Newsletter nov2013 de_horizon

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Newsletter nov2013 de_horizon

  1. 1. De Horizon Consulting Intl. NEWSLETTER ISSUE NOV 2013 Fri, Nov 8, 2013 De Horizon is pleased to present you with our second Newsletter! KEY FACTS De Horizon Consulting Intl. - Active since 2010, headquartered in Beijing, with a nationwide project coverage by our teams in Shanghai, Chengdu, and Hong Kong - Over 100 successful cases with clients from Europe and the US until 2012 - Industry experts, incl. market research, partner investigations, networking, licensing, marketing or legal assistance, and more As an established consulting firm, De Horizon will be continuously publishing regular Newsletters to keep you informed about the latest developments, trends and opportunities in Healthcare, Biotechnology, Pharmaceutical and Medical Devices sectors in China, as well as our company activities and events. This month’ issue connects with Biotechnology, Pharmaceutical and Medical Devices industries and brings you the Chinese market inside view. We hope this Newsletter will give you a decent understanding of China Biotech Industry; and please don't hesitate to ask us any questions you may have, we will gather all your concerns to be part of our upcoming Newsletters or Workshops. De Horizon Consulting Intl. Newsletter | Issue Nov 2013 1
  2. 2. Chinese Government focuses on Biotechnology At the beginning of 2013, the State Council of the People's Republic of China issued a "BioIndustry Development Plan" to highlight the specific role of Biotechnology industrial development as outlined in China’s “12th Five-Year Plan” (FYP).(1) China’s 12th FYP was promulgated in 2012 and has determined Biotechnology as one of seven most important industries for China’s overall market development, focusing on Biological Products, Biopharmaceuticals, Biomedical Engineering, Bio-Agriculture and BioManufacturing. Practically, the Chinese government has allocated more than 12 billion RMB for the development of new drugs between 2011 and 2015, of which Biotech companies have already received benefits in a complex mix of government investments, preferential tax and fiscal policies. In addition, targeting qualitative improvements of Biotechnology products in China, the government explicitly promoted foreign investments and innovation by referring to both academic and industrial R&D collaborations. 3,0 China’s Biotech Industry GDP prognosis 2,5 1,0 2,4 1,8 1,5 1,5 0,66 0,86 1 1,2 0,5 0,0 2007 2008 Source: www.sts.org.cn 2009 2010 2011 Despite all these efforts, China still remains as a technology manufacturer, unlike companies from Europe or the US, which could be widely compared as innovative and, thus, will easily find their place in the Chinese Health Care market. Bio-Industry Development Plan - main concepts • Develop Bio-pharma product quality and competitiveness • Develop Biomedical high-end engineering • Accelerate Biological agriculture development • Promote of industrial scale Bio-manufacturing • Commercial development of the Bioenergy inustry • Develop Bio-environmental industry • Adjust Bio-industry development to market needs Biotechnology as a pillar industry (in trillion RMB) 2,0 CHINA BIOTECH INSIGHT 2012 2015 While FYPs give general directions of national development, China’s new “Bio-Industry Development Plan” was published to specifically promote Biotechnology. It includes an industry development path for the nearest future and emphasizes Biotechnology as a pillar industry(2), next to the sectors of Automotive, Construction, Mechanicals, Electronics, and Petrochemical by 2020. The plan pointed out that the Bio-industry had an average annual growth rate of 22.9% in 2011 and about 2 trillion RMB in output value. (1) China’s Five-Year Plans constitute both social and economic development directions, while most recently they have focused on rebalancing China's economy through actively shifting from investment towards consumption and supporting rural development instead of urban or coastal areas. (2) A "pillar" industry in China refers to an industry that is large enough capacity, and thus can provide a country's economic growth momentum and is large enough scale in order to be able to absorb a country's potential labor force. De Horizon Consulting Intl. Newsletter | Issue Nov 2013 2
  3. 3. Related numbers also give a promising outlook for regional development - the value added of Bio-industry will reach high figures even in central China, for example 100 billion RMB in Shaanxi province by the end of 2015. During the years 2013-2015, the average annual growth of China's Bio-industry output should remain at a unique rate of 20%. Taking this growth as granted, the plan assumes that in 2015, China's Bioindustry GDP rate should be at least doubled as high as the one of 2010. GMP Another effort for developing the Bio-industry was made in February 2013, when SFDA (China's Food and Drug Administration) issued revised GMP (Good Manufacturing Practices), Foreign SME's in China outlook for their business until 2017 83% Optimistic 76% 74% Neutral Pessimistic 18% 13% 4% Pharma & Healthcare 6% Chemicals & Petroleum 26% 0% Food & Beverage Source: EUCC Business Confidence Survey 2013 diminishing some inconsistencies in the existing bio-business relevant laws like the "Pharmaceutical Administration Law" or "Regulations for Implementation of the Drug Administration Law", to be more consistent with other new policies regarding bioindustry such as the 12th FYP. Optimistic prognosis According to a Business Confidence Survey presented by the EUCC (European Union Chamber of Commerce in China) more than 65% of European Pharma & Healthcare companies admitted that they missed out business opportunities due to "The trend is your friend" market access or regulatory barriers in China. Despite that fact, more than a quarter of companies stated they were generating 25% or more of their global revenues in China in 2013, compared to 17% in 2009. Over a third of them were SMEs (Small and Medium Enterprises). Along with data evaluated by the American Chamber of Commerce in Shanghai in a China Business Report (2012/13), which indicated that 45% of the American companies generated more Human Health Care Bioindustry services Environment Bio Industry China Agriculture, Animal Health and Food Materials & Energy Bio Resources & Ocean Biotech than 11% of their global revenue in China, a general 5year outlook of companies in China could be summarized as very optimistic. Therefore, along with its interest in foreign technologies, the Chinese government will expectedly increasingly backup foreign companies both on financial and legislative levels. Along not against What's important is the need for companies doing business in China to adjust their China business plans to FYP and other additional policies. If you have a thorough knowledge of China's policies and adjust your business plan accordingly, you are more likely to succeed. As Dan Harris writes about 12th FYP on www.chinalawblog.com "The trend is your friend"(3) you just need to have the right tools to handle it. Contact us if you need any assistance. (3) www.chinalawblog.com/2013/03/chinas-12th-five-year-plan-go-with-it-not-against-it.html De Horizon Consulting Intl. Newsletter | Issue Nov 2013 3
  4. 4. Understanding China Medical Devices Market It will be redundant to mention how fast China’s Medical Device market is growing, as it’s an obvious fact and statistics are not hard to access. However, huge market potential does not lead straightly to success. Do you know where the opportunities are, how to penetrate this market and how to overcome its market complexity or operational challenges? Click here to read more Shift on China's Pharmaceutical Market According to analysis issued by the State Food and Drug Administration (SFDA) on Oct 28th, only 29.7% of Chinese enterprises producing aseptic pharmaceutical have passed latest SFDA revised sterile pharmaceutical GMP (Good Manufacture Practice) certification, issued August 2013. The SFDA predicts that although this number will rise to 40% by the end of the year, all other domestic enterprises will have to face quitting the business. Click here to read more About us PHONE +86 10 5811 1912 EMAIL enquiries@chinaregional.com WEBSITE http://www.chinaregional.com/ ADDRESS Level 12, China Resources Building, 8 Jianguomenbei Ave, Dongcheng District, Beijing, P.R.China 100005 Stay in touch with us via: We are a consulting company headquartered in Beijing, providing China entry solutions for clients operating in multiple industrial sectors including health care, green technology, and general aviation. Our range of services include consulting and advisory services, industrial and marketing research, product registration and facilitation services, legal services, and more. Don’t hesitate to contact us for or if you have any feedback, suggestions or tips. We look forward to hear from you! De Horizon Consulting Intl. Newsletter | Issue Nov 2013 4

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