Changmugu Medical Secures Tens of Millions in Pre-A Funding Led by Legend Star, with Participation from Frees Fund and WanHui Capital

On September 24, 2019, VCBeat (WeChat ID: vcbeat) learned that Beijing Longwood Valley Medical Technology Co., Ltd. had announced the completion of its Pre-A financing round, raising tens of millions of RMB. The round was led by Legendstar Capital, with participation from FreeS Fund and Wanhui Capital.The proceeds from the financing will be used to expand the company’s AI orthopedics product line, submit applications for clinical registration certificates, and accelerate the clinical implementation of its AI products.. In November 2018, Longwood Valley secured a seed funding round of tens of millions of RMB, led by FreeS Fund.

Longwood Valley is an AI-driven medical product developer that provides end-to-end AI-powered diagnostic and treatment solutions for hospital orthopedics departments, leveraging artificial intelligence, medical big data, and cloud computing. The founding team was initially established in the Longwood Medical Area, home to Harvard Medical School, and in Silicon Valley, home to Stanford University; hence, the company was named “Longwood Valley.”

The company currently boasts an R&D team composed of medical scientists and AI engineers with backgrounds from world-renowned institutions such as Harvard University, Stanford University, Tsinghua University, and Peking University, representing a typical model of medical-engineering integration. Headquartered in Beijing’s Zhongguancun, known as “China’s Silicon Valley,” Dr. Zhang Yiling, CEO of Longwood Valley, stated, “The greatest challenge in AI healthcare lies in product implementation. Our med-tech integrated team enables Longwood Valley to identify clinical pain points, gain a deep understanding of physicians’ actual needs, and develop AI products that meet the real-world clinical requirements of orthopedic surgeons.”

Since its establishment, the company has been recognized as a Zhongguancun High-Tech Enterprise and a Zhongguancun "Young Eagle" Talent Enterprise, and has received the "Orthopedic Innovation and Translation Award" at the Chinese Orthopaedic Association (COA) Congress of the Chinese Medical Association.

There are approximately 150 million patients with osteoarticular diseases in China. As the definitive treatment for joint disorders, artificial joint replacement surgery has witnessed explosive growth in recent years. In 2018, the number of artificial joint replacement procedures performed in China reached 700,000, with an annual growth rate maintained at 15%–20%.

Dr. Zhang Yiling stated, “The formulation of a precise preoperative surgical plan is a key determinant of the success of joint replacement surgery. For a long time, orthopedic surgeons in China have lacked appropriate tools, generally relying on manual measurements from X-rays. This approach makes accurate preoperative assessment difficult, forcing surgeons to determine the size and position of the prosthetic joint intraoperatively, which results in increased surgical difficulty, low reproducibility, and high risk.” Traditional surgical techniques are heavily dependent on the operating surgeon’s experience, and patients are prone to postoperative complications such as leg-length discrepancy, prosthetic loosening and dislocation, and periprosthetic fractures.

Therefore, Longwood Valley has chosen artificial intelligence as the breakthrough point for orthopedic joint replacement surgery, independently developing an optimal solution that integrates surgical simulation algorithms, image processing algorithms, and deep learning algorithms. This computer-assisted approach enables precise three-dimensional preoperative planning for joint replacement procedures. By combining this with 3D-printed, patient-specific surgical navigation guides, the intelligent preoperative plan is accurately executed during surgery, thereby enhancing the precision and safety of joint replacement procedures. The system offers strong reproducibility and effectively reduces the incidence of postoperative complications.

Since its establishment one year ago, Longwood Valley has engaged in in-depth scientific research collaborations with dozens of top-tier orthopedic centers, including the Chinese PLA General Hospital (301 Hospital), China-Japan Friendship Hospital, Peking University Third Hospital, Peking University People’s Hospital, Peking Union Medical College Hospital, the Third Hospital of Hebei Medical University, Yantai Yantaishan Hospital, Shengjing Hospital of China Medical University, Shanghai Changzheng Hospital, Tianjin Medical University General Hospital, Guangdong Provincial People’s Hospital, Guizhou Provincial People’s Hospital, the First Affiliated Hospital of Harbin Medical University, Wuhan Orthopedic Hospital, the First Affiliated Hospital of Army Medical University, the Second Affiliated Hospital of Army Medical University, Fuzhou Second Hospital Affiliated to Xiamen University, the First Affiliated Hospital of Fujian Medical University, the Second Affiliated Hospital of Fujian Medical University, and Shijiazhuang Third Hospital. These partnerships aim to transform the valuable clinical expertise of renowned orthopedic specialists into standardized intelligent systems for future deployment in primary care hospitals nationwide.

“Due to the high threshold for surgery and a long learning curve, very few doctors at primary-care hospitals are capable of performing joint replacement surgeries, leaving a large number of patients unable to receive treatment at the grassroots level,” said Dr. Zhang Yiling. “Artificial intelligence technology can promote top-tier orthopedic surgery”Transitioning from experience-based and contour-based approaches to standardized, precise, personalized, and intelligent solutions, thereby lowering the surgical threshold and shortening the learning curve for young physicians, while empowering more primary-care doctors.。”

In the future, Longwood Valley will develop products targeting various orthopedic conditions and expand its product portfolio to provide orthopedic surgeons with a comprehensive suite of AI-powered auxiliary solutions covering the entire diagnosis and treatment workflow—including disease screening, intelligent diagnosis, clinical decision support, preoperative planning, implant selection, surgical simulation, and patient follow-up. By leveraging AI-assisted diagnosis and treatment, we aim to enhance the overall diagnostic and therapeutic capabilities of primary care hospitals and young physicians, empowering orthopedics with AI and delivering globally leading orthopedic artificial intelligence solutions for patients in China.

Lu Gang, Partner at Legendstar Capital, stated: “New healthcare services are our key investment focus, while technology-enabled innovation represents the future trend. Driven by healthcare reform, the market will present structural opportunities for innovation. With various policies being rolled out across regions and the implementation of zero-markup pricing for medical consumables, the industry is in greater need of high-quality products that can deliver pharmacoeconomic value. Longwood Valley’s products address pain points in orthopedics by leveraging AI to start with surgical planning, offering a pragmatic solution to both medical empowerment and commercial implementation. The team combines top-tier orthopedic expertise with strong AI algorithm capabilities, forming a rare, deeply integrated multidisciplinary team of medical and engineering professionals. We believe this will facilitate the genuine integration of AI with clinical medical experience, paving a new path forward.”

Li Feng, Founding Partner of FreeS Fund, stated, “Over the past year, Longwood Valley’s AI solutions have become increasingly refined, its business loop has grown clearer, and its team structure has been further strengthened, achieving significant progress. The next step is to promote Longwood Valley’s AI products across China, truly empowering primary-care physicians and benefiting more patients—a highly promising development. We continue to increase our investment in Longwood Valley and remain bullish on its long-term prospects.”

Ms. Zhang Hanyan, Founder of Wanhui Capital and Chairman of Fengchuang Technology, stated, “Since its inception, Longwood Valley has been based in our Fengchuang Science Park. Through our long-term tracking and incubation, we have high confidence in the team’s technological frontier, execution capability in practical business implementation, and resource integration skills. With the overall improvement in diagnostic and treatment efficiency across the industry and the growing demand from hospitals in lower-tier markets, Longwood Valley’s product and technical solutions hold broad prospects.”

Legendstar, founded in 2008, currently manages angel investment funds with a total scale of over RMB 2 billion and has invested in nearly 300 projects. As the early-stage investment and incubation arm of Legend Holdings, Legendstar leverages more than three decades of entrepreneurial experience and resource accumulation from Legend to provide entrepreneurs with distinctive services combining angel investment and in-depth incubation.

FreeS Fund was established in 2015, focusing on early-stage and growth-early-stage investments. FreeS Fund’s key investment areas are consumer sectors and deep tech, with a focus on investment opportunities in lifestyle, education, finance, intelligent manufacturing, artificial intelligence, biotechnology and new drug development, new energy, and new materials.

Wanhui Capital, established in 2017, focuses on investing in early-stage projects leveraging AI and big data technologies across various application domains. These include AI-driven deep vertical applications and services in sectors such as AI + biopharmaceuticals, AI + big data, intelligent manufacturing, and AI + education. Backed by the financial strength of its shareholder, Fengchuang Group, and primarily utilizing proprietary funds, Wanhui Capital builds a comprehensive investment ecosystem through direct investments and fund-of-funds strategies.