Danaher Corp's China sales revenue over $3b in 2020

Danaher Corp, a United States-based science and technology company, gained over $3 billion in sales revenue in China last year, and is expected to grow even stronger in 2021, thanks to the country's increasing demand for healthcare-related innovation, manufacturing and services, as well as its dual-circulation development paradigm, said a senior executive. 

The health awareness of Chinese citizens is much higher today as many of them grow older. They are willing to spend on healthcare products and services, and this trend would significantly benefit Danaher's life sciences, biotech and diagnostics businesses in China for the long run, said Shen Yi, the group's vice-president and head of mergers and acquisitions for Asia. 

Under the dual-circulation model, the domestic market is the mainstay while the domestic and foreign markets reinforce each other.

China's economy would continue to grow, with healthcare spending expected to increase as well. Government policy initiatives like the Healthy China 2030 initiative will encourage both public and private funding in the healthcare sector, particularly for diagnostics, which are still below 5 percent of overall healthcare costs, said Shen, who has been working in the areas of investment and M&A activities for 25 years in Deutsche Bank, Merrill Lynch, McKinsey and GE prior to joining Danaher in 2011. 

"Business in China represents nearly 15 percent of Danaher's global revenue, and the country is one of the most important markets for us. We are committed to continue investing in China," he said.

Since 2011, the US company has completed close to 30 transactions in China, and would continue to deploy capital in digitalization, molecular diagnostics, bioprocessing and bioproduction to help pharmaceutical and biopharmaceutical companies discover, develop and manufacture drugs, and gene and cell therapy to provide individualized therapeutic treatment in an efficient way. 

Driven by these national policies such as the Healthy China 2030 initiative and the tough situation caused by COVID-19, Shen found that China's healthcare sector has seen significant innovation especially in terms of the rise of virtual demand. 

"On the other hand, empowered consumers are paying more attention to their own health, and the influence of lifestyle on health has gained greater recognition. There is soaring demand for risk assessment and early intervention for infectious and genetic diseases, cancer, and mental health issues," said Shen, noting digitalization has provided much better remote access and faster speed, and has become an increasingly important tool to reduce healthcare costs.

China is expected to enter the world's top echelon in the research and development of new drugs within the next decade as global companies have deployed more resources from innovation to services and production in the country, while many local companies have cultivated a strong research and development prowess and are thriving in clinical trials, said Chen Kaixian, an academic who specializes in new drug research at the Chinese Academy of Sciences.

Such robust development momentum, which has been on the rise over the past five years, is also a result of deepened collaborations with multinational pharmaceutical giants, he said.