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September 14, 2016

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Thermo Fisher taking the lead in precision medicine and diving deep in Chinese market

IN August, when the Chinese police captured the nation’s “Jack the Ripper” with the help of gene detection technology, the world’s largest supplier of laboratory products and services Thermo Fisher Scientific Inc, hit the headlines.

The chromosomes analytic technique enabled the police to catch the murderer without having his DNA sample, as DNA taken from his uncle was enough to nail him.

It was realized with the help of Thermo Fisher’s gene detection technology, which can track families related to someone by analyzing his DNA. The analysis only takes a few days as Thermo Fisher’s genome sequencing machines can generate high quality data.

Thermo Fisher specializes in analytical technologies used for gene sequencing, food inspection, pollution detection, some laboratory tests and so forth.

It is sustainably growing every year, both in terms of profit and market share, with revenues of US$17 billion and approximately 50,000 employees in 50 countries in 2015. Annual research and development outlays have increased from US$300 million to more than US$700 million.

In particular, it has also been putting emphasis on China.

Last year, Thermo Fisher earned US$1.4 billion in the Chinese market alone, which was about 8 percent of its total revenue. China is its second largest market after the United States, where it forecast a double-digit growth this year.

With genome analyzing technology, Thermo Fisher is of great help to medical researchers involved in studying diseases such as cancer based on gene sequencing. Last year, there were 4.3 million new cancer cases and more than 2.8 million deaths linked to cancer in China.

Recent studies, for example, have verified that several types of genetic mutations occur in some fixed genes that incur diseases and help patients treat diseases once the symptoms appear.

This allows people to take precautions once these genes are detected on them, figuring out targeted therapy plans.

The company might bring technologies on precision medicine to China at the right time.

Included in China’s 13th Five-Year Plan (2016-2020), precision medicine is predicted to be the next big thing as China moves to upgrade the health care landscape. By 2030, the industry expects investments to soar to about 60 billion yuan (US$9 billion).

Relevant institutions have responded actively, by forming alliances with industrial key leaders such as Thermo Fisher.

Thermo Fisher has launched collaborations, being dedicating to build up an ecosystem of precision medicine in China,with Fu Wai Hospital in Beijing, West China Hospital in Sichuan Province and The First Affiliated Hospital, Sun Yat-sen University in the south.

Thermo Fisher’s technologies are helping partnered hospitals in China to upgrade its area of specialties.

An official with Fu Wai Hospital said the collaboration would help them to develop further on curing genetic cardiovascular diseases as it would enable them to prevent patients from heart disease-related genetic mutations.

Assisted by Thermo Fisher’s genetic testing machine, doctors from Fu Wai Hospital found out the genetic cause of three members of a family in Hunan Province who had difficulty in breathing due to funnel bosom. The test also helped find out the gene carrier, thus ensuring the disease is not passed on to the next generation.

Despite being a leader in life science industry and health care, Thermo Fisher’s competitive advantage is also shown in quantitative analytical technologies.

China is now consuming almost half of the antibiotics available in the global market, totaling 162,000 tons annually in 2013 alone, according to a report by the Chinese Academy of Sciences. This puts an irreversible threat on the public health.

Based on spectrum analytical technology, the company can detect antibiotics, nitrite and other toxic ingredients in food. Thermo Fisher is undoubtedly a participator in China’s “guardian war” on food safety.

In June this year, Chinese Premier Li Keqiang said there would be “zero tolerance” over food safety issues.

Policies revolving Li’s core messages have put pressures on local governments and enterprises, also bringing out opportunities.

For example, Shandong Province, known for its fruits and vegetables, is turning to technology in the agriculture sector. The Food and Drug Administration of this province signed a Memorandum of Understanding with Thermo Fisher to use its food detective instruments and groom technicians on the world’s leading technologies.

In addition, recently it released a portable detector on water pollution that allows its customers to control the oxidizable contaminants in wastewater treatment process.

Thermo Fisher will be the trainer of the technicians.

One of the reasons for its successful growth in China is its training system, which has been welcomed by both local hospitals and governments.

In June, the Beijing Industrial Technician Institute set up a collaborative laboratory with Thermo Fisher, where the latter helps train technicians of this institute on advanced genetic analytical skills.

The two companies have been “loyal” partners since 2007.

However, “that’s how we work with every client,” Gianluca Pettiti, President of Thermo Fisher Scientific China, said.

“Every time we establish collaboration, people who use our tools are free to use our training centers.

“Our training centers have educated thousands of customers in Shanghai, Beijing and Guangzhou.”

Apart from building equipment centers for customers, Thermo Fisher has also established laboratories in China, where customers can experience various instruments and have access to the most advanced technologies.

In China, Thermo Fisher has close to 4,000 employees and many of them are technical support and technical sales professionals, who help customers to get used to the equipment and acquire the basic analytical skills.

Such attitude is entrenched in its corporate gene. Historically, Thermo Fisher is a company that continuously learnt from acquisitions. For example, in 2013, Thermo Fisher bought Life Technologies in a US$13.6 billion deal, accelerating its pace to be among the top tier of health care industry.

According to Pettiti, the deal enriched Thermo Fisher’s health care knowledge.

This year, it merged with two other companies specializing in DNA micro-arrays and electron microscopes, further accelerating its business in the healthcare sector.

Working with the Chinese Center for Disease Control, Thermo Fisher is building a cloud center in China that is helping patients to find proper therapies more quickly. Medical professionals can use the large database to research on diseases and acquire knowledge needed to cure patients.

Every time Thermo Fisher acquired a company, it took in new technologies while upgrading itself by systematic knowledge sharing.

“We value the knowledge shared with those merged companies and also get familiar with the needs of relevant customers,” Pettiti said.

“We cannot exclude the possibility that we might buy some leading China-based companies,” he added.

Sharing with customers is the first step to penetrate into the huge Chinese market.

Gene sequencing or genetic analyzing technologies is new here, and China desperately requires trained and skilled workers in the relatively new sector.

Training people should be the best way to engage them, and another way to get familiar with the customers’ needs in this country.

The US giant is a leading player as China digitizes the health care industry, food safety and even social issues such as criminal detection. It is investing in both productivity and quality, and giving shape to things to come.


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