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In Depth
Dropping Unprofitable Customers: 17 Listed Medical Device Enterprises Streamline Operations The medical device industry saw a sharp paradigm shift in 2026: 17 listed device makers unveiled a collective "subtraction" strategy in their half-year reports, reshaping their customer bases. The trend spans IVD, imaging, and consumables, marking a turn from blind scale-chasing to precise quality-chasing. Some shed low-value customers outright — HONSUN, DIAN Diagnostics and others shut inefficient outlets, scaled back low-margin distributor business, and cut loss-making projects, abandoning traditional distribution business with long payment cycles and heavy capital use. Others tactfully refocused on top-tier resources, with Mindray and United Imaging deepening key-account ties and steering resources to high-value-added business. Small distributors and grassroots hospitals are the main casualties, as centralized procurement squeezes terminal margins. This is no short-term winter strategy but a collective pivot to "picking customers" in pursuit of high-quality, sustainable growth.
11min read
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100% Trading Below IPO Price, 87 Companies in Queue: The Ebb of Healthcare IPOs in the Hong Kong Stock Market Hong Kong's healthcare IPO market weakened sharply in 2026 as listing premiums faded and investor sentiment cooled. In Q3, only two healthcare companies went public, both suffering first-day losses. Highly anticipated listings such as MEDCAPTAIN and Beijing TRT Healthcare also saw steep post-listing declines, with some new listings falling over 60%. The downturn reflects tighter primary-market risk appetite, weaker secondary-market confidence, and reduced tolerance for valuations based on early-stage narratives. IPO activity has consequently slowed, with more companies delaying or abandoning plans. A key factor is the crowded approval pipeline: 87 companies remained in the queue as of September 21, prolonging review cycles and discouraging new applications. The market is entering a phase of more rational restructuring.
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SPH Exits After Earning RMB 400 Million in Ten Years On September 29, 2026, Shanghai Pharmaceuticals Holding Co., Ltd. (SPH) announced plans to sell its entire stake in ZIL, an overseas asset held for a decade, to Primavera Capital at an enterprise value of $397 million. The deal is expected to generate approximately RMB 1.336 billion in profit. Following the transfer of Xinte Dong'an Pharmacy, it marks another step in SPH's asset optimization and focus on its core pharmaceutical business. SPH acquired Australian company Vitaco in 2016 to integrate overseas brands with Chinese distribution channels, but expected synergies failed to materialize amid regulatory and cross-border policy changes. As Vitaco shifted toward sports nutrition, its relevance to SPH's core business weakened. The exit concludes SPH's decade-long overseas investment and reflects the broader shift among Chinese pharmaceutical SOEs toward value-focused operations and core capabilities.
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Xinhuanghe Pharma Conquers the "Everest" of Dry Powder Inhalation, Ending Two Decades of Foreign Monopoly On September 18, 2026, the NMPA approved Xinhuanghe Pharma's Budesonide and Formoterol Fumarate Powder for Inhalation (II) for marketing. As China's first approved generic of the product, the approval breaks a foreign monopoly of more than two decades and marks a domestic drugmaker's breakthrough at the "Everest" of dry powder inhalation. Xinhuanghe Pharma's predecessor traces back to Jiufu Pharmaceutical, founded in 1923, which was later folded into Shanghai Pharmaceuticals (SPH) and acquired and renamed by Chenpon in 2014. Amid an industry transition, Chairman Peng Zhaohua chose dry powder inhalation — a technically demanding drug-device combination — over low-cost generics and the hot biologics track. After prolonged investment and R&D breakthroughs across API, formulation, and device, the company has revived a veteran drugmaker and brought patients a high-value domestic alternative.
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In Depth
“Cadaver Skin Needling” Stirs the Medical Aesthetics Industry, as the Underlying Biomaterials Gain Massive Popularity in China! South Korea’s “cadaver skin injection” Re2O, derived from donated human skin tissue, has sparked ethical and safety concerns in China, bringing extracellular matrix (ECM) into focus. After decellularization, ECM retains biological activity and is widely used in tissue repair. Related medical devices are approved in China, but facial wrinkle reduction is prohibited. Identified as an aging biomarker in 2025, ECM is gaining new applications in medical aesthetics amid advances in microparticulate technology. China’s ECM industry is growing rapidly, with firms such as Shengzhi Runhe and Medgen Life Sciences raising multiple financing rounds and expanding from R&D to mass production. Major medical aesthetics and pharmaceutical companies are also investing in the field, driving ECM toward commercialization.
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MNC China LensExpert Interview
An Interview with Bayer's Friedemann Janus: A Third of Drugs in Development Come from China — What Is Bayer Looking For? Dr. Friedemann Janus, Senior Vice President of Bayer's Pharmaceuticals Division, said China's innovative drugs are embedding deeply into the global system, with about a third of drugs in development originating from China. Multinational pharma's China strategy has shifted from license-in of mature pipeline assets to early engagement with biotech teams to grasp their innovation logic. Bayer, which sees China as a key source of high-quality innovation, has built a network linking startups with global capital and R&D experts via Co.Lab sites in Shanghai and Beijing, a venture capital alliance, and global roadshows during 2024–2025. Janus believes China's pharma industry has moved past "Me-too" and "Fast-Follow" toward "Best-in-Class." The core issue now is how multinational pharma can embed even earlier in China's innovation ecosystem and drive local innovation into global R&D, business development, and commercialization — a fundamental elevation of China's global pharma position.
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Insurers Start to Backstop the Money Burned on Innovative Drug R&D Innovative drug R&D insurance is an emerging track in China's pharma industry, sharing drugmakers' R&D failure risk via financial tools. PICC P&C, with Taiping P&C and Sunshine P&C, recently issued the first life-science R&D insurance policy in Beijing — a breakthrough for China. It distinguishes clinical liability insurance (third-party liability) from R&D loss insurance (drugmakers' own losses). Overseas, Clinical Trial Funding Insurance (CTFI) is key: it reimburses incurred costs when a trial misses its primary endpoints, shifting risk from drugmakers to insurers. MCI (Medical & Commercial International) and peers underwrite Phase I, Phase II, and select small Phase III trials with USD 3–35 million budgets, covering small molecules and antibodies but not gene therapies. This gives domestic drugmakers a risk-hedging tool, signaling deeper integration of tech finance and biomedicine.
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