While major urban healthcare markets, concentrated around metropolises like Shanghai, Hong Kong, Beijing, and Guangzhou, have long featured high demand for a range of pharmaceutical and medical devices, pronounced urbanization throughout China has nurtured demand in smaller cities along China’s coastal provinces, and also in the middle and western half of the giant country. The provinces of Southwestern and Central China are projected to see the greatest market growth for pharmaceuticals and medical devices over the next four years, with strong demand out of their emerging regional metropolises.

Economic development in Chinese cities and urban migration have resulted in the percentage of Chinese residing in urban healthcare markets rising from 36% in the year 2000 to 50% in 2010, a rise that continues to bolster the urban healthcare market. Rural residents living in these areas are also apt to pursue specialty outpatient and inpatient care at city hospitals. As a result, the current urban healthcare market in China (including Hong Kong) is over three times the size of the rural healthcare market, with a market volume of approximately US$183.2 billion.

“Cities like Chengdu, Chongqing in West China, and Zhengzhou and Wuhan in Central China are already the beneficiaries of multinational companies’ research and development investment,” said Kalorama Information research analyst Emil Salazar. “But they are also targets for medical product sales and ideal hubs for provincial and regional distribution networks for pharmaceuticals, IVD reagents, and other medical supplies.”

Kalorama Information notes, however, that even with the Chinese governments apparent priorities in improving rural healthcare, recently expanded national health plans provide over five times more total reimbursements to urban enrollees than to rural enrollees. Despite this disparity, the Chinese government must still manage and fund even more diversified and expensive urban healthcare systems, which are equally beset by challenges in coverage.

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