‘China’s Hawaii’ pushed as medical tourism hot spot
On the hilly tropical island of Hainan, local officials and companies are investing billions of dollars to transform a string of riverside villages into a medical tourism destination.
Their aim? To lure wealthy Chinese patients, who might otherwise venture overseas, to this province in the South China Sea known for its beachfront resorts. To do so they are making an unusual promise: The hub will bring in cutting-edge treatments that are available abroad for diseases such as cancer, but don’t yet have regulatory approval in China.
There’s plenty of demand. The travel site Ctrip.com estimates about half a million Chinese travelled abroad for medical services last year. Millions are dying from cancer and heart disease, but regulatory bottlenecks have slowed approvals for the newest international therapies. Chinese hospitals are overflowing, and affluent jet-setters prefer Japan for physical check-ups or the United States for genetic screening.
In 2013, the provincial government of Hainan, often known as “China’s Hawaii”, earmarked more than 1,600 acres of fertile farmland along a river flowing to its eastern coast for a medical tourism hub. Since then fishing villages and rice paddies are slowly being replaced by palm-tree-flanked driveways. The zone’s first hospitals will begin opening their doors in another month or two, the effective beginning of this medical experiment.
Local officials say businesses have already committed to spending 23 billion yuan (US$3.3 billion) for 27 projects ranging from hospitals to plastic surgery clinics, with dozens more awaiting approval. The mission is partly to “retain domestic consumption”, the government body managing the Hainan Boao Lecheng International Medical Tourism Pilot Zone said in e-mailed comments.
Among the investors are Beijing-based Ciming Health Checkup Management Group and the Guangzhou-based medical services firm Evergrande Health Industry Group Ltd, which is being advised by Boston’s Brigham and Women’s Hospital, which is affiliated with Harvard Medical School.
In an early example, the zone’s Chengmei International Health Center imported 24 vials of the Merck cancer drug Keytruda for six patients under the special access channel last October, the government said.
The medicine is approved in the US and elsewhere, but remains unavailable in China. The special permits issued by the Chinese regulator only allow for a small amount of the drug to be used in the tourism hub, and it cannot be distributed elsewhere.
Merck said in a statement that it was conducting clinical trials on Keytruda in China and did not sell the drug in the country. The China Food and Drug Administration and Chengmei did not respond to requests for comment.
By 2025, the hub’s managers want to draw more than one million tourists a year on health-related visits.
Still, China has a patchy record of managing specialised economic zones. Centres such as Shenzhen, the fishing-village-turned metropolis, have thrived. But others have had a quick boom and bust, such as the Caofeidian industrial zone in the northeast, which ended up as a ghost town.
The Hainan medical hub’s relatively remote location and the country’s shortage of qualified doctors make it harder to draw patients. Competition for medical resources is fierce, said Chen Bo, associate partner at consultancy McKinsey & Co.
“Building health-care capabilities there will require attracting excellent talent to work and live in the pilot zone, and good doctors are already badly needed in China’s major cities,” said Chen.
On a recent visit, the area still had the feel of an underdeveloped backwater, showing the challenges to transforming it into a flourishing tourist centre. It is dotted with semi-finished hospitals that remain under construction, without medical equipment inside and with prefabricated homes outside for construction workers. By the end of March, five facilities had begun operating on a trial basis, local officials said.
Evergrande has said it plans to spend 5 billion yuan on its cancer hospital in tyhe zone. Brigham and Women’s hospital in an e-mailed statement said it was serving as a strategic adviser as Evergrande expands its health-care network in China, helping the development of clinical programmes and other aspects including training.
Working with international partners has shown that local staffing tends to be the most effective, and Boao Evergrande International Hospital clinicians will be providing all patient care at that facility, Brigham said.
The hospital is scheduled to start operating by the end of June, according to a press release on Evergrande’s website. In late March, balloons and banners adorned the front gate to celebrate a soft launch, but a quick glance inside the bronze-coloured building from a back entrance showed dark rooms with bare concrete walls, unpacked crates and cement piles.
Off the main street, behind the hospital pilot zone, was a side road yet to be paved, with plywood and empty barrels of asphalt scattered around.
Evergrande did not respond to a request for comment on the new facility.
Li Peijuan, an analyst at Forward Industries Institute, a Chinese research firm, said the area could benefit from Hainan’s environmental beauty, but the quality of service, the standard of medical technology as well as costs will ultimately be key to its success.
Foreign medicines have in the past taken longer to reach China partly because its regulatory agency has been understaffed and has struggled to shepherd surging numbers of drug applications through its complex review process.
The China Food and Drug Administration is now in the midst of dramatic reforms to its approval system to reduce the “drug lag” on the mainland. If that succeeds, Hainan will need to find other selling points.
“It was very appealing a few years back when approval of innovative drugs was relatively slow, but if the pilot zone can’t build fully fledged medical teams and business models in the next two to three years, its attractiveness will be greatly weakened,” said McKinsey’s Chen.