China spends around RMB 9.09 trillion a year on health, roughly USD 1.25 trillion. That is the number every consultant puts on slide two of a China entry deck. It tells you almost nothing about whether you can sell here. The market is not one market. It is a very large public system that buys at prices you probably cannot match, and a much smaller private layer where foreign products still win. This article is the panorama: how the system is built, who pays, what the aging of the population really changes, and where a foreign company has a real opening in 2026.
I am Olivier Verot, founder of Gentlemen Marketing Agency. I have lived in Shanghai since 2012 and my team has worked with medical device makers, supplement brands, private clinics and clinical nutrition companies trying to enter this market. I have watched several of them lose two years chasing public hospital tenders they were never going to win.
An overview of the China health market in 2026
The health care market in China was small twenty years ago. It grew with the country. Living standards rose, people started paying for their own health instead of waiting to be sick, and health products in China are now close to ordinary daily consumption. That part of the old story is still true, and it is the part that matters most to a consumer brand.
The numbers below are the ones I actually use in meetings. They are public and current.
| Indicator | Latest figure | Source and date |
|---|---|---|
| Total national health expenditure | RMB 9,089.5 billion (government 24.9%, social 47.6%, out of pocket 27.5%) | NHC health statistics bulletin for 2024, published Dec 2025 |
| People covered by basic medical insurance | 1.331 billion, coverage rate 95% | National Healthcare Security Administration, March 2026 |
| Population aged 60+ | 323.38 million, 22.99% of the population | National Bureau of Statistics, end 2025 |
| Population aged 65+ | 223.65 million, 15.91% | National Bureau of Statistics, end 2025 |
| Hospitals | 38,710 total: 11,754 public, 26,956 private | NHC bulletin, end 2024 |
| Hospital beds | 8.12 million, 69% in public hospitals | NHC bulletin, end 2024 |
| Outpatient visits per year | 10.15 billion visits, 311.9 million admissions | NHC bulletin, 2024 |
| Internet hospitals | Over 3,340, more than 100 million online consultations a year | Industry data, 2025 |
How the system is actually built
Public hospitals hold the patients
Look at the hospital line in the table again. Private hospitals are 70% of the count and 31% of the beds. That gap is the single most misread fact about this market. Public hospitals, and above all the 4,111 tier-3 hospitals, absorb the serious cases, the reputation, the best doctors and the research budgets. Patients travel across provinces to reach them. A tier-3 hospital in Shanghai can see more outpatients in a day than a European regional hospital sees in a month.
If your product needs a specialist to prescribe or operate it, you need public hospitals. If your product is bought by a consumer, you do not, and you should stop trying.
Private hospitals and international clinics
Private hospitals in China are mostly small: rehabilitation, ophthalmology, dentistry, obstetrics, cosmetic medicine, traditional Chinese medicine. Many are under 100 beds. They buy from their own profit and loss, they price their treatments freely, and they move fast when a supplier shows them a service they can charge for. This is a very different sales cycle from a public tender.
Above them sit the international clinics of Shanghai, Beijing, Shenzhen, Guangzhou and Chengdu. Small volume, high price, mostly serving expatriates and affluent Chinese families with private insurance. They are a credibility springboard, not a revenue plan.
Something did change here. Since the pilot announced on 29 November 2024, foreign investors can set up wholly foreign-owned hospitals in nine locations: Beijing, Tianjin, Shanghai, Nanjing, Suzhou, Fuzhou, Guangzhou, Shenzhen and the whole island of Hainan. The conditions are strict. Tier-3 general, specialty or rehabilitation hospitals only. No traditional Chinese medicine hospitals, no psychiatric, no infectious disease, no acquisition of an existing public hospital. You must bring management methods and medical technology that the local system does not already have. It is a real opening, but it is aimed at operators, not at suppliers. Read more on how the hospital market in China is structured before you build a plan around it.
Aging is the structural engine, not a marketing slogan
China had 323.38 million people aged 60 and over at the end of 2025. That is 22.99% of the population, and the group grew by 13.07 million in a single year. People aged 65 and over reached 223.65 million. The total population fell by 3.39 million over the same year. Both curves point the same way.
The elderly population takes an important part in China’s population today, and one effect of the one-child policy is that a couple in their forties can end up responsible for four parents. That is why nutrition and health care products for older people keep growing, and why the buyer is very often not the user. The daughter in Shanghai buys the supplement, the joint support product or the home monitoring device for parents in Hunan. She researches on Xiaohongshu, she pays on Tmall or JD, and the parcel ships to another province.
Write your product page for her, not for them. We have seen brands lose a whole year because their Chinese copy addressed a 70 year old reader who was never going to see it. If seniors are your core market, the detailed picture is in our piece on how to enter China’s huge market for senior care.
Public insurance and centralised procurement: why your price collapses
1.331 billion people are covered by basic medical insurance, and the coverage rate has held at 95%. One payer of that size does not negotiate. It sets terms.
The mechanism is volume-based procurement, 集采 in Chinese. The state aggregates the demand of thousands of public hospitals into one national tender, then awards guaranteed volume to the lowest bidders. Since 2018, ten national rounds covered 435 drugs. The eleventh round, announced in November 2025 and rolling into hospitals from spring 2026, covered 55 more across anti-infectives, oncology, diabetes, blood pressure, lipids and pain. Prices do not fall by 10%. Originator products that sold for several hundred RMB a pack have come out of these rounds under RMB 100.
The same logic now applies to high-value medical consumables: stents, orthopedic implants, drug-coated balloons, urological devices. Six national rounds so far.
Here is what this means in practice for a foreign supplier. If your product has a Chinese equivalent that a regulator considers therapeutically comparable, you will be put in the same basket as that equivalent, and you will lose on price. Every time. There is no premium positioning inside a 集采 basket. The only escape is to be in a category where no comparable domestic product exists yet, or to sit outside the public reimbursement channel entirely.
Hospital purchasing reform changed who decides
Ten years ago a department head could push a purchase. That era is over. Public hospitals now buy through provincial online platforms, with published prices, and DRG payment reform means the hospital is paid a fixed amount per case type. Every extra item consumed on that case eats the hospital’s own margin.
So the question a Chinese hospital asks about your device is no longer “is it better”. It is “does it reduce my cost per case, my complication rate, or my length of stay, and can you prove it with data from a Chinese hospital”. Bring a European clinical file and a price list, you will be politely thanked. Bring a local pilot with a named Chinese hospital and a cost calculation, you get a meeting.
Private health and prevention: the part that is genuinely open
Everything above describes a closed system. Now the other side.
Chinese consumers pay out of pocket for a growing list of things the public system does not cover: health checks, supplements, sports nutrition, sleep, gut health, physiotherapy, dental, aesthetic medicine, mental health, weight management, home monitoring. Out-of-pocket spending is still 27.5% of total national health expenditure, which is a very large private pool by any standard.
The supplement side alone is worth roughly RMB 230 billion and grows in double digits. Online is now close to half of it, and imported products hold a share close to domestic ones in the e-commerce channel. Cross-border e-commerce matters enormously here, because a cross-border sale avoids the full domestic health food registration process. That single regulatory shortcut is why so many foreign supplement brands test China through Tmall Global or Douyin cross-border before they ever file a dossier.
The market has also shifted from treatment to prevention. Health literacy campaigns, workplace check-ups and the general “养生” culture push people toward products they buy before they are ill. That is a consumer marketing job, not a medical sales job, and foreign brands are usually much better at it than they think.
Digital health
China has more than 3,340 licensed internet hospitals. They handle over 100 million consultations a year, and CNNIC counted 418 million online healthcare users as of December 2024. Online consultation, e-prescription, pharmacy delivery and insurance settlement are progressively linked in the same flow. A patient in a second-tier city can consult a Beijing specialist, receive a prescription and get the medicine delivered the same day.
Artificial intelligence arrived fast. By early 2025, DeepSeek models were deployed in around 90 major tier-3 hospitals across more than twenty provinces, used for triage, report interpretation, documentation and research support. Ruijin, Zhongshan and Union Medical College Hospital released their own medical models.
This matters commercially for a reason most foreign companies miss. Chinese doctors, procurement officers and patients now ask DeepSeek and Doubao questions they used to type into Baidu. Those assistants answer from indexed Chinese-language content and cite sources. If your product has no Chinese-language technical documentation on a site the assistants can read, you are not in the answer. Not ranked low. Absent. We spend a growing share of our client work on exactly this: publishing structured Chinese content, with your Chinese brand name, in a form generative engines can quote. Two adjacent reads: AI in healthcare in China and the Chinese online pharmacy channel.
Where a foreign company can actually win
| Segment | Who pays | Realistic access for a foreign company |
|---|---|---|
| Generic drugs, common implants, stents | Public insurance via 集采 | Locked. You will be priced against domestic manufacturers and lose. |
| Innovative pharma with no local equivalent | Public insurance after NRDL negotiation | Open but slow. Expect heavy price concessions in exchange for volume. |
| Niche medical devices, rare specialties, high-end diagnostics | Tier-3 public and large private hospitals | Genuinely open. Domestic substitution has not reached these categories. |
| Rehabilitation, dental, ophthalmology, aesthetic equipment | Private clinics, out of pocket patients | Open and fast. Clinics buy from their own P&L. |
| Supplements, sports and clinical nutrition | Consumers | Open. Cross-border e-commerce first, domestic registration later. |
| Clinical training, protocols, certification, software | Hospitals and clinic chains | Underserved and undervalued. Often the best door into a hospital. |
| Hospital ownership and operation | Patients, private insurance | Newly open in nine pilot locations, with strict conditions. |
One line in that table deserves more attention than it gets: training. Chinese hospitals and private clinic chains are short of trained operators for anything new. A foreign company that arrives with a device and a certified training programme in Chinese is selling something a domestic competitor usually cannot copy quickly. It also creates the relationship before the purchase order.
Magnus, or why the public tender route almost killed a good product
Magnus runs a Swedish medtech company of about 90 people. Their product is a compression therapy system for lymphedema and post-surgical rehabilitation, sold with a consumables line. Solid clinical evidence, strong position in the Nordics and Germany.
He entered China in 2023 the way everyone advises: a national distributor, a booth at CMEF, translated brochures, and a target list of tier-3 public hospitals. Fourteen months later he had spent about RMB 2.1 million, lost two provincial tenders, and shipped zero recurring orders. The tenders were lost the same way both times. A Chinese manufacturer offered a functionally comparable device at roughly 40% less, and the hospital equipment committee had no budget line for a new imported item that did not shorten length of stay on any DRG case.
He also tried paid search on Baidu for eight months. It generated distributor enquiries, not hospital enquiries, and half of them wanted exclusive national rights on zero commitment.
What we changed was the buyer, not the message. We stopped targeting public hospitals and went after private rehabilitation hospitals and physiotherapy chains in Jiangsu, Zhejiang and Guangdong. Those clinics sell the therapy as a paid service at RMB 300 to 600 per session. For them the device is not a cost centre, it is revenue equipment, and they decide in weeks.
Three things did the work. First, a Chinese brand name registered as a trademark, so his product could be searched and cited consistently. Second, about forty pages of Chinese clinical protocol documentation and eleven therapist training videos, published on a Chinese-hosted site and structured so Baidu and the AI assistants could read and quote them. Third, a WeChat service account used as a private domain: every therapist trained was added, receiving protocol updates and consumable reorder links directly. Two of his Chinese therapists ran a Xiaohongshu account showing real sessions, which is where clinic owners actually look before they contact a supplier.
Eleven months after the pivot: 14 private clinics equipped, around 380 units of devices and consumables shipped, roughly RMB 5.2 million in revenue, and consumables now close to 40% of it, which is the recurring part that makes the business work. Two rehabilitation departments in public hospitals then came inbound, having found the protocol documents on their own. That is the sequence, private first, public later, and it is the opposite of what most European medtech boards want to hear.
Five rules to sell your health products or services in China
Web presence is not optional
Be careful to gain exposure for your products. Online and offline both matter here. There is not much business left in China that relies on a physical presence alone, and digitalisation touches almost every activity, so plan for several sales channels from the start.
Chinese buyers, consumer or professional, research before they purchase. They will look for you. In 2026 that search happens in four places: Baidu, Xiaohongshu, WeChat and an AI assistant. Xiaohongshu in particular has become a search engine for health and wellness questions, with long comment threads where real users compare products. A brand with no Chinese-language content in those four places does not look expensive. It looks nonexistent.
Manage and monitor your branding
Whoever talks about exposure has to talk about brand image. Every brand needs a trustworthy image to keep growing in this market. Brand reputation decides a great deal in China, because good and bad information both circulate fast on Chinese social platforms.
Chinese consumers weigh other users’ comments heavily and often follow their recommendations. It is how they check that a product is effective and safe. In health categories this is amplified: people trust a stranger’s three-month experience report over your clinical summary. Which is why KOC seeding, meaning many small authentic users rather than one big celebrity, works better in health than in almost any other category.
Connect your communication to Chinese health culture
Traditional Chinese medicine has always played a large role in this culture, and some consumers still doubt that foreign products suit Chinese bodies. That said, most middle-aged buyers accept foreign brands today, and part of the older group has moved toward them as well.
Brands still need to adapt their communication and product description to what Chinese people are used to. The cultural gap has narrowed, not closed, and consumers want reassurance in front of an unfamiliar product. Concretely: talk about the season, talk about 调理 and balance rather than only about active ingredients, and never position your product against traditional Chinese medicine. Position it alongside.
Follow the regulation, and check the current version
If you have a project in this industry, stay current with the National Medical Products Administration, the NMPA, which replaced the old CFDA. Rules here change faster than in Europe and old summaries circulate for years.
One example. The list of health claims a health food may make used to contain 27 functions. The 2023 catalogue cut it to 24, removing claims like improving growth and development, promoting lactation, and improving skin oil balance. If your Chinese label copy was drafted before that, it may be illegal now. The same formula can still only apply for a maximum of two health function claims. Advertising rules are stricter still: prescription drugs cannot be advertised to the public, and medical claims are heavily restricted in consumer advertising. Get your claims validated before you spend anything on media.
Put real information on your product
Chinese customers read ingredient lists closely, because counterfeits and low-quality health products have burned this market before. Show origin, batch, certification, manufacturing site. Publish it in Chinese, on your own pages, not only on the marketplace listing. For imported goods, the customs traceability of a cross-border parcel is itself a selling argument, and brands that explain it convert better than brands that do not.
For the medical device specifics, including registration classes and distributor structures, see our guide on the China medical equipment market.
FAQ
How big is China’s healthcare market, and is that figure useful to me?
National health expenditure was RMB 9,089.5 billion in 2024. It is a real number and a useless one for planning, because almost half of it flows through social health insurance into public hospitals buying at tendered prices. The figure you should size is your own addressable slice: out-of-pocket spending, which is 27.5% of the total, plus the private hospital and clinic segment. That is where a foreign supplier sets its own price.
Can a foreign company own a hospital or clinic in China now?
Yes, in nine pilot locations since late 2024: Beijing, Tianjin, Shanghai, Nanjing, Suzhou, Fuzhou, Guangzhou, Shenzhen and Hainan island. The hospital must be tier-3, general, specialty or rehabilitation. Traditional Chinese medicine, psychiatric and infectious disease hospitals are excluded, and you cannot acquire an existing public hospital. You must also bring management or medical technology the local system lacks. Realistically this suits established international hospital operators, not equipment suppliers.
Why did my price collapse when I started selling to Chinese public hospitals?
Because of volume-based procurement. The state pools demand from thousands of public hospitals into one tender and awards guaranteed volume to the lowest bidders. Ten national drug rounds covered 435 products between 2018 and 2025, and an eleventh added 55 more. High-value consumables follow the same path. If a Chinese product is judged comparable to yours, you compete on price alone and you lose. Either be in a category with no local equivalent, or sell outside the public channel.
Do I need Chinese-language content if my buyers are hospital doctors?
More than ever. Chinese doctors and procurement staff research in Chinese, on Baidu, on WeChat professional accounts, and increasingly by asking DeepSeek or Doubao. Those AI assistants build their answers from indexed Chinese-language sources. An English PDF hosted in Europe is invisible to all of them. Chinese clinical documentation, hosted on a fast-loading site accessible in China, is now baseline infrastructure, not a marketing extra.
Getting started
Gentlemen Marketing Agency works with health companies entering China: medical device makers, supplement and clinical nutrition brands, private clinics and health service operators. We handle the Chinese-language side of it, Baidu and Xiaohongshu search visibility, generative engine optimisation so AI assistants quote you, WeChat private domain for distributors and practitioners, and cross-border e-commerce when the product is consumer-facing.
We start by telling you which of the seven segments in the table above you are actually in. Sometimes the honest answer is that the public channel is closed to you and the private one is not. Contact us and we will look at your category before you spend money on it.
