China’s Public Procurement Protectionism and Europe’s Response: The Case of Medical Technology

Between 2010 and 2019, Chinese companies gained considerable market share in the EU’s purchases of APIs across value and volume, going from 5 percent and 12 percent in 2010 to 7 percent and 22 percent in 2019 of all of the EU’s APIs imports from the EU in value and volume terms4. [...] As mentioned in the introduction, a recent survey by the European Union Chamber of Commerce in China of European companies operating in China showed that 78 percent of respondents in the pharmaceutical sector and 64 percent in the medical devices sector report that they missed out on business opportunities due to market access restrictions or regulatory barriers in 2020. [...] In the five-year plan for the MedTech sector from the Ministry of Industry and Information Tech- nology, the Chinese government lays out its ambition for a “new development pattern marked by the domestic cycle as the main body and the mutual reinforcing of both the domestic and international cycles thus built” and says that the government “must promote the high-qual- ity development of the medical. [...] In the lead-up to 2020, public procurement had made it to the top of the agenda of China’s policy leaders – and the consequences of new procurement policies led many to wonder if established business models were still sustainable (See Box 4: Outcomes of the Recent Chinese Procurement in Medical Technologies). [...] In addition, China mandates that foreign companies that are requesting approval from the regulator must first have an approval in the country of origin (in the case of the EU, obtaining the CE mark), which delays the process of getting a new product to the market.