China's strategic position is attracting multinational med-tech companies to the market, not only for manufacturing but increasingly to engage in research and development.
The latest example of this is Johnson & Johnson (J&J; New Brunswick, New Jersey), which reported the launch of its Asia Pacific Innovation Center in Shanghai with satellites in Singapore, Australia and Japan. The aim of the center is to develop therapies and devices to address unmet medical needs.
The center will provide one-stop customized support, funding and commercial expertise to entrepreneurs and scientists with early-stage ideas and technologies.
The Asia Pacific Innovation Center is part of Johnson & Johnson Innovation (a division of Johnson & Johnson (China) Investment), which focuses on accelerating early-stage innovation and collaboration between entrepreneurs and the company's global healthcare business.
The Asia Pacific Innovation Center focuses on all three businesses of Johnson & Johnson: pharmaceutical, medical devices and consumer health products.
"We don't have a bias or a specific formula – we are equally receptive enthusiastically to build in each sector," said Ken Drazan, head of Johnson & Johnson Innovation, California speaking at a launch conference on Oct. 31. "In developed countries with mature markets – China is still a maturing market – the amount of pharmaceutical investment is usually one-to-one with medical device sector investment. In China, med-tech investment is still one third of pharmaceutical investment."
"That suggests to us there is still a lot of opportunity here to build, create and commercialize more products for this country and the region," he added.
Along with the launch, Johnson & Johnson also reported six new collaborations in Australia and China. That makes more than 80 collaborative projects under Johnson & Johnson's innovation centers to date.
These collaborations team up stakeholders including government, industry and academic partners, including Australia's James Cook University and the University of Queensland on pain relief, and China Pharmaceutical University, Peking University and Zhejiang University.
"The challenge is how you can interact with you regulators on developing products and also timelines. Industries of course seek the shortest route possible to get drugs or devices developed. A stable regulator with a well-guided system is extremely important for the industry," said Paul Stoffels, Johnson & Johnson chief scientific officer and Worldwide Chairman, Pharmaceuticals in a media briefing.
"The consumer market in China is easier because of less regulation and more free market. If you do innovations there, it could go fast," he added. "But the medical device and pharmaceutical markets are much more long term investments and make much more benefit for patients in the end. In the medical devices and pharmaceutical sector, you have to have a solid long-term approach to get that done."
As part of its collaborations, the innovation center will also establish a local presence in Suzhou BioBay, an incubator with more than 400 companies in pharmaceutical, medical devices, in vitro diagnostics, biotech and nanotech.
"There is an explosion of growth in the Asia Pacific region, and China in particular, as well as significant medical needs," said Wu Dong, Head of the Johnson & Johnson Innovation Asia Pacific Innovation Center, in a company release.
"The Asia Pacific Innovation Center plans to build on the company's track record of collaboration in the region and advance the most promising science. It will play a key role in sourcing early stage science in the region for the development of new medicines, medical devices, and consumer products," said Wu.
Johnson & Johnson has been in China since 1985 and now has more than 10,000 employees in the country.
"Our on-the-ground presence across the region allows us to work side by side with our partners with speed, agility, and insight to translate innovations into new products," said Jesse Wu, chairman of Johnson & Johnson China. "The Asia Pacific Innovation Center supports our larger goal to address China's specific healthcare needs, invest in local capabilities, and increase our external collaborations."
J&J Innovation also spotted an unmet need of dealing with the patient volume in the China market.
"We think there's an enormous opportunity in the [Chinese] device market," Drazan told Medical Device Daily. "For example, in the city of Shanghai there is an enormous need to treat some very common diseases but there are not enough providers to actually deliver the care, and that's an opportunity for us, most people wouldn't necessarily think that handling more volume is an area of innovation. It's going to take a long time to get there but we're very committed to that."
"If you're out in the community 1,000 kilometers from a tier-one city, all the basic needs are not met yet, whether it's trauma care, infectious disease or chronic disease. We want to solve these problems so we have to come up with innovative solutions that work with the structure in that remote nature of the healthcare system," said Drazan. //