Lion Medical Secures Tens of Millions in USD in Series B Funding Led by Shangcheng Capital and Yuan Capital, with Additional Investment from Medtronic China Fund

VCBeat (WeChat ID: vcbeat) has learned that recently,Leno Medical, a company specializing in the R&D, manufacturing, and sales of single-use interventional medical devices, announced the completion of its tens-of-millions-of-dollars Series B financing round, led byShangchengCo-led by Capital and Yuanyi Capital, with continued participation from existing investor Medtronic China Fund; Life Capital served as the exclusive financial advisor.

Leno Medical, established in 2015 with its headquarters in Shanghai, operates two wholly-owned subsidiaries in Suzhou. It features a 2,000-square-meter manufacturing facility equipped with standard Class 10,000 cleanrooms and advanced equipment and production processes for catheter and guidewire manufacturing.

The company is committed to providing users with high-quality, cost-effective medical device products by combining the licensed introduction of advanced foreign technologies with independent research and development.To date, Leno Medical has built a diversified product portfolio in the fields of cardiovascular and ENT (ear, nose, and throat) specialties. Multiple innovative products with full intellectual property rights have obtained certification from the China Food and Drug Administration (CFDA), while several other products are progressively entering clinical trials and registration stages.

In the field of cardiovascular medicine, guidewires are key to the success of percutaneous transluminal coronary angioplasty (PTCA) procedures. However, due to the high technical difficulty and barriers associated with their manufacturing, the market is currently monopolized by foreign brands.

Leno Medical’s PTCA guide wire—Nayutus—was acquired in its entirety from Japan’s SDL, encompassing product patents, technical know-how, manufacturing processes, production equipment, and raw materials.China's First PTCA Guidewire with Quality Rivaling Foreign BrandsNayutus offers a lower price while delivering the highest level of operational experience. As a domestically produced device, it holds inherent advantages in bidding processes and medical insurance reimbursement, resulting in strong market competitiveness.

In the field of otorhinolaryngology, Leno Medical has also established a comprehensive product portfolio. The Nasclear sinus balloon, licensed and introduced from Hong Kong-based CathMed, has completed the R&D of its second-generation improved version, securing a unique leading position in China. Compared to other first-generation sinus balloons on the market, the second-generation Nasclear sinus balloon features an integrated design for all components, offering simpler, more convenient, and faster operation.

Cui Teng, CEO of Leno Medical, revealed that the company has established a continuous product development program in the field of otolaryngology and ophthalmology. Over the next three to five years, Leno Medical will launch a comprehensive series of interventional products targeting multiple indications in this specialty, by combining technology introduction with independent research and development.

As the world’s second-largest medical device market after the United States, China has witnessed rapid growth in high-value consumables for interventional procedures in recent years, with a compound annual growth rate (CAGR) of 28% and a market size exceeding RMB 100 billion.

However, traditional medical device companies generally have narrow product lines, face high risks with single products, and find it difficult to build diversified product portfolios. Moreover, due to a lack of core intellectual property rights, their products struggle to enter international markets.

According to Cui Teng, who has been engaged in medical device investment for many years, it is crucial for a medical device company to broaden its product portfolio. Companies should not rely on a single product but must develop a comprehensive series covering multiple products. However, under the traditional business model of medical device enterprises, which relies on imports or independent R&D and manufacturing, it is difficult to build a relatively complete product line within a short period.

Therefore, Leno Medical decided to pursue a path of innovation from its inception,The company adopts a global license-in model, leveraging technology licensing and mergers and acquisitions to rapidly build a diversified product portfolio in selected therapeutic areas, thereby effectively and with low risk securing a market presence.

So-calledTechnology License-in, refers to obtaining the primary rights to advanced foreign products in China (or the Asia-Pacific region) through commercial contracts, by paying licensing fees and sales royalties. These rights include patent usage rights, transfer of technical know-how, production licenses, brand ownership, and distribution rights. In other words, the ownership of the product in China belongs to the licensee who introduces it.

Cui Teng introduced to VCBeat that this License-in model has the following three advantages:

● Diversified Product PortfolioThe license-in model, which leverages research outcomes from advanced foreign enterprises, significantly lowers the requirements for the licensee’s in-house R&D capabilities, allowing the same resources to be used to simultaneously introduce multiple different products. Product direction is no longer constrained by the existing team’s capabilities; instead, companies can address gaps in their internal expertise by licensing in new technologies.

● Rapid Market EntryThrough the license-in model, products can achieve a development cycle nearly synchronized with advanced international counterparts, enabling immediate entry into the Chinese market and establishing a first-mover advantage. Meanwhile, compared to foreign competitors entering China via traditional import channels, the licensee can fully leverage local advantages, benefit from policy incentives, and obtain marketing authorization more rapidly.

● Full Intellectual Property RightsBy acquiring full intellectual property rights for new products in China through license-in agreements, the introducing enterprise raises product entry barriers and capitalizes on policy dividends. Meanwhile, by assimilating and absorbing the introduced technologies and know-how, it rapidly enhances its in-house team’s technical capabilities, secures rights to patents for secondary development, and establishes a foundation for independent intellectual property R&D.

“This means that we not only spent money to acquire this product, but also built up related R&D capabilities. In the long run, this is highly beneficial for establishing our own R&D capabilities,” said Cui Teng.

First, by licensing in foundational core technologies and products, establish a proprietary intellectual property foundation;

Secondly, during the License-in process, through collaboration with the technology provider, leverage proprietary technologies to improve and develop the product while retaining partial intellectual property rights;

Finally, by leveraging established core process technologies and integrating select new technologies acquired through license-in arrangements, we lead the development of innovative medical devices, thereby securing full intellectual property rights that can be licensed or transferred to third parties.

Certainly, introducing advanced foreign medical products into China and ultimately achieving sales places exceptionally high demands on the team. The team must simultaneously possess business negotiation capabilities for product introduction, capabilities for localizing production, and regulatory affairs expertise to ensure rapid market approval in China.

Coincidentally, the three founders of Leno Medical each possess these capabilities, forming a perfect combination.

Cui Teng, CEO of Leno Medical

Bachelor of Engineering in Automation, Shanghai Jiao Tong University,

MBA from the Wharton School of the University of Pennsylvania

Cui Teng, CEO of Leno Medical, previously worked at CITIC Capital for an extended period, where he was responsible for project investments in the medical technology, agriculture, and biotechnology sectors in China. He also served as a senior consultant at Boston Consulting Group (BCG), focusing on research and projects related to the medical equipment and device industry in China.

Therefore, Cui Teng possesses extensive investment experience and a robust project pipeline in high-value medical equipment, implantable medical devices, and advanced diagnostic systems, distinguished by his unique insight and exceptional business negotiation skills. Currently, he is primarily responsible for strategic planning, business development, and financial management at Leno Medical Technology (Shanghai) Co., Ltd.

 Qian Yongwei, COO of Leno Medical

Master of Clinical Medicine, Shanghai Second Medical University,

Ph.D., Louisiana State University School of Medicine,

Ochsner Medical Foundation Postdoctoral Fellow

Dr. Qian Yongwei, COO of Leno Medical, previously served as a Senior Scientist at NPS Pharmaceutical and as the Pharmaceutical Director at China-US United Health Services (United Family Healthcare). He is also the Founder and CEO of Orbus Neich and SynexMed.

Dr. Qian Yongwei enjoys a high profile and widespread acclaim in the interventional medical device industry, holding an undisputed position of authority particularly in the manufacturing, application, and research and development of interventional cardiology products and balloon catheters. Since joining Leno Medical, Dr. Qian has been primarily responsible for the company’s daily operations, establishment of management systems, and technical development of new products.

Dr. Li Ning, the company’s third co-founder and current Non-Executive Chairman of the Board of Leno Medical, brings over a decade of experience at the U.S. FDA, where he served in various capacities including Reviewer and Senior Reviewer in the Drug Division, Review Supervisor, Senior Clinical Reviewer in the Office of Scientific Research, Senior GCP Clinical Observer, Review Supervisor in the Cardiovascular Products Division, and Director of the Medical Devices Division.

Meanwhile, Dr. Li Ning serves as a Senior Expert Advisor to the China Food and Drug Administration (CFDA), assisting in the redesign and development of China’s drug and medical device review processes. Leveraging his professional expertise, Dr. Li provides evaluation and guidance on product introduction, research and development, clinical trials, and regulatory registration for Leno Medical.

Such a top-tier team is one of the key reasons why investors are bullish on Leno Medical. Gao Yi, Partner at Yuanyi Capital, told VCBeat: “The global license-in model places high demands on teams. It requires tracking, selecting, negotiating, transferring technology, and collaborating on products worldwide, while involving multiple stages such as clinical development, expedited registration, integration and divestiture, manufacturing localization, market expansion, and sales synergy. The team must possess strong competitive advantages across the entire value chain, as well as extensive professional expertise to make informed decisions.”

“After years of collaboration, the founding team of Leno Medical has developed highly complementary expertise and capabilities, forming a cohesive unit that aligns seamlessly with the company’s business model. In international operations and mergers and acquisitions, the core management team possesses extensive experience across various models, including License-in/License-out agreements, R&D collaborations, international clinical partnerships, minority equity investments, controlling acquisitions, management buyouts (MBOs), asset acquisitions, and joint ventures, earning strong support from leading global industry players.”

With a clear strategy and a strong team, Leno Medical has established its presence in the two major therapeutic areas of cardiovascular and ENT (ear, nose, and throat) within less than three years since its inception, achieving phased results. The company currently has five products on the market and nine products under regulatory review, including multiple innovative products independently developed by Leno Medical.

Regarding the achievements Leno Medical has made to date, Cui Teng stated, “Without technology introduction and collaboration, it would have been difficult for us to establish our own innovation and R&D capabilities in such a short period. We are fortunate that we clearly defined our future goals and strategy from the very first day of the company’s establishment and successfully implemented them. Of course, we owe this to the unwavering strong support from our investors.”

“Upon the completion of this round of financing, the Company will continue to intensify its efforts in R&D and sales, optimize its product portfolio, and strengthen the marketing and sales of existing products. These initiatives aim to establish Leno Medical as a leading platform enterprise in China’s interventional medical device sector, thereby maximizing corporate value for its shareholders.”

Leno Medical’s distinctive global license-in model has frequently attracted capital market favor, with the company having received continuous investment from professional investors including Medtronic China Fund, Zhongwei Fund, Kaixuan Venture Capital, and Jingxu Venture Capital.

The lead investor in this financing round, Yuan Yi Capital, is an international venture capital fund. Its initial phase comprises a U.S. dollar-denominated fund and a renminbi-denominated fund, focusing on early-stage and growth-stage enterprises in the healthcare and innovative financial technology sectors.

Yuan Yi Capital is committed to identifying the most innovative stars of tomorrow on a global scale through in-depth, continuous industry research and by leveraging the support of world-class industry experts. By capitalizing on the significant opportunities arising from market reforms, the firm focuses on corporate growth, team quality, and core competitiveness, thereby substantially enhancing the strategic, operational, market expansion, and international collaboration capabilities of its portfolio companies.

Gao Yi, Partner at Yuan Yi Capital, stated that unlike traditional medical device R&D and manufacturing companies that focus on imitating single products or serving single departments, Leno Medical is positioned as“Global Product Licensing In-Licensing + Technical Collaboration + Independent R&D” Strategy, transcending the limitations of the import substitution model in terms of intellectual property and product iteration, and avoiding inherent systemic risks in the medical device sector—such as limited market size due to reliance on single products, R&D lagging behind competitive product iterations, and lack of marketing and sales synergies—through diversified licensing and introduction models and portfolio management of product lines.

The company’s current product strategy focuses on the cardiovascular field, which offers broad applications, and the otolaryngology segment, a blue-ocean market, with multi-product line coverage at the departmental level. Meanwhile, the company achieves rapid growth through a combination of mergers and acquisitions (M&A) and independent R&D, evolving into a global enterprise rooted in the Chinese market with international capabilities in R&D, operations, and M&A.

Shangcheng Capital, officially established in January 2016 by Mr. Yu Jianming, is a private equity investment fund focused on the Chinese market, with an emphasis on innovation-driven growth investment opportunities.

As a co-lead investor in this financing round, Jin Jinghua, Partner at Shangcheng Capital, stated: “Shangcheng Capital has long maintained a positive outlook on innovative medical technology enterprises. Leno Medical has addressed the challenges faced by traditional medical device manufacturers—such as high risks associated with single-product portfolios, lengthy R&D cycles, substantial capital expenditures, and slow product iteration—by adopting a global License-in model. Through this approach, the company has rapidly achieved its initial accumulation of resources, establishing independent R&D capabilities and high-quality production capacity. Leno Medical is well-positioned to break the monopoly held by foreign companies in the cardiology sector and continuously explore new market demands in ophthalmology and ENT (ear, nose, and throat), thereby achieving leapfrog growth.”

Medtronic is a global leader in medical technology, services, and solutions, dedicated to alleviating pain, restoring health, and extending life for millions of people worldwide. On average, more than two patients every second benefit from Medtronic’s medical technologies or therapies. With 84,000 employees globally, Medtronic serves physicians, hospitals, and patients in approximately 160 countries.

Medtronic China Fund is a fund jointly established by Medtronic, Sequoia Capital China, and Suzhou BioBAY in early 2016. It primarily invests in early-stage domestic medical technology startups in China, while also investing in and accelerating overseas innovative technologies and healthcare service companies that align with the Chinese market.

Shi Yonghui, Executive Director of the Medtronic China Medical Fund, stated, “The Medtronic China Fund aims to assist innovative enterprises in bringing high-quality medical solutions to Chinese users at an earlier stage through a multi-faceted approach encompassing products, clinical applications, and branding. Since leading the Series A+ financing round for Leno Medical in 2016, the Medtronic China Fund has continued to participate in its Series B financing, seeking to deepen the collaboration between Medtronic and Leno Medical. Together, they aim to drive the development of domestically produced innovative medical devices and provide more Chinese patients with high-quality, affordable surgical treatment options.”