Due to technological advancements, the COVID-19 pandemic, an aging population, and rising healthcare costs worldwide, the global medical device industry has experienced remarkable growth in recent years. Among the emerging markets, South Korea stands out as a promising destination for companies in the medical device sector.
Qualtech explores the prospects of the medical device industry in Korea and outlines five compelling reasons for companies to consider when entering this dynamic and rapidly evolving market.
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South Korea's robust healthcare infrastructure is a key draw for medical device companies. The country boasts an advanced healthcare system featuring modern hospitals and clinics with cutting-edge technology. Moreover, these facilities foster the adoption of advanced medical devices through the country’s consistent investments in facility upgrades. Additionally, South Korea’s Ministry of Health and Welfare has implemented multiple social security programs to improve its citizens' overall quality of life. Among these initiatives, the Korean social security system comprises mandatory health insurance and medical aid. The National Health Insurance (NHI) system[1] ensures healthcare coverage for all citizens through contributions from individuals and government subsidies[2], while the medical aid program uses subsidies to serve low-income groups. This well-designed infrastructure provides a solid foundation for successfully introducing and utilizing new medical devices in the Korean market. |
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Like many other developed nations in the region, South Korea is experiencing a demographic shift characterized by an aging population. Along with having one of the lowest birth rates in the world, the nation is on track to transition into a "super-aged society" by 2025, when the percentage of individuals aged 65 and over will make up 20% of the total population. By 2050, this figure is projected to surge even further, potentially reaching as high as 44%[3]. This demographic trend presents a substantial opportunity for medical device companies specializing in products for elderly care, such as mobility aids, orthopedic devices, and remote monitoring systems. |
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The Korean government recognizes the importance of the medical device industry and has implemented policies to support its growth. Regulatory agencies, such as the Ministry of Food and Drug Safety (MFDS), have streamlined approval processes to facilitate the entry of new medical devices into the market. Additionally, the government provides financial incentives, tax benefits, and research grants to companies engaged in biopharma and medical device innovation[4][5]. These initiatives not only reduce market entry barriers but also encourage research and development efforts. |
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Korea has established a reputation as a hub for technological innovation and research excellence. Korean companies and research institutions actively participate in revolutionary medical research and development. This innovation culture has led to the creation of progressive medical devices in areas such as diagnostic imaging, wearable health tech, and minimally invasive surgical instruments. Companies entering the Korean market can embrace this culture of innovation by collaborating with local partners or leveraging the talent pool to develop and market their products. |
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Korea has a consistent rise in healthcare spending, reflecting the country’s increasing commitment to enhance healthcare quality and accessibility. As disposable incomes grow and healthcare awareness improves, consumers become more inclined to invest in advanced medical treatments and devices. This positive trend in healthcare expenditure offers a promising opportunity for companies seeking to enter the Korean market. In 2021, the total market value of imported medical devices in Korea reached $5.3 billion, marking a 20% increase, according to the MFDS [6]. The United States has consistently held the top position in the Korean import market for medical devices over the past four years, with a market share ranging from 40% to 50%. However, there has been a noteworthy shift in the market share of medical devices in recent years, with Chinese imports experiencing a significant increase from 7.8% in 2020 to 12.3% in 2021. This places China in the third position, right behind Germany, which saw a decrease from 17.4% in 2020 to 14.8% in 2021. |
The future of the medical device industry in Korea holds great promise. This optimism is rooted in the country's well-constructed healthcare infrastructure, a steadily expanding aging population, strong government backing, ongoing technological advancements, export potential, and growing healthcare expenditure. Korea not only offers a lucrative market for medical device companies but also serves as a strategic entry point to the broader Asian market.
To enter the Korean market, companies must establish a local presence through an importer. This entity is crucial for guiding medical devices through the approval process and ensuring compliance with the MFDS standards for quality management system and products. This meticulous approach is key to gaining the necessary regulatory approvals and building trust with Korean authorities and consumers.
Qualtech, with its team of regulatory experts, can be the strategic partner you need to expand into the Korean market successfully. By enlisting in our services, we can help you navigate the complexities of the regulatory landscape, streamline the approval process, and maximize your business potential in South Korea.
References:
[2] HEALTH INSURANCE REVIEW & ASSESSMENT SERVICE
[3] The Lancet Regional Health – Western Pacific
[4] KLRI
[5] Korea Times
[6] International Trade Administration