The market for home healthcare products and services was estimated at about $ 3 billion (€ 2.8 billion) in China in May 2014, the American consulting firm Pacific Bridge Medical reported.
Moreover, the Chinese market could account for 20 and 30% of total wearable technologies sales in 2016, according to the analyst firm IDC.
The connected devices market is booming in China, with, on the one hand, solutions developed to face its aging population and the development of chronic diseases; on the other hands, with leisure tools: fitness trackers, more and more popular across the country.
H&TI focuses on this thriving industry, with a zoom in the Chinese connected devices market through the interview of Sonny Vu, president and chief technology officer of connected devices service at Fossil Group.
Connected devices to cope with the aging population: China
Through its first Future Health Index (FHI), published in June 2016, Philips unveiled the results of its international study on the readiness of each country for digital health integration. China ranks third (58.1/100), behind the Netherlands (58.9) and the United Arab Emirates (65.3).
And the most promising sector in this huge eHealth market is the one of connected devices, which is taken increasingly seriously by government and industry to better cope with the aging of population and the rise of chronic diseases within the country.
Respect for the elderly people is one of the most valuable virtues in China. It is common for three generations to live in the same home so that younger people can take care of their elders while educating their children. The growing number of elderly people in the country is putting this organization at risk:
- The 65+ population should grow to 167 million by 2020, accounting for 11.5% of the population – nearly double what it was in 1995 – and should account for approximately 20 or even 30% of the Chinese population by 2025-2030 (official figures).
This demographic evolution raises questions. Indeed, it is difficult for the youngest to be able to meet the needs of the elderly financially. Retirement homes are still quite uncommon in China and healthcare infrastructure is unable to provide optimal care to the elderly.
- And with this aging population, there is an increase in chronic diseases (cardiovascular in particular). These diseases account for about 85% of deaths in China and require about 70% of medical resources, the World Economic Forum reported in September 2015.
$3 billion: the Chinese market for home healthcare products and services’ value
To evolve the Chinese healthcare system, the development of connected objects is one of the solutions taken seriously in order to allow home follow-up of patients who do not necessarily require hospitalization.
China’s government has begun to take positive steps by introducing various measures to encourage the integration of advanced health technologies. In 2012, he announced that home healthcare would be promoted as the main strategy to care for the growing elderly population.
The Chinese government aims for 90% of seniors to be cared for in their own homes or in the homes of their children. A projected 7% of low-income seniors will live in government-funded elderly communities and hospitals. The remaining 3% of seniors will move to private nursing facilities and senior housing.
Its aim: 90% of seniors to be cared for in their homes. 7% of low-income seniors will live in government-funded elderly communities and hospitals, 3% of seniors will move to private nursing facilities and senior housing, precised Pacific Bridge Medical, a consulting firm for international pharmaceutical and medical device companies to expand presence in Asia.
According to the American agency, the Chinese market for home healthcare products and services was estimated at about $ 3 billion (€ 2.8 billion) in May 2014.
This growing market concerns:
- the 230 million Chinese people with chronic diseases;
- the 85 million disabled people in the country;
- the more than 300,000 injured workers who receive government funded rehabilitation treatment annually.
China’s government encouraged health tech companies to invest in home care market
The Chinese government is also encouraging the private sector to get involved in the home care market by inviting companies specializing in eHealth to collaborate with private hospitals.
Chinese start-ups, such as CCX Homecare (Shanghai) and PineTree (Beijing), have joined forces with US companies, such as Right at Home and Home, one of the largest home care providers in the world.
“The senior care market is projected to explode in the next several years [in China], making now a great time to start market penetration as well as build up brand recognition and market share,” Pacific Bridge Medical pointed out in the Spring of 2014.
Philips is one of the most active private groups in this sector. Here are some of its current products:
- The group is working with the Chinese Society of Cardiology to create the China National Cardiovascular Data Repository, a national cardiovascular data center to improve clinical research in this area.
- Philips Research China is developing a system to help doctors better manage their patients with chronic diseases. It includes two interfaces, one for health personnel and the other for patients, allowing real-time communications between the two of them.
- Philips Research China also developed a stroke rehabilitation system several years ago that connects patients with community hospitals so that they can be informed on a day-to-day basis of patients’ conditions and accordingly adjust their rehabilitation plans.
- The group has developed a series of wearable and mobile devices that connect hospitals to patients’ homes, such as ECG monitor and handheld blood test device Minicare, as well as personal health management tools, such as Lifeline.
“Prevention of chronic diseases should be top priority in China. Control is the next step. We are ready for action, with our technology and our solutions,” Andy Ho, CEO of Philips Greater China, said to Your-bizbook.com.
The Chinese trackers market is booming
The development of state-of-the-art home care solutions is one of the priorities of the Chinese government, but private eHealth stakeholders have identified another flourishing sector in the country in recent years: fitness trackers.
More than 100 million wearable technology expected to be sold in 2016
According to a report by IDC, about 9.5 million wearable were sold in China in just three months (between April and June 2016). This is a 13.2% increase over the January-March period of the same year.
If the country keeps up the way it is going, the Chinese market could end up accounting for 20 or 30% of worldwide wearable technology sales, estimated at 101.9 million items sold in 2016.
Tools related to health and sport, such as sleep and fitness trackers, are among the most popular wearable in China.
Best trackers brands in China
In October 2016, the Personal Connected Health Alliance (PCHAlliance), a US organization, launched its China Work Group to cultivate the ecosystem of personal connected health technologies in China. This is another sign of the interest of health stakeholders in the Chinese market.
“There is growing interest in personal health technologies throughout Asia, and the Chinese market represents an important opportunity to expand the use of interoperable personal connected health tools to improve health management, clinical outcomes and quality of life for Chinese citizens,” Horst Merkle, President and Chairman of The Continua Health Alliance – founder of PCHAlliance -, said.
“Policy and education will be overwhelmingly the pieces that will move the needle in various places in Asia” (Sonny Vu, Fossil)
You are president and CTO of connected devices at Fossil Group. I read that Misfit (Fossil owned) was outselling Fitbit in China with 660,000 wearable products sold in 18 months, from 2014 to summer 2015. Is it right?
Fossil Group hasn’t announced break downs of numbers by brand but needless to say if you just look at the number of reviews we have online on places like Jd.com you can see that we’re selling quite well in China.
“We’ve never seen anything like it, there is a lot of momentum in China,” you said to Wareable.com.
Do you really feel a particular craze for connected objects in China?
It does feel like it. I’m not sure if proportionally it’s higher than other places but with hundreds of millions of people getting access to mobile internet, an important prerequisite to having a connected experiences, the numbers are naturally going to be large in terms of connect devices sales.
Is China right now one of the most important market to set up based when you are a society focusing on health connected devices?
China is certainly up there in terms of being an important market. With the health trends moving in the direction that it is (high rates of obesity / diabetes / hypertension in developing countries as well as developed countries), people are going to be paying more attention.
What are Fossil’s current projects in China on the health connected devices market?
We continue to see good sales of our tracker (activity/sleep) products in China – more to come on that front so stay tuned. The main idea is to make these things fashionable – wearable tech that doesn’t look like wearable tech but fashion accessories and jewelry.
According to you, how can connected devices solve some of the healthcare issues in China?
I think it’s going to take a lot more than just connected devices. Really captivating content and coaching will be important to engaging users in a meaningful way. This is just at the product / commercial level. Most certainly policy and education will be overwhelmingly the pieces that will move the needle in various places in Asia.
Some experts say that it can be a problem that private companies lead the eHealth market from an ethical point of view.
What is Fossil’s policy about health data privacy and security?
We take data privacy and security of our users’ data very seriously. We’ve been working on these issues for a number of years now so our systems are fairly well hardened. It’s really the new entrants trying their hand at connected devices for the first time that you need to be worried about.
Isn’t it an issue for you, for companies development specialized in eHealt, that the regulations to ensure safety and protection of personal data in China are either lag behind or no clear guideline for now?
Sorry, as I’m now an officer in a public company, I can’t parse your question.
In your opinion, can China become an international leader in health connected devices in five, ten or twenty years?
I think it kind of already is, at least in terms of consumer tracking products – they probably have more active users of activity trackers than any other country in the world, with a slightly possible exception of the US.