Why this is important to Wisconsin businesses: With an aging population, Japan is looking to technology to help stem the increase in health care costs, and Wisconsin companies can supply some of these innovative devices.
Japan is the world’s third-largest medical market, with imported medical devices accounting for 49 percent of this market. In Japan’s rapidly aging society, people over age 65 account for one-quarter of the population, and this age group is projected to make up nearly 39 percent of the population by 2050. To combat the associated rise in health care costs, Japan has reduced approval times to get medical products onto the market, including a fast-track approval process for innovative medical devices, which took effect on July 31, 2017.
- Japan is the No. 3 medical device market globally.
- Japan is No. 3 in health care spending globally.
- Japan’s health care expenditures are $332 billion (10.3 percent of GDP) and rising.
- Japan’s population is 40 percent the size of the U.S. population.
- 27 percent of Japan’s population is over 65 years of age.
- Japan has a universal health care system with fair valued reimbursement.
- Japan is a fast adopter of new technology.
- 40 percent of Japan’s medical devices are imported; this number is 50 percent for high-end diagnostic and therapeutic devices.
- Once reimbursed, the adoption rate of new medical technology in Japan is high.
- Japan is three to five years behind the U.S. in terms of new technology introduction.
- Quality is the No. 1 consideration in Japan.
These trends pose a unique opportunity for Wisconsin medical technology companies with innovative, high-tech products. Market entry is typically through one of the following three models:
|1. National distributor||Low||Low||Small investment; lack of control; lower margin|
|2. Direct sales||High||High||High investment; full control; trial and error approach|
|3. Hybrid model||Low||Low||Medium investment; own product approvals; maximize mutual benefits|
The life sciences, with their potential to improve the quality of life of people worldwide, require a wide range of applied technology, including biotechnology. To this end, the field is poised to grow markedly, and Wisconsin companies would be wise to enter the market with a thoughtful and well-executed strategy. This includes visiting the market to listen and learn, and considering the distributor, direct and hybrid sales models before choosing one path. Remember that reimbursement is key, and stand firm on your vision, culture and objectives.
Wisconsin firms may wish to give serious consideration to attending and/or exhibiting at the following trade events. A proactive partner search undertaken several months prior to the event would lay the groundwork for a productive show through search, pre-qualification and meeting setup with potential distributors and partners.
The Medical Japan expo will take place in February 2018 in Osaka. Comprising seven specialized shows, Medical Japan is the leading event that covers products, services and technologies for health care, clinical testing, diagnostics and medicine.
The Japan Life Science Week expo will take place in Tokyo from April 18-20, 2018. With 1,200 exhibitors and 60,000 attendees, this show comprises 12 business-to-business events under one roof for the pharmaceutical, medical device, health technology and fine chemicals sectors.