As U.S. hospitals and health care providers continue to explore China’s market for international health care business opportunities, including telemedicine, they often consider providing services or products to consumers through partnerships with Chinese medical institutions and other entities. U.S. hospitals and health care providers should know how their services or products are being advertised and promoted by their China partners, particularly in light of proposed China rules regarding medical advertisements. Being aware of and addressing these specific issues in the contractual arrangements on the front end is a prudent decision.
The State Administration for Industry and Commerce of China solicited public comments between July 9, 2015 and August 1, 2015 on a draft version of the Management Measures on Medical Advertisement [关于《医疗广告管理办法（修订稿）》（征求意见稿）公开征求意见的公告] (“the Measures”). The draft Measures, if implemented in their current version, could significantly affect how medical advertisements – defined as “advertisements which use various media or forms directly or indirectly to introduce the medical institution or medical services” – are regulated in China.
Here are three highlights that may affect U.S. to China health care provider arrangements:
There are tremendous opportunities in offering medical services and products to China’s rapidly growing health care market. In anticipation of this growth, it is evident the Chinese government is developing a regulatory structure for medical advertisements to protect its people. This should not be viewed as a bar to U.S. hospitals and health care providers expanding their business in China, but is instead another reason to be cognizant of the China-specific rules when developing such business and negotiating and drafting related contracts. Taking steps early to develop proper contractual rights and obligations can best position both parties to harness these international opportunities.