Israeli medical device startups seeking to expand into new markets should consider exploring the Land of the Rising Sun. According to data from the Israel Export Industry, Japan has the third highest sales volume for medical devices in the world and is one of the top five importers of medical devices worldwide.
Healthcare system under pressure
Japan is under considerable pressure to optimize its healthcare system and healthcare services. The country has the largest over-65 population in the world, with rapid annual growth. In addition, 6% of the Japanese population seeks medical treatment every single day, making three times as many doctor visits than patients in the U.S. The Japanese healthcare system is challenged to keep up with this high demand, especially with 40% fewer doctors than the OECD average. It is therefore no surprise that Japan has seen a 50% increase in demand for import of medical devices in the last decade.
Reforms to meet increasing demand
Registration of medical devices in Japan can be complex and costly and still take years to achieve. However, due to the need, in 2014, the Japanese government began to employ radical reforms to accelerate the Pharmaceutical Medical Devices Agency’s (PMDA) process to “open up” to new innovative technologies. The PDMA’s Shonin (Approval) now approves fast tracking channels for some selective technologies that target the elderly – such as regenerative therapy, etc. – and technologies to help to reduce hospitalization time, especially important in Japan, which holds the record for the longest hospitalization time in the world.
Opportunity for Israeli startups
One of Japan’s main goals is still to become a leader in R&D of medical devices and pharmaceuticals. Fortunately, Israel is one of Japan’s top 15 trade partners for export of medical devices. This means the lines of communication are already open and the need is there. If you are an Israeli medical device startup and would like to learn more about how to successfully market your product in Japan, contact Oded Dotan, a global expert and consultant in sales and business development for the biotech, medical instrumentation and aesthetics industries, for a free consultation.Looming over all this excitement, is the realization that pricing is heading in a downward direction. There is tremendous pressure from governments to lower healthcare costs- especially in hospitals- where medical devices are most heavily used. This is a major concern for medical device companies who have traditionally focused their resources on R&D, as now they must figure out how to stay on top of their shrinking margins. This is compounded by the fact that with data becoming a hot commodity, many new companies are entering the market in an attempt to harness medical data from patients and end users. In order to stay in the game, companies need to adjust their revenue structure to add more services and technologies into their devices.
Here are some of the changes we will be seeing in the coming decade, as the medical device industry adjusts to tightening margins and advances in technology.
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