Johnson & Johnson, the first in China

From a "cost advantage" to an "innovation hub," China's market role in multinational enterprises is undergoing a transformation.

#01

The first in China

Johnson & Johnson's China Innovation Center will be located in Beijing

Today (July 14), Johnson & Johnson Medical (China) Ltd. and the Beijing Municipal Health Commission jointly announced a strategic cooperation, signing a memorandum of understanding to establish the Johnson & Johnson China Innovation Center (hereinafter referred to as the "Innovation Center") in Beijing.

The Innovation Center is the first integrated "industry-academia-research-application" enabling platform by Johnson & Johnson Medical (China) Ltd. in China. It will focus on three strategic areas: digital healthcare innovation, professional talent incubation, and clinical applications in electrophysiology, accelerating the integration and synergy between global resources and Chinese innovation.

"This collaboration marks another significant milestone in upgrading Johnson & Johnson's global innovation strategy in China, further demonstrating our long-term commitment to China's healthcare system," said Min Tao Chou, President of Johnson & Johnson Medical (China) Ltd. "Beijing brings together top-tier clinical resources, strong scientific research capabilities, and an open policy environment, offering ideal conditions for medtech innovation. We look forward to leveraging the Johnson & Johnson MedTech China Innovation Center to connect global research and industrial capabilities with China's clinical expertise, creating mutual empowerment and enabling the next generation of medical technology solutions to benefit more patients in China."

The Innovation Center will comprehensively upgrade the Johnson & Johnson China Academic Center, while establishing the Johnson & Johnson China Digital Innovation Center and the Global Electrophysiology Applications and Training Center.

Since 2005, Johnson & Johnson has established the Johnson & Johnson China Academic Center in China. Johnson & Johnson stated that this latest upgrade will focus on meeting future healthcare training needs by enhancing training programs and facilities, adding specialized training centers in areas such as natural orifice robotic surgery, heart failure management, and structural heart interventions. The Johnson & Johnson China Digital Innovation Center will prioritize the development of cutting-edge medical technologies, including artificial intelligence, smart surgery, and digital diagnostic and therapeutic support. The Global Electrophysiology Applications and Training Center is the first professional research and training center established by Johnson & Johnson Medical (China) Ltd. dedicated to the electrophysiology field in China. Based in Beijing, the center will serve nearly a thousand medical institutions nationwide.

02

Introduce multiple high-end product lines

Multinational medical device companies upgrade localization strategies comprehensively

With the rapid development of the economy and society, China has established new locational advantages for multinational enterprises to develop and invest in the country. China not only possesses a vast market, but also has a complete industrial chain and supply chain system, and modern infrastructure construction provides great convenience for foreign investment.

Coupled with a comprehensive upgrade of talent resources and a globally leading digital economy, simple technology transfer no longer suits local market development, as China's market shifts from a "cost advantage" to an "innovation hub."

In the medical device field, domestic products have largely replaced imported ones in the mid-to-lower end segments, while domestic companies are rapidly advancing into the high-end segment. Under this new competitive environment, multinational companies are gradually accelerating their R&D and innovation investments in China.

According to the magazine "People's Tribune," since 2020, the growth rate of foreign investment in research and development has rebounded to around 10%, indicating an increasing trend of localization of R&D by foreign capital.

Recently, Johnson & Johnson Medical (China) Ltd. announced the launch of a production capacity upgrade project at its Surgical Factory in the Suzhou Industrial Park, planning to relocate the entire stapler production line previously located on Xingpu Road in Suzhou Industrial Park to the company's new medical technology industrial park on Changyang Street, upgrading it into an intelligent manufacturing cluster and supply chain base.

In 2019, Johnson & Johnson Medical (China) Ltd. officially opened its Surgical Manufacturing Facility in Suzhou. Over the past six years, the facility has gradually built a diversified production system—starting with the first suturing device production line, followed by the introduction of high-end product lines such as sutures and ultrasonic surgical devices, enabling rapid response to China's market demands through accelerated localization. Relocating the suturing device production line to the Suzhou Industrial Park represents a key step for Johnson & Johnson Medical's surgical facility in integrating resources and advancing capabilities.

GE Healthcare is also making strides in the high-end segment of the Chinese market. Recently, the first phase of GE Healthcare's Precision Medicine Industrialization Base in China, located in Chengdu Tianfu International Bio-City, successfully passed the final joint inspection upon completion, marking the official establishment and commissioning of its first precision medicine high-end equipment industrialization base in western China.

The project's initial phase focuses on the domestic production of cyclotrons, a critical piece of equipment in nuclear medicine, marking a key step in its comprehensive localization strategy following its independent listing in 2023.

Medtronic has also established an innovation hub in Beijing. Located in the Beijing Economic-Technological Development Area, the International Medical Innovation Park (Biopark) serves as Medtronic's digital healthcare innovation base. It will act as a super hub connecting Medtronic's global R&D capabilities with its ecosystem partners in China.

In June, Philips (China) Investment Co., Ltd. signed memorandums of cooperation with domestic companies including Qianglian Zhichuang and Peixin Technology, initiating in-depth collaboration in areas such as the construction of AI-enabled interventional therapy ecosystem platforms.

In response to the evolving market conditions in China, multinational medical device companies need to be fast enough to meet Chinese demands. "Relocating R&D centers to China" has become a common strategy among these companies, shifting from manufacturing to innovation as China's lever to influence the world, with local R&D serving global needs.