Region/Countries: Asia, Japan Industry: Biosciences / Medical Devices, Other Date: January 2020

Why this is important to Wisconsin businesses: Wisconsin companies are recommended to work with a local partner when entering the market.

Japan is among the world’s 10 largest importing markets in the health technology industry, with an established history of welcoming imported medical technology (49% of the medical technology market in 2014).

The Japanese population is aging rapidly (an estimated 30% of population will be over the age of 65 by 2025), and the specific issues and new needs associated with a super-aging society are relevant for the health care sector.

The Japanese government seeks to implement structural and systemic reforms to address a shortage of qualified health care workers, an imbalance between cities and rural areas regarding health care access and service providers, and exploding costs that threaten the national health insurance system. Innovation is encouraged and supported, and major priorities have been identified: the effective use of Big Data analytics, a general drive to improve patient outcomes for cost-saving purposes and the launch of the personal health record.

To reach those goals, legal changes were recently implemented to allow the use of smartphones as medical devices and telemedicine in general, paving the way for innovative solutions.

Analyses show that the use of information technology products and related services in the health care industry should grow at least 2.3 times by 2030 (compared with 2013 numbers). Among other valuable sub-segments, the market of Internet of Things–related equipment and systems in the medical field (valued at $753 million in 2016) should reach nearly $1.7 billion in 2025. The artificial intelligence–related products and services market, which includes big data analysis (valued at $37 million in 2016), is expected to reach $134 million in 2025. The Japanese health technology market is defined by two contradictory factors: on the one hand, lagging information and communications technology infrastructure in hospitals and clinics, as well as poor technological  literacy among decision-makers and health care providers, and on the other hand, a high-level penetration rate of smartphones, wearable devices and connection to high-speed internet among the general population (81.7%). Combined with a pressing need to tackle costs and improve efficiency, these two features create opportunities for exporters that offer disruptive solutions.

The opportunities and pressing needs of this booming market are already recognized by major domestic players, in particular non-life-science players in the telecom or electrics industries—such as NTT, DoCoMo Canon or IBM Japan. Large general trading houses like Mitsubishi Corp. are developing new and dedicated business strategies in this field. Despite the presence of those major companies in 2017, the competitive environment was fragmented, with smaller players accounting for a large share of the total sales. Targeting niche markets, with products and services catering to the individual demands of consumers, seems to be a key point for a successful market entry. Tracking and monitoring of patients (using apps and devices), big data and associated data-driven insights, chronic care management apps, devices and artificial intelligence solutions are among the exports Wisconsin companies can supply to Japan.

On top of the language barrier and business cultural differences, exporters face challenges such as overlapping regulations and authorities, a fragmented hospital network, a slow approval process and a complex multi-tier distribution system. These hurdles can be overcome by establishing partnerships with local actors who have  an existing network and are eager to introduce new technologies to the market.