EVE Energy, a Billion-Dollar New Energy Leader, Files IPO Prospectus for Medical Battery Business Amid MedTech-Industrial Convergence

According to data from the General Administration of Customs, China’s medical device exports totaled approximately RMB 478.5 billion in 2022, establishing a development pattern driven by both domestic demand and exports. Frost & Sullivan projects that China’s medical device market will reach a scale of over RMB 1 trillion by 2024, with a compound annual growth rate (CAGR) of 18.5%.

Amid the rapid growth of the medical device market, how can the localization of high-end medical devices be achieved? How can domestic medical device companies secure a leading position in R&D? Recently, EVE Energy Co., Ltd., a billion-dollar market cap industry leader riding the new energy wave, announced its entry into the medical industry. This suggests that cross-sector empowerment by advanced manufacturing may become a new driving force for the upward development of the medical device industry.

EVE Energy, a leading lithium battery enterprise with a market capitalization exceeding RMB 100 billion, announced the establishment of a Medical Battery Division to achieve independent research and development and production of domestically made medical batteries.

Founded in 2001, EVE Energy has undergone more than two decades of rapid development. Riding the boom in China’s new energy industry, it has become a high-quality lithium battery platform company, possessing core technologies and comprehensive solutions for both consumer and power batteries. According to data from the consulting firm InfoLink, EVE Energy ranked third globally in energy storage battery shipments in 2022.

EVE Energy Co., Ltd. started with lithium primary batteries, later expanded into consumer lithium-ion batteries through acquisitions, and entered the power battery sector after 2015, gradually extending its reach into energy storage. Looking back on its 20-year development history, EVE Energy has demonstrated considerable foresight in strategic layout. Each of its cross-industry expansions has capitalized on the dividends brought by market shifts, earning it the title of “King of Market Trends.” This proactive move into the medical sector is also a crucial piece in completing its industrial puzzle.

Leveraging its profound expertise accumulated over years of deep engagement in the battery industry, EVE Energy Co., Ltd. simultaneously released seven major medical battery solutions targeting AEDs, ventilators, blood glucose meters, capsule endoscopes, brain pacemakers, and rechargeable neurostimulators upon announcing its diversification into the healthcare and wellness sector.

Compared with consumer electronics, medical batteries are subject to more stringent standards in terms of energy density, lifespan, size and shape adaptability, reliability, safety, and adaptability to special environments; batteries used in implantable medical devices have even higher requirements.

Taking external AEDs as an example, AEDs are typically deployed in public settings, thus requiring batteries with a wide operating temperature range that can deliver high-current discharge from -40°C to 50°C. Furthermore, since AEDs need to remain on standby for extended periods, the accompanying batteries must possess characteristics such as high energy density, low self-discharge rate, and low maintenance costs. Previously, a single battery from NIHON KOHDEN cost approximately 3,000 to 5,000 yuan.

In the field of implantable medical devices, medical batteries also present a significant challenge. Due to the unique operating environment within the human body, there are extremely high requirements for battery safety and longevity. The market for in-body medical batteries, such as those used in capsule endoscopes and deep brain stimulators, has long been monopolized by foreign companies, with a single implantable U-shaped battery priced as high as $600. This highlights the substantial market opportunity for in-body medical batteries.

According to EVE Energy, its AED batteries have undergone market validation with over 50 million units deployed, achieving a standby life of more than five years. Its batteries for deep brain stimulation (DBS) implants have completed clinical validation in over 1,000 cases in the past decade. The battery designed for capsule endoscopes measures only 7 mm in diameter, boasts a volumetric energy density of 400 Wh/L, and provides 10 to 15 hours of operational endurance. Meanwhile, EVE Energy stated that the defect avoidance rate for its medical battery products essentially exceeds 99%.

Medical batteries for implantable medical devices, due to factors such as high costs, long development cycles, and slow returns, had previously seen almost no independent R&D in China. The market for medical batteries used in vivo was long dominated by imported products, with domestic offerings being virtually nonexistent. For relevant enterprises, reliance on critical components subject to supply chain bottlenecks poses hidden risks during subsequent commercialization, particularly for innovative products. The emergence of domestic alternatives is expected to break the monopoly held by imported products in the in vivo medical battery market.

Affected by fluctuations in upstream raw material prices this year, lithium battery companies have begun to diversify their industrial portfolios to enhance risk resilience. In this context, EVE Energy Co., Ltd. has entered the medical battery sector, aiming to identify a new growth curve beyond its three core pillars: consumer, power, and energy storage batteries. Furthermore, adhering to the stringent standards of medical products will drive improvements in its R&D capabilities, thereby further strengthening EVE Energy’s competitiveness in the battery industry.

Advanced manufacturing empowers healthcare, serving as an effective pathway to address weaknesses in the industrial chain.

In a similar vein, BYD, another new energy giant, is also making moves into the healthcare sector. Although BYD produced large quantities of disinfectants and face masks during the pandemic, this was widely regarded as an exceptional measure taken under emergency circumstances. However, data from Qichacha shows that on March 31 this year, BYD applied to register the trademarks “Yuandeng Medical” and “Yueya·Medical Aesthetics,” both classified internationally under medical devices. This move undoubtedly confirms BYD’s determination to cross over into the healthcare industry.

BYD Applies for Medical Device Trademarks, Image Source: Qichacha

Unlike other companies that have diversified into the medical device sector by initially focusing on manufacturing and distribution before considering R&D, BYD has launched its medical device production and R&D almost simultaneously, selecting highly challenging niche segments.

According to data from the "2019 Blue Book of Medical Devices," the localization rate of ultrasonic bone scalpels in China was less than 10%, with the market share dominated by imported products. Yet, BYD chose precisely this sector, which was monopolized by foreign brands.

As a novel medical device, the ultrasonic bone scalpel operates with high-frequency vibrations, which impose extremely stringent requirements on its manufacturing materials. Key components, such as titanium alloy tips and the piezoelectric ceramics used in transducers and ultrasonic generators, are currently monopolized by foreign manufacturers.

In June 2022, a patent disclosure by BYD regarding ultrasonic bone scalpels revealed that the company had redesigned the transducer to improve ergonomics and successfully completed experiments replacing titanium alloy tips with ceramic ones. This development subtly suggests a breakthrough in overcoming technological blockades through material substitution.

The automotive industry is a highly complex sector that requires multi-domain, multidisciplinary collaboration. As a representative of full-stack in-house R&D in China’s automotive industry, BYD Company Limited has accumulated expertise in multiple specialized fields, including mechanical design and the application of new materials. Although there is still a long way to go from patenting to commercialization, and the research, development, and application of new materials cannot be achieved overnight, China’s healthcare and wellness industry needs more “BYDs” to participate.

It is not only industry giants such as EVE Energy and BYD; some smaller companies with accumulated expertise in their respective fields are also beginning to empower the healthcare sector.

Shenzhen Megmeet Electrical Co., Ltd. is a company specializing in electronic control products, primarily used for the conversion, control, and application of electrical energy in home appliances, industrial equipment, and automation systems. After years of development, Megmeet has accumulated extensive expertise in power electronics and related control technologies, and has begun to expand into new fields such as healthcare, communications, new energy, and rail transit.

In recent years, developed countries have gradually reshored their medical device manufacturing industries. This trend has created opportunities for the development of China’s medical device manufacturing sector while also imposing higher requirements on enterprises within the industrial chain. Taking medical power supplies as an example, many precision medical diagnostic instruments are highly sensitive to power quality. Power supply issues can range from minor problems, such as system crashes and data transmission errors, to severe consequences, including equipment damage. Compared with other electronic products, medical power supplies must meet stricter standards in terms of anti-interference capability, stability, power output, comprehensive protection circuits, and electrical safety factors for human contact.

Through years of sustained R&D investment in the medical field, Megmeet’s product portfolio now covers ventilators, portable oxygen concentrators, hemodialysis machines, anesthesia machines, patient monitors, defibrillators, portable or tabletop color Doppler ultrasound systems, and MRI scanners. Its technical solutions have been validated by the market, and the company has established partnerships with industry leaders such as GE, Philips, and Mindray. During the pandemic, Megmeet successively supplied thousands of power supply units to Huoshenshan Hospital and Leishenshan Hospital, ensuring their normal operations.

As a vast and stable market, the healthcare industry boasts broad development prospects and potential. By entering the healthcare sector, companies across various industries can implement business diversification strategies, which not only establish a second growth curve to reduce reliance on a single industry but also promote high-quality industry development.

In the healthcare industry, taking medical devices as an example, industrial development—particularly as companies advance into the high-end segment—inevitably involves upstream supply chains such as electronic components, raw materials, software, and emerging technologies. The more innovative a product is, the higher the requirements for specialized products within niche segments of the supply chain. Such demands are often niche; without the participation of corresponding enterprises in the supply chain, relying solely on in-house R&D frequently yields half the result with twice the effort.

Companies with the requisite technological expertise entering the healthcare sector can address weaknesses across the industry chain and accelerate R&D efficiency for medical innovation enterprises.

It is not only the upstream industrial sector that empowers healthcare; upstream healthcare enterprises can likewise apply their technologies to a broader range of industrial scenarios.

iRay Technology, which focuses on the R&D, production, and sales of digital X-ray detectors, is one of the few companies globally that simultaneously masters the four core sensor technologies—amorphous silicon (a-Si), IGZO, CMOS, and flexible substrates—and possesses mass production capabilities for X-ray detectors. In addition to extensive applications in the medical field, iRay Technology also employs its products in areas such as industrial non-destructive testing and security screening.

Industrial non-destructive testing is currently widely applied in industries such as mechanical manufacturing, automotive, electronics, railway, aerospace, and pressure vessels. With the rapid development of the new energy and semiconductor industries, inspection of power batteries and post-packaging inspection in semiconductors have become new growth points for X-ray detectors in industrial applications in recent years. Furthermore, in the field of security screening, driven by increasing global emphasis on public safety and the construction of infrastructure such as airports, railways, and urban rail transit, the demand for X-ray security inspection equipment is also growing rapidly.

Kangzhong Medical, whose business structure is similar to that of iRay Technology, has gradually extended its digital X-ray flat panel detector products from general medical radiography to fields such as mammography, dynamic fluoroscopy, radiotherapy, and 3D dental imaging, and further expanded into industrial, security inspection, and veterinary medical sectors.

Not only upstream medical device companies, but also some upstream biopharmaceutical companies have joined in.

The production of biopharmaceuticals is generally divided into upstream fermentation processes and downstream separation and purification processes, with the latter accounting for approximately 50% to 70% of the costs. NanoMicro Technology’s core business focuses on microsphere materials used for separation and purification.

Chromatography is currently one of the most effective techniques for separating complex components, directly determining the purity and quality of pharmaceutical products. The chromatography column is the heart of the chromatographic system, and chromatographic packing material is its core component; such packing consists of microspherical materials with nanoporous structures.

As an indispensable core foundational material in fields such as biopharmaceuticals, analytical testing, and in vitro diagnostics, the preparation of nanospheres involves multiple frontier disciplines and presents high technical barriers. Together with photolithography machines and operating systems, it was listed by Science and Technology Daily as one of the 35 “chokehold” technologies constraining China’s industrial development.

According to NanoMicro Technology’s prospectus, its R&D expenditures in the three years prior to its IPO were RMB 26.11 million, RMB 29.39 million, and RMB 33.27 million, respectively. In 2021, the year of its listing, R&D expenses surged to RMB 66.09 million. Backed by substantial R&D investment, NanoMicro Technology has achieved a coefficient of variation (CV) of less than 3% for the particle size distribution of its chromatography resin microspheres—significantly lower than the 10% CV typical of imported products. Moreover, it has become one of the few companies worldwide capable of simultaneously producing four types of complementary chromatography media: silica, polystyrene, polyacrylate, and agarose or dextran.

Nanospheres are not only essential materials for biopharmaceuticals, but also indispensable raw materials for panel manufacturing in the flat-panel display industry.

Nano-microspheres used in display materials must meet stringent quality and performance requirements, such as high precision in particle size, extremely narrow particle size distribution, excellent mechanical strength, smooth surface properties, and ultra-high cleanliness. These materials have long relied on imports. NanoMicro Technology’s products have broken the monopoly held by imported alternatives. Meanwhile, NanoMicro Technology is also developing microsphere products for energy storage and power batteries, further expanding into the new energy industry.

Upstream enterprises in the industrial chain, whether in electronic components or new materials, and regardless of whether they previously focused on industrial or medical applications, will provide support for the breakthrough of high-end medical device products as industry integration deepens.

Medical and industrial technologies must converge, with their integration further revitalizing both sectors.

With the advancement of technology, a new round of technological transformation and cross-industry integration is accelerating. In particular, frontier technologies—such as new materials, biotechnology, big data, the Internet of Things (IoT), cloud computing, intelligent robotics, and digital imaging—have demonstrated strong driving forces in recent times, propelling the development of related industries.

Currently, China's healthcare industry is facing a new wave of technological transformation. Many niche sectors, particularly certain high-end medical device products, are at a critical juncture for achieving breakthroughs from zero to one. Their success in breaking through depends on the collaboration of the upstream industrial chain.

Taking surgical robots as an example, their development involves multiple disciplines. Creating a surgical robot with clinical value requires the participation of all sectors—industry, academia, research, and clinical application—with particular emphasis on engagement from frontline clinical practitioners. It is precisely the specific challenges raised by frontline clinicians that drive robotic companies to apply various innovative technologies to address these issues.

Cross-empowerment is the path to development, though it is by no means easy.

Take Dashu Technology, a company that independently develops and manufactures core components for cryo-electron microscopes (cryo-EM), as an example. Before entering the electron microscopy industry, its founder spent many years exploring the fields of “automation control” and “microelectronic chip design and R&D.” During his use of electron microscopes, he identified the predicament in China where such instruments were either “unaffordable” or “underutilized due to operational challenges,” which inspired him to venture into the electron microscopy sector. He subsequently assembled a team of like-minded individuals to pursue independent R&D, ultimately achieving breakthroughs in key cryo-EM components.

However, such cases are few and far between; more often, companies outside the healthcare sector struggle to find an entry point. “We are closely monitoring medical robotics but remain uncertain about how to break into the market,” said the head of a company specializing in the upstream segment of the industrial robotics industry, in an interview with VCBeat. Cross-industry synergies require greater openness and communication among stakeholders.

For example, the target audience of hospital services should not be limited to patients but should also include innovative enterprises.

Only through the close integration of physicians with engineering technicians, hospitals with enterprises, and medicine with engineering can industry barriers be broken down and mutual empowerment achieved. “Many people worry that medical professionals do not understand engineering, and engineers do not understand medicine. However, in actual collaboration, there are few communication barriers between the two sides. Instead, they lament the scarcity of opportunities for cross-industry cooperation,” a practitioner told VCBeat. “We hope that medical institutions will open their doors to attract external innovative resources into hospitals, and that frontline healthcare providers will identify and communicate more valuable clinical issues, thereby encouraging companies across the industry chain to invest in research and development.”

For frontline clinical healthcare professionals, now is also an excellent time to engage in interdisciplinary research at the intersection of medicine and engineering. Currently, many medical schools in China have been merged into comprehensive universities, where engineering disciplines are well-established. Whether leveraging the universities’ own scientific research resources or their alumni-owned enterprises, opportunities for med-engineering collaboration are readily accessible—provided there is a clear research direction, be it in biology, materials science, diagnostics, or medical instrumentation.

The field of medical devices, particularly high-end innovative products, requires the integrated application of diverse technologies and specialized expertise. Their research and development demand technical reserves across multiple disciplines, leveraging the empowerment of medicine-engineering convergence to apply cross-sectoral technologies and experience to healthcare. This enables breakthroughs in previously untapped areas or the creation of new niche markets. We look forward to the emergence of a “BYD-like” company in the medical device sector that, through innovation and technology combined with China’s robust manufacturing capabilities, can engage in comprehensive competition with established industry players.