China Wound Care Market Is the Local Potential Much Higher than the Exports?
P7B0-54
August 2014
6 P7B0-54
Executive Summary
7 P7B0-54
Source: Frost & Sullivan
Key Findings
• The wound care market in China is moving away from being an export-oriented industry to domestic-
sales-oriented industry, due to expanding domestic demand and the contraction of export market. The
share of domestic sales has been increasing; and there has been an increase in the number of export-
oriented manufacturers venturing in the domestic market.
• 10% of the manufacturers account for 47% of the market share. The other 90% of the manufacturers
are smaller and regionalized.
• Traditional wound care products contribute to 70.0% of the total wound care market revenue, as these
products require low technology and the natural materials are sourced in China at low cost.
• With the increase in disposable income and physicians’ awareness of the benefits of advanced wound
care dressing, the growth potential of advanced wound care dressing is expected to increase.
• MNCs dominate the advanced wound dressing segment, while local manufacturers hold a higher
share of the traditional wound care segment. Owing to advancement in technology and development
of new strategies in servicing hospitals and clinicians, domestic manufacturers are making inroads into
the advanced wound care dressing segment.
8 P7B0-54
Source: Frost & Sullivan
Market Definition
Tier Function No. of Bed
I Primary care hospital that provides prevention, basic medical services, and health maintenance 20-99
II Regional hospital that provides medical services to multiple communities 100-499
III Cross regional hospital that provides specialized medical services to multiple regions >500
Total Wound Care Market: Segmentation, China, 2013
Wound care refers to the restoration of the continuity of cells, through a continuous sequence of
inflammation and tissue repair during which epithelial, endothelial, inflammatory cells, platelets and
fibroblasts briefly interact to restore normal function.
Moist wound dressing, antimicrobial dressing, and active therapies are grouped under advanced wound
dressing segment in the study.
In China, hospitals are classified into three tiers according to their functions and size as below:
Traditional Wound Care Products
he restoration of the
Moist Wound
Dressing
continuity of cells th
Antimicrobial
Dressing
gh a continuous
Active
Therapies
equence of
Negative Pressure
Wound Therapy
Total Wound Care Market
9 P7B0-54
Source: Frost & Sullivan
Key Questions This Study Will Answer
What are the key market drivers and restraints in the Chinese wound care market?
What is the growth prospect for traditional wound care segment and advanced wound care segment
in China?
Who are the key market participants? What are the positioning strategies of the key market
participants?
What is the business environment of the Chinese wound care market?
10 P7B0-54
Note: All figures are rounded. The base year is 2013. Source: Frost & Sullivan
Market Engineering Measurements
Total Wound Care Market: Market Engineering Measurements, China, 2013
For a tabular version, click here. Stable Increasing Decreasing
Compound Annual Growth Rate
5.5%
(CAGR, 2013–2021)
Market Concentration
8%–10%
(% of market share held
by top 3 companies)
Market Stage
Growth
Market Size for Last Year of Study Period
$3,124.6 M
(2021)
Customer Price Sensitivity
7
(scale:1 [low] to 10 [high])
Degree of Technical Change
5
(scale:1 [low] to 10 [high])
Market Revenue
$2,037.0 M
(2013)
Base Year Market Growth Rate
4.8%
Market Overview
11 P7B0-54
Source: Frost & Sullivan
CEO’s Perspective
2
The average disposable income in China, mainly in the urban
sector has increased by 13.4% a year and is around 25,000 Yuan.
This increase, along with affordable pricing, is likely to support
spending on better treatment; hence, market share of domestic
companies is likely to increase by 10–5% during the period.
3
Hospital sector accounts for 70%–80% of the total sales, hence
sales force channelization to build relationships with hospital
personnel is the key to success. With the growth in newer cities,
Tier II hospitals is likely to be the new opportunity for growth.
4
Domestic wound care manufacturers tend to invest around 2% of
the revenue in R&D. With increased competition form
multinational participants, innovation in products, competitive
pricing and quality is key to increasing market share in the wound
care sector for these companies.
5 The universal coverage (approximately 95%) of public health
insurance schemes and increased reimbursement rate for wound
care products would further stimulate demand.
1 With 18% of the population in China aged above 60 years and
10% of the population being diabetic, the country holds very high
potential for the growth of wound care products.
12 P7B0-54
Source: Frost & Sullivan
Multinational Companies to Watch
Smith & Nephew
One of the earliest MNCs which made its presence in the AWC market in China.
The company has two manufacturing facilities in China which cater to the global
demand. It has two education and training centers that provides knowledge and
product training for physicians in China. Its long-term relationship with many key
Tier III hospitals has supported loyal customer base and high market share.
Molnlycke Health Care AB
The company has built strong relationship with physicians in China by setting up
its wound care center to training clinicians at six Tier III hospitals. This approach
allows the company to create product portfolio that meets the local needs. It is
one of the leading companies in moist wound care product sector.
Coloplast
The company has a significant presence in wound care and ostomy care market
in China. It is considered one of the leaders in the moist dressing sector due to
its superior quality products and effective marketing strategies. The company
aims to expand its product line and target key hospitals and also increase its
sales force to support the same.
Kinetic Concepts Inc.
With its leading technology in AWC, the company has significant presence in the
NPWT segment in China. The takeover of Systagenix supported further
penetration into advanced wound care (AWC) dressing market in China.
13 P7B0-54
Source: Frost & Sullivan
Local Companies to Watch
Shandong Wego
Newlife Medical
Devices
A leading domestic manufacturer of NPWT. The company has good reputation
among the Tier III hospitals. Its strength in product innovation and effective
marketing strategy (through providing training to physicians and nurses) makes
the company a leader in the segment.
Zhejiang Top
Medical
The company is one of the pioneers of AWC products in China. Its strength lies
in strong R&D and extensive distribution network. The company intends to
expand its market coverage through own brands.
Winner Medical
Group Inc.
An established and leading manufacturer and exporter in traditional wound care
products. The company owns a vertically integrated supply chain which allows it
to better control costs and provide high quality products. Its established
brands—Winner and PurCotton—have gained extensive presence in domestic
market.
Changchun JA
Biotech
A leading manufacturer of hydrogel dressing, the company has gained
recognition and support from the government. Its R&D ability and product
innovation outstand many manufacturers of the segment.
14 P7B0-54
Source: Frost & Sullivan
The Last Word—Three Big Predictions
3 AWC will gradually replace the traditional wound care in during and beyond the
forecast period.
1 More export-oriented manufacturers will reorient the focus of business to the
expanding domestic wound care market, so intense competition among
traditional wound care products manufacturers is expected.
2 Government policy to support the growth of local Chinese AWC product
manufacturers would challenge the domination of MNCs in this segment.