Zhang Mengru of LeLi Capital: Empowering Primary Healthcare through Medical Imaging Innovation and Localization
Medical imaging technology plays an indispensable enabling role in promoting high-quality development and enhancing service capabilities at primary healthcare institutions. Under the ongoing healthcare system reforms, the application of medical imaging at the grassroots level is being continuously expanded, with a growing number of imaging devices—such as ultrasound, digital radiography (DR), computed tomography (CT), and magnetic resonance imaging (MRI)—being deployed in primary healthcare facilities.
Furthermore, the integration of imaging technologies with 5G has transcended temporal and spatial constraints, enabling resource sharing and information interoperability. The continuous establishment of remote consultation services and remote imaging service centers allows the public to access convenient, efficient, and high-quality medical care at their doorstep. Empowered by AI, the application of medical imaging in primary healthcare systems presents numerous opportunities and value, while simultaneously facing a series of challenges.
On May 8, 2024, at the AI Medical Imaging Forum of the VBEF Future Healthcare Ecosystem Expo hosted by VCBeat,Zhang Mengru, Partner at Le Li Capital, shared profound insights on “Medical Imaging and the Development of Primary Healthcare.”
Zhang Mengru, Partner at LeLi Capital
“Since we are discussing primary healthcare, we must meticulously analyze and deconstruct it to understand its constituent components. Macro-level data reveal that there are currently 17,000 county-level hospitals, 36,000 township health centers, and 622,000 village clinics. What, then, are the specific challenges faced by these entities?”
Zhang Mengru pointed out that, first and foremost,Shortage of Doctors, physicians face limited career development pathways, and the lack of medical equipment makes it difficult to conduct precise patient examinations, posing risks of missed or misdiagnoses; these factors contribute to a shortage of professional personnel in primary healthcare institutions; secondly,Equipment shortage. In county-level hospitals and township health centers, medical resources such as DR and CT are relatively scarce; thirdly,Lack of experience. Compared with primary healthcare institutions, patients place greater trust in Grade A tertiary hospitals in first-tier cities, resulting in relatively fewer patients at primary healthcare institutions and a lack of sufficient case accumulation.
“We are contemplating a question: as healthcare investment practitioners with relatively limited technical expertise, what can we do for primary healthcare in China? I believe the key lies in addressing four challenges: ‘lack of equipment,’ ‘lack of experience,’ ‘lack of patients,’ and ‘high risk,’” introduced Zhang Mengru. He noted that through technological accumulation, it is possible to popularize medical devices at lower prices with superior after-sales service. In this context, while primary hospitals may not be able to achieve rapid breakthroughs in specific diagnostic and treatment capabilities, they can excel in laboratory testing and inspection, thereby resolving the issues of insufficient equipment and experience. Furthermore, integrating AI with medical imaging equipment helps primary care physicians make more accurate diagnoses.
In modern medicine, 75% to 85% of therapeutic information is derived from medical imaging. Medical imaging permeates every stage of clinical practice, including diagnosis, treatment, surgery, and prognosis. The development of radiology departments can assume greater social responsibility within primary healthcare systems.Taking stroke as an example, it has become the leading cause of death and disability among adults in China. The optimal golden window for emergency treatment of stroke is within 5 hours. Although hospitals at the county level and above have established stroke centers, patients in more grassroots settings may not be able to receive timely care. If township health centers were equipped with CT scanners, they could enable rapid diagnosis and life-saving interventions.
In 2022, China’s total health expenditure exceeded RMB 8 trillion, accounting for approximately 7.0% of GDP. Compared with developed economies, China has a higher proportion of out-of-pocket health spending, imposing a heavier medical financial burden on residents. The core driver of this phenomenon is population aging, which has accelerated the growth rate of health insurance fund expenditures while simultaneously slowing the growth rate of health insurance revenues.
China’s county-level population accounts for more than 70% of the national total. Under these circumstances, the basic medical insurance system has done its utmost within its capacity to safeguard residents’ life and health security. “China’s healthcare system is largely inclusive in nature, but we do not wish to see the overall burden of medical expenditures remain so heavy. We hope that, through our own efforts and by investing in higher-quality enterprises, we can reduce medical costs for both residents and the government in a more cost-effective manner,” said Zhang Mengru. Turning to medical imaging services, their scope should accordingly extend beyond central cities to reach the vast grassroots level.
This concept aligns closely with national macroeconomic policies. In 2022, the National Health Commission proposed the “Thousand County Project,” explicitly aiming to ensure that by 2025, at least 1,000 county-level hospitals would achieve medical service capabilities equivalent to those of Grade A tertiary hospitals. The state issued the Notice on the Catalogue for Permit Management of Large Medical Equipment Configuration (2023). Under the new configuration catalogue, purchase restrictions on CT scanners with 64 slices or more and MR systems with 1.5T or higher have been removed; any medical institution may directly procure medical equipment not listed in the catalogue, provided the price does not exceed RMB 30 million, without needing to apply for approval from provincial or municipal authorities.
What Kind of Equipment Does Primary Healthcare Really Need? Beyond Greater Precision, It Must Also Be More Accessible.“Precision in diagnostics and treatment is inevitably the direction pursued by scientific and technological advancement. However, at present, we believe that ‘greater accessibility’ is a more critical imperative, as it translates to lower healthcare costs for patients and reduced government expenditure.”, Zhang Mengru explained. “Around the year 2000, the cost of a CT scan was RMB 800–1,000. Today, although prices vary across provinces and cities, the median price (for 16-slice scanners and below) has generally remained between RMB 100 and 220, with some prefecture-level cities in Zhejiang Province charging as little as RMB 48. This shift—from needing an entire month’s salary to afford a single CT scan to being able to cover diagnostic and treatment costs with just one day’s wages—reflects the positive changes brought to patients’ healthcare access through the continuous advancement and dedication of medical professionals.”
Within the broader macroeconomic logic, what can investment institutions do to achieve the goal of universal healthcare access? The answer lies in reducing the comprehensive cost per device while enhancing the quality of medical services—namely, through the domestic substitution of medical equipment. “Whether it concerns CT scanners, MRI systems, or radiotherapy equipment, nationwide domestic substitution translates into reduced household expenditures. Therefore, we have consistently focused on teams driving this trend,” introduced Zhang Mengru. “From a software perspective, these are outstanding algorithm teams; from a components standpoint, they are reliable supply chain partners. Additionally, there are some ambitious start-ups developing complete integrated systems.” Zhang emphasized the term “ambitious” because China’s basic medical imaging equipment market has historically been monopolized by leading overseas enterprises. Under such circumstances, any attempt to develop domestically produced complete systems requires overcoming many entrenched perceptions and biases, which demands considerable courage.
Regarding what constitutes good medical imaging equipment, Zhang Mengru pointed out that key factors include reliable after-sales service, stable quality, ease of operation, and, most importantly, affordable pricing. With the ongoing localization and substitution of components for medical imaging equipment, this goal will gradually be achieved.
“Not only in diagnosis, but also in the field of treatment, we need to continue our exploration. The penetration rate of radiotherapy in China is currently relatively low, and there is a lack of advanced radiotherapy equipment and technologies,” introduced Zhang Mengru. There are approximately 2.4 radiotherapy devices per million people in China, far lower than the 6-12 units in developed countries. Only 7.6% of county-level hospitals possess radiotherapy equipment, with fewer than 500 such facilities nationwide.
Many residents in county-level cities, if unfortunately diagnosed with malignant tumors and requiring radiotherapy or surgery, must travel hundreds of kilometers to first-tier cities or provincial capitals. They often face the hardship of temporarily renting accommodations, sometimes even living in basements, while enduring dual emotional and financial pressures that prevent them from receiving adequate care. Gradually equipping and promoting radiotherapy facilities at the county level would therefore carry profound significance.
““Domestic substitution of medical devices is a formidable challenge. Although the road ahead is long, we have the courage to say, ‘The path is arduous and lengthy; proceed steadily, and you will surely arrive,’” said Zhang Mengru. He emphasized that domestic substitution is not merely about national pride, nor is it about empty slogans or simply replicating foreign medical equipment. Rather, the goal is to deliver higher-quality, more accessible healthcare solutions.“We look forward to medical devices being manufactured and sold with greater precision and at lower costs, enabling us to adopt better diagnostic and therapeutic methods that benefit every county and village across this nation of 1.4 billion people.”