Healthcare Opening-up to Create Opportunities

A report from chinadaily.com.cn on Oct. 11th, 2024:

China’s recent moves to further open its economy to foreign investment in the healthcare sector has been viewed as mutually beneficial — driving domestic innovation and growth while expanding opportunities for US companies to explore the vast market.

China’s Ministry of Commerce announced plans last month to expand foreign investment access to the nation’s healthcare sector, including establishing wholly foreign-owned hospitals and conducting research and development in life science technologies.

“Healthcare is just one of the markets where foreign companies have wanted to invest more, so lifting the restrictions will certainly be welcome,” Ker Gibbs, an executive in residence with the China Business Studies Initiative at the University of San Francisco, told China Daily.

The measures are expected to not only improve the medical services in China but also expand opportunities for US companies with the vast potential of the Chinese market.

“China is the second-largest economy in the world and hence, the second-largest healthcare market. The opportunity to explore this market is vast, and foreign firms would be excited to participate if China has the open and liberal policy to allow foreign investors to participate and compete in this market,” Kenneth Fong, founder and chairman of Silicon Valley-based venture capital firm Kenson Ventures, told China Daily.

In recent years, China has implemented a series of reforms in the healthcare sector aimed at boosting foreign investment, streamlining drug approvals and registration, and improving market access, said an analysis published by the law firm Morgan Lewis last month.

These reforms include “significant changes” to China’s Drug Administration Law and corresponding legislation, including the nationwide Market Authorization Holder system, the analysis said.

In July 2023, China’s State Council released a new set of opinions on boosting foreign direct investment in China. Among these, it emphasized the support of foreign investment in the life science sector, encouraging foreign-invested enterprises to carry out clinical trials of overseas marketed cell and gene therapy drugs.

The country continues to deepen its push to open up the healthcare sector. The plans announced by the Commerce Ministry last month will allow foreign entities to set up wholly foreign-owned hospitals in several major cities and provinces, including Beijing, Tianjin, Shanghai, as well as Guangdong, Jiangsu, Fujian and Hainan provinces.