Ventilator Industry in China Meets a Rare Opportunity

PostDate：2020-06-08

Ventilator has become an indispensable medical device, which can effectively replace artificial ventilation in respiratory failure, anesthesia，and emergency resuscitation of the respiratory tract. And it also can prevent respiratory failure and reduce the incidence rate.

In this epidemic, a ventilator has become one of the main auxiliary methods for critical patients with new coronavirus. The more ventilators there are, the more lives there will be. At present, except for a few countries including China, the global epidemic has not been effectively controlled with increasing patients to use respirators, which makes the demand for respirators increase in a blowout way.

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From the connection mode of the two ventilators, two main types consist of invasive ventilators and non-invasive ventilators. The former is mainly used in the intensive care unit, general ward, and family to treat patients with moderate respiratory failure. The latter is generally used in ICU to treat patients with severe respiratory failure.

Ventilator Industry Chain

It is Difficult to Produce Massive Ventilators in a Short Time

As a high-end medical equipment, ventilator production depends on the global supply chain. A ventilator contains thousands of parts produced by the cooperation of domestic suppliers and foreign suppliers. However, affected by the epidemic, some upstream parts manufacturers and midstream transportation links are blocked, which makes it difficult to import and export relevant parts. The production of a ventilator will undoubtedly be affected.

For professional manufacturers of the medical equipment, it may take 40 days to produce a ventilator, while for enterprises with no experience, it will take 18 months to achieve mass production. Many problems such as the transformation of production lines and technical barriers have become obstacles for the enterprises to produce massive ventilators in a short time.

Countries All over the World Rush to Buy Chinese Ventilator

For Europe, the United States, and other countries with developed medical systems, they can't believe the fact that the proud medical system appears a short plate.

According to statistics, half of the world's ventilator manufacturers are located in the European Union, and the rest are mainly in the United States and China. However, the current epidemic situation is not optimistic in Europe and America, both of which are unable to achieve self-sufficiency in ventilator production. As a result, ventilator manufacturers in China have shouldered the heavy burden of producing a ventilator for the global supply.

It is reported that the supply chain of a ventilator in Europe can only meet 10 percent of the demand, which means that the remaining demand of 90 percent is expected from other countries, especially China.

The American Society of critical medicine estimates that about 960,000 patients will need to be equipped with ventilators, while the number of existing ventilators is about 212,700. There is a vast gap for ventilators demand of about one million.

Domestic Suppliers Try Best to Supply the World

It is reported that the domestic ventilators chain has supplied more than 2.7 sets by March 29, to the whole country to provide important support for China to fight against the epidemic. At present, the epidemic prevention and control in China have been effectively improved, where the ventilators have been played an essential role.

There are 21 domestic innovative ventilator manufacturers, accounting for about one-fifth of the global production capacity, 8 of which have compulsorily obtained the EU CE certification. According to incomplete statistics, more than 1,700 invasive ventilators have been urgently provided to foreign countries in a short period of more than ten days in March, which is half of the total number of domestic invasive ventilators in 2020.

With the rapid growth of ventilator demand during the epidemic, the stock price of ventilator related listed companies is rising all the way.

There will always be an end to the epidemic. After the end of the epidemic, can the enterprises in the industry maintain their performance growth?

We believe that the ventilator industry is a sunrise industry in China, where the demand for the ventilator is long-term, thus, there is a broader development perspective for the domestic ventilator industry.

The market expansion of a ventilator driven by the accidental outbreak was only temporary. However, it is undeniable that this epidemic provides a good opportunity for the development of domestic ventilator brands, which can accumulate a lot of experience and are expected to shoulder the future of domestic ventilator.

After the outbreak, people will pay more respect and attention to the life not only themselves but also their families, whose awareness of medical protection will improve. It is expected to drive the demand for household medical equipment. Also, supported by national policies, the ventilator was selected into 5 major configuration standards of medical institutions. After the outbreak, the construction of ICU in China will be gradually implemented, which is estimated that the total incremental demand in 2020 will be 15,342 units, with a year-on-year growth of 30.1 percent, and that the new demand of basic medical institutions and five centers will be more than 20,000 in the next 2-3 years.

However, as the ventilator industry has pretty high technical barriers, it is still difficult for domestic manufacturers to replace imported products, which give more requirements in the R & D and innovation of the ventilator for the domestic enterprises.

Mindray is mainly engaged in the R & D, manufacturing, marketing, and service of medical devices. It is always oriented by customer needs and is committed to providing high-quality products and services for global medical institutions. Leading company in the field of medical devices in China. Yuwill medical is mainly engaged in providing medical clinical devices, internet medical services, and household medical devices such as respirators. During the epidemic, the company has completed the production in two months, equivalent to the output in recent ten years in the past 10 years.