Breaking News: Ford to Produce 50,000 Ventilators in Michigan in Next 100 Days; Partnering with Airon Corp and GE Healthcare Will Help Coronavirus Patients -
We are pleased and honored to announce the Strategic Alliance between Airon USA and GE as part of the current fight against the Corona Virus. Under this strategic agreement, facilitated by MedWorld Advisors, GE in alliance with Ford will be producing the pNeuton model A of the current Airon product Line in the effort to save lives.
Asia is a fast-growing market in many ways. Until this century, APAC was often dismissed in the past for diverse reasons by Western companies (regional and MNC). As many of us know, this region is a now a force to be reckoned with. Here is an overview along with a few facts about the current #2 Largest Market for Healthcare (and everything that is related to it - MedTech, Med Device, Biomed, Dental etc...).
Approx. 4.5 Billion
Population Over the Age of 50 by 2025 : Over 1 Billion
Fastest Growing Population in the world
HealthCare in Numbers:
- 2/3 of the Major Chronic World Respiratory Diseases will be in the region (besides the population growth, anyone who have visited a major city in China in recent times will understand why)
- By 2020, APAC will be the 2nd largest MedTech Market behind the US (Europe will be 3rd)
- With the exception of the Top Tier Emerging Market Hospitals, 80% of the current solutions on the markets are not affordable in the APAC region
- In countries like China, the economic landscape changes are creating huge demand for
Up until recently, International companies have been using products created for the US or the EU for the APAC Market. Fewer devices or solutions were created to meet the needs of the population in this region yet 51% of the world population is in APAC
Distribution channels are often indirect and complex. That means that for some:
- They have very little control of their products in APAC
- Volumes often comes at great discount pricing
- Direct Contact to users is often difficult
- Getting regulatory approval has been done by a 3rd party to get into the market faster
- The 3rd Party may own the registration rights to the country/Region.
Now the tides are changing:
-Countries like China are now buying MedTech companies and producing locally to reduce cost while providing better technologies - US Companies have been buying local companies to have products developed to meet the demand of the region, some of them now have local "innovation centers” or “Centers of Excellence”.
-As the Trade Disputes between China and the US right now are a hot topic, Chinese companies are looking at other parts of the world for partnerships and acquisitions more than ever
- Governments are supporting local companies (China and Singapore are great examples)
- APAC's market's expansion will continue in the future
- The Healthcare landscape is changing as the region's economies are growing.
- Size of the middle class in the region is rapidly expanding. Asian Development Bank expects this group to grow from 24% of the total population in 2010 to 65% by 2030.
- Demographic trends such as (population aging and urbanization), is expected to fuel demand for better quality healthcare
- Asian Innovations are showing promises. They are creating products that are meeting the clinical unmet needs of the APAC Region and its population. As companies regionally and globally better understand the market, its gaps and opportunities, they are developing new products and are hitting the market relatively quickly (considering regulatory requirements).
- Although US and European KOLs are highly regarded, local Asian market data and influencers are now a requirement for success in some regions.
- Regulatory requirements can still be a hurdle if you are not based in Asia and do not have good partners there.
With that stated, here are some thoughts about entering the Asian market….
1. Distribution: Distribution is a great solution if you have a product that fits the market. A distributor may be able to help you get regulatory approva. However, be sure to avoid relinquishing your registration and/or IP rights to the Market in order to do so.
Obviously, having a distributor with feet on the ground in your target markets is important. The key is to be sure to directly manage your distribution channel and your KOL’s. And it’s critical to stay close to the market by tracking what happens to your product and obtaining customer/user feedback. This is how you will keep on creating products that are needed in the market and will make you successful for the long term.
2. Joint Venture/ Partnership:
Joint ventures are one of the options to help you grow your market share in Asia. While you are not owning a company out right, you may have shares (minority or majority) that help you create a partnership giving you access to manufacturing facilities, established distribution networks, care centers and a lot more. Like with every relationship that is a partnership, it will take work to cultivate and grow your relationship and your investment. It’s important to “get it right” up-front to ensure the long-term success.
3. Acquisition : The dynamics of an acquisition or a joint venture varies from country to country in Asia. For example , the acquisition of a private medical device company in China may be on the basis of Net Asset Value plus a premium. You may find out that figuring out the "true" value of a company may not be easy as “book” reporting is done very differently or is not done in the conventional way. Therefore, you may need to be creative and look at the company assets and add a premium to get a value. And, you need to have trust for the management team. Additionally, we do recommend using a local third party to help you with the diligence process. An acquisition may be a great way to help you gain quick access to the markets in Asia. Acquisitions go both ways geographically. It is not always outsiders buying local companies in Asia. More and more Asian Countries purchase companies/technologies from Western Countries and bring them back to Asia for further development and commercialization. Asian countries will look at a company having a higher value if the product has FDA approval and/or CE Mark. US IP is also a bonus. And US or EU sales will add a premium. While there is no guarantee, some companies with early innovative technologies will bring a excellent value if the technology answers an unmet or growing need in the region and also has good clinical evidence, regulatory, and legal IP assets. With the current state of "Trade Wars", Asia is looking at buying in the rest of the world rather than in the US. However, remember these times are highly volatile and bring dynamic changes so tomorrow may be different.
The bottom line is make your best decisions for your long term interests. While you need to manage thru the short-term challenges, you will thrive if you assess your business opportunities on long term opportunities and ignore the short term volatility.
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