Stroke Medical Closes Series B, in a Move to Defeat China’s Chronic Problem
A three-year-old startup from Shanghai is challenging the world’s most prominent firms in the development of PCI and LLA devices.
A Shanghai-based medical device producer, Stroke Medical (心玮医疗), announced that it had raised nearly CNY 100 million in its Series B financing round. This round was led by Grand Yangtze Capital (长江国弘), Chengyu Capital (盛宇投资), and Hidea VC (海达投资).
Stroke Medical is located in Zhangjiang Hi-Tech Park in Shanghai, where it belongs to a cluster of medical device producers. The company is focusing on the prevention and treatment of ischemic stroke.
There are currently two core products being developed: a device to facilitate Percutaneous Coronary Intervention (PCI) and a Left Atrial Appendage (LAA) occlusion device. PCI is a non-surgical procedure that uses a thin, flexible tube to place a stent to open up blood vessels in the heart that have been narrowed due to atherosclerosis. The second core product series, LLA devices, are used to implant a 'Watchman', – which monitors the heart for the signs of a stroke.
Watchman procedures are among the safest, and there have been over 80,000 Watchman implants with a success rate of over 94.3% in the US since 2015.
Stroke is amongst the top 10 causes of death in China. The number of people suffering from stroke in China over 40 years old is 12.42 million, with the disease killing over 2 million people in 2018. The numbers will multiply as China’s population ages. The stroke intervention market is expected to reach CNY 3 billion by 2020 in China.
Yet, the Chinese stroke-fighter is not the only supplier of this gigantic market; indeed it competes with some of the world’s largest producers, including, among others, Medtronic (MDT: NYSE) and Stryker Corporation (SYK: NYSE). But the company claimed to produce cost-efficient products compared to those of its rivals from the US.
"Although the domestic stroke intervention market has been developing strikingly, it is still facing the clinical shortage of stroke interventional devices. There is an urgent need for more and better stroke intervention devices that are produced by domestic players in the mainlann," claimed Wang Guohui (王国辉), the CEO of Stroke Medical.
In the Medical Devices field, China has yet to have a presence, even in the domestic market. However, there are more companies that are challenging this phenomenon. Chinese companies are especially being more visible, particularly in relatively smaller value-added medical products such as stents and needles.
Micro-Tech (南微医学) (688029: SH) is yet another medical devices and equipment developer from Nanjing. It was amongst the first batch of the companies to have been traded on China’s STAR Board.
Stroke Medical's products are certified by CFDA, and there is no related patent dispute; claimed the company. However, the patent question is one of the major variables that need to be watched in the upcoming period.