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MDR – 4 frustrations facing dental implant manufacturers

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We invested many hours into EUR MDR compliance. Learn how we can help. 

The EU Medical Device Regulations: Fears and Frustrations for Dental Implant Manufacturers

For over twenty years, the Medical Device Directive (MDD) has regulated medical devices in the EU, and assured safety and performance. However, with rapid advancements in technology, evolving healthcare needs, and emerging challenges, the EU recently introduced more robust and comprehensive Medical Device Regulations (MDR) to replace the aging MDD.

The MDR ushers in a new regulatory era for medical devices with stricter requirements to ensure higher product safety, efficacy, and quality standards. Moving forward, all dental implant devices will be held to increased scrutiny of their quality and rigid requirements for clinical evidence.

And though many of the changes will be beneficial overall, critics say the regulations will hinder innovation, significantly affecting how many products providers can bring to the market and increasing their initial costs.

In the face of so much change, dental implant manufacturers are understandably worried and frustrated by the challenges ahead and the uncertainty of how to best plan and proceed.

Lack of clarity around timing and costs

The MDR requires a comprehensive process to apply for certification and to succeed, and firms need to have an in-depth understanding of the EU’s regulatory requirements and compliance guidelines.

Many dental implant manufacturers are frustrated and need more tools and understanding to ensure compliance with the requirements. They’re rightly worried about whether in-house resources can manage the task, how much time and money will be needed to get an entire product catalog approved (or even just a few select products), whether they can stay competitive during the process, and how many products they might have to pull from the market in the future.

The necessity to conduct clinical testing is crucial within the new MDR requirements. Clinical evidence is typically obtained through actual patient trials and generally requires costly maintenance to keep up-to-date. Moreover, putting resources towards MDR could slow product development and innovation, leading to even more barriers toward ongoing sales and marketing objectives.

The challenge is increasingly difficult for manufacturers with a more extensive product catalog since they will likely be delayed. At Elos Medtech, we spent three years getting our entire product catalog MDR approved, and many other firms are now only in the early stages of obtaining MDR certifications.

Firms may face unexpected challenges with customers looking elsewhere to fulfill their product needs if they can’t meet the timelines for their product approvals. Moreover, the risk of MDR compliance rejection can also result in slower product releases with lost revenue while waiting for a new application to be processed.

Market access challenges

Studies are typically performed at the implant level, requiring applicants to set up costly trials to collect abutment and prosthetics usage data.

Implant manufacturers usually work with various third-party providers, who may lack the resources to set up expensive trials to gather data on abutment and prosthetics usage. In these cases, implant manufacturers must find ways to ensure they can still offer a complete product catalog.

Moreover, older and less popular products are likely to be discontinued in the market because the new requirements are too great to justify the cost and time investment needed; this will be especially true for specialized devices sold in smaller quantities.

A hindrance to innovation

Stricter MDR requirements and tighter controls pose real challenges to innovation in the dental implant market. Increased emphasis on robust clinical evaluations and evidence, extended approval timelines, and more costly product development means that implant manufacturers will be deterred from developing new technologies unless they are a sure bet for revenue generation.

Liability concerns for non-compliance

There are a variety of implications for non-MDR compliance ranging from fines to product delays, legal action, delayed product launches, loss of market share, and recalls to extensions of manufacturing licenses.

If a product is rejected during the MDR certification process, it will result in slower product releases with lost revenue while waiting for a new application to be processed. Even if products are already on the market with the MDD approval, they must be removed after MDR goes into effect.

Your trusted partner for achieving MDR compliance

Ensuring compliance amidst growing regulatory challenges is critical, but staying attentive to market success is equally important. Choosing the right partner is crucial for companies that need help knowing how to move forward.

At Elos Medtech, we have already made the significant time, financial, and intellectual investments required to put all our products through the rigorous MDR approval process. As one of the first to adapt to the new regulations, we are ready to offer you an effortless transformation to being able to offer fully compliant products.

While the usual turn-around time for an implant manufacturer working alone to become MDR compliant is two years or more, Elos Medtech can dramatically speed up that process. In just six months, we can be your legal manufacturer, and you can be ready to sell abutments repackaged with your company brand.

Plus, we’re already prepared with a plan for maintaining our products’ certification status, which is also a costly and laborious process since dentists have to work with product providers to deliver clinical data on an ongoing basis.

Elos Medtech is a pioneer in our industry and has consistently been pushing the boundaries of innovation. We were the first company to introduce a high-precision scan body to digitalize implant restorations: the Elos Accurate® Scan Body, the entry key to a truly open digital workflow.

We have partnerships with premium, global implant brands that use the Elos Accurate® Scan Body in their libraries and workflows today. With our MDR-compliant Elos Accurate® product line, you’ll have access to the same benefits.

You’ll be well-positioned to earn new business with a full line of precision products that give your users direct access to a truly open digital workflow. Focus your investment dollars on improvement, innovation, and new product development instead of working backward. We’ll help you avoid pitfalls like gaps in your product portfolio from delays in approval and financial risks around customer retention.

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US patent granted for Elos Accurate® Analog for Printed Models

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Elos Medtech is pleased to announce our Analog for Printed Models (PMA) — due to its unique attributes — has been granted a U.S. patent by the United States Patent and Trademark Office (USPTO). The patent is based upon the analog’s special features for improving components used in dental implant technology. The PMA provides an effective alternative to prior technology for dental implant analogs.

The PMA has solved critical issues faced by dental labs and offers valuable improvement to a clinic’s workflow.

Years of development were invested in the PMA, which can now be correctly positioned even when there may be slight flaws in the printed model of a patient’s teeth. 

The U.S. patent caps an intensive five-year process resulting in a patent that is key in fair trade and international agreements.

The U.S. patent regulator USPTO sets some of the world’s most stringent criteria for patent approval.  The procedure involves a methodology that thoroughly examines every detail of claims made by the applicant. Consequently, the USPTO searches all known technological knowledge (“prior art”) to ensure that an invention is new and unique. This is why the course of examination that resulted in the patent took five years to complete.

The unique features of Elos Medtech’s PMA helped expedite the approval process. Nevertheless, the process was time-consuming and expensive. But in the long run, the investment will pay off as the patent will act as a testimonial to the PMA’s unique features and as a firewall of protection against illegal copies.

Low-cost 3-D printing machinery may produce physical models having dimensions that can deviate substantially from the actual dimensions of the patient’s teeth.

Like snowflakes or fingerprints, each patient’s set of teeth is unique, but a 3-D model is generally made in a cost-efficient manner. After all, it is just an expendable model, and certain deviations can be expected.

A model of a patient’s teeth requires very low engineering tolerances. Unfortunately, compliance with said levels of tolerance cannot always be achieved when 3-D printed models are produced. Deviations often occur. When these deviations do occur, they create the potential for damaging the model, and an ultimate worst-case situation: an improper fit. For clinics, this can pose a serious disadvantage as the tight fit between an implant analog and the correspondent model of a patient’s teeth might not be achievable. What’s more, the application of high pressure that can deform the model may result in incorrect placement of the PMA and, in turn, incorrect positioning of the prosthetics. This situation can have immediate consequences on the tooth restoration process.

The development of the Analog for Printed Models by Elos Medtech provides the dental implant market with an implant analog that can be correctly positioned despite any slightly incorrect dimensions occurring in a printed model.

In short, the PMA allows for a tight fit between the implant analog and the 3-D printed model without the application of excessive pressure to the model. This feature safeguards printed models from becoming deformed in the process.

Along with the obvious value of precision, the PMA conveys an added value both in economic terms and ease of installation. The physical workload of laboratory technicians can be significantly reduced as the installation process no longer requires excessive strength, which can instigate work-related ailments as well as damage to a model.

By using the analog pliers developed by Elos Medtech, lab technicians can simply pull the analog into place instead of using a lot of muscle strength to click it into position. This handy precision tool, coupled with the features of the analog, significantly reduces the risk of ruining the model.

Specialized features of the Elos Medtech analog deliver technical advantages that dental clinics will translate into ease of workflow, improved precision, and savings.

The newly-patented PMA has been designed with three locking areas/anti-rotational means that prevent unwanted rotation of the dental implant analog. These locking areas also enable the dental technicians to torque the prosthetic tooth on the model with the same torque that will be used when tightening the prosthetic in place on the patient.

Ease and precision are also benefited from another feature of the analog: triangular wedges with inclined, wedge-like, engaging surfaces. When in use, the inclined top surface engages with the protrusion located on the through-going hole of the printed model. Any excess material found on the surface of correspondent protrusions of the model will simply be removed during insertion. This ensures both accurate centering and a tight fit within the hole.

In a nutshell, the analog kit allows dental technicians to pull the analog tightly and precisely into place, without the risk of rotation, and without the use of significant muscle pressure.

Read more about the Analog for Printed Models.

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Hooray we made it!

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Elos Medtech receives EU Medical Device Regulation certification

We are excited to share that we have recently received certification for all our Class IIb products in line with the EU Medical Device Regulation (MDR). We are committed to continuously improve and innovate our processes to provide better products and solutions to our customers.  As competence is the key to moving forward, all of our Elos Accurate® products are fully certified, ensuring the continuation of reliable supply of products, before and after May 2024, in compliance with relevant standards and regulations.

“We are pleased to receive the MDR certification, an EU regulation to increase the safety and performance of medical devices for patients,” says Henrik Andersen, Head of Engineering of Elos Medtech, Dental.

“As a trusted dental partner, we are in compliance with the standards and regulations that we follow throughout the entire development and manufacturing processes. The accreditation shows our commitment towards excellence, and I would like to thank all my colleagues at Elos Medtech for this incredible achievement.”

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In China for China- Part 3

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How to Become a Domestic Brand in the Chinese Dental Implant Market

The Chinese market is quickly getting the attention of foreign implant manufacturers—and for good reason. As the economy grows, more people are willing to spend money on dental health. China’s population is also becoming more familiar with the benefits of dental implant restorations, and the number of dentists offering implant dentistry is growing too.

However, with new policy putting foreign dental implant companies at risk, it’s becoming a more difficult market to understand and compete in. A new regulation by the NMPA in China, the chief administrative authority, is now publicized and took effect as of June 1, 2021, with an enforcement date of January 1, 2022. Our assessment of the new policy is that it’s a step in the direction of stricter regulation of foreign implant manufacturers’ access and ability to operate in China.

We predict it will be imperative to become classified as a “domestic” brand in China, acting as the legal manufacturer to be able to sell dental implant products in future—especially in the lucrative public hospital sector.

Why adapt to get domestic brand status?

The new policy is currently exclusively affecting the public sector. And with more than 50% of the dental implant business originating from the public sector and the majority of dentists wanting to work at public hospitals, it’s not something that should be downplayed. Foreign brands can still enter the private market sector, but the expectation is that this will also change in future to consolidate regulations, essentially pushing foreign brands out.

Continued access to public hospitals is critical for Class I and Class III products, as it is the most lucrative sector for dental implants in China.

Inaction could lead to foreign brands being forced out of the Chinese public sector and losing growth potential, brand value, and ultimately revenue. Worst case, it may even mean foreign dental implant companies risk being pushed out of the market entirely in the future.

How to attain domestic brand status

The prerequisites to being considered a domestic brand in China are complex and time-consuming. One of the biggest challenges is that the Legal Manufacturer has to be located in China: a task not easily overcome and a financial burden for many.

The policy treats some aspects of production for Class I and III medical devices the same, but a few key differences are essential to understand.

For both Class I and Class III devices, the Legal Manufacturer can outsource manufacturing until the component / semi-product stage. This production phase can be conducted by the Seller (manufacturer for Class I) or an Entrusted Partner (manufacturer for Class III). 

A key point for Class I device regulations is that complete manufacturing cannot be outsourced. The Legal Manufacturer (Buyer) and registrant of the products must perform the final manufacturing stages (packaging, labeling and an additional procedure like cleaning) in China to be considered a “domestic” brand. In other words, the Legal Manufacturer either needs to be located in China and perform all of the production stages itself or outsource only the component / semi-product stage; if one of these is not the case, then “foreign” brand status will be applied. 

For Class III devices, there is a bit more flexibility: the Legal Manufacturer (Entrusting Party) and registrant of products can either perform the complete manufacturing process itself or outsource the entire process (including the final stages) to an Entrusted Partner located in China. 

Working with an Entrusted Partner

If the manufacturer wants to handle the production stages itself, there is a high level of transparency in the documentation required by the NMPA, and there are also future policy risks and unknowns to contend with.

Before the new policy was enacted, the Legal Manufacturer (Entrusting Partner) needed to submit all documentation to the National Medical Products Administration (NMPA) during the establishment of the production plant in China, which meant that the Legal Manufacturer had to give away rights to the technical files as well. This is still the case for those wanting to establish a plant in China and handle the production themselves.

However, under the new regulations, the Legal Manufacturer must apply for the Products Registration Paper under their brand from the NMPA and list the real producing site and Entrusted Partner to the NMPA for the site inspection. They also still need to provide the production files for any stages being outsourced but only to the Entrusted Partner / Supplier—not to the NMPA. 

The key advantage of working with an Entrusted Partner: your production files do not have to be provided to the NMPA.

Faster time to market

Elos Medtech is already set up in China to be an Entrusted Partner and can transfer all the benefits of obtaining a domestic license without having to wait years or make costly investments in building local manufacturing plants.

As Elos Medtech has a manufacturing site in Tianjin, established in 2010, we can act as your entrusted partner. We are flexible and can handle partial or complete manufacturing of Class I and Class III components in China, depending on your needs. We already work with leading global implant manufacturers worldwide, who trust us and our quality.

Disclaimer: The information contained herein is presented in good faith and is, to the best of our knowledge and belief, true and reliable. It is offered solely for your consideration and is subject to change without prior and further notice unless otherwise required by law or agreed upon in writing. There is no warranty being extended as to its accuracy, completeness, correctness, non-infringement, merchantability or fitness for a particular purpose. All rights reserved. 

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In China for China – Part 4

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4 Steps to Secure Your Brand’s Success in China’s Growing Dental Implant Market

In the first article in Elos Medtech’s “In China for China” series, “,” we took a closer look at the expanding dental implant market in China and attitudes toward public versus private providers. China Offers a Lucrative and Growing Market for Dental Implant Manufacturers,” we took a closer look at the expanding dental implant market in China and attitudes toward public versus private providers.

In our estimation, it’s crucial for dental implant manufacturers to give priority to public hospitals in their planning activities, especially considering that public hospitals are estimated to win an even greater share of the market from private clinics in the future.

Implant brands are putting in an effort to succeed in public hospitals due to their strong influence, academic status, and better gross profit margin. However, as new policies come into play in China, the public sector will continue to become more difficult for foreign brands to access, posing a challenge to which brands should be ready to adapt.

A new policy is positioned to incentivize the protection, development and localization of domestic brands in the dental implant industry in China. In our second article, “5 Key Things to Know About Regulatory Changes in the Chinese Dental Implant Market,” we reviewed the key takeaways implant manufacturers need to know about the policy.

Being considered a domestic brand will be vital for those wanting to enter the Chinese market for the first time and those already doing business there. In this, our fourth and final article in the series, we’ll highlight four steps your brand can take to work toward meeting the requirements of becoming a domestic brand in China.

Step 1: Understand the requirements to meet domestic status.

In our third article, “How to Become a Domestic Brand in the Chinese Dental Implant Market,” we looked at the whens, wheres, and hows of the new requirements. Here’s a recap of what you need to know:

For Class I medical devices:

  • The Legal Manufacturer can outsource manufacturing up to the component / semi-product stage to the Seller (Class I)/Entrusted partner (Class III)  but cannot outsource the complete manufacturing.
  • The Legal Manufacturer and registrant of the products must perform the final manufacturing stages (packaging, labeling, and an additional procedure like cleaning) in China to be considered a “domestic” selling partner.

For Class III medical devices:

  • The Legal Manufacturer can perform manufacturing up to the component / semi-product stage by an Entrusted Partner.
  • The Legal Manufacturer and registrant of products can either perform the complete manufacturing process themselves or outsource the entire process (including the final stages) to an Entrusted Partner located in China.

For both Class I and Class III:

  • The Legal Manufacturer needs to obtain a business license and first apply for and attain product registration before applying for a Medical Device Production License.
  • The Legal Manufacturer must also comply with Good Manufacturing Practice (GMP) regulations.

For firms wanting to establish a plant in China and handle all production stages on their own:

  • The Legal Manufacturer must submit all documentation to the National Medical Products Administration (NMPA) during the establishment of the production plant, including the rights/status of the core-value technical files.
  • Future policy risks and unknowns can come into play later that may require additional adaptations in processes, licensing and/or equipment.

 

For those firms that want to outsource one or more production stages:

The Legal Manufacturer only needs to provide the files for the stages being outsourced to the Entrusted Partner / Contracted Manufacturer, but not to the NMP

Step 2. Evaluate your current position and options in China.

Since for both Class I and Class III devices, the Legal Manufacturer must be located in China, your firm should evaluate its current operations in China to determine the best options.

A part of your evaluation process could include consideration of the following questions (and more): 

  • Do you have a product registration in China?
  • Do you already have manufacturing facilities located in China?
  • Can your facilities be adapted to meet growing requirements?
  • Does your firm have the internal expertise and infrastructure to support any new China business initiatives?
  • Does your firm have a plan yet for addressing the new regulatory requirements, handling the paperwork, and obtaining approvals?

If your answer is “no” to any of these questions, it’s likely your firm should look to the help of an Entrusted Partner to handle the process, which can decrease the time to market from years to just a few months. 

Step 3. Your time to market: understand the substantial time and effort required. 

Firms must carefully consider expected timelines when evaluating how long it will take to realize the potential of any investments they plan to make.

The setup of the final production stages for Class I devices is more straightforward than for Class III devices, and dental implant manufacturers can choose to establish Class I final production stages in China including cleaning (which doesn’t require a clean room), labeling, and packaging. However, for Class III devices, the setup of the final production stages is much more complicated, and manufacturers need to have a clean room.

When establishing a new plant, additional time is required to get a production license (including testing equipment, self-checking, and on-site inspection). If a firm decides not to engage with an Entrusted Partner to manufacture but instead decides to build a plant by itself and get the approved registrations needed, the expected time is at least 2-4 years to become a domestic brand for Class I or III device manufacturing.

Step 4. Consider whether you’ll go it alone or work with an Entrusted Partner. 

It takes considerably less time to find an Entrusted Partner to handle the process than to set up a licensed organization and plant in China.

Collaborating with an Entrusted Partner can shave years off the process and bring your time investment down to a matter of months

If you have a plant in China, you can benefit from working with an Entrusted Partner for some or all of your production activities. There is the possibility of adding the critical final production stage manufacturing phase for Class III medical devices, thereby becoming a domestic brand. Full transparency of your production files for the stages being outsourced goes to the Entrusted Partner only (not to the NMPA), and you retain the status of being the Legal Manufacturer.

Additionally, safety and reliability can be offered by partners like Elos Medtech. At our manufacturing site in Tianjin, established in 2010, we can act as entrusted partner of both Class I and Class III contract manufacturing. 

Conclusion It’s vital that foreign implant makers start taking steps now to adapt to the regulations being enacted in the Chinese dental implant market. This holds true for firms that are new to the Chinese market and those already doing business there, since it will be crucial to have access to the most lucrative Chinese implant sector: the government-controlled public hospitals.

If your firm needs guidance, Elos Medtech is ready to help you solidify the best plans for your success and make the complicated process easier, faster, and more efficient.

Disclaimer: The information contained herein is presented in good faith and is, to the best of our knowledge and belief, true and reliable. It is offered solely for your consideration and is subject to change without prior and further notice unless otherwise required by law or agreed upon in writing. There is no warranty being extended as to its accuracy, completeness, correctness, non-infringement, merchantability or fitness for a particular purpose. All rights reserved. 

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Free eBook

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7 Trends Shaping the Future of Digital Workflows in Implant Dentistry

Implant dentistry has reached a tipping point. Digitalization is taking precedence over conventional processes and will continue to accelerate unevenly but steadily and faster.

In the 7 Trends eBook, we share the benefits, challenges, and solutions within digital workflows in implant dentistry. It also highlights the 7 trends that shape the landscape today and into the future. 

Download now

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In China for China – Part 1

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China Offers a Lucrative and Growing Market for Dental Implant Manufacturers

The Chinese dental implant industry has shown strong growth in recent years and is expected to continue this trend in the foreseeable future. With the Chinese population experiencing increased upward mobility and the ability to afford dental care like dental implants, so has the increase in consumers’ access to and demand for restorative dental services. Organizations who provide these services are also growing to meet local demand.

With the dental implant market size reaching upwards of USD 600M by 2024 and almost $680 million by 2027[1]expected market increases are setting the stage for lucrative opportunities for dental implant manufacturers.

Source: iData Research Inc., 2021

A look at the public and private markets for dental implants

The proportion of dental implant procedures performed in private dental clinics is much greater than that of government-owned public hospitals in some regions; however, this split differs between Northern/Southern regions and Eastern/Western regions. And on average, across China the total number of dental implant procedures performed in private clinics versus public hospitals is split almost fifty-fifty.[2]

With an almost equal distribution of procedures taking place in clinics as compared to hospitals, it would seem logical to deduce that they are also equally desirable for implant manufacturers to focus on this area with their attention and investments. However, this is actually not the case. In fact, public hospitals are a much more lucrative segment for implant manufacturers to target to grow their business in China substantially.

Public hospitals are considered the most reliable and qualified treatment centers among patients and the prime segment for premium foreign brands today. Consumers have greater confidence in public hospitals, and the best dentists want to work for public hospitals—not private clinics.

More than 50% of dental implant sales already target hospitals as their prime segment today, and this market is estimated to win an even greater share of the market from private clinics in the future. Furthermore, most dental implant companies are persistent enough to put in the effort to succeed in public hospitals due to their strong influence, academic status, and better gross profit margin.

Foreign vs. domestic brands

It’s also key to know that Chinese patients prefer foreign brands over Chinese brands; in fact, more than 90% of dental implants in China are provided by foreign brands today.[3] Furthermore, Chinese consumers prefer American and European brands over all others since they are known to be market leaders in the dental industry with safe, high-quality performance.[4]

The high trust in foreign brands means excellent opportunity in the Chinese dental market. However, foreign brands doing business in China need to understand the regulatory challenges and new policies to be able to compete. For instance, the National Medical Products Administration (NMPA) launched new regulations for medical devices, which pose threats to foreign dental implant manufacturers.

A brief look at the regulations

In early 2021, a proposal was submitted to the National People’s Congress mentioning the high cost of dental implants for the first time at the national level. Later that year, a notification was issued by the Pharmaceutical Equipment & Procurement Service Center of Sichuan Province stating that information collection of high-value medical consumables in the dental category would take place, including dental implants, repair abutments, prosthetic products (crown/bridges/bars) and other medical consumables that constitute dental implant systems.

And in 2022, an executive meeting of the State Council was held to deploy and accelerate the major projects identified in the “Outline” of the “14th Five-Year Plan,” covering the years 2021-2025. At that time, it was announced that dental implant systems would be included in the program of volume-based procurement on a national level.[5]

State order 739 is the approval for the new regulation:  “The Regulations on the Supervision and Administration of Medical Devices” which is now publicized and took effect as of June 1, 2021, with an enforcement date of January 1, 2022.

Although the official reasoning behind the new policy is a reduction in the cost of the medical burden on patients, Elos Medtech assesses that the policy will be much more detrimental to foreign dental implant brands sold in China than meets the eye. The new policy incentivizes the protection of domestic brands in China, localization of dental products, and development of China’s technical knowledge in the dental implant industry.

Our assessment of the new policy’s regulations is that it is becoming imperative to become classified as a “domestic” brand in China, acting as a Legal Manufacturer to be able to sell dental implant products into public hospitals in future.

And in the most recent move, on August 18, 2022, the Chinese National Health Care Insurance Association solicited public comments on the “Notice on Carrying Out Special Governance of Oral Implant Medical Service Charges and Consumables Prices.” This notice is in relation to the pre-stages of the procurement of implantology, and this move shows that the government is working swiftly to accelerate implementation of their implantology plan. Notably, this notification relates to both public and private clinics as well.

It’s vital to act quickly to avoid being left out of such an important market, and Elos Medtech can help. For more in-depth information about the regulatory changes, how to become a domestic brand, and strategies to help ensure your success in China, stay tuned for our soon-to-be-released articles in the “In China for China” series.

[1] Dental Implants Market Size, Share & COVID19 Impact Analysis | China | 2021-2027 | MedSuite | Includes: Dental Implants (Premium, Value, Discount, Mini), Final Abutments (Stock, Custom Cast, CAD/CAM) & Surgical Guides
[2] Source: https://zhuanlan.zhihu.com/
[3]Source: Financial Report of the 21st Century
[4] Source: 看牙好贵！为什么更多人偏爱进口种植牙？|牙科|口腔|全瓷牙|牙医_网易订阅 (163.com)
[5] Source: Heyihui Medical

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In China for China- Part 2

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5 Key Things to Know About Regulatory Changes in the Chinese Dental Implant Market

The dental implant industry in the Asia Pacific region is advancing rapidly. Notably, China is seeing a strong growth r, making it a lucrative target for dental implant manufacturers.

At the same time, new policies are now in play that control foreign implant makers’ access to the Chinese dental implant market. Only manufacturers that become familiar with how to work within the limits of the new regulations will have the expertise to start or continue doing business in the most lucrative Chinese implant sector: the government-controlled public hospitals.

In this article, we’ll look at five key things dental implant manufacturers need to know about the latest regulation changes in order for their business activities in China to flourish.

1. A brief look at the new policy

At the beginning of 2021, the Chinese deputies submitted a proposal to regulate the high cost of dental implants, a move that will ultimately limit foreign dental implant manufacturers’ ability to sell their products in China.

That same year a “Notification” was issued to collect information on high-value medical consumables, such as dental implants, repair abutments, prosthetic products, and other medical consumables that constitute dental implant systems.

An executive meeting of the State Council, the chief administrative authority in China, was held on January 10, 2022. At that meeting, Chinese deputies officially stated that the program of volume-based procurement on a national level would include dental implant systems.[2]

State order 739 is the approval for the new regulation: “The Regulations on the Supervision and Administration of Medical Devices” which is now publicized and took effect as of June 1, 2021, with an enforcement date of January 1, 2022.

2. The reasoning behind the new policy

Although the official reasoning behind the new policy is a reduction in the cost of the medical burden on patients, we assess that the policy will be much more detrimental to foreign dental implant brands sold in China than meets the eye.

Within the dental implant market in China, the cost of components is not the most significant proportion of patient costs. In fact, the majority of treatment fees paid by patients flow mainly to dentists/clinics and hospitals in the form of hourly charges for services with only a small share used to cover the cost of dental components from implant companies and suppliers. Therefore, controlling foreign products will not control patient costs.

In reality, the most likely outcome of the new policy will be a strengthening of Chinese implant manufacturers’ competitiveness and market share with limitations on foreign companies’ access. The policy incentivizes the protection of domestic brands in China and the localization of dental products.

The new policy allows more flexibility for Class III medical devices; after all, these are advanced technology and not easy to develop or acquire.

3. The hidden risks built into the policy

The policy is one that we expect to be detrimental to many foreign dental implant brands sold in China. Currently, no foreign implant manufacturers are considered domestic brands in China (even Korean brands), so the risk is high that many of them will lose out on a significant market share in the future.

Implant manufacturers who want to enter China will have to navigate the new regulations and face costly investments unless they work with a partner familiar with the new laws and local manufacturing requirements.

What’s more, we predict that the policy will be especially detrimental within the most important market segment: the public hospitals. The public hospitals in China are by far the most lucrative market over privatized clinics, accounting for more than 50% of dental implant sales. Patients favor the public sector as a reliable and qualified provider of treatment centers. They are known for better patient results due to their average high technical level and the Chinese National Healthcare System.

According to the latest notification of August 18, 2022, private clinics will also be affected by the new policy.

4. Our predictions related to the policy

For additional context around regulations in China, we refer back to a policy introduced in 2021 in Northeastern China that limited purchasing volume within dental chemical consumables: only 30% of public hospital purchases of Class I, Class II, and Class III products are now allowed to be foreign brands. While various regions will have various policies, this policy is expected to be expanded to more than 20 provinces in the near future.

Since that time, dental chemical consumables have already experienced volume-based procurement and domestic replacement. And as of January 2022, with implantology being confirmed by the State Council to have volume-based procurement—and the voice from the deputies having mentioned domestic replacement as well in their “14th Five-Year Plan”—it leads us to these predictions:

  • Using this implementing approach and speed as our guideline for the 2022 policy for implantology, we estimate that the implementation of the 2022 policy might be complete by Q4 in 2022 or Q1 in 2023. 
  • We also expect that, though previously, all brands could be listed in hospitals’ purchasing systems (including foreign brands), this practice will change and that the restrictions for implant systems are likely to be even more severe than Class I, Class II, and Class III dental consumables (like silicon materials).
  • Chinese products, considered to be domestic today, will likely become more mature and offer good performance and lower costs compared to foreign brands.
  • A longer-term prediction is that all purchases of all classes will come from domestic brands and that foreign brands will gradually be forced out; in other words, a silent policy where purchasing would always prefer brands registered in the system with the priority being domestic brands. This implicates the importances of becoming a domestic brand.
  • A worst-case scenario could be that foreign implant systems brands might not have access to public hospitals for Class I and Class III products—or perhaps only in a few exceptions, for instance if a domestic/Chinese brand cannot replace the required solutions.

5. How to get ahead of the policy to ensure success

This calls for immediate action: to compete and grow, it is becoming imperative to become classified as a “domestic” brand in China, acting as the Legal Manufacturer to be able to sell dental implant products into public hospitals in the future.

It’s a potentially lengthy process to adhere to the requirements, but with an entrusted partner handling the process, setup and timelines can be decreased from years to several months.

As a reliable and ready partner to dental implant firms like yours, Elos Medtech has already completed the required process to comply with the requirements of an entrusted partner/supplier with an approved business license in place. Our manufacturing site in Tianjin, established in 2010, has the technology and capability to operate as an entrusted partner for Class I and Class III contract manufacturing services, including at the component level for Class I and all stages for Class III.

For more in-depth information about the requirements of the new policy, how to become a domestic brand, and strategies to help ensure your success in China, read the other blogs in our “In China for China” series.

[1] Dental Implants Market Size, Share & COVID19 Impact Analysis | China | 2021-2027 | MedSuite | Includes: Dental Implants (Premium, Value, Discount, Mini), Final Abutments (Stock, Custom Cast, CAD/CAM) & Surgical Guides
[2] Source: Heyihui Medical