Public-Private Closed-Door Forum on Medical-Enterprise Collaboration, Healthcare Reimbursement, and Financial Support: Core Strategies for Medical Innovation落地 [2019 VB100]
On December 20, 2019, during the 2019 Top 100 Future Healthcare Companies Conference, VCBeat, in collaboration with the Construction and Management Committee of the Dashihua New Area in Yuzhong District, Chongqing Municipality (hereinafter referred to as the “Dashihua Management Committee”), held a closed-door seminar on new opportunities in the development of cutting-edge medical technologies. The event was hosted by the Dashihua Management Committee and organized by VCBeat.
Attendees included relevant officials from the Dashi Chemical Industry Park Management Committee, the Yuzhong District Health Commission of Chongqing Municipality, and Chongqing Traditional Chinese Medicine Orthopedic Hospital, as well as senior representatives from 18 companies listed on the Future Healthcare 100, including Soochow Medical, Jianpei Technology, Sinovision, Jianhai Technology, Huamai Xingwei, Titanium Rice Robotics, Yimai Yangguang, and Zechuang Tiancheng. The conference centered on discussions around “New Opportunities in the Development of Cutting-Edge Medical Technologies.”
Excellent enterprises are always favored by local governments. How to attract these enterprises to settle in not only tests the resource environment of the industrial park, but also tests its hospital resources and services.
A representative from the Dashi Hua Administrative Committee stated that, to facilitate the smooth development of medical innovation enterprises and foster stronger research translation partnerships with hospitals, the Yuzhong District Government plans to complete the construction of a medical innovation ecosystem within the next two years. The first phase, comprising 20,000 square meters of office space, has already been completed. This facility will serve as an industry-academia-research translation center in collaboration with the China Medical Board, dedicated to supporting the commercialization of medical achievements, with related supporting facilities gradually being improved.
On the other hand, the construction of the Chongqing Medical University (CQMU) Healthcare Ecosystem is also underway. Leveraging a 20,000-square-meter translational medicine center and the Medical Innovation Center established by the Yuzhong District Government of Chongqing Municipality at the Longfor Times Paradise Walk Clinic, the park will introduce venture capital funds to jointly serve enterprises within the park. As a Medical Innovation Center, it will serve as a vital link between enterprises and hospitals, facilitating in-depth collaboration between medical companies in the center and the various affiliated hospitals of CQMU.
The clinic has currently introduced Sinopharm Medical Devices to establish its presence. Phase I of the clinic will adopt a point-to-area approach to form a circular network, leveraging the influence of Chongqing Medical University. Phase II will integrate the surrounding environment and introduce relevant enterprises to complete the medical ecosystem, creating a comprehensive ecological chain for medical translation and scientific research. By collaborating with tertiary Grade-A hospitals and specialized hospitals, the clinic aims to facilitate the implementation of innovative medical products.
In terms of policy, the Yuzhong District Government has established incentive policies that can be tailored to individual enterprises (“one enterprise, one policy”), covering areas such as technology transfer and implementation, hospital collaborations, and more.
Regarding government support, enterprises also have their own perspectives. Participating companies stated that they are currently developing two categories of products: the first is CT scanners, for which there is demand in hospitals and with which the industry is well acquainted; as long as product quality is high and pricing is reasonable, hospitals are willing to pay. The second category is image-guided surgical robots; the company has already developed related products for oncology and neurosurgery. Robotic systems represent a relatively new product segment, despite the presence of established players such as the da Vinci Surgical System.
However, this field still faces the issue of lacking standardized fee schedules. Hospitals have no established fee standards when conducting cost accounting, and these services are not covered by medical insurance. Over the past two years or more, provinces and municipalities such as Shandong Province and the Inner Mongolia Autonomous Region have introduced proposals in this regard, but progress requires province-by-province negotiations.
For products that are clinically effective and already approved, if local governments can help innovative healthcare models and medical device companies establish pricing standards and consider including them in medical insurance coverage, this would be highly attractive to enterprises.
As a traditional medical device company, maintaining an inventory of over one hundred units incurs annual cash flow costs exceeding RMB 100 million. Under such circumstances, the company faces difficulties in sustaining its own capital circulation. Furthermore, it is challenging for a growing enterprise to obtain credit lines from banks. Companies of this type hope that the government can provide support for their operating cash flows through banking and financial channels.
If the government can introduce operational and financial cash flow support to assist enterprises within the industrial park, this would be highly attractive to businesses.
“Dashihua” is an abbreviation for the three subdistricts of Daping, Shiyoulu, and Hualongqiao in Yuzhong District, Chongqing. Located in the western part of the Yuzhong Peninsula in Chongqing, adjacent to Jiulongpo District and Shapingba District, the Dashihua New Area serves as the “geometric center” of Chongqing’s main urban area, with existing industrial space totaling approximately 2.84 million square meters. At the outset of the symposium, a relevant official from the Dashihua Administrative Committee delivered a keynote speech titled “The Path to Coordinated Development of the Big Health Industry Led by the New Economy,” providing a detailed overview of the development history and industrial park layout of the Dashihua New Area.
“In 2012, the Yuzhong District Government of Chongqing Municipality made a strategic layout to develop towards the west of Jiefangbei, and the Dashihua New Area emerged at that time. After several years of development, the Dashihua New Area has now formed a mature '123' spatial layout." The "123" layout mentioned by the head of the Dashihua Management Committee refers to one commercial development platform, two golden brands, and three major industries.
A Platform for the Development of the Commercial and Trade Sector: The Greater Petrochemical New Area leverages the Daping Business District as the forefront of its commercial and trade sector to enhance platform development. Through adjusted planning and differentiated development strategies, the Daping Business District has achieved annual sales exceeding RMB 10 billion after three years of growth from 2015 onward. In 2018, the district recorded an average daily foot traffic of 400,000 visitors, with total sales surpassing RMB 13 billion. The Petrochemical New Area hosts a variety of festivals and events annually in the Daping Business District to foster a vibrant commercial atmosphere and drive its continued development.
Two Prestigious Titles: These two prestigious titles were awarded to the Greater Petrochemical New Area by the Chongqing Municipal Development and Reform Commission.
The first designated zone is the “Daping Big Health Industry Agglomeration Demonstration Circle,” extending from E’ling Park in the east to Hutouyan Park in the west. Covering a total area of 5.76 square kilometers, this area hosts more than ten medical institutions, including Chongqing Medical University, the First Affiliated Hospital of Chongqing Medical University, and Daping Hospital. The majority of the Dashihua New Area is being developed as a demonstration zone for big health industry agglomeration, while also establishing a high-end hospital hub in accordance with the requirements of the Chongqing Municipal People’s Government.
The second accolade is the “Professional Services Cluster,” awarded in 2017. It currently hosts service industries such as industrial consulting, finance, and human resources, demonstrating strong growth momentum.
Three Major Industries: The New Petrochemical Zone has focused on attracting emerging high-tech enterprises in fields such as artificial intelligence, the internet, big data, and blockchain. To date, it has established itself as a hub for emerging industries, achieving initial scale.
The Blockchain Innovation Industrial Base, established in 2017, has attracted leading enterprises in the blockchain sector, including IBM and Yinjian Technology. The professional services cluster has drawn 14 Fortune Global 500 companies and 435 service-sector enterprises, demonstrating robust growth momentum.
The highlight is the Daping Health Industry Aggregation Demonstration Zone. Through vigorous investment promotion over the past two years, the New Dashihua Area has now gathered 311 health-related enterprises and 28 specialized medical institutions. In 2019, its revenue reached RMB 2.46 billion, a year-on-year increase of 14.26%.
It is reported that the Dashihua New Area is positioned as “Chongqing’s New Urban Core and a New Tier for Yuzhong’s Development,” focusing on the development of big data and intelligent technologies, finance, high-end commerce, professional services, cultural tourism, and the medical and health industry. Notably, the Daping Health Industry Cluster and the Hualongqiao Professional Services Cluster (legal sector) have been successfully established as the city’s first batch of Strategic Emerging Service Industry Agglomeration Demonstration Zones. In 2018, the gross regional product of the Dashihua New Area reached RMB 17.627 billion, accounting for 14.64% of the entire district’s total, with a year-on-year growth of 2.1%.
In conclusion, the head of the Dachongqing Petrochemical Administrative Committee invited enterprises to visit and establish operations in the New Area of Dachongqing Petrochemical Industry, marking the end of his speech. The seminar then proceeded to the thematic discussion session. Relevant leaders from Chongqing Traditional Chinese Medicine Orthopedic Hospital and several industry representatives engaged in discussions on hot topics such as medical quality control and health management.