Foreign Investment Plans to Enter the Chinese Market: Can the Medical Robotics Sector Defend Its Territory and Expand?

Foreign medical robotics companies are making inroads into the Chinese market, and some domestic companies have already begun developing medical robotics. The global market is expected to reach $11.4 billion. However, in reality, artificial intelligence medical robots are still in their “infancy” stage. Industry experts believe that we should concentrate superior research resources to tackle key issues and avoid redundant construction of “low-end capacity”.

Foreign Robots Planning to Enter the Chinese Medical Robotics Market

It requires complex multidisciplinary cutting-edge technologies that can bring significant impacts and transformations to people’s livelihoods and industries… The medical robotics field, characterized by high barriers and high value, is referred to as the “aerospace engineering of the medical device sector”.

According to reports, the prospects for medical robotics are broad, covering various fields such as surgery, rehabilitation, nursing, and education, with surgical robots accounting for the highest proportion. Currently, foreign medical robotics companies are entering the Chinese market, and some domestic companies have also begun their research and development in medical robotics.

Industry experts believe that in this emerging medical robotics industry, currently, China, the U.S., and Europe are all in the “infancy stage”. The government can increase support for research and development to achieve a leapfrog development in China’s health industry.

Global Market Expected to Reach $11.4 Billion

Medical robots are a type of intelligent service robot, with various types based on their applications, including clinical medical robots (such as surgical robots and diagnostic and therapeutic robots), medical teaching robots, nursing robots, rehabilitation robots, patient transfer robots, and medication delivery robots. Surveys have found that surgical robots and rehabilitation robots applied in rehabilitation care and prosthetics represent significant market potential.

According to BCG Boston Consulting Group, as of January 2016, the global medical robotics industry generated annual revenues of $7.47 billion, with a projected compound annual growth rate of 15.4% over the next five years, potentially reaching $11.4 billion by 2020. Surgical robots account for about 60% of the market share.

Foreign medical robotics companies are entering the Chinese market, and some domestic companies have also begun their research and development in medical robotics. The global market is expected to reach $11.4 billion. However, in reality, artificial intelligence medical robots are still in their “infancy” stage. Industry experts believe that we should concentrate superior research resources to tackle key issues and avoid redundant construction of “low-end capacity”.

It requires complex multidisciplinary cutting-edge technologies that can bring significant impacts and transformations to people’s livelihoods and industries… The medical robotics field, characterized by high barriers and high value, is referred to as the “aerospace engineering of the medical device sector”.

According to reports, the prospects for medical robotics are broad, covering various fields such as surgery, rehabilitation, nursing, and education, with surgical robots accounting for the highest proportion. Currently, foreign medical robotics companies are entering the Chinese market, and some domestic companies have also begun their research and development in medical robotics.

Industry experts believe that in this emerging medical robotics industry, currently, China, the U.S., and Europe are all in the “infancy stage”. The government can increase support for research and development to achieve a leapfrog development in China’s health industry.

Medical robots are a type of intelligent service robot, with various types based on their applications, including clinical medical robots (such as surgical robots and diagnostic and therapeutic robots), medical teaching robots, nursing robots, rehabilitation robots, patient transfer robots, and medication delivery robots. Surveys have found that surgical robots and rehabilitation robots applied in rehabilitation care and prosthetics represent significant market potential.

According to BCG Boston Consulting Group, as of January 2016, the global medical robotics industry generated annual revenues of $7.47 billion, with a projected compound annual growth rate of 15.4% over the next five years, potentially reaching $11.4 billion by 2020. Surgical robots account for about 60% of the market share.

Huang Jian introduced that based on current clinical feedback, the Da Vinci robot also has certain drawbacks. For example, clinical doctors generally report visual fatigue from prolonged use. Additionally, it is merely a mechanical arm and cannot distinguish between normal tissue and tumors. Most importantly, the surgeon is separated from the patient and the assistant, making this remote-controlled surgery more suitable for military and aerospace applications. In routine surgeries, if the operation loses network connectivity, it poses a risk.

Interviews with reporters revealed that the mindset of domestic hospitals introducing surgical robots is complex, with some hospitals placing more emphasis on the “halo effect”.

Industry experts explain that the price of the Da Vinci system is around 20 million yuan, and the average annual service fee/consumable cost after each system sale is between $100,000 and $200,000. Therefore, merely using the Da Vinci system does not bring additional revenue to hospitals.

The enthusiasm of hospitals for the Da Vinci system is mainly due to its accompanying “halo effect”: first, it attracts patients. The Da Vinci robot has become a symbol of “high-end advanced medical equipment”, and the resulting “prestige” effect and the subsequent influx of patients can not only cover the costs of introducing the equipment but also generate revenue for the hospital. Second, it attracts doctors. The ergonomic design of the Da Vinci system can reduce fatigue for surgeons and decrease the occurrence of occupational diseases. Surgeons are the main source of economic income for hospitals, and meeting their surgical needs is one of the motivations for hospitals to purchase the Da Vinci system.

Still in the “Infancy” Stage

As artificial intelligence is applied in the medical field, diagnostic and therapeutic medical robots are expected to become real-time health managers that can “think”.

In the “Guangdong Province Network Hospital” located in Haizhu District, Guangzhou, a medical chatbot under development is conversing with a simulated female patient experiencing “head pain”: “Generally speaking, a fever above 39 degrees Celsius is considered high fever, and fever is a self-protective response to resist infection. Does your situation match the description above?” “Do you have several of the following symptoms?” “This situation is urgent; please go to the emergency department immediately. These symptoms may indicate acute meningitis…”

Experts explain that the future role of artificial intelligence will not be limited to assisting in diagnosis but will also provide treatment plans. According to Wang Taifeng, Chief Operating Officer of IBM Watson’s oncology expert operator in China, as cognitive computing capabilities continue to improve, Watson will become a powerful assistant for doctors in clinical decision-making and treatment plan suggestions.

“In 2015 alone, there were 44,000 articles published in high-level medical journals worldwide on oncology. If an oncologist wants to comprehensively learn about the latest treatment methods distributed globally, they would need to spend an average of 160 hours a day to read them all. This is impossible for humans, but it is precisely the strength of artificial intelligence. In the future, robots can provide diagnostic and treatment plans for most human diseases through continuous deep learning,” Wang Taifeng said.

It has been revealed that the IBM Watson oncology robot has already entered 23 hospitals in China and plans to charge for its services, making it one of the first intelligent doctors to enter clinical practice globally. However, Watson’s role is not to replace doctors, as it cannot create knowledge. In reality, artificial intelligence medical robots are still in their “infancy” stage.

Zhou Qiru, director of the Guangdong Province Network Hospital, stated that this “infant” needs to consume more resources, which means deep learning: first, medical textbooks targeting clearly defined clinical pathways; second, a large amount of evidence-based medical data; third, a wealth of cutting-edge medical literature, which is equivalent to a consultation with global experts; and fourth, case studies from teaching hospitals. “Clean data is crucial and must undergo strict screening. It cannot be cases of overtreatment, and patient privacy must be protected.”

Domestic Companies Accelerate R&D Pace

There are numerous domestic medical robotics companies. Some representative companies, such as Harbin Boshi, Chongqing Jinshan, and Miao Shou Robot, have surgical robots that are already in the research and development or clinical trial stages.

Boshi Co., Ltd. is the industrialization base of the Harbin Institute of Technology’s Robotics Research Institute and the Harbin Institute of Technology’s robotics industrialization platform. According to researchers from the Harbin Institute of Technology’s Robotics Research Institute, the domestically produced minimally invasive laparoscopic surgical robot system has independent intellectual property rights in China. Researchers have made significant breakthroughs in key technologies such as mechanical design, master-slave control algorithms, 3D laparoscope, and system integration for various minimally invasive surgical procedures, and have applied for multiple national invention patents. However, the overall development level in China still lags behind international standards, and clinically, it is not yet sufficient to shake the position of imported equipment.

The Harbin Institute of Technology Robotics Group, co-established by provincial and municipal governments and universities, was founded in early 2015 and has concentrated high-end technologies in the field of intelligent equipment from the Harbin Institute of Technology. Bai Xianglin, the group’s vice president and chief technology officer, stated, “China’s advantage in developing the medical robotics industry lies in talent, technology, the rapid development of related disciplines, and the enormous domestic market demand. However, in terms of product transformation and market development, we are overall lagging behind international levels.”

In April 2014, Xiangya Third Hospital of Central South University successfully completed three surgeries using domestically produced robots, marking the first clinical application of a surgical robot system independently developed in China. The surgical robot system used was jointly developed by Tianjin University, Central South University, and other institutions.

Seize Opportunities and Plan Early

Professor Sun Lining, a leading talent in the national “Ten Thousand Talents Program”, believes that there is a significant gap between domestic and foreign industries in pharmaceuticals and traditional medical devices, making it difficult for developing countries to catch up with the century-long history and accumulation of Europe and the United States. However, in the emerging medical robotics industry, currently, China, the U.S., and Europe are all in the “infancy stage”. The Chinese government should plan early and increase support for research and development to achieve a leapfrog development in China’s health industry, contributing to the ambitious goal of “Healthy China 2030”.

Industry insiders believe that in subfields such as rehabilitation robots, China can have its own development space. “Compared to surgical robots, the domestic and foreign rehabilitation robot market is just starting and is still in the ‘infant’ stage, representing a sunrise industry with no obvious leading advantage abroad, making it a field where we can achieve significant progress and surpass others,” Bai Xianglin believes that from the perspective of the entire industry, everyone is at the same starting line.

Bai Xianglin believes that medical robots are the forefront of the development of medical tools and methods in China, driven mainly by the demand for high-end technology in diagnosing and treating various diseases, the social pressure of aging on assistance and care for the elderly and disabled, and the supply-demand contradiction caused by the lack of high-quality medical personnel.

Regarding the demand for rehabilitation robots, China has a large population of disabled and elderly individuals, with the ratio of rehabilitation physicians to the basic population being about 1.7 per 100,000 people, while in developed countries, this figure reaches 30-70 per 100,000 people, indicating a significant gap in rehabilitation professionals in China. “In the field of rehabilitation robots, explosive growth is expected in the next three years,” Bai Xianglin said.

Avoid Redundant Construction of “Low-End Capacity”

Industry experts believe that we should seize the opportunity, concentrate superior research resources to tackle key issues, and refine the existing research directions in the robotics industry.

Bai Xianglin stated that the robotics industry is a key development sector in the national “Made in China 2025” plan. However, due to the high barriers to entry and technical requirements in the medical robotics industry, as well as the lengthy cycles and significant financial investments required under China’s current medical registration and certification system, the risks for enterprises are high. To tackle medical robotics, it is necessary to plan for research units to concentrate on developing a specific type of medical robot.

Which core areas need to be tackled in research? Hannes Bleuler, an academician of the Swiss Federal Institute of Technology and director of the robotics laboratory at the Swiss Federal Institute of Technology in Lausanne, along with some researchers from domestic robotics companies, believe that components such as reducers and servo motors remain constraints on the leap in key technologies for robots. Additionally, the next generation of surgical robots, particularly single-port surgical robots, which have high difficulty and market potential, is the direction for the development and clinical application of surgical robots.

At the same time, standards for medical robots also need to be established to avoid redundant construction of “low-end capacity”.

Industrial robots have international standards, national standards, and industry standards. However, the medical robotics industry standards are still blank. Industry insiders suggest that within the next two to three years, research institutions, medical institutions, standard-setting committees, and industry associations should take the lead, supported by universities and research institutions, to form some common standards, such as what functions and safety conditions robots must meet, ensuring that “while restoring nerves, they do not damage joints”. The safety and ethical considerations of medical robot applications cannot be overlooked.

Zhou Qiru, director of the Guangdong Province Network Hospital, suggests that the development of medical robots should avoid a “rush to the market” that leads to redundant and excessive “low-end capacity”. The government should focus on supporting enterprises with core technologies and high-end products. Additionally, it is necessary to streamline the “upstream and downstream industrial chain” to avoid the awkward situation of “being able to go up, but not able to come down”.

Industry insiders believe that the robot body is the culmination of automation technology, possessing the strongest bargaining power in the robotics industry chain, and can effectively integrate upstream component manufacturers and downstream system integrators. On one hand, China needs to unleash vitality, streamline the “research institution-enterprise-market” chain, tackle core technologies, and encourage and cultivate the development of supporting services based on robotic products, thereby guiding and compelling existing robotics companies to develop in categories.

Industry experts suggest emulating the practices of Europe, the United States, and Japan, providing “counter-subsidies” to units, institutions, and individuals using products from domestic robot manufacturers, to avoid focusing solely on high-end technology while neglecting market applications, which could lead to a situation where “high places are hard to reach”, resulting in product homogenization, market shrinkage, and industrial discontinuity.

Foreign Investment Plans to Enter the Chinese Market: Can the Medical Robotics Sector Defend Its Territory and Expand?

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Foreign Investment Plans to Enter the Chinese Market: Can the Medical Robotics Sector Defend Its Territory and Expand?

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