Tongxin Medical Accelerates Overseas Clinical Trials with $965 Million IPO Fundraise Amid Rising Losses

BrioHealth Solutions, a company conceptualized around artificial hearts, is competing with Core Medical to become the "first domestic artificial heart stock."

BrioHealth Solutions, which plans to raise RMB 1.064 billion through an initial public offering (IPO) on the STAR Market, saw its core product, the CH-VAD, approved for market launch in November 2021 as the first fully magnetically levitated implantable artificial heart approved by China’s National Medical Products Administration (NMPA).

Interface News reporters noted that BrioHealth Solutions’ next-generation product, the BrioVAD, has secured insurance coverage for its clinical trials in the United States, generating substantial overseas sales revenue. Financial data shows that the company’s 2025 revenue reached RMB 213 million, a year-on-year increase of 175%, with foreign income accounting for more than half of the total for the first time. However, due to high R&D expenditures and early-stage market promotion costs, the company accumulated net losses exceeding RMB 1 billion over the past three years, with operating cash flow remaining consistently negative.

"Burning Cash for Growth"

Past3Year,BrioHealth Solutions Achieves Significant Revenue Growth. From 2023 to 2025, the company’s operating revenues were RMB 50 million, RMB 77 million, and RMB 213 million, respectively, representing a more than threefold increase. Notably, revenue exceeded RMB 200 million in 2025, primarily driven by the scaled-up adoption of its CH-VAD system in China and RMB 97.8 million in revenue generated from clinical trials of BrioVAD in the United States. However, the absolute revenue level still lags behind the pace of cash burn.

From 2023 to 2025, BrioHealth Solutions’ net profit attributable to shareholders of the parent company was RMB -306 million, RMB -372 million, and RMB -374 million, respectively. The losses failed to narrow but instead continued to widen. This contradictory situation of “rising revenue without corresponding profit growth” reflects the typical dilemma faced during the early stage of commercialization: the scale of revenue is far insufficient to cover high research and development and operational costs.

The root cause of BrioHealth Solutions’ losses lies in the continuous escalation of its three major expense categories. During the reporting period, R&D expenses rose from RMB 108 million to RMB 204 million, primarily allocated to U.S. clinical trials for BrioVAD; administrative expenses increased from RMB 151 million to RMB 194 million, with share-based compensation expenses amounting to RMB 70–80 million annually, serving as the primary driver of elevated administrative costs; and selling expenses also grew from RMB 58 million to RMB 92 million.

Although the ratio of the total three expenses to operating revenue decreased from 630% to 234%, it remains at an abnormally high level. This indicates that the company has not yet reached its break-even point, with period expenses exceeding two yuan for every one yuan of revenue generated.

As of the end of 2025, BrioHealth Solutions had accumulated undistributed losses of RMB 1.454 billion, with equity attributable to parent company shareholders amounting to only RMB 185 million. This indicates that the company has burned through more than RMB 1.4 billion since its inception.

The company's net cash flows from operating activities for the years 2023 to 2025 were -RMB 220 million, -RMB 293 million, and -RMB 319 million, respectively, with the outflow increasing year by year. This indicates that the company's core business is still unable to generate positive cash flow, and evenEach year of operation consumes approximately3100 million yuan in cash.

The balance sheet situation is also not optimistic. At the end of 2024, BrioHealth Solutions' debt-to-asset ratio rose to 93.48%, nearly insolvent; after completing a Series E financing round of RMB 465 million in June 2025, the debt-to-asset ratio dropped back to 70.63%.

BrioHealth Solutions has been able to sustain years of significant cash burn by relying on multiple rounds of financing in the primary market for capital infusion. From the D+ round to the E round, its valuation was adjusted from approximately RMB 4.2 billion to RMB 3.8 billion. The triggering of anti-dilution provisions necessitated compensating existing shareholders through the conversion of capital reserves into additional shares, which itself indicates that subsequent financing valuations have declined compared to earlier rounds.

Subscribers to the Series E financing round included well-known institutions such as the Baiyang Group and Sequoia Capital. The share purchase price for the transfer of existing shares was RMB 7.10 per share, representing a significant discount compared to the RMB 9.64 per share price for the capital increase portion. This structured arrangement reflects new investors’ prudent assessment of risk and also suggests that BrioHealth Solutions’ bargaining power in the primary market is weakening.

Highly Singular Product Portfolio

BrioHealth Solutions’ core product is an implantable left ventricular assist system (commonly known as an artificial heart), primarily used for long-term circulatory support in patients with end-stage heart failure. The company’s first product, CH-VAD, was approved for market launch in November 2021, marking the first domesticallyFully AutonomousFully Magnetically Levitated Artificial Heart with Independent Intellectual Property Rights.

Full magnetic levitation technology is widely recognized as the most advanced current technical pathway for ventricular assist devices (VADs). Compared to earlier technologies such as hydrodynamic suspension, it offers significant advantages in blood compatibility and in reducing the risks of thrombosis and stroke. The prospectus compares CH-VAD with Abbott’s globally leading product, HeartMate 3, across multiple performance metrics, claiming superiority in indicators such as pump thickness, percutaneous cable diameter, and flow pulsatility. However, it should be noted that these comparisons are largely based on laboratory or ex vivo test data, and the level of evidence and sample size of real-world clinical data still lag significantly behind those available for HeartMate 3.

In terms of product development progress, BrioHealth Solutions’ next-generation product, BrioVAD (which features the same blood pump as the CH-VAD, with primary optimizations made to the extracorporeal components), has initiated a head-to-head, randomized controlled, confirmatory clinical trial against HeartMate 3 in the United States, with a planned enrollment of 780 patients. As of the date of signing the prospectus, 152 implants had been completed. In February 2024, BrioVAD received FDA approval to proceed with an Investigational Device Exemption (IDE) clinical trial, becoming the first active implantable medical device from China to gain FDA approval for entry into clinical trials.

BrioHealth Solutions also plans to conduct the BrioLife study in Europe and expand pediatric indications in the United States and Japan. However, advancing overseas clinical trials is extremely capital-intensive; the company intends to allocate RMB 695 million from its fundraising proceeds solely for the global clinical trials and registration program of BrioVAD. Notably, the company has not yet disclosed any head-to-head clinical endpoint data comparing BrioVAD with HeartMate 3, meaning that the purported “potential advantages” lack support from high-level evidence.

BrioHealth Solutions is simultaneously advancing CH-VAD and BrioVAD, two essentially homologous products, both domestically and internationally, indicating a relatively singular product pipeline. To date, apart from the CH-VAD series, the company has no other approved and marketed products. In its R&D pipeline, BrioVAD 2.0 remains in the design verification stage, while the BrioCare patient remote management system is in the preclinical research stage, with regulatory approval still a distant prospect.

BrioHealth Solutions also explicitly acknowledges the “risk of a single-product portfolio” in its risk factors, with short-term revenue relying primarily on CH-VAD and BrioVAD. This “putting all eggs in one basket” model means that any setback in the commercialization of either product—such as price reductions due to intensified competition, failure to gain reimbursement coverage, or denial of license renewal—would have a significant adverse impact on the company.

From the perspective of market competition, six implantable ventricular assist devices have been approved in China, with competitors including Shenzhen Core Medical, Chongqing Yongrenxin, Aerospace Taixin, and the multinational giant Abbott. By the end of 2024, BrioHealth Solutions’ products accounted for 26.9% of the cumulative implant volume market share, failing to establish an overwhelming advantage.

Abbott’s HeartMate 3 holds a monopolistic position in the global market (with a market share exceeding 99%), driven by robust clinical data and strong brand equity. To break this dominance in the U.S. market, BrioVAD must not only demonstrate non-inferiority or even superiority but also incur substantial costs for marketing and physician education.

Given Abbott’s established channel presence and brand equity in the cardiovascular sector, BrioHealth Solutions, as a latecomer, will face a difficult and protracted battle for market penetration even if it obtains regulatory approval.

Betting on "Head-to-Head"

BrioHealth Solutions plans to raise a total of RMB 1.064 billion in its initial public offering (IPO), with the largest allocation of RMB 695 million—accounting for over 65% of the total proceeds—dedicated to the “BrioVAD Global Clinical Trials and Registration Project.” The remaining funds will be allocated as follows: RMB 190 million for the next-generation LVAS research and development project, RMB 129 million for production facility construction, and RMB 50 million to supplement working capital.

In absolute terms, the fundraising scale of RMB 1.064 billion is an exorbitant demand for a company with an annual revenue of RMB 213 million and accumulated losses of RMB 1.454 billion. More notably, the company’s total R&D expenses during the reporting period amounted to RMB 460 million, whereas a single clinical trial project requires raising RMB 695 million—far exceeding the sum of its total R&D investment over the past three years.

Behind the massive fundraising lies BrioHealth Solutions’ bold bet on defeating HeartMate 3 in “head-to-head” trials in the U.S. market. The project plans to invest RMB 695 million to conduct confirmatory clinical trials, subsequent CAP trials, and European clinical trials in the United States. As of the date of signing the prospectus, only 152 implants have been completed in this trial, falling significantly short of the total planned enrollment of 780 cases.

BrioHealth Solutions generated RMB 97.8 million in revenue from BrioVAD clinical trial charges in 2025; however, this revenue essentially stemmed from hospital procurement payments rather than normal sales profits following product commercialization. Using funds raised in the secondary market to subsidize “trial-charge business” still in the clinical stage means that investors bear pre-commercialization risks without being able to share in the returns in the short term.

BrioHealth Solutions plans to invest RMB 129 million in its production base construction project, adding an annual production capacity of 3,800 units. Notably, the company’s total sales volume of the CH-VAD in 2025 was 415 units, with capacity utilization remaining below 60% of the existing designed capacity of 700 units. This proposed expansion implies a capacity increase of over 540%, despite the current production capacity being far from saturated.

BrioHealth Solutions’ fundraising and investment projects also include a R&D project for the next-generation LVAS, with a planned investment of RMB 190 million for the development of products such as BrioVAD 2.0. A Jiemian News reporter noted that the company’s current core product, CH-VAD, and BrioVAD are essentially based on the same blood pump platform. The iterative product, BrioVAD 2.0, is still in the design verification stage, and it will take at least five more years before clinical enrollment and regulatory approval for market launch can be achieved.