According to a research report published by the Central Policy Unit of the Government of the HKSAR on Smart City in late 20151, Smart Living – Healthcare was listed as one of the six major components in the whole development blueprint for Smart City. Also, the trend of aging population and increasing health consciousness have boosted the global demand for various medical and healthcare devices, and HKSAR Government has addressed this trend and the needs on healthy aging in many occasions. According to the latest announcement published by the China Government in Feb 20172, more emphasis will be placed on the development of products suited for aging population in the areas of wearable devices, treatment of chronic disease, rehabilitation devices, emergency devices, communication devices, etc. Among them, the global smart medical devices market was valued at US$33.7 billion in 2015, and it is estimated to be valued at US$66.1 billion by end of 20243. With this foreseeable market trend, many high technologies local companies are now focusing on the development of innovative smart medical and healthcare products for healthy ageing.

 

In general, smart medical and healthcare devices are the medical and healthcare devices that can connected to the internet and be able to identify themselves to other devices, such that these smart devices are aware of their context, and can communicate and assimilate information to facilitate healthcare decisions.4 Such intelligence and communication heavily rely on the advanced hardware (such as sensors, microprocessors, integrated circuits (ICs), actuators which are mostly electronic-based, etc.), as well as algorithm for signal acquisition and processing. The increased demand for smart medical and healthcare devices will require more specialised electronics components, such as sensors, actuators, LCD monitors, integrated circuit (IC), printed circuit board (PCB), etc., which account for a huge amount of business for electronics industry (providers of such components cover around 70% of the whole Hong Kong electronics components industry).

 

Hong Kong’s electronics industry is the largest merchandise export earner of the territory, accounting for 65.5% of Hong Kong’s total exports in 2016. Parts and components constitute about three quarters of Hong Kong’s electronics exports5. With cut-throat price competition and accelerating number of market competitors from the Mainland, Taiwan, and Singapore in the traditional electronics industry, local electronics industry are now facing great challenges in maintaining their business on the market of traditional electronics products (e.g. toys, computers, mobile phones, cameras, washing machines and TV, etc.). With foreseeable huge market opportunity on smart medical and healthcare devices, local electronics industry has great interest and very eager to enter the high-value added smart medical device and healthcare device industry, for sustaining their current business in the long run. However, even though with the extensive knowledge and experience on electronics development, local electronics companies are still finding difficulties in stepping into smart medical and healthcare device industry with the greatest entry barrier on the compliance of medical device Quality Management System (QMS) and stringent international market entry requirements.

 

Traditional electronics manufacturing processes include PCB production, mounting of components onto the PCB with Surface Mount Technology (SMT)6, microcontroller programming7, sputtering deposition for LCD8 production, etc., any discrepancy during these critical processes may lead to serious defects to the final medical and healthcare devices such as malfunctioning and inaccuracy data generation. Therefore, comprehensive control (validation and testing) to these manufacturing processes would be crucial to the safety and effectiveness to the smart medical and healthcare devices. Due to the requirements on stringent supplier management for ensuring the supply of qualified medical devices, even though it is not mandatory for component suppliers of smart medical and healthcare devices to comply with any quality standards, it has become a common trade practice for smart medical and healthcare devices manufacturers to select those who have obtained certification on quality standard for medical devices, especially with the newly released standard requirements on risk management for supplier (e.g. ISO 13485*, 21 CFR 820#, etc.). Component suppliers will be considered as qualified suppliers only after they have met the requirements of the medical device quality management. As such, the electronics component manufacturers will need to upgrade their existing QMS (e.g. ISO9001) to more stringent level which can fulfil the requirements of relevant international requirements. Since US and EU are the largest markets for medical and healthcare devices9, ISO 13485 (which is adopted as a harmonized standard for Quality Management System in EU and formally recognised under the Conformity Assessment Standards Order in Australia as a standard for the manufacture of all kinds of medical devices that require a quality management system for conformity assessment) and 21 CFR 820 (Quality System Regulation) for US are the two major requirements on QMS by manufacturers of medical and healthcare devices.

 

For medical device manufacturing, traceability, design and manufacturing validation, risk management, process verification and validation, supplier management, compliance testing are some critical elements for ensuring the final medical devices are safe and effective. However, these requirements are not common in traditional electronics business, which pose a great obstacle for local electronics SMEs to upgrade their current QMS to ensure the quality of the products. Without the capability to carry out process control as required by Quality Management System, it will be difficult for local electronic component manufacturers to step into the smart medical and healthcare device industry. Currently local electronics SMEs can engage consultancy for upgrading their QMS, but the cost for such upgrading is very high and local SMEs need a considerable amount of time to understand the process and to establish their new QMS.
 

Due to the difficulties, The Hong Kong Electronic Industries Association (HKEIA) has received various feedback from the industry on the needs to assist and guide them to minimize the aforementioned gaps for their future entry to high-value added smart medical and healthcare device market. As such, HKEIA proposes to provide guidance for local electronics industry on upgrading their QMS. With the help of this project, it is expected that the cost for upgrading the Hong Kong electronics industry through this project can be greatly reduced. Upon the completion of this project, it is expected that the local electronics industry will be able to enhance their competence in performing process and quality control on their products. With such capability and compliance owned by the electronics companies, they will be able to be selected by smart medical and healthcare devices companies, and gain confidence from their buyers (finished products manufacturers) to start business on supplying components with good quality, and thus, allowing them to capture the high potential smart medical and healthcare devices components market.