Guosen: How do multinational medical device companies view the Chinese market?

Guosen released a research report stating that overall, innovative devices, high-value consumables, CGM, PFA, surgical Siasun Robot & Automation, structural heart, tumor early screening/MRD, and AI medical platforms are still the main drivers of growth. For the Chinese market, most MNCs still face temporary pressures. MNCs remain cautious in the short term about operations in China, but generally recognize the market potential brought by China's medium to long-term medical demand, high-end innovative products, and procedure upgrades. The medical device industry is in a phase of "policy pressure clearance, mass production of innovative products, domestic upgrading and internationalization". At the same time, AI medical, precision medical, and digital medicalization are currently in the rapid commercialization phase and are expected to become new growth curves for the medical device and diagnostic industries. Guosen's main points are as follows: In 2025 and Q1 2026, the overall growth trend of overseas medical device MNCs will continue, but differentiation between sectors will be more pronounced. Most traditional medical equipment, medical consumables, and IVD companies still maintain positive growth, with innovative-driven companies such as Intuitive Surgical, Boston Scientific, and Dexcom showing outstanding performance, with revenues growing by 20.5%, 19.9%, and 15.6% respectively in 2025. Companies related to AI medical, precision medical, and digital medicalization have even higher growth rates, with Tempus AI, Hims & Hers, Natera, and Guardant Health achieving revenue growth of 83.4%, 59.0%, 35.9%, and 32.9% respectively. Overall, innovative devices, high-value consumables, CGM, PFA, surgical Siasun Robot & Automation, structural heart, tumor early screening/MRD, and AI medical platforms are still the main drivers of growth, while mature imaging equipment, some diagnostic businesses, and consumable companies with strong consumer attributes show relatively weaker performance in terms of profitability, affected by factors such as tariffs, price pressures, channel adjustments, and R&D/commercialization investments. For the Chinese market, most MNCs still face temporary pressures, mainly from the expansion of centralized procurement, control of medical insurance expenses, cautious hospital budgets, weak consumption, domestic substitution, local low-price competition, and channel inventory adjustments, leading to some companies still facing pressure on their revenues in China. Equipment procurement is significantly affected by the pace of hospital procurement, tender delays, and price competition; diagnostic businesses are affected by centralized procurement, reimbursement reductions, and standardization of testing prices; high-value consumables in orthopedics, surgery, ophthalmology, etc., still need to continue following the impact of centralized procurement and competition from domestic products. However, from a marginal perspective, some companies' pressure has eased, for example, Abbott Core Lab China's revenue decline has narrowed to level off, Danaher has gradually crossed over the centralized procurement year-on-year pressure, and STAAR Surgical's channel inventory in China has returned to the target range. Overall, MNCs are still cautious about short-term operations in China, but generally acknowledge the market potential brought by China's medium to long-term medical demand, high-end innovative products, and procedural upgrades. The current medical device industry is in a phase of "policy pressure clearance, mass production of innovative products, domestic upgrading and internationalization". Medical equipment is greatly affected by macro cycles and hospital procurement rhythms, but domestic leading companies in this field show relatively outstanding global competitiveness, with product high-endization and increased market share overseas being the main growth trends in the medium to long term; in the field of high-value consumables, domestic centralized procurement already covers many homogeneous products, with future dependence shifting more towards innovative products, procedure upgrades, and international expansion, although there is still a gap between domestic enterprises and MNCs, under the impetus of engineer dividends, accumulated clinical cases, and policy encouragement for innovative medical devices, catching up is expected to accelerate; in the area of in vitro diagnostics, precision diagnostics remain the basis for effective treatment, the promotion of centralized procurement boosts the increase in market share for domestic leading companies, platform deployment, breakthroughs in core upstream technologies, molecular diagnostics, mass spectrometry, and production line automation will become important levers for opening up long-term opportunities. At the same time, AI medical, precision medical, and digital medicalization are currently in the rapid commercialization phase and are expected to become new growth curves for the medical device and diagnostic industries. Recommended to watch: Shanghai United Imaging Healthcare, APT Medical Inc., Jiangsu Yuyue Medical Equipment & Supply, AK MEDICAL, Micro-Tech, ShenZhen New Industries Biomedical Engineering. Risk warning: product research and development failures, increased market competition, centralized procurement price reductions exceeding expectations, slower-than-expected progress in tenders, geopolitical risks, exchange rate fluctuations.