurgical implants, electrophysiological catheters, pacemakers, extracorporeal blood circuit/blood purification devices, ophthalmic implants, dental implants, and others.

A key element of the tendering process is the speed with which it is executed. When we review the timeline of the DES tendering process, the official tender document was released on 16 October, the bid date was 5 November and just within hours, the bidding was done, and the results were immediately made available to the public. As a result, organizations must decide before the tendering process, not during the tender, whether the organizational imperative is to win the tender and the lowest price they can go.

Boston Healthcare Associates works with innovative medical technology and biopharmaceutical players to help clients unlock the value of innovation. Our in-market experts closely monitor the policy and market trends in strategic markets like China to stay on top of industry trends and develop strategies and action plans to capture opportunities and mitigate barriers. BHA will continue to monitor and provide updates on the further development of the national tenders in China. Please contact us to see how we can help.

References:

1. https://www.chinadaily.com.cn/a/202011/05/WS5fa3ffaea31024ad0ba83631.html