Fading Appeal For Medical Device Manufacturing In China Gives Way To Opportunities In Vietnam & India

For some medical device companies, China’s position as a favorable site for low-tech medical device manufacturing has waned in recent years. These firms are instead starting to look at new hotspots such as Vietnam and India. Offshore production for US medical device companies has been negatively affected by rising Chinese labor costs (which will increase by 10-15% in 2011), higher global shipping costs, and new taxes on wholly foreign-owned enterprises (WFOEs). Although the quality of Chinese products has improved in recent years, problems with intellectual property theft still persist.

Vietnam has been recognized as an excellent alternative site for low-tech medical device manufacturing, boasting a highly educated, stable, and skilled workforce. Support labor, such as support engineers and technical personnel, is significantly cheaper in Vietnam than in China. A plethora of educated workers already live in close proximity to government established industrial parks, further reducing costs to manufacturing companies by eliminating the need to build living quarters for workers at the factory site (which is common in China).

India’s Department of Biotechnology and the US government will soon begin a collaborative program on low-cost medical devices. The program aims to foster relations between US and Indian scientists and will develop technologies used to address global medical needs in low-resource settings. Emphasis will be placed on technologies that increase healthcare access, address global health disparities, and/or help diagnose and treat diseases of the poor. In the area of cardiovascular diseases, the focus will be on detection and monitoring devices as well as equipment for disease treatment. In cancer screening, focus will be on the development of screening technologies simple enough to be operated by people with minimal education (10th grade). In maternal/neonatal/infant health, newborn screening technologies which identify treatable conditions or inherited disorders will be the main focus.