China’s Healthcare System

China Demographics -China has emerged as a massive economic player in the global marketplace -Studies have concluded that China’s retail marketplace is the largest emerging global opportunity, growing at an unprecedented rate of 9% per year -China’s communist government has also contributed to this growth by easing restrictions on foreign companies -Since 1979, when a ban on commercial advertising was lifted, China’s advertising industry has become the world’s third-largest in 2005 Total Population 1,330,044,544 Age Breakdown 0-14 years: 20.1% 15-64 years: 71.9% 65 years and over: 8% Ethnic Groups Han Chinese 91.9%, Zhuang, Uygur, Hui, Yi, Tibetan, Miao, Manchu, Mongol, Buyi, Korean, and other nationalities 8.1% Languages Standard Chinese or Mandarin, among many others

New Media in China -Because China has unfavorably high traditional advertising costs, many companies are turning to new media outlets to get their message across -The Internet is one of many ways that advertisers are reaching Chinese consumers -China’s Internet users spend more time using the Internet than watching TV and reading newspapers -Internet users have grown by 18% since 2004 and stood at 137 million in 2007

Healthcare System in China -The Chinese healthcare system is in a period of reform, as are many of China’s industries -For 50 years the government handled the country’s health needs; central, provincial, and local governments funded hospitals and administered medical care to patients at little to no charge -As China has come to embrace a market economy, hospitals are now expected to finance some of their own costs -There are very few independent doctors’ offices or clinics, Chinese citizens utilize their hospital for primary care facilities -Because of this, hospitals experience extreme overcrowding and long waits, however, in a country of close to 1.5 billion individuals, the patient/doctor ratio is very high

Healthcare System in China -Hospitals vary from place to place in China, in large cities one can typically find well-staffed general and specialty hospitals -Rural areas there are local and county hospitals, as your climb the system increasing levels of medical expertise are available -In areas of extreme poverty, hospitals are very antiquated, with little modern equipment and few doctors -While these overcrowded conditions leave much to be desired, even in the technologically-advanced city hospitals, China’s emerging middle and upper classes are for the first time demanding better levels of care and are willing to pay out of pocket for it

Top Conditions Amongst the Chinese -Hypertension, heart disease, and cancer top the list of chronic conditions among Chinese citizens -Among senior citizens, 90% are dealing with at least one chronic conditions -Chronic conditions in China account for 80% of deaths per year -Obesity is also on the rise, in 2005 20% of children 7-17 in major cities were overweight/obese, contributing to a high rise of diabetes cases

Pharmaceuticals and Disease Treatment -China’s pharma market is forecasted to be the world’s 5 th largest by 2010 -Due to China’s massive population, drug sales in the country are expected to surpass those in every other nation by the middle of this century -More and more pharma companies are investing in new R&D in China -However, domestic pharma companies account for 70-80% of sales in China -While China’s pharma companies were focused mainly on producing generic drugs, in 2006 the government signaled reforms in the industry to entice these domestic companies to invest in R&D and set up technology centers

A Delicate Balance VS -Before the 1970s, China’s government pushed citizens more toward traditional medicines and doctors, however, by the late 1980s the proportion of doctors of Western medicine had exceeded those of traditional practices

Register Now for Upcoming Webinar Thank you for viewing our presentation! We’d like to invite you to our upcoming webinar: Taking the Pulse® Asia: Physicians and Emerging Information Technologies Friday, April 3, 2009, 9:00am & 3:00 pm Manhattan Research President Mark Bard will preview the latest technology adoption and integration trends in physician practices across Japan, China, South Korea, Taiwan, and Australia from the Taking the Pulse Asia market research and advisory service. Mr. Bard will review the importance of key topics such as the Internet, impact of Web 2.0 technologies, email communication, PDAs/smartphones, search engine reliance, tech-enabled sales reps, and electronic medical records. Register Now! Choose from two sessions: Friday, April 3, 2009, 9:00am & 3:00 pm Register here: www.manhattanresearch.com/webinars