Chinese ICE Leader TingSheng Medical Secures Over RMB 100 Million in Series B Funding, Product Enters NMPA Innovation Review Pathway

Recently, TINGSN, a leading enterprise in China's intracardiac ultrasound industry, announced that it had completed a Series B round of financing exceeding 100 million yuan. It is reported that this round of financing was completed in September 2022, led by Qiming Venture Partners, with participation from Huatai Zijin (Jiangsu) Equity Investment Fund, Tasly Capital Holding (Beijing) Co., Ltd., Ascendum Capital, and Guangxi Nanwan Baiao Phase I Venture Capital Partnership (Limited Partnership). The funds from this round of financing will be used for the mass production of intracardiac ultrasound products, expansion of the R&D team, and development of new products.

TINGSN Technology announced at the same time that its "Single-Use Intracardiac Ultrasound Catheter" has officially entered the special review process for innovative medical devices by the National Medical Products Administration (NMPA).

Intracardiac ultrasound products have become a popular field pursued by the investment community and ultrasound R&D companies. According to incomplete statistics, more than 12 Chinese enterprises have entered this field, and with imported brands, nearly 20 companies are competing in this niche market.The main reason for the market heating up is that intracardiac ultrasound products were included in the national medical insurance, followed by the inclusion of electrophysiology-related consumables in 27 provinces into centralized procurement in April 2023. With a significant increase in electrophysiological and structural heart surgeries, coupled with a substantial reduction in the price of intracardiac ultrasound products, the clinical demand has grown exponentially. Currently, Johnson & Johnson still dominates the intracardiac ultrasound catheter market in China. Abbott quickly entered the Chinese market after resolving compatibility issues with its corresponding ultrasound host. Under the dual challenges of product quality and pricing, domestic brands face immense competitive pressure.

The track seems to be hot, and the products appear to be simple and easy to produce. However, to truly reach a position capable of competing with Johnson & Johnson and Abbott is, in fact, an arduous journey requiring massive investment. Since 2019, TINGSN has been heavily investing in funds and human resources to develop intracardiac echocardiography (ICE) products. The company has continuously improved the overall product performance and achieved semi-automated mass production. Currently, TINGSN has established a nearly 4,800-square-meter R&D and process manufacturing center, equipped with the world's most advanced precision R&D testing equipment and semi-automated production facilities. The cumulative R&D investment in two-dimensional ICE products and related technologies has reached nearly 200 million yuan. In the next six months, TINGSN’s two-dimensional ICE product will officially enter the clinical trial registration phase and is expected to achieve global market sales for this China-produced ICE product after 2024. The advantage of obtaining expedited regulatory approval will make TINGSN’s ICE catheter even more competitive.

At the same time, TINGSN is accelerating the development of its 4D intracardiac echocardiography (ICE) product, with collaborative efforts from chip design and ultrasound teams based in both China and the United States. The foundation of 4D ICE research and development lies in miniaturized ASIC circuit design and electronic matrix process development. The design of ASICs tailored for ultrasound imaging differs significantly from traditional ASIC designs. Globally, only a handful of teams possess mature electronic matrix process development technology. Consequently, the talent and technical reserves required for 4D ICE development are extremely scarce in China and even globally.

TINGSN plans to invest an accumulated 300-400 million RMB in the next 2-3 years for the research and development, process improvement, derivative product development, and the construction of a supporting talent team for this product. Under the leadership of several senior overseas returnee doctors in the field of digital ultrasound, they aim to optimize and improve certain technical details that currently need enhancement in foreign 4D ICE clinical applications. The company strives to closely follow the market entry timeline of international manufacturers' 4D intracardiac echocardiography products into China, while launching a more cost-effective 4D intracardiac echocardiography product.

High R&D investment, cross-disciplinary professional team building, meticulous process improvement, comprehensive supply chain management, and semi-automated production quality control are the fundamental factors that truly enable intracardiac ultrasound products to compete with similar overseas products. After four years of significant R&D investment, TINGSN has maintained a focused product development direction, achieving full in-house R&D of core components with high production success rates. The company has also integrated dozens of top-tier industry component suppliers, completing standardized and uniform manufacturing processes. This has allowed TINGSN to achieve production costs at nearly one-third of its competitors, a cost advantage that will propel it to become a leading domestically produced brand in the intracardiac ultrasound industry, with the greatest opportunity to capture a larger effective market share.

Since the recent intraprovincial procurement of electrophysiology products across 27 provinces has reduced the price of intracardiac ultrasound catheters to between 10,500 and 13,500 RMB, under the premise of a significant increase in clinical usage in the future, it is possible that national procurement may demand a substantial reduction in the price of this product due to the pressure of medical insurance payments. TINGSN, with its solid R&D, comprehensive supply chain management, and excellent cost control, can still handle the situation with ease.

As many operators have envisioned, it is expected that in the next 3-4 years, more domestically produced products will compete with imported brands. There is also anticipation for another era of independent innovation in coronary stents, which could be recreated in the field of intracardiac ultrasound that has been monopolized by imports for 19 years.

Tingsn Technology, founded by senior scientists in the ultrasound field, cardiologists, and serial entrepreneurs, is headquartered in Nanjing, China. The company has built an international R&D team and established R&D centers in both China and the U.S. Focusing on technological innovation in the application of ultrasound for cardiac electrophysiology, Tingsn integrates imaging, mapping, and ablation energy to provide more effective treatments for patients with heart diseases. The company aims to become a globally influential medical device brand manufactured in China.

Qiming Venture Partners was founded in 2006 and has successively established offices in Shanghai, Beijing, Suzhou, Hong Kong, Seattle, Boston, and the San Francisco Bay Area. Currently, Qiming Venture Partners manages 11 USD funds and 7 RMB funds, with total managed assets reaching 9.4 billion USD. Since its establishment, it has focused on investing in outstanding early-stage and growth-stage companies in the Technology and Consumer (T&C) and Healthcare industries. To date, Qiming Venture Partners has invested in more than 480 rapidly growing innovative enterprises, of which over 180 have gone public or exited through mergers on exchanges such as the New York Stock Exchange, NASDAQ, the Hong Kong Stock Exchange, the Shanghai Stock Exchange, and the Shenzhen Stock Exchange. Additionally, more than 70 of these enterprises have become unicorns or super unicorns recognized within their respective industries.

Huatai Zijin is a wholly-owned subsidiary of Huatai Securities (601688.SH) that engages in private equity investment business. Relying on the full business chain advantages of Huatai Securities and adhering to the investment philosophy of "growing together with entrepreneurs," Huatai Zijin leverages its rich financial and industrial resources to provide comprehensive capital services to its partners. With a fund management scale of nearly 60 billion yuan, it operates multiple funds including PE, M&A, FOF, and industry-focused funds. Huatai Zijin maintains its industry positioning, conducts solid industry research, and focuses deeply on strategic emerging industries such as healthcare and TMT, accumulating extensive industry experience and resources.

Tasly Capital is one of the most influential industrial investment institutions in China's healthcare industry. Since its founding in 2007, after 15 years of steady development, it has become a comprehensive investment platform covering all fields of the healthcare industry, integrating equity investment, industrial mergers and acquisitions and incubation, asset management, and other businesses. Currently, Tasly Capital manages assets worth 14.8 billion yuan, has invested in over 110 companies, successfully exited from 31 companies, and facilitated the listing of 16 companies.

Ascendum Capital is a pioneering medical fund established in 2020. It focuses on investing in innovative medical devices, biopharmaceuticals, and related technologies. The company's team is composed of seasoned professionals from both the medical and investment fields, committed to promoting the development of the healthcare industry. It is dedicated to seeking out innovative medical products and technologies globally, assisting in their product development and implementation in the Chinese market. Its vision is to become a powerful driver for innovative medical products and companies.

Guangxi Nanwan Baiao Phase I Venture Capital Partnership (Limited Partnership) is a specialized healthcare fund under the LD Capital, focusing on investments in the life sciences and healthcare industry. The fund has extensively invested in areas such as biopharmaceuticals, IVD, and innovative medical devices. It is committed to the incubation and empowerment of early-stage life science and innovative healthcare projects, closely collaborating with outstanding entrepreneurs to co-create top-tier products that contribute to overcoming diseases and promoting human health.