Ezisurg Medical: A Decade of Foundation and Two-Stage Strategy to Become a Global Leader in Minimally Invasive Surgery

Recently, VCBeat conducted an interview focusing on the changes and opportunities in the minimally invasive surgery industry, as well as ESM’s strategic planning, technological breakthroughs, and product innovation.Nie Honglin, Chairman and Founder of ESMConducted an exclusive interview.

ESM, established in 2011, is a high-tech company dedicated to the research, development, and industrialization of high-end medical devices for minimally invasive oncologic surgery, with the aim of building a premium Chinese brand in this field. Currently, in the high-end minimally invasive medical device and equipment sector, which has been heavily dominated by imported brands, ESM has developed four major product lines: stapling, energy, endoscopic systems, and surgical support. The company provides comprehensive minimally invasive surgical solutions for cancer treatment to customers worldwide.

Why Focus Exclusively on Minimally Invasive Surgical Oncology?

Nie Honglin stated, “ESM’s long-term vision is to build a leading brand in the field of minimally invasive surgery, not limited to oncologic minimally invasive surgery. However, this is a long-term process.”

First, the market for minimally invasive surgical devices is vast, encompassing multiple fields such as oncology, cardiovascular and cerebrovascular diseases, orthopedics, and urology. Each of these fields represents a substantial market size with numerous products and technologies involved. Establishing a full-category product line would pose significant challenges to a company’s professional technical expertise and commercial operational capabilities, making it particularly unsuitable for ESM during its startup phase.

Secondly, in the early stages of its founding, ESM conducted thorough research on globally renowned medical device companies and identified a common pattern: these established players typically waited until they had been in operation for over ten years—often two to three decades—to develop mature and efficient commercial systems and accumulate substantial foundational strength before embarking on large-scale mergers and acquisitions or business expansion.

Based on this, ESM plans to focus on minimally invasive oncologic surgery in its early stages, diligently strengthening its capabilities in core areas such as technological innovation, product development, quality management, manufacturing, marketing and services, brand building, and talent reserves.

Finally, ESM believes that it must possess key commercial operational capabilities before embarking on a path of business expansion. These critical commercial operational capabilities include: efficient product commercialization development capabilities, mature marketing models, comprehensive brand integration capabilities, and strong talent reserves and development capabilities.

Thus, the first decade of ESM was a journey from “0” to “1.” Having celebrated its 10th anniversary, ESM was well-prepared for business expansion. In 2022, ESM formally embarked on diversification, taking decisive steps into fields such as urology.

During the first decade of its founding, ESM primarily focused on the field of minimally invasive oncologic surgery, launching a product portfolio that included staplers, ultrasonic scalpels, endoscopes, and trocars.

To establish itself as a leading brand in the field of minimally invasive surgery, ESM actively strengthens its capabilities in technological innovation, product research and development, and quality management.。

For example, ESM has progressively accelerated the pace of product initiation, R&D, and regulatory approval: its laparoscopic stapler received EU CE certification in 2013, NMPA approval in 2014, and FDA clearance in 2015. Since then, ESM has rapidly expanded and iterated its stapler portfolio, launching disposable linear cutting staplers and disposable circular staplers in 2016. Currently, its laparoscopic stapler products have evolved to the fifth generation—the cordless electric stapler.

Regarding other products, ESM’s ultrasonic scalpel received CE certification in 2017 and NMPA approval in 2019; the company also launched its 4K endoscopic system in 2019.

As can be seen, ESM boasts impressive capabilities in rapid commercialization and innovative product R&D. Furthermore, ESM has made significant efforts to ensure product quality, thereby greatly meeting clinical needs.

For example, its third-generation endoscopic stapler integrates the technical advantages of the previous two generations. It not only features a 60° ultra-large articulation angle, one-handed operation, and high-efficiency staple guide channels, but also adds a one-handed release button to enhance one-handed functionality, increase jaw clamping force, and further reduce tissue slippage.

Meanwhile, this product adopts a replaceable staple cartridge design. Compared with similar international products, its shorter jaw design facilitates operation in confined spaces. Furthermore, the adoption of this new technical solution helps reduce the cost of consumables in clinical surgeries.

For another example, the ultrasonic surgical dissection and hemostasis system launched by ESM features minimal thermal damage, rapid cutting speed, and reduced bleeding during soft tissue grasping, coagulation, dissection, and cutting. Moreover, it generates no smoke during use, thereby avoiding obstruction of the surgical field and air pollution in the operating room. The waveguide rod of its ultrasonic scalpel head adopts an innovative design for which an invention patent has been filed, enabling better coordination between the vibration frequency and amplitude of the ultrasonic scalpel head. This ensures optimal hemostatic efficacy while maintaining high cutting speed. Notably, this product is capable of sealing 5mm blood vessels and is the first Class III ultrasonic surgical device in China to receive regulatory approval for the indication of sealing 5mm blood vessels.

Leveraging its superior product performance, ESM has simultaneously enhanced its rapid commercialization capabilities, marketing prowess, and brand integration abilities, while also cultivating a reserve of top-tier talent.

In terms of rapid commercialization, the ESM team is capable of accelerating product approvals and expanding sales globally. To date, ESM’s ultrasonic scalpel products have been launched and sold in the European Union, Serbia, South Africa, Malaysia, Indonesia, Brazil, and other countries and regions; its stapler products have entered more than 40 countries and regions worldwide, with cumulative clinical usage reaching millions of units.

In terms of market strategy, ESM has seized the policy opportunities for import substitution by building an elite team and capturing high-end markets, such as key hospitals and departments, through differentiated professional education and academic promotion. Meanwhile, it has rapidly achieved scale for individual products by leveraging Key Opinion Leaders (KOLs) and adopting an aggressive high-profile approach. After consolidating its position with single-product lines, ESM has expanded from single products to a full product portfolio, using its flagship products to drive sales of other items or new launches within its product mix.

Currently, ESM has secured a leading position in the domestic market for laparoscopic staplers and is beginning to drive sales of other minimally invasive surgical products, such as ultrasonic scalpels, endoscopes, and trocars, through its stapler business.

In 2021, ESM celebrated its 10th anniversary, marking a milestone in its first phase. Moving forward, ESM will embark on its second phase: business expansion.

Nie Honglin stated, “Over the next 2–3 years, ESM will expand into other sub-sectors of minimally invasive surgery, such as ultrasonic scalpels, endoscopic systems, and flexible ureteroscopes. Through growth in these sub-sectors, ESM aims to become a leader in the minimally invasive surgery industry.”

During the business expansion phase, ESM plans to increase its market investment in certified products. For instance, ESM will strengthen the marketing of reusable ultrasonic scalpels, reusable electric staplers, and cordless electric staplers. Previously, ESM’s ultrasonic scalpel was successfully selected in the 2021 centralized procurement program led by Guangdong Province, which involved a 16-province alliance, with relatively reasonable winning bid prices.

With ESM’s ultrasonic surgical scalpel winning bids in the centralized procurement programs of 16 provinces and the company intensifying its marketing efforts, ESM expects that revenue from ultrasonic surgical scalpels will account for approximately 15% of its total revenue in 2022.

In terms of products, ESM will accelerate product iteration and regulatory approvals. In 2022, ESM will complete the registration applications for products such as single-use endoscopes and cordless electric staplers, and initiate the registration processes for several other products. Meanwhile, ESM will launch the research and development and iteration of multiple new minimally invasive surgical products.

In terms of overseas markets, ESM plans to actively develop the global market. It is reported that ESM has established subsidiaries in the Netherlands and the United States, respectively, to provide commercial operations and after-sales maintenance services to local customers, thereby enhancing its overseas service capabilities. Nie Honglin stated, “ESM is poised to become the first Chinese enterprise to sell laparoscopic staplers to the U.S. market on a large scale under its own brand.”

In 2022, ESM will intensify its market development efforts in North and South America, while increasing investment in its strongholds such as the Middle East and Europe, thereby generating greater market growth. With this push into overseas markets, ESM projects that international revenue will account for 20% of its total revenue.

Notably, ESM also plans to conduct an initial public offering (IPO) on the Main Board of the Hong Kong Stock Exchange within this year.

In 2020, a four-province alliance comprising Yunnan, Guizhou, Chongqing, and Henan launched centralized procurement of surgical staplers. In 2021, Chongqing, in conjunction with Hainan, Yunnan, Guangxi, Qinghai, Henan, Xinjiang, and the Xinjiang Production and Construction Corps, conducted centralized procurement of disposable endoscopic linear cutting staplers and components. In December 2021, Guangdong led a 16-province alliance in the centralized procurement of ultrasonic scalpel tips...

As municipal and provincial alliances have successively included products such as staplers, ultrasonic scalpels, and endoscopes in centralized procurement, the minimally invasive surgery industry is undergoing unprecedented transformation.

Nie Honglin stated, “Among various policy options, the volume-based procurement (VBP) model is the most suitable approach to achieve a win-win outcome for both medical insurance funds and the industry. On one hand, VBP can reduce medical insurance expenditures; on the other hand, it significantly lowers companies’ sales and distribution costs, allowing more funds to be allocated to innovation.”

For enterprises, competition after centralized procurement still revolves around product quality, production costs, and distribution channels. Therefore,Enterprises in the field of minimally invasive surgery still need to build their core competitiveness by innovating technologies, improving product quality, and reducing production costs, thereby winning the market with high cost-performance ratios.

For the industry, as the volume-based procurement policy advances, the number of companies in the minimally invasive surgery sector will decline significantly, leading to a substantial increase in industry concentration.

It is important to note that the current volume-based procurement rules primarily emphasize price reduction magnitude and awarding contracts to the lowest bidders, while paying less attention to industrial balance and healthy development. We recommend that,The design of centralized procurement rules must account for the long-term nature of domestic substitution. It is essential to reserve room for high-value expenditures, such as R&D investment by innovative enterprises and funding sources for future technological innovation. By establishing bid-winning criteria based on multidimensional indicators—including the proportion of R&D expenditure—companies can maintain sufficient R&D funding capacity after winning bids. This approach will continuously enhance the international competitiveness of leading Chinese brands.Bridging the Gap with International Medical Giants,Promote the sustainable, healthy, and rapid development of China's healthcare industry.