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Siemens Healthineers looking to tap growth seams in China

By Wang Ying in Shanghai | China Daily | Updated: 2019-05-31 10:04
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Visitors check out Siemens Healthineers' products at an exhibition in Wuhan, Hubei province. [Photo provided to China Daily]

Global diagnostic imaging major plans to localize products and operations

Siemens Healthineers, the German medical technology company, is looking to tap the growth seams in China's medical market by localizing operations, products, a top company official said.

"Our greatest challenge for further development in China is to become a truly local company, which will be the basis for all future competition," said Wang Hao, president of Siemens Healthineers in China.

According to Wang, in order to become a truly local company, a foreign enterprise needs to establish a localized mechanism, so that it can behave responsively and make decisions effectively in line with the market rules.

"Bearing this mission in mind, we need to make local products, and research and develop local solutions tailored for the Chinese market," said Wang.

At the same time, Siemens Healthineers also has to contend with the rapid growth of Chinese medical enterprises, he said.

Large and medium-sized listed Chinese medical equipment companies reported average revenue and net profit growth of 21.5 percent and 43.23 percent in 2018, according to data from Huajin Securities.

"Along with their revenue growth, listed local medical companies are investing heavily in research and development, which is far higher than that of the industry average and has strengthened their innovation capabilities," said Gai Binhe, an industrial analyst with Huajin Securities.

"We will research, develop and manufacture products locally that are suitable for our Chinese clients and we believe this is the only way to maintain our strategic edge in China in the future," said Wang.

Currently, Siemens AG is leading a nearly 500-member research and development team in China, the second-largest after Germany, according to Chen Qixiao, head of Siemens Corporate Technology Suzhou and head of development for the internet of things services. The corporate technology team provides research and development support to the six groups of Siemens AG.

Siemens' collaboration with Siemens Healthineers will facilitate the transformation of innovative ideas into market-oriented products, said Chen.

Since 1992, Siemens Healthineers has established three production bases in Shanghai, Shenzhen and Wuxi of Jiangsu province.

"China is Siemens Healthineers' second largest market after the United States ... China is probably one of the main contributors of our future growth as the country has the greatest economic growth potential. For most medical companies, China's success determines whether a company can achieve growth, as this is one of the key growth contributors," said Wang.

A digital subtraction angiography cath lab was established in the Baicheng municipal hospital of northeastern Jilin province earlier in May, which shed light on China's primary hospitals that are struggling with interventional therapies due to financial, technical and operational difficulties.

Siemens Healthineers launched the one-stop intelligent cath lab incubator from scratch in China in November 2017. It embarked on the quest to find comprehensive solutions for the construction, operation and development of a cath lab, so that primary hospitals can establish cath labs with comprehensive intervention capabilities.

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