Medical equipment is our long-term focus and the key investment direction in the future. Since it is the key direction, we must be clear about the characteristics of this sub-industry. Only when we know what we are doing can we not panic in the process of investment. Freely, and obtain good investment income.

The first feature of the medical device industry is long cycle.

In the entire medical device field, the performance of devices continues to improve over time, showing a spiral increase. In other words, companies can often continue to benefit from time and technology accumulation. No device was born out of nowhere, it was developed to its present appearance after a long period of accumulation and improvement, and the life cycle of the device is relatively long, unlike the consumption of medicine, the device is reused. During this period, factory personnel will have long-term transactions and communication with doctors, and even the use of some equipment is completed by the manufacturer’s assistant doctors, which makes doctors and equipment manufacturers form a cooperative relationship.

The second feature is that the device is more viscous and will not be easily replaced.

Once the hospital has determined to use a certain company’s product, it is in consideration of the stability and reliability of the device, especially for the consideration of usage habits. It is generally not easy to change the new brand. After the new brand is changed, the doctor It takes a long time to learn how to use the new device, which will increase the doctor's time cost, so the device will not be easily replaced. When we go to the hospital, we often see that some instruments, such as monitors, ventilators, defibrillators, operating beds, etc., have been a brand for almost many years. This shows to a certain extent that the medical device industry is due to the characteristics of medical instruments and The stickiness and other requirements of hospitals often have a long service life and are not subject to time constraints such as seasons. This is very consistent with the stock selection conditions of value investment.

The third feature is high industry barriers.

A medical device often requires numerous processes and parts to complete. For example, after the outbreak of the "COVID-19" this year, the global demand for "invasive ventilators" exploded, but why can't manufacturers meet the needs of the market? This is because a medical ventilator requires multiple skilled engineers to assemble, and thousands of parts need to be collected from multiple places around the world. Therefore, medical equipment is an industry that can only be completed by multi-faceted collaboration. With the launch of new products and the use of hospitals, manufacturers continue to upgrade and improve products through patient feedback. The longer the time, the more stable and advanced the performance of the product, and latecomers are often difficult to surpass.

It is precisely because of these characteristics that medical devices have become our focus of attention.