Weigao Announces Major Board Restructuring, May Price Adjustments for Five Categories of Medical Consumables, and Haier Launches MedTech Translation Platform

Apr 14, 2024 15:15 CST Updated 15:15

WEGO

Medical Device and Pharmaceutical R&D Manufacturer

WEGO ORTHO

Orthopedic Medical Device Manufacturer

On April 8, Weigao Group Co., Ltd. ("Weigao Group") announced changes in its board of directors. According to the "Resolution of the Shareholders' Meeting of Weigao Group Co., Ltd.," the number of members on the Weigao Group's board of directors has been increased from five to seven. Lian Xiaoming has resigned from his position as a director, and Chen Min, Gao Yu, and Cong Rinan have been elected as new directors, each serving a three-year term. The new board of directors consists of seven members: Chen Lin, Tang Zhengpeng, Long Jing, Yan Xia, Chen Min, Gao Yu, and Cong Rinan.

Public information shows that WEGO Group was established in 1988. It is currently committed to developing its main businesses in medical devices and pharmaceuticals, while also promoting the coordinated development of construction, finance, and other industries. The group oversees several industrial groups, including medical products, orthopedics, blood purification, Purui, medical commerce, pharmaceuticals, and surgery.

According to the financial data provided by Qichacha, during the 2020-2022 period, WEGO Group achieved operating revenues of 22.781 billion yuan, 25.891 billion yuan, and 28.567 billion yuan respectively; total profits reached 3.028 billion yuan, 2.794 billion yuan, and 2.827 billion yuan respectively. In the first three quarters of 2023, WEGO Group achieved an operating revenue of 21.597 billion yuan and a total profit of 1.937 billion yuan. By the end of the third quarter of 2023, WEGO Group's total assets amounted to 77.75 billion yuan.

It is reported that WEGO currently has investments in 89 enterprises, of which 72 are active or in operation, 15 are dissolved, and 2 have relocated. Under the WEGO Group, there are three listed companies: WEGO ORTHO (688161.SH), Weigao Group, and Huadong Numerical Control.

A month ago, WEGO ORTHO announced three major personnel changes involving positions such as the company's chairman and board directors. Due to the impact of these personnel changes, WEGO ORTHO is currently facing significant performance pressure. Moreover, with the normalization of high-value medical consumables being included in bulk procurement at both national and provincial levels across China, the three major fields of orthopedic joints, trauma, and spine have all been incorporated into the centralized procurement scope for orthopedic medical devices, with implementation gradually rolling out. This has brought considerable short-term impacts on orthopedic device companies.

WEGO ORTHO stated that last year, with the implementation of China's high-value orthopedic consumables bulk procurement policy, the sales prices of the company’s products significantly declined. This change directly affected the company’s main business revenue and gross profit margin, resulting in a substantial decline in operating performance. Additionally, the decrease in product ex-factory prices and inventory price adjustments due to channel stock replenishment further contributed to the decline in sales revenue and gross profit margin, ultimately impacting the overall profit level.

What "medical device" news is worth paying attention to in the medical device industry this week? Insights into new industry policies, observations of corporate developments, and a review of market investments and financing are all covered in "Pharmaceutical Economic News"!

Insights into New Industry Policies

1. CMDE Publicly Solicits Opinions on the "Guiding Principles for Registration Review of Decellularized Matrix Soft Tissue Wound Repair Materials (Draft for Comments)"

Recently, according to the requirements of the 2024 annual medical device registration review guidance principles development and revision plan by the National Medical Products Administration, the Center for Medical Device Evaluation has organized the drafting of the "Guidance Principles for the Registration Review of Decellularized Matrix Soft Tissue Wound Repair Materials." The draft is now open for public comments online, with a deadline of May 10, 2024.

This guidance principle takes two types of implantable wound repair products as examples: dermal layer defect substitutes and repair products for skin wounds, and lamellar corneal grafts. It proposes specific requirements for the substitution and repair of corresponding soft tissue wound defects.

2. CMDE Releases Guidance Principles for Clinical Evaluation of Absorbable Surgical Sutures under the Same Category

Recently, in order to further standardize the management of absorbable surgical suture medical devices, the Center for Medical Device Evaluation of the National Medical Products Administration has formulated and released the "Guiding Principles for Clinical Evaluation of Equivalent Products of Absorbable Surgical Sutures for Registration Review."

This guidance principle applies to absorbable surgical sutures made from polymer synthetic materials, which are typically used for general soft tissue suturing. The materials covered include polyglycolide, glycolide-lactide copolymer (PGLA), poly-p-dioxanone (PPDO), and other absorbable synthetic materials. It does not include sutures with entirely new technical characteristics and/or an entirely new clinical scope of application. According to the current "Medical Device Classification Catalog," the classification code for absorbable surgical sutures is 02-13-06, and the management category is Class III.

3. The fourth round of national procurement will be implemented on May 10, and five types of medical consumables will undergo price adjustments.

On April 8, the official website of Henan Province Medical Security Bureau released the "Notice on Doing a Good Job in the Volume-based Procurement and Use of Five Types of Medical Consumables Including Artificial Crystals" (hereinafter referred to as the "Notice"). This is the first province in China to issue the implementation notice and specify the implementation time for the fourth round of national procurement of medical consumables.

The Notice shows that five categories of medical consumables, including artificial crystals and sports medicine products, will undergo price adjustments starting from May 10. The centralized bulk procurement cycle for artificial crystal, sports medicine, and orthopedic trauma medical consumables will last for 2 years. The volume-based procurement cycle for ultrasonic scalpel heads and endoscopic staplers in the Beijing-Tianjin-Hebei alliance will be 1 year. The first-year agreement period is from May 10, 2024, to June 30, 2025.

The specific product range is as follows:

Observation of New Trends in Enterprises

1. Haier's Yingtai Life Releases "Haiyi Hui," Building China's First Medical-Engineering Technology Industrialization Platform

Recently, on the eve of the 89th China International Medical Equipment Fair, Haier Group's large health ecosystem brand, Yingkang Yisheng, took the lead in establishing the first medical engineering technology innovation industrialization platform in China — "Haiyi Hui."

The "Haiyi Hui" platform, led by Yingcare Lifelong and jointly initiated with the Chinese Research Hospital Association, Shandong Industrial Technology Research Institute, and Hanyuan Capital, focuses on innovative fields such as brain science, life science, women's health, hematology ecosystem, precision oncology diagnosis and treatment, and medical rehabilitation. It is dedicated to accelerating the transformation and incubation of high-end innovative pharmaceuticals and medical devices' scientific research achievements. Guided by clinical needs and adhering to the principles of "public welfare, ecological integrity, and applicability," Haiyi Hui has formed a collaborative ecosystem integrating industry, academia, research, and finance, and is actively promoting the transformation of basic research into clinical applications.

2. Orthopedic Implants with Nearly 100% Sterilization Efficacy Approved by FDA

Recently, Onkos Surgical's antimicrobial-coated orthopedic implants received FDA approval, capable of killing 99.999% of bacteria, offering a new solution to address contamination issues with orthopedic implants.

The company also focuses on orthopedic oncology research and complex orthopedic surgeries, committed to improving the contact between bone implants and the patient's body, reducing the risk of aseptic loosening, and enhancing postoperative healing.

3. ZENFLOW® Pufferfish Peripheral Spur Balloon Dilation Catheter from Guchuang Tongqiao Approved for Marketing

Recently, ZENFLOW® Pufferfish Peripheral Cutting Balloon Dilation Catheter, independently developed by Guichuang Tongqiao, has been approved for marketing. This product boasts excellent performance and will contribute to the advancement of PCI procedures. The volume of PCI surgeries in China and globally is expected to continue growing, driving the market demand for coronary balloon dilation catheters. By 2025, the market size in China is projected to reach 6.528 billion yuan.

Guichuang Tongqiao Medical is a research and production enterprise of cardiovascular medical devices, mainly engaged in the study of high-end vascular medical devices such as drug-eluting peripheral vascular stents and balloons. Its product categories include balloons, stents, accessories, embolic agents, etc., with main products being drug-eluting PTA balloon dilation catheters, peripheral vascular stent systems, and PTA balloon dilation catheters. The company owns two comprehensive product platforms: Guichuang Medical Peripheral Vascular Intervention Solution Platform and Tongqiao Medical Intracranial Neurovascular Intervention Solution Platform.

4. Sylfirm X, the dual-wave RF therapy device exclusively distributed by 4环医药 (Four Rings Pharmaceutical), obtains Class III medical device registration certificate from NMPA

Recently, Sinopharm Group announced that the dual-wave radiofrequency treatment device SylfirmX, exclusively distributed by the group and manufactured by South Korea's ViO Co., Ltd., has officially obtained Class III medical device registration from the National Medical Products Administration (NMPA) in China. SylfirmX is the world’s first dual-wave radiofrequency treatment device to receive approvals from both the U.S. Food and Drug Administration (FDA) and the NMPA. It works by emitting high-frequency currents to induce skin tissue coagulation, effectively reducing skin wrinkles and treating atrophic acne scars.

The product utilizes dual-wave radiofrequency pulse types, PW (Pulsed Wave) and CW (Continuous Wave), with eight dual-wave treatment modes: PW1, PW2, PW3, PW4/CW1, CW2, CW3, CW4. It employs bipolar non-insulated microneedle electrodes to provide full-thickness dermal treatment, ensuring uniform energy output and delivering significant therapeutic effects. With targeted subcutaneous treatment at depths of 0.3mm–4mm, clinical results demonstrate no serious treatment-related adverse reactions and a short postoperative recovery period. Precise treatment at 300μm/0.3s is comfortable, painless, and blood-free.

Market Investment and Financing Review

1. U.S. Medical Device Company Biolinq Raises Over 400 Million Yuan in Financing to Advance New Wearable Non-Invasive Blood Glucose Sensor Patch

Recently, Biolinq, a U.S.-based medical device company, secured $58 million (approximately RMB 400 million) in funding to advance clinical trials for its wearable, non-invasive glucose sensor patch. The patch consists of micro-biosensors capable of continuously tracking blood glucose levels for up to a week. The funding will support subsequent trials and the commercialization process of the product.

Biolinq's wearable sensor consists of multiple independent micro biosensors. The wearable sensor can be placed on the upper forearm and measures subcutaneous glucose levels through a series of micro electrochemical sensors. It uses an integrated display screen to notify users when blood glucose levels are within the target range or exceed the healthy range.

2. WEGO Medical Completes New Round of Financing Worth Hundreds of Millions

Recently, Genius Medical Technology Group announced that it has secured a new round of financing worth hundreds of millions of RMB. This round of financing was led by Xichuang Investment and Binhu Industrial Group, with a well-known American medical device industry party following the investment. The funds will be used for product research and development, production expansion, and subsequent commercial expansion both domestically and internationally at Genius Wuxi base.

Genius Medical has multiple products with leading advantages and is the first local enterprise in China to obtain approvals for high-tech medical devices such as electric endoscopic staplers, antibacterial sutures, intracranial thrombectomy stents, and interventional aortic valves.

3. Yipin Bio Completes Tens of Millions of Yuan in Series A Financing, Accelerating the Construction of a CRTDMO Integrated Service for Medical Devices

Recently, Guiyang Yipin Biotechnology Co., Ltd., a subsidiary of Yipin (Guiyang) Quality Technology Co., Ltd., officially announced the completion of a multi-million yuan Series A financing round. This round was led by Guiyang Venture Capital, with participation from Guiyang Health Investment and Guiyang Baiyun Industrial Investment. The proceeds will primarily be used to accelerate the construction of a high-level passive medical device CDMO platform in the Baiyun District Medical Device Industrial Park, focusing on providing services for product categories such as medical aesthetics, gels, catheters, and IVD reagents.

Yipin Technology is an innovative start-up enterprise with government investment background. The company has received support from multiple rounds of venture capital. It focuses on the rapidly developing medical device and biopharmaceutical industries, providing contract research organization (CRO) and testing services for manufacturing enterprises and scientific research institutions both in China and abroad.

Editor: chun