Reyalis Files IPO Prospectus: Targeting Industry Pain Points as a Domestic IVD Core Raw Material Supplier with Independent Intellectual Property

“China’s in vitro diagnostics sector is moving from the ‘Spring and Autumn’ period to the ‘Warring States’ era. Transitioning from the Hundred Schools of Thought in the Spring and Autumn period to the Seven Warring States, it is crucial to determine who can steer their course effectively in this era of profound transformation.”Dr. Su Shaobo, Founder and Chairman of ReallyThus spoke.

Su Shaobo believes that China’s IVD industry is still in its early stages, but the COVID-19 pandemic has ignited its growth. Driven by the epidemic, there are currently approximately 1,500 to 2,000 IVD product R&D and manufacturing enterprises in China; when including related channel and trading companies, the total number of IVD-related enterprises reaches tens of thousands.

The market demand for IVD raw materials has also surged. However, the underlying accumulation of core technologies has not advanced at a comparable pace. Due to the high difficulty in R&D and the complexity of production technical routes and process flows, domestically produced in vitro diagnostic raw materials still lag behind imported products in terms of quality control, manufacturing processes, and purity.

“Currently, China’s IVD industry is still following the path taken by Roche, Abbott, Beckman, and Siemens, lacking the capacity to conduct basic research. Raw materials are akin to semiconductors; they represent the foundational research segment of the industry and constitute the core of IVD. Breakthroughs are needed first in methodologies, and second in the discovery of substances,” said Su Shaobo.

Shenzhen Really Group Co., Ltd.(Shanxi Really Biotechnology Co., Ltd.) was established by the technical team of the Shenzhen Institute of Advanced Technology, Chinese Academy of Sciences. It is an innovative technology-based company integrating biological products, IVD raw materials, medical devices, diagnostic reagents, standard quality control, scientific research technical services, and a medical translation center.

In 2010, Su Shaobo earned his Ph.D. from the University of Science and Technology of China and joined the Shenzhen Institute of Advanced Technology (SIAT). In 2013, Shanxi Province signed a cooperation agreement with SIAT, seeking to introduce high-tech projects to the province. “As a native of Shanxi, I facilitated this collaboration. Leveraging the local goat industry, we selected a polyclonal antibody project, registered and established Shanxi Really Biotechnology Co., Ltd., which was officially launched in Yangcheng, Shanxi, in 2014,” recalled Su Shaobo.

In early 2017, Shanxi Really Biotechnology Co., Ltd. secured the Chinese distributorship for Randox Laboratories (UK), selling Randox quality control products to domestic IVD companies, with annual sales exceeding RMB 10 million. Subsequently, the company expanded its portfolio by distributing products from other international brands, including Bio-Rad (USA), BIOMEX (Germany), and Kikkoman (Japan), thereby initially establishing its market presence.

By acting as an agent for foreign brands, the company has also driven the research and development and sales of its own proprietary products. In 2021, the company’s total sales revenue exceeded RMB 70 million, with exports reaching RMB 25 million; independently developed products accounted for half of this total.

At the end of 2017, the Shenzhen Institute of Advanced Technology (SIAT), Shanxi Really Biotechnology Co., Ltd., and the People’s Government of Yangcheng County jointly established the “Joint Laboratory of Biotechnology at the Shanxi Really Yangcheng Science and Technology Industrial Park, Chinese Academy of Sciences Shenzhen Institute of Advanced Technology.” The three parties engaged in extensive cooperation across multiple dimensions, including cutting-edge research on core raw materials for in vitro diagnostic reagents and other projects, new product development, establishment of technical platforms, and talent cultivation. Together, they aimed to promote the translation of scientific and technological achievements into industrial applications, enhance corporate technological innovation capabilities and market competitiveness, serve socio-economic development, and contribute to the Healthy China initiative.

In 2020, to further drive the company’s growth, Su Shaobo decided to relocate the headquarters of Really Group to Shenzhen. “Taking into account Shenzhen’s advantages in biomedical talent, policy support, and industrial chain, we moved our headquarters back to Pingshan, Shenzhen, while retaining certain production and polyclonal antibody R&D teams in Shanxi. The company is positioned as a platform enterprise specializing in the R&D and manufacturing of active pharmaceutical ingredients (APIs) for in vitro diagnostics (IVD).”

To date, Shanxi Really Biotechnology Co., Ltd. has established six R&D centers, two provincial-level R&D platforms, and four production bases, securing 14 invention patents, 2 utility model patents, and 2 software copyrights as its independent intellectual property rights. The company operates a provincial key laboratory, a joint laboratory with the Chinese Academy of Sciences, a postdoctoral workstation, and regional medical testing centers, among other facilities. Committed to becoming a leading provider of core raw materials for the IVD industry in China with independent intellectual property rights, it strives to make research and biotechnological production simpler, faster, and safer.

Since its establishment, Shanxi Really Biotechnology Co., Ltd. has been committed toSelf-Owned IPR Core Raw Material Provider for the IVD Industry, targeting the pain points of the IVD industry to help address the challenges faced by biopharmaceutical companies and research institutions"Critical Minor Matters" in the Import and Export of Raw Materials, Reagents, and Special Items.

According to Su Shaobo, enterprises typically face two major pain points in the R&D process, particularly with regard to raw materials.First is the issue of import substitution for raw materials.Many enterprises wish to use domestically produced raw materials; however, a gap still exists between domestic and imported raw materials, with imported products accounting for 80%–90% or even more of the market share.

To this end, Shanxi Really Biotechnology Co., Ltd. has broken the monopoly by developing China’s first synthetic droplet generation oil for digital PCR, dedicated to addressing the critical bottlenecks facing the IVD industry. This droplet generation oil enables the controlled formation of nanoliter-sized droplets that are uniform, stable, and resistant to the thermal cycling processes of PCR, making it suitable for applications such as digital PCR and cell encapsulation.

Second, the risks associated with the import and export of specialized biological samples.According to Su Shaobo, the in vitro diagnostics (IVD) industry frequently requires blood samples or specimens from patients with specific diseases. These samples contain high-risk positive agents that pose significant biological hazards to humans and present substantial challenges for customs importation. Nevertheless, they are indispensable and highly valuable to IVD companies. Therefore, addressing the importation issues associated with such special specimens is of paramount importance.

However, the unique characteristics and high-risk nature of biological samples have led to stringent national controls over their import and export. In contrast, many enterprises lack a thorough understanding of the regulations governing the import and export of special items, are unfamiliar with the relevant procedures, and fall short in risk management capabilities.

“Pingshan District is home to more than 800 biopharmaceutical companies, while South China has over 10,000 such enterprises, creating a substantial demand for risk management in the import and export of special biological products,” said Su Shaobo.

Against this backdrop, Shanxi Really Biotechnology Co., Ltd. participated in the establishment of the Shenzhen Pingshan Comprehensive Bonded Zone Biological Raw Materials R&D and Translation Center. Leveraging the policy advantages of the Comprehensive Bonded Zone and with the support of Shenzhen Customs, Really Biotechnology, as the platform operator, has established Biosafety Level 2 (P2) and Biosafety Level 3 (P3) laboratories. By implementing centralized management for the risk disposal of waste materials, the company ensures controllable risks for imported products, helps enterprises address their supply needs for special hazardous materials, and drives industry advancement.

As the core material of the entire IVD industry, quality control materials serve as the measurement standards in the medical field.

In 2020, the global quality control market was valued at $2.46 billion, equivalent to approximately RMB 16 billion. Among this, Bio-Rad’s global sales reached $1 billion, but its sales in the Chinese market accounted for only one-tenth of those in external markets.

As China promotes the adoption of ISO 13485 and GB 20486 standards, the quality control (QC) environment for clinical sample testing is gradually evolving from QC once every three days to QC once daily or upon each instrument startup. With industry development and improvements in laboratory testing capabilities, the QC environment for final samples will progressively align with the requirements of the International Federation of Clinical Chemistry and Laboratory Medicine (IFCC), leading to a substantial long-term increase in QC demand.

Targeting this demand, ReallyProvide enterprises with comprehensive quality control solutions centered on quality control materials and their related raw materials.

Shanxi Really Biotechnology Co., Ltd. serves as the exclusive national distributor in China for Bio-Rad, a globally renowned quality control brand, and also acts as the Chinese agent for Randox. Together, these brands command over 90% of the global quality control market and are widely used in most Grade IIIA hospitals and some Grade IIA hospitals across China.

Based on years of agency experience, Shanxi Really Biotechnology Co.,LtdWe have also custom-developed a series of single-analyte and composite quality control materials, and can tailor quality control products to meet customer requirements.

The core raw materials for quality control products are all classified as special-risk items, with compliant procurement channels typically requiring 1–2 years. Leveraging its import and export platform advantages, Shanxi Really Biotechnology Co., Ltd. can achieve a supply cycle of just one month. Through its existing agency sales model, the company has secured distribution channels with nearly 300 agents, generating cash flow to support long-term R&D investment.

In addition, Shanxi Really Biotechnology Co.,Ltd also providesR&D Translation Services: Providing Early-Stage Experimental CRO Support to In Vitro Diagnostic Companies.Including the establishment of a biobank to collect 3 million clinical samples globally, helping enterprises address sample sourcing issues and reduce R&D risks. CRO services are also one of Shanxi Really Biotechnology Co., Ltd.'s key future development focuses.

Leveraging the technical expertise of the Shenzhen Institute of Advanced Technology (SIAT) under the Chinese Academy of Sciences, Shanxi Really Biotechnology Co., Ltd. actively fosters collaboration between academic research institutions and industry to facilitate the commercialization of scientific achievements. “SIAT employs over 4,000 researchers, including more than 1,000 returnees from overseas. We align with corporate needs, relay these requirements to the institute, and carry out customized development projects. For instance, we have assisted a leading domestic pharmaceutical company in customizing polyclonal antibodies and developed droplet-generation oils for a Chinese genetic testing company.”

“Serving as a translational bridge between university research institutes and industry players, we bring dormant technologies from academy and university laboratories to light, cultivating our own intellectual property for Industry 4.0. This approach may be more pragmatic than blindly pursuing so-called technological breakthroughs, as it genuinely enhances the conversion rate of scientific research achievements,” said Su Shaobo.

The quality of raw materials for in vitro diagnostics (IVD) has a significant impact on the performance and accuracy of diagnostic reagents, and it has long been a critical bottleneck in China’s IVD industry. There are tens of thousands of types of raw materials, involving numerous technical pathways and processes, making it difficult to establish a comprehensive underlying technology platform. Currently, companies in the market are predominantly technology-driven; the technological landscape is both highly concentrated and fragmented. High technical barriers force these companies to focus on specific niche markets, which often restricts their growth. In contrast, foreign companies generally operate as platform-based enterprises, such as Thermo Fisher Scientific, Merck, and Danaher.

For this reason, Shanxi Really Biotechnology Co., Ltd. has given itsPositioned as a platform-based IVD company.By centering on customers’ pain points and facilitating corporate matchmaking through resource integration, market limitations can be avoided.

“For instance, in the area of import and export, the availability of substantial data flows enables us to analyze which products are being imported in large volumes. We can then strategically position ourselves in advance through mergers and acquisitions, technology purchases, or collaborative development with the Chinese Academy of Sciences. Our future model is ‘buy and operate,’ achieving growth through capital investment and operational excellence to build a platform-based company,” said Su Shaobo.

Last year, Shanxi Really Biotechnology Co., Ltd. completed a 50 million yuan Pre-A financing round to fund the purchase of instruments and equipment as well as laboratory renovation. The company has also initiated a new round of financing.

“Targeting the pain points of enterprises, doing what others have thought about but no one has done, and doing them all well. Making this industry a little different because of us has always been our original intention.” said Su Shaobo.

In recent years, Shanxi Really Biotechnology Co., Ltd. has maintained an annual growth rate of 40% to 50%. By April this year, the company had already achieved approximately 85% of its previous year’s performance targets. Su Shaobo believes that China’s in vitro diagnostics (IVD) industry is still following the path previously taken by the “Big Four” (Roche, Abbott, Beckman Coulter, and Siemens), lacking the capacity for fundamental research. The exit of these multinational giants from the Chinese IVD market is inevitable, driven by both national policy requirements and historical trends. Following their withdrawal, leading domestic companies are poised to capture this share of the market.

“Our goal is to become a core supplier to these leading IVD companies and enhance our irreplaceability through customized services. Additionally, as our export volume continues to grow, we are steadily increasing recognition among foreign enterprises. In the future, we hope that Shanxi Really Biotechnology Co., Ltd. will carve out a unique niche in China’s raw material industry through differentiated positioning and a distinctive operational model, emerging as one of the ‘Seven Warring States,’” said Su Shaobo.