Covidien Deepens Investment in China With Shanghai R&D Center

Covidien’s China strategy took a leap forward today with the opening of a new R&D facility in Shanghai.

The company’s China Technology Center will focus on designing products specifically for China and other emerging markets as well as developing local talent.

“We are dedicated to improving patient outcomes, and we recognize the immense potential of basing an R&D facility in Shanghai,” Dong Wu, Covidien’s vice president of China R&D, said in a statement. “This location will help us tap into internationally renowned experts based here in China, including world-class engineering talent.”

The 100,000-sq-ft facility, which will eventually have 300 employees, features 17 laboratories and surgical and simulation suites. The project will cost the company $45 million over three years.

The R&D center is not Covidien’s first investment in China. The company already has 10 commercial offices, a manufacturing plant, and training facilities for healthcare providers in the country. It also has partnerships with Chinese universities and has aligned itself with the healthcare priorities laid out in the country’s 12th Five-Year Plan, which include developing healthcare infrastructure.

“China is a key market in our global strategy, and this investment is a reflection of our strategic initiatives,” José E. Almeida, chairman, president, and CEO of Covidien, said in a statement.

In the company’s Q3 earnings call, Almeida said Covidien experienced 25–30% growth in some of the BRICs countries, led by China.

“China is growing exceptionally well, our deployment of our growth plan there including the infrastructure,” Almeida said on the call. “But also the sales force and how we are understanding the market and how we are penetrating several different facets of the market has been great for Covidien.”

Covidien makes medical devices for markets including vascular, soft-tissue repair, and respiratory.

—Jamie Hartford is the associate editor of MD+DI. Follow her on Twitter @readMED.