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Analysis EO
Jul 12, 2020 10:52 am ·

Top 10 Market Cap Chinese Medical Device Companies: Champions and Runners-Up

► Top 10 Chinese medical device companies are selected by market capital. ► Mindray Medical has the highest market cap but is too big to keep R&D-driven. The Chinese A-share market is experiencing a boom, with a record deal value amount at over CNY 1.5 trillion within four trading days. This craze surely has a powerful impact on the medical devices field – a fast-growing business. The medical device industry in China sped up only in recent years due to substantial capital injections, advanced technologies and supportive policies. The current premature stage indicates much potential for growth soon and the exciting emergence of new high-tech companies. A glance at top 10 Chinese medical devices by market cap Here, the top 10 Chinese medical device companies are mentioned, to provide a brief look into local benchmarks in the industry. Some companies have been steadily operating for over 20 years and are recently moving into a new growth stage or reorienting in unprecedented directions due to fierce market competition. Some younger companies have quickly found their value position by advanced resource-upgrading throughout the industry chain. Among the ten companies, there are two clinical medical equipment companies, three high-value medical device providers (such as heart stents, orthopedics implants and ophthalmology), four IVD manufacturers and only one in the home-use medical device area. Based on a general overview of the top ten companies, some companies stand out from the rest. Besides Mindray (300760:SZ), which has the highest market cap, Yuyue Medical (002223:SZ) at 10th position is the only listed home-use medical device company in the top-ten market cap rank.    Mindray: too big to sprint Mindray, the champion company, stands at the top position with an unbeatable valuation of over CNY 380 billion. As suggested by EqualOcean’s fundamental analysis, the company has come this far through frequent acquisitions and strengthening regional distribution channels. The conglomerate provides equipment in life information and support, IVD (in vitro diagnosis) and medical imaging. These three major businesses have been hot picks since the outbreak of COVID-19. However, the conglomerate relies more on the robust R&D foundation and strong global selling network.  When a company gets bigger, the slower the giant grows – an aspect especially indicated by the R&D efficiency. Yuyue: keeping agile in the C-end selling Even though Yuyue medical is ranked 10th in the top ten list, it is the champion company in the home-use medical device segment. One advantage for companies in this segment is that they have more flexibility in selling strategies because they provide end consumers with small medical gadgets, from sphygmomanometers to glucose meters, massage devices, etc. As a previous EqualOcean analysis said, they can not only invest in developing their technology (R & D) but also seek a new growth direction as they shift to a more efficient selling strategy. This is exactly what Yuyue has been trying and will continue to try in the near future. The COVID-19 crisis has created a mania for home healthcare. Yuyue has spared no effort in utilizing this trend. It has been cooperating with the two most prominent e-commerce platforms in China,  Taobao and JD.com. Now the online vendor has an over 1.13 million followers on the Taobao platform alone, with an over 480 thousand sales record of one single SKU (Stock Keeping Unit) – a household digital manometer.

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Mar 5, 2020 11:41 am ·

Open Source, Open Mind: Baidu and LinkingMed Help Doctors in Medical Images

LinkingMed has launched its AI-based detection model for pneumonia CT-screening and prediction based on the Baidu’s PaddlePaddle (Parallel Distributed Deep Learning), EqualOcean learned from the medical imaging firm. A Hunan-based hospital affiliated to Xiangnan University became the first medical institution to use the system. This AI-equipped diagnosis system can detect and contour the lesion, picture the diagrams of the density of the two hemisphere lungs, and visualize a series of quantitative benchmarks such as quantity and volume percentage. All these tasks can be completed within less than one minute, with an accuracy rate of  92% - 97%, LinkingMed claims. So far, LinkingMed has not initiated any commercial plans for this AI-based pneumonia detection system. “The motivation to launch this AI medical diagnosis model is only to help fight against the spread of coronavirus,” Mr. Ryan Zhang, the CEO of LinkingMed, said. “We will unconditionally contribute our AI power to containing this plague, as much as we can,” he added. The high-tech medical solution provider focused on solving the compatibility issue with different types of scanning equipment by cooperating with research entities. At the development stage of the algorithm used by the system, the Xiangnan University-affiliated hospital provided professional clinical instructions regarding the data annotation, module design and set strict acceptance criteria to satisfy various medical conditions. This online AI screening system will be deployed at multiple hospitals in Hubei, Chengdu, and other severely-affected areas. Founded in 2016, LinkingMed is an AI technology enterprise in the field of oncological radiation therapy. The Beijing-based medical high-tech company sells techniques and cloud services related to the organic contour, target contour, and radiotherapy to medical institutions. By leveraging the internet and cloud platforms, it also provides remote collaboration and relevant website services for oncological doctors and physicists. During the past four years, LinkingMed has received d four funding rounds, including the recent one worth CNY 40 million in October 2019. Linear Venture is the serial investor for LinkingMed from Series Pre-A finance to the last Series A finance. Medical imaging is a niche business given lightweight and comparably less attention as Chinese medical device makers are promoting their ‘globally competitive’ strategy. Now this area is increasingly highlighted, as the novel coronavirus continues to spread and consumes a lot of medical facilities and doctors across China. The domestic high-tech medical device market rose in 2016, a fierce tussle participated by United Imaging (联影医疗), Huiyihuiying (汇医慧影) and VoxelCloud (体素科技). Most players use essentially indifferent AI technology while base the competency on different sources. These providers still need to consider some fundamental issues to apply AI in daily life. The first is developing the algorithm for the specific problem, for instance, coronavirus event. The other is high-quality data annotation, which takes time and hard work. Additionally, the lack of industry standards, quality protocols, and practice guidelines stand as the major problems ahead of the industry. For patients, time is life. CT imaging plays a critical role in identifying the infected patients, serving as a surrogate to PCR (polymerase chain reaction) diagnostic, according to a previous report. In the Huoshenshan (‘Fire God Mountain) hospital, one of the frontline hospitals, the CT lung screening by InferVision (推想科技) helped with the lab’s capacity as the number of suspected cases rose quickly.  To facilitate the detection process and guarantee the test results, LinkingMed incorporated the AI learning framework into the CT imaging process by utilizing Baidu’s PaddlePaddle. Injected with the AI’s deep-learning power, this open-source online diagnosis model can improve the efficiency and ease the pressure on the clinical doctors.  Before 2020, ‘Artificial Intelligence’ was a buzz word. Now, the outbreak of coronavirus is pushing many key industries to accelerate their AI processes, especially, in the urgent demand for medical facilities. The epidemic has forced Ali Health (阿里健康), Yitu Technology (依图科技), Huawei (华为), Deep Wise (深睿医疗), and other tech companies to introduce their AI-equipped diagnostics, in different aspects, aligning a joint wholistic force to ease the infection.  The PaddlePaddle of Baidu is an open-source deep-learning Chinese platform for industrial applications. Similar to Google’s TensorFlow, PaddlePaddle comprises core learning-framework, model bank, development tool kits, and online services supporting over 1.5 million developers in businesses.  The option to cooperate with PaddlePaddle also indicates LinkingMed’s motivation for its AI diagnostic system. “To curtail the current tension in Korea, Iran, and Japan, we want to provide technical support through Baidu’s platform for international medical institutions and developers,” says Mr. Zhang, “We also will keep an open mind to work with different medical entities, including online healthcare. The goal is to inject technology, whilst fulfilling our social responsibilities. ”

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Mar 4, 2020 12:00 am · 36Kr

Inventory of giants in pharmaceutical investment layout

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Mar 1, 2020 11:32 pm ·

Restarting Office Hour: BGI Genomics Helps China Resume Work

As the disease outbreak is being stabilized, many companies are recovering daily operations and production nationwide. BGI Genomics (300676: SH), as the manufacturer of Covid-19 diagnostic kits, not only offers a free test service for its employees before allowing them to return to the office but also provides a one-stop Covid-19 examination plan for enterprises. Since its diagnostic products were approved by the National Medical Products Administration (NMPA), the Shenzhen-based bio-company completed 215 thousand coronavirus tests as of February 24. As the authorized institution for detecting this virus, BGI Genomics helped facilitate the upgrading of the diagnostic process from the initial 16 hours to three hours, by its real-time fluorescent RT-PCR (reverse transcription-polymerase chain reaction) technology In the race of diagnostics distribution To detect the virus, the nucleic diagnosis, compared to protein diagnosis, can be developed within a shorter time at a lower cost. This nuclei-based method first extracts the RNA from the patient sample, and lets it go through RT-PCR before enlarging and signaling the virus information attached to the sample. BGI’s one-stop checkup plan for business introduces two sampling methods: on-door sampling service and self-sampling, both non-invasive and no-blood. On its WeChat account, it published a short video to explain the detailed procedure in the case of self-sampling within just five steps. According to Nature Biotechnology, there are 13 selected diagnostic tests for Covid-19 across China, U.S. and Europe (mostly Germany), with 10 available listed below . These test developers include national research labs and commercial entities at different stage, with six from China’s mainland and Hong Kong region. Compared to the mature application of assays in China, kit providers in the U.S. are either applying for the FDA’s approval (such as Novacyt Primerdesign), or only for research use (Biomeme or Thermo Fisher Scientific) Huo-Yan Laboratory: the key to diagnosis Huo-Yan Laboratory is a diagnosis lab named after the Golden Eyes of Sun Wukong (from ancient Chinese literature, the Journey to the West). In the frontline of the epidemic, it plays a crucial role in discerning suspect cases, aligning with other strategic establishments, such as Leishenshan (Thunder God Mountain) and Huoshenshan (Fire God Mountain) hospitals and mobile cabin hospitals. This laboratory is equipped with BGI’s automatic machine for sample preparation, which can complete the extraction task without manual work within one hour. Since the launch on February 5, Huo-Yan Laboratory (Hubei) has received a provincial-level total of 57 thousand patient’s samples as of February 24.  From the central city of the outbreak, Wuhan, BGI has deployed such labs in the other five capitals and taken full charge of sample examination. So far, BGI has been examining over 50 thousand case samples per day if counting all these labs; it can raise daily capacity to 80 thousand. Medical assurance: a new demand at scale As it comes to the end of the extended Spring Festival vacation, an increasing number of employees are busy returning to their work city. But it does not mean that the whole of society has surpassed the tension stage.  On February 19, an employee at DangDang, the once-public e-commerce based in Beijing, was diagnosed positive for Covid-19 and other 66 colleagues asked to do home-quarantine. More similar cases occurred after the workers resumed regular office schedules without a strict examination in advance. According to the national guidelines on orderly recovering production, the manufacturing industry is prioritized due to its wide supply chain and substantial economic influences. As of 21 February, China reached an overall 70% resumption rate in manufacturing. With such a tremendous amount of population movement, all cities urge enterprises to take as many precautions as possible to prevent potential virus-carriers from spreading the illness.  BGI, as the first recognized kit provider by the Chinese FDA (Food and Drug Administration), is actively taking this niche market by providing diagnosis services in a flexible form. The value created is more than a test result of employees with credit from a third-party, but also facilitates resuming regular daily operation and gaining time advantages on a strategic phase. Cross-border assistance Since the approval of the kits, this biotech has started to produce the nucleic kits at full capacity for immediate use. The first batch of 100 thousand kits was sent to the most severe area, Hubei Province, followed by 200 thousand to outbound. On February 20, BGI Genomics, together with Mammoth Foundation, sent loads of diagnostic kits to Japan’s National Institute of Infectious Disease. Since the RT-PCT kits are handy and efficient on the frontline, the company has supplied to over 26 countries and regions.  Since the outbreak, the market witnessed BGI’s share price soar to a history-high CNY 90.73 on February 5, at a two-day growth of 3.75% before a 15% slump to CNY 76.77 later. Now the share is priced at CNY 82.85 as of today, showing signs of a move upward.