Author: Dr. Stephen Cheung

1. Stephen W. Cheung PhD
Reshaping
Hong Kong’s
Healthcare

2. Panel Members
Name Role Fields & Interests
Dr. Stephen Cheung Moderator Medical Devices
Dr. Ronald Li Challenger Biotech
Mr. Charlie Hung Panelist Internet, investor
Mr. Jimmy Tao Panelist Food Safety, Biotech
Dr. Nelson Wong Panelist HK Healthcare
Practitioner
*Ms Vanessa Cheung (panelist) is unable to attend

3. Session Objectives
1. Hong Kong’s Healthcare Landscape
• What opportunities?
• Special case: Aging population services
2. Industrialization candidates
• Biotech
• Medical Devices
3. Conclusion of Session
• Are the above at Tipping Point?
• List 3 critical drivers to move forward
Examples of critical drivers
a. Qualified investments
b. Government support
c. Cost of doing business
d. Critical mass
e. Skilled workers
f. Market access (HK & China)
g. Technology partners
h. Support industries
i. Legal & regulatory issues

4. % GDP Countries
Over 12% USA (17.1%) – US$2.9 Trillion
9-12% France, Switzerland, Germany,
Canada, Finland, Japan, UK
6-8% S. Korea, Taiwan
4-6% HK(5.2%*), China (5.6%),
Singapore (4.6%), India, Malaysia
Healthcare Expenditure as % of GDP (2012/2013)
Source: World Bank and HK Gov Health and Food Bureau
*: HK’s expenditure is US$13.6 B, 48% by HK Gov

5. Demographics (2014-15)
Demo groups % of Pop
United
States
Boomers (1946-65)
Millennials (1981-
2000)
76M (24%)
83M (26%)
HK* 10-30 yr old
30-49 yr old
50-69 yr old
1.5M (20.5%)
2.2M (31.4%)
2.2M (31.3%)
China 15-30 yr old
40-50 yr old
250M (18%)
280M (20%)
*: Extrapolate from 2011 HK Census

6. Est aggregate net worth by generation in US
Source: Board of Governors of the Federal Reserve System – Survey of Consumer Finances, US Census Bureau,
JP Morgan Asset Management: data as of Dec 31 for each survey year
Greatest
Generation
Baby
Boomers
Gen X and
Millennials
Boomers have $ !!

7. HEALTH
MED EQUIPBIOTECH
ETF Performance
of Health, Biotech,
and Medical
Equipment
2006-2015

8. Causes (US CDC) Deaths % HK (HK Gov) China (2012 CCDC)
1. Heart disease 611k 23.5 #3 (13.4%) #2 (21%)
2. Cancer (1.66M new cases) 585k 22.5 #1 (31.3%) #1 (28%)
3. Chronic lower respiratory
diseases
149k 5.7 #5 (4.0%) #4 (5%)
4. Accidents 131k 5.0 #6 (4.3%) #5 (3%)
5. Strokes 129k 5.0 #4 (7.5%) #3 (11%)
6. Alzheimer 85k 3.3 #9 (2.3%)
7. Diabetes 76k 2.9
8. Influenza & Pneumonia 57k 2.2 #2 (15.7%)
Top Causes of Death (2013)

9. Demand
• 5-12 linac systems per
million
US: ~ 5,000 systems
China: needs 10,000+
~ 2,000 current
Unit price
• US$3-6M
• Gross Margin: 70%
Business investment cycle
• 10+ yrs to IPO
Example: Radiation Oncology

10. Critical Success Factors
• Initial adoption
• FDA approval
• Good ROI for hospitals
• Versatility
Benefits
• High knowledge
content
• Well pay jobs
Example: Radiation Oncology

11. Linacs per million inhabitants
Source: 2012 Elekta
New cases in the
world:
~15 M (2015)
~20 M (2030)

12. WHO: Cancer Cases On The Rise in China (2012)
• Report: Africa, Asia, and Central/South America
were the hardest hit by cancer
• World registered: 14 M new cases, 8.2 M deaths
• China’s new cases: 3.07 M (21.8% of global)
Deaths: 2.2 M (26.9% of global cancer deaths)
• China's own statistics: ~3.5 M new cases and 2.5 M
deaths
• Most new cancer cases & deaths: liver, esophagus,
stomach and lung
Source: South China Morning Post 02/07/2014

13. “Only 20% of
Chinese cancer
patients now take
radiation therapy,
while the figure
stands at more
than 70%
in the US.”
China Daily
11/23/2015
Source: 2012 Elekta
China radiation oncology market
Market drivers: need of training and education

14. Technologies on the Horizon: NBIC to CKTS
NBIC(2002 NSF): Convergence of
Nano + Bio + Info + Cognitive
Coordinated R&D
US and worldwide
CKTS (2013): Convergence of
Knowledge + Technology
to benefit Society

15. 1. Boomers: the BIGGEST market in history
• Proliferation: Senior care, organ replacements, robotic
prostheses…….
2. Diagnosis and treatment of common illnesses & diseases
• Emphasis: Preventive care, minimum intrusion
• Personalized medicine on rise: Genomics, customized medication
• Coming to market: stem cells, regenerative
• Wearable and implantable devices
• The body is BIG DATA
3. Service providers
• Productivity Tools to Control Cost
• What about Traditional Chinese Medicine (TCM)?
4. Millennials: Will have different experience when they age
Visualize Healthcare - Now to 2030

16. Stephen W. Cheung PhD
Reshaping
Hong Kong’s
Healthcare