Health and medical to Hong Kong

(Last updated: 07 Mar 2008)

Trends and opportunities

The market

The Hong Kong market for medical equipment and supplies is estimated at US$310 million in 2007, equal to US$45 per capita.  It is expected that the device market will continue to expand at a rate of 6.6% per annum, reaching US$427 million, or US$60 per capita by 2012.  The majority of imports into Hong Kong are not intended for domestic consumption; around 80-90% are re-exported.

The bulk of imports tends to be the more expensive advanced medical equipment, much of which is re-exported with only a small proportion intended for domestic use.

The major suppliers of medical equipment and products to Hong Kong are from China, Japan, Singapore, Germany and the US.

Healthcare in Hong Kong is dominated by the Hospital Authority (HA) and is the major buyer of medical equipment in Hong Kong.  The government revealed that the budgeted outlay on recurrent medical and health services will rise from 15% to 17% in 2011-12. Spending is expected to reach US$18.3bn in 2011, up 44% from US$12.7bn in 2007.

Key characteristics of Hong Kong’s healthcare system include:

• 41 public hospitals / institutions managed by HA and 12 private hospitals
• 30,542 beds in total, representing 4.41beds per thousand people
• 27,742 beds in hospitals run by the Hospital Authority
• 2,800 beds in 12 private hospitals
• 10,980 doctors registered with the Hong Kong Medical Council
• 33,917 nurses registered with the Nursing Council of Hong Kong

The SARS crisis in 2003 raised awareness of the need to improve Hong Kong’s infectious disease management.  With additional funding from the government, the Infectious Disease Control Training Centre has been set up to organise infection control training to healthcare professionals in all disciplines, and coordinate high level epidemiology, risk communication and outbreak management training for clinicians and managers to combat future epidemics.

Opportunities

Although China is a large manufacturer of medical equipment and devices, as well as homecare and healthcare products, many Hong Kong and Chinese consumers prefer Western and Japanese products because of their reputation for quality and reliability.  The imported high performance electro-diagnostic equipment such as cardiovascular equipment, computerized tomography, magnetic resonance imaging apparatus, ultrasonic scanning apparatus, etc. are well accepted by local public and private hospitals.

There is also an increasing demand for aged-care products and rehabilitation equipment due to an increase in the ageing population in Hong Kong.

The best opportunities for Australian suppliers are in the following products:

• Hi-tech laser equipment
• Advanced operating theatre equipment
• Ward equipment
• Isolation facilities
• Aged-care equipment
• Rehabilitation equipment
• Homecare/healthcare products

Tariffs, regulations and customs

Hong Kong is a free port.  There are no import restrictions or duties imposed on the importation of medical equipment and related supplies.

The Hong Kong Department of Health is phasing in a new administrative control system governing the supply of medical equipment in Hong Kong.  Medical devices will be classified into High/Medium/Low risk categories.  These risk categories will govern product registration and other regulatory requirements for medical equipment in Hong Kong.  For details, please refer to the website of Medical Device Control Office of the Hong Kong Department of Health at www.mdco.gov.hk.

Marketing your products and services

Market entry

The ‘personal touch' and an assurance of technical support are considered to be critical in this industry.  The most common means of entry is through an agent or distributor as there are over 40 major suppliers in Hong Kong, most of whom are agents and/or distributors for more than one overseas manufacturer and supplier.

Direct selling to hospitals is not recommended unless the company has an established office in Hong Kong.

The most important qualities for medical products are:

• reliability
• durability
• ease of operation
• high quality after-sales service

Price competitiveness is not the most important selling factor.  Competition is fierce as there are over 40 major suppliers, mostly agents for major overseas manufacturers, competing for 50 major hospitals.  In Hong Kong there is a shortage of technical support specialists, so those companies that can provide long-term training and technical support services will be received more favourably.

Distribution channels

Distribution of medical equipment in Hong Kong can be through a representative or directly through your own branch.  For those companies that wish to control distribution or sell directly to hospitals, it is not uncommon to establish an office in Hong Kong.  The most critical factor in selecting an agent is the ability to provide after-sales service.

The HA Procurement and Materials Management Section has strict procurement and tender guidelines.  Full details, including application forms to be considered as a registered supplier, can be found on its website: www.ha.org.hk.

Relevant Trade Exhibition

Hong Kong International Medical & Health Care Fair 16-20 Aug 2008

Links and industry contacts

Health and medical–related resources

Department of Health - www.info.gov.hk/dh
Federation of Medical Societies of Hong Kong - www.fmshk.com.hk
Infectious Disease Control Training Centres - www3.ha.org.hk/idctc/default.asp

Hospital Authority - www.ha.org.hk
Hospital Authority Building
147B Argyle Street
Kowloon, Hong Kong
Tel: (852) 2330 6769
Fax: (852) 2890 7726

Hong Kong Medical Association – www.hkma.org/index.htm
5/F., Duke of Windsor Social Service Building
15 Hennessy Road
Wanchai, Hong Kong
Tel: (852) 2527 8285
Fax: (852) 2865 0943

Government, business and trade resources for Hong Kong

Australian Consul General Hong Kong – www.australia.org.hk

The Australian Chamber of Commerce in Hong Kong - www.austcham.com.hk
4/F, Lucky Building
39 Wellington Street
Central, Hong Kong
Tel: (852) 2522 5054
Fax: (852) 2877 0860