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Japan Launches €515 Billion Initiative to Grow Medical Markets

Japan Launches €515 Billion Initiative to Grow Medical Markets

The Japanese government announced a strategy on 31 July 2012 to support the creation of new medical-related markets by 2020 in such areas as innovative medical device development, medicine and healthcare. The initiative is designed to boost the value of life sciences to more than 50 trillion yen (€515 billion) and create more than 2.84 million jobs.

Roughly half of the growth (€206 billion) is expected to come from outside the country. To this end, the government is encouraging Japanese companies to capture market share in overseas healthcare sectors within the next eight years.

Domestically, the government anticipates that the creation of innovative medical devices and drugs will help boost the nation’s economy by €17.5 billion. It also aims to build up its healthcare market to a value of €257 billion and add 800,000 employees in that sector.

Although the plan does not clearly mention how the specific goals will be financed, the government asserts that priority will be given to investments closely related to medical devices, medicine, and healthcare.

“We will work to establish a collaborative system among industry, government and academia for creating innovative medical devices, and help promote devices developed and manufactured in Japan and expand Japanese businesses overseas,” says the plan, released by the Council on the Realization of New Growth Strategies, part of the National Policy Unit. For example, the government will encourage universities, research institutions and manufacturers to create nursing-care robots, and build the infrastructure to develop and commercialise these products.

The government also says that it aims to speed up the approval process for drugs and medical devices by revising the Pharmaceutical Affairs Law (PAL) and increasing the number of regulatory officials and consultants to allow products to be brought to market in a more timely manner.

To demonstrate the government’s commitment, Prime Minister Yoshihiko Noda visited orthopaedics company Nakashima Medical in Okayama Prefecture and the Sharp Corp. factory in Hiroshima Prefecture, where blue LED chips are produced. Japan can generate new growth [opportunities], if Japan’s core manufacturing and medical technologies [work together], he told reporters covering the visit. Noda also recognised the necessity of revising the PAL to bolster the medical device industry, local newspapers reported.

The initiative drew inspiration from a government council draft published in June that outlined agrowth strategy and called for a revision of the PAL. Some of the measures pledged under the strategy will be financed by next year’s budget.

Whether the current administration will be able to press ahead with this growth strategy is uncertain, however. While Noda managed to clear tax reform bills that will double the sales tax to 10% by 2015, this is almost completely aimed at covering soaring social security costs. The two major opposition parties, which supported passage of the bills after Noda promised to dissolve the lower house, are now putting pressure on him to call an election.

Unless Noda establishes a stable and powerful political footing, the new vision to bolster the medical device industry will end up a castle in the air.

 

August 14, 2012 – 8:22 am

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Miki Anzai

 
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