Xien Medical and Boston Scientific Sign Framework Agreements for Strategic Collaboration in Global Commercialization, Manufacturing, and R&D

Acandis Medical Technology Holdings Limited (“Acandis,” stock code: 6669.HK) announced that it signed a Framework Cooperation Agreement and a Framework Services Agreement with Boston Scientific Corporation (“Boston Scientific,” stock code: NYSE: BSX) on July 20, 2023. The framework agreements primarily outline a series of collaborations between the two parties over the next three years in areas including global commercialization of products, product manufacturing services, and product research and development.

Boston Scientific is a global leader in the research, development, manufacturing, and sales of medical devices. Its core products and services include innovative medical solutions in areas such as interventional cardiology, peripheral interventions, endoscopy, urology, and neuromodulation. Committed to advancing science for life, Boston Scientific strives to meet unmet patient needs through a broad portfolio of efficient medical solutions while reducing global healthcare costs. In 2022, Boston Scientific generated over $12 billion in revenue, with R&D investments exceeding $1 billion.

Acotec is dedicated to leveraging trusted innovative technologies to address unmet clinical needs. Backed by robust R&D capabilities, Acotec has established a rich product pipeline across peripheral vascular, cardiovascular, nephrology, neurology, and men’s health indications. Notably, Acotec’s AcoArt Orchid® & Dhalia® are the first percutaneous transluminal angioplasty drug-coated balloons (DCBs) approved in China, securing a four-year lead over competitors. The below-the-knee DCB is the first product globally to demonstrate superior clinical outcomes in this field, thereby earning the U.S. FDA’s “Breakthrough Device” designation. Currently, Acotec’s products have achieved significant commercial success in the Chinese market. Furthermore, Acotec’s upstream supply chain layout has effectively empowered its manufacturing operations, further strengthening its R&D and cost advantages.

Following the completion of the partial tender offer in February 2023, which made Boston Scientific the controlling shareholder of Acotec, both parties have been exploring commercial collaboration opportunities in research and development, manufacturing, and commercialization. The signing of this Framework Agreement on Cooperation and Framework Services Agreement will further advance the realization of synergistic value between the two parties.

Pursuant to this framework cooperation agreement, the two parties will adopt a cross-selling model in the Chinese market. By distributing each other’s products, both parties can reach more new customers while strengthening their relationships with existing clients. In specific overseas markets, Boston Scientific holds exclusive distribution rights for selected LifeTech products (the initial batch of selected products includes peripheral drug-coated balloons, peripheral thrombectomy aspiration systems, endovenous radiofrequency ablation systems, and coronary PTCA [Percutaneous Transluminal Coronary Angioplasty] balloon dilation catheters). Leveraging Boston Scientific’s robust sales network, LifeTech products will enter broader global markets to benefit more patients. Between 2023 and 2025, the annual cap on transaction amounts for LifeTech’s procurement of Boston Scientific products for resale shall be USD 2 million. Meanwhile, the caps on transaction amounts for Boston Scientific’s procurement of LifeTech products for global sales shall be USD 20 million in 2023, USD 50 million in 2024, and USD 110 million in 2025, respectively.

Acotec has manufacturing facilities in Beijing and Shenzhen, with the capability to produce raw materials for precision catheter tubing. The company is gradually expanding its production capacity and can provide professional product manufacturing services to Boston Scientific to meet its needs for cost reduction and efficiency improvement. From 2023 to 2025, the maximum transaction amounts for the manufacturing services provided by Acotec Medical to Boston Scientific were $5 million, $8 million, and $10 million, respectively.

Under the current framework service agreement, both parties will engage in a series of collaborations in research and development (R&D) and Contract Sales Organization (CSO) services. The parties may provide R&D support to each other and share R&D and innovation resources. On one hand, Acandis can leverage Boston Scientific’s global R&D network to strengthen its R&D capabilities; on the other hand, Boston Scientific can rely on Acandis’s localized R&D advantages to improve R&D efficiency. In addition, both parties may provide CSO services to each other, further broadening the scope of their cooperation.

From 2023 to 2025, the annual caps on transaction amounts for R&D support and CSO services provided by Acotec to Boston Scientific were USD 60 million, USD 110 million, and USD 145 million, respectively; conversely, the annual caps for such services provided by Boston Scientific to Acotec were USD 50 million, USD 90 million, and USD 120 million, respectively.

Regarding the signing of this significant agreement, Ms. Li Jing, CEO of Acotec, stated, “The execution of these two framework agreements holds substantial strategic significance and commercial value for both parties. First, by leveraging a more comprehensive product portfolio, both parties can capture extensive global sales opportunities and enhance their brand influence. Second, Acotec’s manufacturing services will help Boston Scientific reduce costs and improve efficiency, thereby optimizing product supply capabilities. Furthermore, collaborative R&D efforts will drive technological advancement and facilitate product innovation and iteration. This commercial partnership will diversify Acotec’s revenue streams, boost profitability, and promote the company’s healthy and steady growth. Looking ahead, Acotec and Boston Scientific will embark on a new journey together, continuously providing cutting-edge product solutions to patients and healthcare providers worldwide.”