Blue Sail Medical Reports Sustained Revenue Growth and Sharply Narrowed Losses in Key Financial Update

On the evening of August 30, Bluesail Medical (002382.SZ) reported its strongest financial results since the first quarter of 2023.

For the six months ended June 30, 2024, Bluesail Medical achieved operating revenue of RMB 3.006 billion, representing a year-on-year increase of 32.88%, significantly exceeding the industry average.

In terms of net profit attributable to shareholders of the parent company, the Company’s net loss decreased from RMB 213 million in the fourth quarter of last year to RMB 98.9196 million in the first quarter of this year, and further declined to RMB 61.2972 million in the second quarter. The net loss has been narrowing quarter by quarter, indicating a trend toward turning profitable.

Bluesail Medical Revenue Data

Steadily improving financial data indicate that, after years of steadfast investment, a business line combining “high-value consumables + mid- to low-value consumables” (“A+X”) has been quietly established, and Bluesail Medical’s multi-sector operations have entered a harvest phase.

Unpacking the true growth drivers behind Bluesail Medical’s figures requires acknowledging the booming market fueled by domestic substitution, as well as the supportive policies implemented across various regions. However, to replicate Bluesail Medical’s success in the medical device sector, we must first clarify the company’s strategic layout logic.

From Champion of a Vertical Niche to a World-Class Medical Device Enterprise: Bluesail Medical Has Traversed Three Stages, Each Closely Tied to Its Strategic Upgrades.

First, during the company’s initial decade of entrepreneurship (2003–2012), Bluesail Medical focused on disposable health protection products such as PVC gloves, becoming the first listed company in China’s medical glove industry and rising to become the global leader in the PVC medical glove sector in less than ten years;

Second, the company upgraded its corporate strategy to break through the ceiling of a single-product pipeline, establishing the “High-Value Consumables + Medium- and Low-Value Consumables” (“A+X”) development strategy in 2013. By pursuing overseas expansion and cross-border mergers and acquisitions, the company successfully achieved a comprehensive layout covering both high-value and medium- to low-value consumables. Meanwhile, it evolved from a company with globalized market operations into a multinational medical device platform enterprise characterized by globalized R&D, clinical operations, manufacturing, and an international talent pool. This transformation has effectively reduced and diversified operational risks across different countries, regions, and industries, enabling sustained and steady growth.

Third, launch the Globalization 3.0 strategy and enter a new stage of development as a globally renowned brand. Starting from 2023, we will begin exporting technology, brands, and standards to international markets.

All three phases demonstrate the forward-looking nature of Bluesail Medical’s development strategy.

Based on the financial results released this time, under strategic support, Bluesail Medical has achievedMultiple Performance Breakthroughs.

During the reporting period, the Company’s Cardiovascular and Cerebrovascular Business Division achieved sales revenue of approximately RMB 570 million in January–June 2024, representing a year-on-year increase of approximately 12%. The gross profit margin improved by more than 2 percentage points compared to the same period last year, further narrowing the loss. Meanwhile, despite industry-wide capacity clearance, the Health Protection Business Division recorded substantial revenue growth in the first half of 2024. The combined sales volume and production volume of glove products increased by nearly 37% year-on-year, driving a year-on-year revenue increase of over 40%. Additionally, the Emergency Rescue Business Division generated a profit of approximately RMB 14 million in January–June 2024, with its gross profit margin further improving compared to the same period in 2023.

Notably, amid the capital winter, Bluesail Medical successfully introduced strategic investors in the first half of this year, completing a private equity financing round totaling RMB 1 billion. This stands as the largest single private equity financing transaction in China’s medical device sector over the past two years. The strategic investment has provided ample financial support for the company’s business development, further accelerating its expansion into the high-end innovative medical device market.

Guided by a clear long-term strategy, Bluesail Medical has advanced steadily, achieving leapfrog growth in stages and building core corporate competitiveness, thereby successfully joining the ranks of globally renowned medical device manufacturers.

If the “A+X” strategy and the globalization strategy are viewed as the two major wheels driving Bluesail Medical’s future growth, then the propulsion of these wheels relies on innovation and optimization within its specialized business segments.

In recent years,Bluesail Medical Makes Major Strides in Cardiovascular and Cerebrovascular Fields, Accelerating Expansion into the High-End Innovative Medical Device Market. Not only does it boast a rich portfolio of cardiovascular and cerebrovascular products and a robust pipeline in development, with marketed products covering implantable and interventional devices such as drug-eluting stents, drug-coated balloons, plain balloons, and transcatheter aortic valve replacement (TAVR) systems, along with ancillary products, but the company also continues to push the boundaries of its product innovation capabilities, entering a period of R&D fruition.

Bluesail Medical Cardiovascular and Cerebrovascular Products

The company possesses independently developed, globally exclusive patented drug Biolimus A9.^®, and launched the world's first polymer-free drug-coated coronary stent, BioFreedom^®, China's First Sirolimus-Class Drug-Coated Balloon: Baiteng^TMUmirolimus-Coated Coronary Balloon Dilatation Catheter, SoniCracker for the Treatment of Fully Calcified Cardiovascular Lesions^TMCoronary intravascular lithotripsy (IVL) catheters, along with a range of other stent and balloon products.

Bluesail Medical's Star Product: BioFreedom^®As the world’s first polymer-free drug-coated coronary stent, it has achieved multiple breakthroughs in core technologies. Patients implanted with BioFreedom^®Post-stenting, the duration of dual antiplatelet therapy (DAPT) can be shortened from the conventional one year to just one month, significantly reducing the risks and inconveniences associated with DAPT. BioFreedom^®Owing to its superior product performance, the stent is widely regarded as the undisputed “gold standard” in the field of high bleeding risk (HBR) and has been selected as the comparator by numerous industry leaders.

Currently, this stent has received a recommendation from the European cardiovascular guidelines and is the first drug-eluting stent specifically designed for patients at high bleeding risk to gain market approval in the four major markets of China, the United States, Europe, and Japan. BioFreedom^®Iterative Product BioFreedom^® After obtaining CE certification in 2020, Ultra's overseas market products began to be handled by BioFreedom.^®To BioFreedom^®Ultra Transition and Switching. During the First Half of 2024, BioFreedom^®Ultra’s overseas sales revenue increased by more than 15% compared to the first half of 2023. BioFreedom^®Since receiving regulatory approval in China in June 2022, the stent has become a flagship product in the Chinese market, with domestic sales in the first half of 2024 increasing by more than 60% quarter-on-quarter compared to the second half of 2023.

As the current market demand for high-quality medical devices continues to grow, Bluesail Medical’s robust capabilities in technological R&D, market access, and international operations will lay a solid foundation for further expanding its global market share, while also enabling technology export and revenue growth.

Notably, China’s medical device industry is experiencing rapid growth and has progressed through stages of domestic substitution, pioneering first-in-China innovations, and achieving industry leadership. The era in which a single product could guarantee sustained success without further effort is over; the market now also tests companies’ ability to build comprehensive R&D systems.

Currently, Bluesail Medical is deeply engaged in the field of coronary implantation and intervention, maintaining consistently high levels of R&D investment and building a robust pipeline of products under development. The company has established a comprehensive portfolio covering coronary stents, drug-coated balloons, specialty balloons, and solutions for complex lesions.

Two Products Approved for the Company in the First Half of This Year, providing new momentum for the growth of Bluesail Medical's business scale.

Among them, the XinQi™ Coronary Balloon Dilatation Catheter achieves multiple breakthroughs in diameter specifications, rated burst pressure, and delivery system, providing a novel device for the treatment of complex coronary lesions, including chronic total occlusion (CTO). Meanwhile, it further enhances Bluesail Medical’s portfolio of devices for complex lesions in the field of coronary intervention. SoniCracker^TMAs the intravascular lithotripsy (IVL) catheter with the most comprehensive range of specifications and models currently available in China, it has improved the therapeutic efficacy for coronary calcified lesions, enriched Bluesail Medical’s technical capabilities in the field of coronary intervention, and provided clinicians with more treatment options.

Certainly, innovation in medical devices also includes external innovation that enhances product competitiveness by integrating global resources. Bluesail Medical has applied this strategy to its innovative products as well.Expanding into New Business Areas Through External Investment and Incubation。

The Company has made equity investments in the cardiovascular and cerebrovascular fields, including VAD and OCT, as well as in related sectors such as peripheral intervention, neurointervention, and minimally invasive surgery. In the neurointervention and peripheral intervention businesses, the Company has established a comprehensive portfolio, with multiple innovative medical device products already approved for market launch or in the R&D and design stages. Several products in its minimally invasive surgery business have also obtained regulatory approvals and are being sold both domestically and internationally, demonstrating strong growth momentum.

It can be seen that currentlyBluesail Medical’s Investments in Innovative Medical Devices Are Beginning to Yield Returns，Not only are new products being launched successively, but the geographic scope of product approvals is also expanding, with the number of approvals continuing to rise.As clinical applications and market share continue to expand, Bluesail Medical’s brand influence is poised to grow further, positioning the company as a leader in the cardiovascular medical device sector. Meanwhile, its strategic product portfolio—targeting multiple gaps in domestically produced offerings and aligning with globally leading technologies—will continue to drive Bluesail Medical’s growth momentum.

According to the financial report data released, Bluesail Medical’s Cardiovascular and Cerebrovascular Business Unit achieved a dual turnaround in revenue and gross profit margin in 2023. With more innovative products continuously approved for market launch, the company’s cardiovascular and cerebrovascular business demonstrated growth momentum in its first-half financial report this year, with sales increasing by approximately 12% year-on-year.

In the post-volume-based procurement era, Bluesail Medical's coronary business in China has maintained a strong growth momentum.

Meanwhile, its valve business demonstrated strong growth momentum, with year-on-year revenue growth reaching 78%, far exceeding the industry average.

Notably, in its domestic business, Bluesail Medical’s sales volume of ordinary balloons from January to June 2024 surged by approximately 250% year-on-year.

Furthermore, in overseas markets, Biosensors International, a subsidiary of Bluesail Medical, continues to lead in revenue scale and maintain a faster growth rate. In the first half of 2024, overseas revenue from cardiovascular and cerebrovascular products amounted to approximately RMB 371 million, representing a year-on-year increase of nearly 12% compared to RMB 332 million during the same period last year. By region, sales of this business segment grew across China, Europe and emerging markets, and the Asia-Pacific region. Specifically, the China region achieved growth of approximately 13%, the Asia-Pacific region saw growth of around 25%, and Europe and emerging markets recorded a growth rate close to 5%. The company’s growth rates in all regions exceeded the respective regional averages.

The above data sufficiently demonstrates the growth resilience and development potential of the company’s cardiovascular and cerebrovascular business. Behind these figures lie Bluesail Medical’s successfully established comprehensive sales channels and diverse product portfolio, as well as its deep understanding and mastery of market rules and commercial access mechanisms. It is precisely these factors that have laid the foundation for the company’s sustained revenue growth.

In the domestic market, the company leveragesThe Advantage of Direct Hospital Admission Granted by Volume-Based Procurement, now possessesMedical Device Sales Network Covering Approximately 2,500 Hospitals, which is expected to empower the launch of more new products for the company by leveraging these sales networks in the future.

Bluesail Medical has established, in light of the market characteristics and future expansion directions of the sectors covered by each business unit,A multi-level marketing model combining direct sales and distribution, with an overseas sales network spanning more than 130 countries and regions worldwide. Partners include renowned pharmaceutical distributors and end-users, medical device distributors and terminal hospitals, as well as numerous well-known enterprises, establishing a truly global sales channel and network for high-value and low-to-mid-value consumables.

The growth in sales revenue of key products, coupled with the frequent regulatory approvals, reflects the unleashing of Bluesail Medical’s accumulated R&D capabilities.

Through innovative R&D, Bluesail Medical continuously enhances the added value of its products, expands its scale and efficiency advantages to build high competitive barriers, further strengthens its core competitiveness, and bolsters its risk resilience.

In terms of R&D layout, the company has first established a global 24-hour R&D mechanism with bidirectional linkage between international and domestic operations. By leveraging its global R&D and clinical platforms along with clinical data from top-tier hospitals both in China and overseas, Bluesail Medical has not only achieved localization and internationalization of its R&D capabilities but also facilitated the mutual exchange of R&D outcomes and technology sharing across borders. This has successfully broken the monopoly of foreign technologies and laid the foundation for the domestic production of medical devices in niche sectors.

Secondly, Bluesail Medical possesses technological advantages and academic standing in innovative research.

Bluesail Medical’s core technologies, products, and clinical outcomes have been featured multiple times in top-tier international journals. Its exclusively patented products have repeatedly showcased the strength of Chinese clinical practice on the global stage, filling numerous technological gaps. Products under Bluesail Medical have been published five times in two of the world’s four leading medical journals: The New England Journal of Medicine and The Lancet. At the European Association of Percutaneous Cardiovascular Interventions (EuroPCR 2024), which concluded in Paris, France, on May 17, 2024, the company’s exclusively patented product, Boteng^TMBA9^TMClinical outcomes of DCB restenosis indications were presented in the Late-Breaking Trials session and simultaneously published in EuroIntervention, once again bringing Chinese clinical research to the international stage.

Finally, Bluesail Medical has always adhered to innovation-driven high-quality development. Since 2023, the company has launchedGlobalization 3.0A New Stage of Development.

Leveraging its 24-hour global R&D mechanism with bidirectional coordination between domestic and international teams, as well as the establishment of an innovative R&D ecosystem, Bluesail Medical is able to proactively identify numerous gaps in domestically produced medical devices and globally leading products. By aggregating top-tier global resources for strategic deployment, the company empowers its business to achieve efficient growth.

“Report on the Development of China’s Medical Device Industry: Current Status and Outlook for the 14th Five-Year Plan” predicts that by 2025, the operating revenue of China’s medical device industry is expected to reach RMB 1.875 trillion. This represents an increase of RMB 1.2453 trillion compared with 2015, a cumulative growth of 197.88%, and a 10-year compound annual growth rate (CAGR) of 11.5%, approximately twice the global market growth rate.

As public health awareness rises, consumer demand for innovative pharmaceuticals and medical devices has increased significantly. Furthermore, policies such as “accelerating domestic substitution,” “prioritizing innovative medical devices,” “promoting tiered diagnosis and treatment,” and “trade-in programs” will foster industrial innovation and iteration, enhance product penetration, and drive industry development.

Driven by the release of favorable policies and market forces, the medical device market is undoubtedly ushering in new development opportunities.

In the new stage of future development, Bluesail Medical will also tap into the huge growth potential of the medical device market, enhance its product R&D capabilities, and continue to seize opportunities by deepening its presence in the Chinese market, further refining a new marketing strategy characterized by diversification in marketing, channels, and products. Continuously enrichingProducts Related to Cardiovascular and Cerebrovascular Health, Health Protection, Emergency Medical Care, and Minimally Invasive Surgerylines, and through multi-channel deployment, continuously expand market share while exporting Chinese solutions globally。