DeKang Medical Secures RMB 500 Million Series B Financing with China Renaissance as Exclusive Financial Advisor, Files for IPO

VCBeat (WeChat: vcbeat) learned第一时间that recently, Decans Medical, a leading company in comprehensive orthopedic surgery solutions, has completed its Series B financing and received a series of financial support, accumulating a total funding of 500 million yuan. This is the largest single financing in the field of orthopedic implants in China over the past three years. The round was led by Hangzhou Bay Smart Healthcare Industry Fund, with participation from Gongqingcheng Yongqian, Lanshan Investment, Shouzheng Zefu, and Xiaochi Capital, while existing shareholders Haibang Capital and Hongda Junhe continued to increase their investment. This fully demonstrates investors' confidence in Decans Medical’s rapid development driven by R&D advantages and swift commercialization capabilities amidst the increasingly clear environment of volume-based procurement in the orthopedic sector. In this transaction, Easy Capital served as the exclusive financial advisor to Decans Medical.

Decans Medical was founded in 2012 and is currently in China.The only orthopedic digital platform with original research capabilities in new materials and new surgical techniquesAfter eight years of in-depth research and development, by the end of 2021, the company had obtained NMPA certification for its full range of spinal and trauma products and continued to launch multiple innovative product pipelines in the spinal and trauma fields. In addition, the main product lines of the company’s sports medicine and joint sectors have completed development and are expected to receive certification between 2022-2023. Meanwhile, the intelligent digital orthopedic system is in the process of being launched. The company's revenue over the past three years has...Compound annual growth rate reached 130%，It will soon become one of the few platform companies in China to cover the full range of orthopedic product lines.

The company currently focuses on spinal products, among which the NOAH Cobalt Chromium Molybdenum Spinal Fixation System, SAGI Self-Stabilizing Fusion System, and TAURUS Occipitocervicothoracic Minimally Invasive Fusion System are the three major products.First Certificate of Chinese Production, featuring cutting-edge designs with new materials and compatibility with innovative surgical techniques, filling a domestic void in China. The NOAH Cobalt-Chromium-Molybdenum spinal fixation system enhances comprehensive mechanical performance by more than three times while reducing the implant volume by 30%, offering a significant advancement in the treatment of severe scoliosis and adolescent patients. Decans Medical, committed to creating clinical value, leverages internationally recognized forward research and development capabilities to continuously develop new product lines centered around new materials and advanced surgical methods, striving to becomeComprehensive Surgical Solution Provider in the Orthopedic Field。

The Kunpeng Biomechanics Laboratory of the company has obtained the ISO/IEC 17025 management system certification, supporting the company's product design and material verification, etc. It has nearly 300 independent tests involving performance standard testing of Class III orthopedic implants as well as metals and biomaterials, with an annual cyclic testing capacity of 7.8 billion times. This is an important indicator that the laboratory’s management level and technical capabilities have reached international standards. The company has deep reserves in new materials and digital technologies, with professional R&D teams for material research and digital healthcare. Among them, the self-developed Tianqiong Orthopedic Database will be launched as an open platform, capable of achieving digital 3D transformation, database creation, auxiliary diagnosis, and continuously promoting the development of new products.

Since the company's products were launched, they have entered hundreds of national/regional flagship Class A tertiary hospitals and hundreds of regional hospitals, with sales channels covering the entire country. Several of the company’s products have filled domestic gaps in China and received unanimous acclaim from authoritative experts in the industry. In July 2021, during the orthopedic trauma procurement alliance of twelve provinces, all the company’s participating products were successfully awarded contracts, accelerating the nationwide sales growth of its trauma products in China, with revenue far exceeding expectations.

After this round of financing, Decans Medical will accelerate the construction of a new production base to address the current capacity shortage, continue to expand sales, and invest in the research and development of novel orthopedic materials and next-generation digital orthopedics, maintaining its innovative first-mover advantage with continuously updated products.

Dr. Xu Xiaobo, founder of Decans Medical, said"Orthopedic diseases are common clinical conditions, especially as the aging population continues to grow, people's increasing health demands for skeletal functions are translating into a huge demand for related products. On the other hand, China's medical device industry is in a period of transition and rapid development. Innovation-driven growth, industrial upgrading, import substitution, and medical insurance cost control represent the historical mission of China’s medical device industry development. After nearly a decade of innovation and entrepreneurship, Decans Medical has been committed to technological innovation driven by research and development, providing high-quality and affordable products along with comprehensive surgical solutions for clinicians and patients. Following this round of financing, Decans Medical will accelerate the construction of its Jiaxing intelligent R&D and production base, comprehensively enhancing its supply capabilities to seize the historical development opportunities in China’s medical device industry. This move also marks an important step in Decans Medical’s strategy to establish a high-performance orthopedic industry platform integrating production, education, research, and application in the Yangtze River Delta Greater Bay Area."

For this round of financing,Hangzhou Bay Smart Healthcare Industry FundIndicates:"Orthopedics is an important细分领域 in the medical device industry. The domestic market in China has long been dominated by foreign companies, with Chinese-produced enterprises concentrated in the mid-to-low-end market, resulting in a relatively分散 competitive landscape. Since its establishment, Decans Medical has adhered to a development model driven by clinical needs and innovation through research and development. It is one of the few innovative enterprises in China with forward-looking R&D capabilities. Dr. Xu Xiaobo, the founder of the company, demonstrates convincing foresight regarding the future trends of the orthopedic industry. The company’s R&D and commercialization capabilities have been well validated. We look forward to Decans Medical continuing to innovate and becoming a benchmark enterprise in high-end orthopedic implants, driving the import substitution of mid-to-high-end orthopedic implants in China."

Xie Li, President of Haibang Investment, said:"As an early investor in Decans Medical, we have accompanied Decans throughout its growth and have continued to increase our investment in this round. This is firstly due to our high recognition of the results from previous collaborations, and secondly due to our acknowledgment of Decans' rare technical innovation capabilities and R&D-driven characteristics in the orthopedic field, successfully breaking the market monopoly held by multinational brands. As a high-growth, high-tech company, Decans has a sound mechanism and environment. The team is dedicated, pioneering, and adept at seizing market opportunities. With the release of Phase II production capacity, the next few years will be a period of rapid development and performance breakthrough for Decans Medical."

Li Jin, Managing Director of CEC CapitalStated: "CEC Capital continues to focus on various sub-tracks of the medical device sector. We firmly believe that the orthopedics industry has tremendous development potential, and Decans Medical, with its continuous innovation capabilities and ability to address clinical pain points, will undoubtedly unleash vigorous vitality."

Decans Medical, founded in 2012, is a company focused on the research, development, and manufacturing of high-performance orthopedic implants and surgical technology systems. Upholding the philosophy of "medicine as a benevolent art, striving for perfection," its main products include spinal, trauma, sports medicine, and joint implants, as well as data acquisition, processing, and analysis systems, among other high-quality medical devices. The company integrates industry, academia, and research, collaborating with top scientists, clinical experts, and engineers from China and abroad, as well as with world-class universities, leading orthopedic hospitals, and research institutes in China. By applying new materials and advanced technologies to the research and manufacturing of orthopedic implants, the company produces superior-performing products better suited for the Chinese population.

Hangzhou Bay Smart Healthcare Industry Fund, jointly established by listed companies in the industry, local governments, and social capital, primarily invests in growth-stage and mature-stage projects within the medical device sector. The fund will fully leverage its role as a nexus for industry, capital, projects, and talent, serving as a platform to aggregate superior project resources, talent resources, and industrial chain cooperation resources, thereby promoting the enhancement of innovation capabilities and industrial transformation within the medical device industry.

Lanshan Investment was founded in 2007 and is one of the earliest equity investment companies in Zhejiang. The company adheres to the concept of long-term value investing, focusing on industrial chain investment layout in key areas, selecting high-quality investments, and striving to be a craftsman-style equity investment enterprise. It primarily concentrates on the VC (Pre-A to B rounds) and PE (Pre-IPO) investment stages, with a particular focus on investment opportunities in fields such as healthcare and hard technology. Early in its establishment, the company seized the opportunity to take stakes in a number of high-quality enterprises including Silver River Co., Ltd., Hangzhou Bank, Caitong Securities, Yongyi Co., Ltd., and Lante Optics. These projects have all subsequently performed exceptionally well in the capital markets. Over the past decade, more than 20% of the projects invested in by the company and its affiliated funds have gone public.

Hangzhou Xiaochi Private Equity Fund Management Co., Ltd. ("Xiaochi Capital") is a venture capital firm focused on early-stage investments in life sciences. The company targets globally advanced, unmet clinical needs and high-barrier innovations in biopharmaceuticals and medical technology, investing in and incubating life science enterprises with sustainable competitiveness.

The company's risk partner has founded multiple biopharmaceutical companies and successfully capitalized them. The Chief Investment Officer of Xiaochi Capital has ten years of experience in biopharmaceutical investment. The management team of Xiaochi Capital comes from top-tier VC funds, multinational pharmaceutical companies, and CROs, with the investment team boasting extensive academic backgrounds, investment experience, industry resources, and commercialization expertise. The company possesses abundant industry resources in biopharmaceuticals and healthcare.

Haibang Investment was established in 2011 and initiated the first venture capital fund in China with the theme of "Returnee Entrepreneurship." The company adheres to the core values of "Technology and Talent," primarily focusing on three major fields: life sciences and health, digital economy, new materials, and high-end manufacturing. It mainly invests in early- to mid-stage projects founded by overseas high-level talents, achieving positive results in promoting the aggregation of top talents, supporting talent entrepreneurship and innovation, and driving talent enterprises into the capital market. Haibang Investment has cumulatively set up 15 talent funds and multiple special funds in Hangzhou, Ningbo, Shaoxing, Huzhou, and other places, managing a capital scale exceeding 5 billion yuan. Its funds have invested in more than 110 enterprises, with an investment amount surpassing 4 billion yuan. Among the invested companies, 19 have achieved IPOs or mergers and acquisitions, and over 20 have been recognized as "unicorn" enterprises. In the life sciences and health sector, Haibang Investment has nurtured listed companies such as New Horizon Health, Guichuang Tongqiao, AllTest Biotech, and MicroTech Medical through early-stage investments.

Hongda Junhe Capital is an investment institution with a deep industrial background, established by Hongda Holding Group, a top 500 private enterprise in China, and possesses abundant industrial resources. It focuses on key layouts in industries driving China's economic transformation and upgrading, such as healthcare, high-end manufacturing, new energy, new materials, and automobiles, primarily investing in growth-oriented VC and PE projects. The company's team has cumulatively invested over 3 billion yuan, successfully investing in companies including CATL (300750), Supcon Technology (688777), Zhuhai CosMX (688772), Shengshi Technology, Baiweishen Technology, Chuanghuai Medical, and Yongdao Zhiyuan.

CEC Capital is a leader in China's new economy investment banking, focusing on three major industries globally: TMT, consumer, and healthcare. In addition to its investment banking business, CEC Capital is managing one RMB fund and one USD fund. The company has branches in Beijing, Shanghai, Los Angeles, and San Francisco, and holds a U.S. securities market license.

The healthcare industry is a key focus area for CEC Capital and one where it has significant advantages. For five consecutive years, it has been the new economy investment bank with the most healthcare industry transaction records in China. Meanwhile, CEC Capital boasts the largest, most professional, and comprehensively industry-chain covering healthcare investment banking team in China.