A new report from Decision Resources Group examines the Asian Pacific spinal implant and bone graft substitute market through 2022.
Here are five highlights from the report:
1. The Asia Pacific market for spinal implants and bone graft substitutes — including Australia, South Korea, China and India — will more than double through 2022. The market will reach a value of nearly $7 billion over the next eight years. The Deloitte 2014 Global healthcare outlook report shows overall healthcare spending growth in these countries, along with other developing countries, will offset slow growth in North America and Western Europe.
The report also notes the rapidly rising income level and internet use in China is increasing patients' ability to pay for treatment and driving new expectations for quality of care. At the same time, healthcare spending is expected to grow slowly in Australia as much of the funding is provided through the state.
2. The less-developed markets — India and China — will undergo rapid expansion while growth in Australian and South Korean markets will be more modest. However, this doesn't mean it will be easy to enter these markets.
"Multinational corporations face strong competition from low cost domestic manufacturers in China, India and South Korea," said DRG Analyst Susan Weng in a news release. "However, some markets have proven more immune to domestic competition; for example, the complex nature of spinal nonfusion technologies and growth factors results in them being largely only offered by multinational corporations."
3. Price for spinal implants and bone graft substitutes will decline individually through 2022 due to competition in the market and heavy government regulation and reimbursement cuts. Notably, South Korea recently cut reimbursements and huge price declines are also likely in the Indian market where local manufacturers drive competitive pricing.
"Companies looking to enter the Asia Pacific spinal implant and BGS market need to be conscious of different regulator bodies and cultural preferences in different countries," said DRG Analyst Hamza Sajjad in a news release. "As an example, Chinese physicians rarely use xenografts or allografts because of a cultural aversion to using human or animal tissue, while Australia does not allow for the use of xenografts. As a result, the Asia Pacific market can be complex to navigate as a whole, especially for the smaller competitors."
4. Synthetic bone graft substitute will be the most-used bone graft substitute material in the Asia Pacific market because they have proven track records and relatively low pricing. There will be an exception to this trend in South Korea where patients tend to choose less expensive, nonproprietary allografts. However, hospitals are motivated to promote higher priced, better reimbursed demineralized bone matrices in order to increase revenue.
5. Nonfusion technology is currently expensive in these countries, so access will be an issue; the products will be unattainable to a large portion of the population. Reimbursement is an issue in South Korea and Australia where governments continue to heavily scrutinize reimbursement for nonfusion spinal technology.
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