According to reports, U.S.-based medtech company Boston Scientific
(NYSE: BSX)
says it intends to open its first factory in China.
Reuters reported that Boston Scientific shared the news in a statement on its WeChat social media account. The report said the company shared its interest in expanding regional production in supply chains. Its factory will be in Lingang, a free trade zone in Shanghai, focusing on production for the China market. According to Reuters, the Shanghai government promotes this area as a “landing base” for developers of semiconductors, electric vehicles and pharmaceuticals.
Boston Scientific outlined China as a serious area of focus at its recent Investor Day event on Sept. 20. Chair and CEO Mike Mahoney describes the country as “one of the most attractive medtech markets.” The company sees “unmatched” growth, scale and a worthwhile innovation ecosystem within the country.
June Chang, president of Boston Scientific in Greater China, said at the Investor Day that many complexities in the Chinese market still exist, though. The company will have to navigate payment reform, local competition and policy pivoting towards local sourcing.
Despite challenges, Boston Scientific expects its China business to exceed $1 billion in revenue by 2024. The company projects mid-teens revenue growth with “attractive margins.”
“We know that it’s not an easy market to play, but it is a compelling market,” Chang said. “So, we stand firm our commitment, but we constantly recalibrate and refresh our approach to maximize our potential and to focus on our core, focus on highly differentiated product technology. And we continue to find new ways to grow. We believe we are in a very, very strong position to win, and we have the best team on the ground to deliver that.”
