This white paper discusses trends in the medical device market and manufacturing in Asia. It notes that the medical device market is growing more slowly in Western countries but quickly in developing countries, especially Asia. Many large Western medical device companies are opening new manufacturing facilities and expanding existing ones in Asia to reduce costs and access growing Asian markets. The white paper provides an overview of the size and growth of major medical device markets globally and in Asia. It also summarizes manufacturing facilities and industry zones near Shanghai that are attractive for medical device production.

1. Medical Device
Manufacturing in Asia
Pacific Bridge Medical
2013 White Paper
www.pacificbridgemedical.com

2. Medical Device
Manufacturing in Asia
Pacific Bridge Medical
2013 White Paper
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by US and International copyright laws and may not be copied, reprinted, published, translated, resold, hosted, or otherwise distributed by any means without explicit permission.
Disclaimer: the information contained in this report is the opinion of Pacific Bridge Medical, a subsidiary of Pacific Bridge, Inc. It is provided for general information purposes
only, and does not constitute professional advice. We believe the contents to be true and
accurate at the date of writing but can give no assurances or warranties regarding the accuracy, currency, or applicability of any of the contents in relation to specific situations and
particular circumstances.

3. Global Medical Device Market Trends
❖ Growing slowly in the West – US/EU
❖ Western device companies facing increasing cost
pressures
❖ More emphasis on cost-effective devices with fewer
bells and whistles for developing countries
❖ Growing quickly in developing countries with high
double digit growth
❖ BRIC really means China
❖ Developing world experiencing more Western
diseases as they eat more McDonald’s and
Kentucky Fried Chicken
❖ Cardiology, orthopedics and cancer growing
❖ Developing world needs more devices to manage
more Western diseases
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4. Size and Growth of Global Medical
Device Markets
Region
Market Size
Growth
(since 2006)
North America
$105 billion
Western Europe
$65 billion
10%
Japan
$28 billion
12%
Asia Pacific
(excluding Japan)
$23 billion
28%
13%
Sources: Acmite Market Intelligence, and other PBM sources
2006
North America
Western Europe
Japan
Rest of Asia - Pacific
2012
Source: Acmite Market Intelligence
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5. Asian Medical Market Size & Growth
Rate Higher than Global Growth Rate
❖ Cardiology: The growth in Asia is significantly
above the global average (3%). The CAGR for
cardiology surgery devices in Asia is predicted to
be 15% from 2009-2016
❖ Orthopedics: Asia will witness much faster growth
than the rest of the world (6%). The CAGR for
orthopedic devices in Asia is predicted to be 13.4%
from 2009-2014.
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6. Medical Device Manufacturing
Moving to Asia (to reduce costs and
get closer to growing markets)
2005
US
EU
Japan
Other
2015
*Sources: Frost and Sullivan, Department of Commerce, and other PBM sources
**Asia is 90% of Other
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7. Purchasing Trends
❖ As more device manufacturers set up operations in
Asia, more purchasing managers for medical device
components and medical devices are being hired
locally in Asia
❖ It is sometimes difficult for purchasing managers
located in the West to buy components for factories
in Asia
❖ Purchasing decisions for medical devices are now
oftentimes made in Asia, not in the West
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8. Other Global Medical Device Trends
❖ Significantly tougher FDA, encouraging medical
device companies to launch overseas before the US
❖ Weaker dollar means easier to export medical
devices
❖ More local medical device manufacturing in
developing countries
❖ Local manufacturing companies in developing
world can now make more sophisticated, higher
quality medical devices than before
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9. Asian Medical Device Market Trends
❖ Explosive demand for medical devices in the Asian
markets attracts Western and local medical device
companies
❖ Western medical device companies increasing sales
to Asia with basic models and lower costs of their
top of the line Western products (outsource)
❖ Many more local Asian medical device
manufacturers now in business making more
sophisticated products with components of better
quality as demand increases in the region and
globally
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10. Main Asian Markets for Medical
Device Manufacturing
1. Japan – largest device market in Asia ($28
billion); quality is key
2. China – fastest growing device market; quality
rapidly growing
3. Korea – 3rd largest device market in Asia,
increasing exports
4. S.E. Asia – growing demand for devices with an
expanding middle class
Each medical device market is different. Local
staff is needed in each country for the project to be
successful.
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11. Asia Medical Device
Manufacturing Trends
❖ Western medical device manufacturers are closing
Western facilities (especially in the EU) and
opening new facilities in Asia
♦ Smith and Nephew has been relocating device
manufacturing processes from England to
China
♦ Boston Scientific laid off 1,000 employees
worldwide in 2010 but is expected to hire
thousands of additional workers in China
by 2016
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12. Western Medical Device
Manufacturers Setting Up
Facilities in Asia
❖ Medtronic
♦ Set up an R&D center in Shanghai in 2012 to
move towards local product development and
commercialization in China. The company
plans to hire 1,000 additional employees over
the next 5 years, many of whom will be placed
in the R&D center.
♦ Set up Asia and international headquarters in
Singapore in 2009 and invested $65 million on
a manufacturing plant in the country in 2011.
The new manufacturing facility was set up to
fulfill strong future growth of cardiac devices
in Asia.
♦ Launched a joint venture with Shandong
Weigao Group Medical Polymer Company in
China in 2007.
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13. Western Medical Device
Manufacturers Setting Up
Facilities in Asia
❖ Boston Scientific to invest $150 million over the
next 4 years to expand manufacturing, training
and marketing facilities in China. In addition, the
number of R&D and clinical study employees in
China will increase from 200 to 1,200. Revenues
are expected to reach $500 million by 2016.
❖ Biomet set up $15 million manufacturing facilities
for orthopedic implants and medical devices in
Changzhou Export Processing Zone in China
❖ Smith & Nephew opened a 10,000 sq. feet
orthopedic manufacturing facility in Beijing, China
and expanded existing facilities in Suzhou, China
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14. Western medical Device
Manufacturers Setting Up
Facilities in Asia
❖ Flextronics/Avail opened a 600,000 sq. feet
medical device manufacturing facility in Shenzhen,
China and a 180,000 sq. feet medical device
manufacturing facility in Malaysia to support rising
demands from medical OEMs
❖ Accellent opened a 65,000 sq. feet medical device
manufacturing facility in Penang, Malaysia
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15. Chinese Drug Eluting Stent Market
❖ 5 years ago, foreign imported products accounted
for 75% of the DES market – Medtronic, Abbott,
Boston Scientific and JNJ. Local Chinese
manufacturers accounted for 25% of the market
❖ 5 years later, 75% of the DES market are local
Chinese DES manufacturing companies and now
only 25% of the market are foreign made products
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16. Sample Manufacturing Facilities
near Shanghai
Industry Zone
Level
Location
From
Industry
DowntownShanghai
Companies
Caohejing Hi-Tech
Park
State
Shanghai
20 km
FMC Corporation, 86,114
Kerry Bio-Science sq feet
Co.,Ltd., Unilever,
GE, Philips
Minhang Econ. & State
Tech. Development
Zone
Shanghai
30 km
Minhang Econ. & State
Tech. Development
Zone
Shanghai
30 km
Suzhou Industrial
Park
State
Suzhou
70 km
Suzhou Industrial
Park
State
Suzhou
70 km
Suzhou Industrial
Park
State
Suzhou
70 km
Linang Nicheng
Industrial Park
Kunshan new &
hi-tech industrial
development zone
?
Shanghai
50 km
Province
Kunshan, 50 km
Jiangsu
province
Spark Development Municipality Shanghai
Zone
Information Technology,
New Materials,
Biotechnology &
Pharmaceuticals,
Aeronautics, Automotive
Accessories
Diversity of
manufacturing, Hi-Tech,
Logistics
Johnson &
Johnson, CocaCola, Pepsi,
Bristol-Myers
Squibb
Diversity of
Johnson &
manufacturing, Hi-Tech, Johnson, CocaLogistics
Cola, Pepsi,
Bristol-Myers
Squibb
IC, TFT-LCD, automotive Johnson &
and aeronautical parts,
Johnson, Pfizer,
software, outsourcing
Lilly, Nabisco,
services, pharmaceutical Baxter, Honeywell,
Emerson
IC, TFT-LCD, automotive Johnson &
and aeronautical parts,
Johnson, Pfizer,
software, outsourcing
Lilly, Nabisco,
services, pharmaceutical Baxter, Honeywell,
Emerson
IC, TFT-LCD, automotive Johnson &
and aeronautical parts,
Johnson, Pfizer,
software, outsourcing
Lilly , Nabisco,
services, pharmaceutical Baxter, Honeywell,
Emerson
Heavy-duty equipment,
Siemens, UPS,
international logistics
Philips, Volvo
Precision
GE, Apex
Machinery,Solar Energy
And Wind Energy, BIO
Pharmaceutical
Biomedicine, fine
DSM Vitamins,
chemical industry,
Xiaoxi
chemical fiber
Biotechnology,
Whyte Pioneer
50 km
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Size
72,400
sq feet
Rent
($/month)
55,385
34,142
106,146
sq feet
129,171
sq feet
33,230
129,171
sq feet
40,615
150,700
sq feet
34,462
100,000
21,400
sq feet
4 buildings, 25,520
81,163 sqf
each
90,549
sq feet
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23,295
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17. Map of Sample Manufacturing
Facilities near Shanghai
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18. Summary of Cultural Issues in Asia
❖ For each Asian country you must know the local
traditions and unique cultural factors.
❖ Not all Asian countries share the same Asian
attitudes, values and mindset.
❖ Try and get to know about these countries’ histories,
culture, religion, the types of people there, etc.
❖ How do you write your emails to Asians?
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19. Thank You!
Pacific Bridge Medical
Connect with us today.
7315 Wisconsin Avenue, Suite 609E
Bethesda, MD 20814
www.pacificbridgemedical.com
Click here to contact us about manufacturing
strategies for your medical device in Asia.
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