GE Healthcare, Medtronic reveal China strategy

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GE Healthcare ($GE) and Medtronic ($MDT) have already poured substantial sums of money into building their market presence in China. With beachheads in place, they see targeting smaller cities and rural areas as key to conquering the entire country.

The Chinese news web site Morningwhistle.com reports that both companies are pursuing similar strategies in this regard, with an eye toward taking advantage of China's huge, ongoing investment into building its healthcare system in second- and third-tier cities as well as rural areas.

Consider: GE Healthcare used to book 20% of its China sales from small cities and rural areas. The company now hopes to grow that to 50% in less than 5 years, Duan Xiaoyin, GE Healthcare China's president and CEO, told the web site. And the company won't be doing it through marketing alone. GE Healthcare plans to roll out 40 new products over the next few years, a large majority of which will be targeted at China's primary care market. What's more, the company will help medical facilities of a certain size finance their purchases, according to the story.

Medtronic is pursuing a similar path, having acquired China Kanghui Holdings for $816 million in cash. The maker of a number of orthopedic devices and other technologies already has a significant network in second- and third-tier cities, the story notes, complementing Medtronic's existing sales relationships with hospitals in larger cities. Moving ahead, Medtronic plans to use the Kanghui network to broaden its reach, Medtronic China's director of public relations Wu Weinong adds in the piece.

- read the Morningwhistle.com story

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