Industry Trend Analysis - Healthcare Reforms To Shape Drugmaker Opportunities - DEC 2017

BMI View: Following President Xi Jinping's speech at the opening of the 19th National Congress on October 18 2017, we expect the Communist Party of China will continue to pursue its national healthcare objectives. These include more effective management of the country ' s rising chronic disease burden and reforming the delivery of healthcare. As such, pharmaceutical firms will continue to build their presence in China, aligning themselves with the government's push to develop the medicine sector and leveraging opportunities to build closer ties with the healthcare authorities.

China's pharmaceutical and healthcare landscape will continue to evolve over the coming years as authorities seek to meet the population's rising demand for healthcare while containing costs. The development of a 'Healthy China' is central to the Chinese government's agenda for health and development and the country's president, Xi Jinping has put healthcare at the centre of China's policy-making endeavour. At the National Health Conference held in August 2016, the president stressed that 'if the problems in the health sector are not effectively addressed, people's health may be seriously undermined, potentially compromising economic development and social stability.' Furthermore, the 'Made in China 2025' initiative identifies biopharmaceuticals and advanced medicinal products as one of 10 key sectors that the country will focus on.

More recently, China's president kicked off the 19th National Congress of the Communist Party of China (CPC) on October 18 2017 by delivering the party's work report on behalf of the 18th Central Committee, which provides key insights into the country's political and economic trajectory over the next five years (see 'Xi's Congress Speech Bodes Well For Policy Continuity', October 19 2017). During his speech, Xi noted the four key themes of institutional healthcare reforms and innovation that are broadly in line with the country's 13th Five-Year Plan (2016-2020). Comments made by the president revealed the government's policy directions, namely to:

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    China: Pharmaceutical Sales (CNYbn)
    f= BMI Forecast. Source: Source: Southern Medicine Economic Institute (SMEI), Association of the European Self-Medication Society (AESGP), National Bureau Of Statistics Of China, local news sources, BMI

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