21st Century Business Herald reporter Wu Bin reports from Shanghai
With the gradual development and growth of its economy, the Chinese animal health market is ushering in new opportunities for development.
Zoetis Executive Vice President, Chief Digital Technology Officer, China& Wafaa Mamilli, President of the Brazilian Market and Precision Medicine Business Group, recently stated in an interview with 21st Century Business Herald that the pet market in China is developing rapidly, with 75% of pet owners considering their pets as family members. In the past few years, the number of pets in China has grown rapidly, and currently China is the world's second-largest animal health market.
On the other hand, there are differences between the Chinese market and developed Western markets, and there is still a lot of room for growth. Wafaa Mamilli mentioned that currently, the proportion of pet owners taking their pets to hospitals for preventive treatment is not as high as in developed Western markets, and the prospects of the Chinese animal health market are broad.
In her opinion, the technological development speed of the animal health industry is very fast, and veterinarians need to constantly learn new knowledge and technology. She looks forward to the rapid improvement and development of veterinary education. The Shuoteng Foundation supports the joint training of Doctor of Veterinary Medicine (DVM) programs between China and the United States, providing a platform for outstanding Chinese students to access world-class veterinary education. In addition, more education and training are needed for pet owners to recognize the value of preventive techniques and treatments.
Shuoteng is a globally renowned animal health company, originally part of Pfizer's animal health division. It was independently listed on the New York Stock Exchange in February 2013.
What is the impact of economic headwinds?
With the slowdown in economic growth and fluctuations in consumer confidence, the growth rate of the pet industry has also declined, but overall resilience has been maintained.
Wafaa Mamilli mentioned that the slowdown in global economic growth will also lead to a decline in the development speed of the industry, but the pet industry has certain anti cyclical characteristics. The emotional connection between humans and pets is very strong. Even in times of economic challenges, pet owners still care for and nurture their pets like family, including their daily and medical expenses. Chinese consumers have a great demand for innovative products and services, with a strong growth rate in recent years.
For the future of the Chinese pet market, Mike Wang, Senior Vice President of Shuoteng International and General Manager of Greater China, told reporters that the number of pets and medical expenses determine the market prospects, and it is best when both indicators are growing rapidly. The slowdown in economic growth has had an impact on the growth of pet numbers, but from a medical perspective, China's current pet treatment rate is relatively low, and there is significant room for improvement compared to developed countries. At present, the pet medical market in China is mainly concentrated in three areas: sterilization, parasite prevention, and vaccination, and most of the time it is for puppies and kittens. The market potential for treating diseases in elderly pets has not been fully developed. So from this perspective, even if the growth of pet numbers slows down, the potential for medical expenditure growth is still enormous.
It is crucial to invest in innovation capabilities. Wafaa Mamilli stated that every year, Shuoteng invests approximately 7% of its revenue in product innovation and research, creating new therapeutic areas through significant investments, such as animal skin diseases, deworming drugs, osteoarthritis, and other fields in the global market. In the future, we are expected to introduce two products for treating osteoarthritis in dogs and cats in China, both of which are monoclonal antibody products. In addition to drugs, we have also invested heavily in diagnostic capabilities and have diagnostic laboratories in Shanghai and Beijing
The Chinese market is a key part of Shuoteng's global strategy. Wafaa Mamilli stated that Shuoteng has been operating globally for over 70 years and in China for almost 30 years. In China, we are not only committed to optimizing business operations, but also value investment in innovation and research and development. We hope to introduce more global innovation into the Chinese market.
Actively embracing the AI wave
Under the wave of AI, the animal health industry has benefited greatly. Wafaa Mamilli analyzed that AI will be applied in various fields, but it is necessary to first find the application areas where AI can be most efficient, pilot in these areas, and achieve results.
On the R&D side, under traditional conditions, it takes several years and hundreds of millions of dollars to launch a product into the market. AI can greatly shorten the R&D cycle and improve R&D efficiency. On the production side, AI can also improve efficiency and output, predict whether a batch of products meets quality standards, and avoid unnecessary investment and waste. On the sales side, it is possible to better predict market demand and match inventory with supply. In the business field, AI systems can be used to find the next most promising customer to complete a transaction.
On the diagnostic side, AI has played a very important role. For example, all you need to do is take relevant medical imaging photos of your pet, upload them to the cloud, and the results can be obtained in 15 minutes, unlike in the past where it took only a few tens of days to obtain results, greatly improving efficiency. In addition, the application of AI will profoundly change communication methods and reduce communication costs.
Although AI will profoundly change the animal health industry, Wafaa Mamilli also reminds that AI is a double-edged sword. We need to ensure that every employee applies AI technology in a compliant and ethical manner, and hope that AI systems empower every employee to improve their work efficiency.