HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/venus-medtech-hangzhou-inc" target="_blank" data-smartkarma-citation="entities:28257:1" rel="noopener">Venus MedTech (2500 HK)</a> is taking the lead in TAVR industry, but <a href="https://www.smartkarma.com/entities/peijia-medical" target="_blank" data-smartkarma-citation="entities:28862:1" rel="noopener">Peijia Medical (9996 HK)</a> has advantages in development progress of future products. So, the market pattern is not yet determined.</li>
<li>The high cost of TAVR surgery is the main reason for lower-than-expected sales performance of related companies and low market penetration. The fierce competition would also bring more challenges. </li>
<li>A good solution is to enter developing markets with CE mark, which would offer a new commercialization option and also a wider expansion beyond just European and American markets.</li>
</ul>



Venus MedTech (2500 HK) is taking the lead in TAVR industry, but Peijia Medical (9996 HK) has advantages in development progress of future products. So, the market pattern is not yet determined.
The high cost of TAVR surgery is the main reason for lower-than-expected sales performance of related companies and low market penetration. The fierce competition would also bring more challenges. 
A good solution is to enter developing markets with CE mark, which would offer a new commercialization option and also a wider expansion beyond just European and American markets.


Peijia Medical (9996.HK) Vs Venus MedTech (2500.HK) Vs CardioFlow (2160.HK)-Pain Points and Solution

Thematic (Sector/Industry)

<ul>
<li>Based on our analysis, the growth rate of China's drug spending is linked to GDP, and it would not be a high growth rate, but a stable growth rate.</li>
<li>The logic behind China and US biotech companies is different. To some extent, the lower the domestic biotech’s share price, the greater the risk.</li>
<li>In the current policy environment, the risks of VBP on anesthetics could be low because of their high barriers, strict control and potential social risks.</li>
</ul>


Based on our analysis, the growth rate of China's drug spending is linked to GDP, and it would not be a high growth rate, but a stable growth rate.
The logic behind China and US biotech companies is different. To some extent, the lower the domestic biotech’s share price, the greater the risk.
In the current policy environment, the risks of VBP on anesthetics could be low because of their high barriers, strict control and potential social risks.


China Healthcare Weekly (Jan.7)-China's Drug Spending,Logic Behind China/US Biotech, Anesthetics VBP

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Shanghai MicroPort MedBot Group / Equity Capital Markets

<div>
<p>Shanghai MicroPort MedBot Group (MM), a surgical robot company, raised around US$200m in its Hong Kong IPO.</p>
</div>
<div>
<p>MicroPort MedBot (MM) is a surgical robot company which designs, develops and commercializes surgical robots to assist surgeons in performing complex surgical procedures. It is the only company with a product portfolio covering the five major and fast-growing surgical specialties of laparoscopic, orthopedic, panvascular, natural orifice and percutaneous surgical procedures, as per Frost &amp; Sullivan (F&amp;S).</p>
</div>
<div>
<p>We have looked at the company’s background and products in our earlier notes:</p>
</div>
<div>
<ul style="list-style-type: disc;">
<li><a href="https://www.smartkarma.com/insights/microport-medbot-pre-ipo-robodoc-pre-revenue-has-a-large-competitor-but-a-large-market-as-well" target="_blank" rel="noopener">MicroPort MedBot Pre-IPO - RoboDoc - pre-revenue, has a large competitor but a large market as well</a></li>
<li><a href="https://www.smartkarma.com/insights/microport-medbot-pre-ipo-robodoc-phip-updates-and-a-look-at-its-largest-competitor" target="_blank" rel="noopener">MicroPort MedBot Pre-IPO - RoboDoc - PHIP Updates and a Look at Its Largest Competitor, and</a></li>
<li dir="ltr" aria-level="1"><a href="https://www.smartkarma.com/insights/microport-medbot-pre-ipo-thoughts-on-valuation" target="_blank" rel="noopener">MicroPort MedBot Pre-IPO - Thoughts on valuation</a></li>
<li dir="ltr" aria-level="1"><a href="https://www.smartkarma.com/insights/microport-medbot-pre-ipo-valuation-appears-reasonable-but-sentiment-will-weigh" target="_blank" rel="noopener">MicroPort MedBot Pre-IPO - Valuation Appears Reasonable but Sentiment Will Weigh</a></li>
</ul>
<p>In this note we will talk about the trading updates.</p>
</div>


Shanghai MicroPort MedBot Group (MM), a surgical robot company, raised around US$200m in its Hong Kong IPO.


MicroPort MedBot (MM) is a surgical robot company which designs, develops and commercializes surgical robots to assist surgeons in performing complex surgical procedures. It is the only company with a product portfolio covering the five major and fast-growing surgical specialties of laparoscopic, orthopedic, panvascular, natural orifice and percutaneous surgical procedures, as per Frost &amp; Sullivan (F&amp;S).


We have looked at the company’s background and products in our earlier notes:



MicroPort MedBot Pre-IPO - RoboDoc - pre-revenue, has a large competitor but a large market as well
MicroPort MedBot Pre-IPO - RoboDoc - PHIP Updates and a Look at Its Largest Competitor, and
MicroPort MedBot Pre-IPO - Thoughts on valuation
MicroPort MedBot Pre-IPO - Valuation Appears Reasonable but Sentiment Will Weigh

In this note we will talk about the trading updates.


MicroPort MedBot IPO Trading - Decent Demand But Upside Is Limited from the Top-End

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

HeMo Bioengineering / Equity Capital Markets

<p>HeMo Bioengineering, a China-based interventional medical device company, plans to raise up to USD 300m via a Hong Kong listing.</p><p>The company's main products are catheters for the aspiration thrombectomy for acute ischemic stroke. The thrombectomy market is experiencing rapid growth and the company targets a less competitive thrombectomy segment but effectively it is facing intense competition with stent retrievers. We are of the view that the company's product is not competitive and innovative enough to acquire large market share from other players despite the penetration rate of the aspiration thrombectomy in China is much lower than that in the US. </p><p>The company's management does have a track record in developing medical devices in the past but we think its current product line does indicate few inventions.</p>

HeMo Bioengineering, a China-based interventional medical device company, plans to raise up to USD 300m via a Hong Kong listing.The company's main products are catheters for the aspiration thrombectomy for acute ischemic stroke. The thrombectomy market is experiencing rapid growth and the company targets a less competitive thrombectomy segment but effectively it is facing intense competition with stent retrievers. We are of the view that the company's product is not competitive and innovative enough to acquire large market share from other players despite the penetration rate of the aspiration thrombectomy in China is much lower than that in the US. The company's management does have a track record in developing medical devices in the past but we think its current product line does indicate few inventions.

HeMo Bioengineering (禾木生物工程) Pre-IPO: Signs of Lacking Innovation

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<div><p><a href="https://www.smartkarma.com/entities/shanghai-microport-medbot-group-co-ltd" target="_blank" data-smartkarma-citation="entities:33485:1" rel="noopener">Shanghai MicroPort MedBot Group (MMG HK)</a> is a global surgical robot company and a subsidiary of <a href="https://www.smartkarma.com/entities/microport-scientific-corp" target="_blank" data-smartkarma-citation="entities:4487:1" rel="noopener">Microport Scientific (853 HK)</a>, a 54.61% shareholder. MicroPort MedBot has developed a portfolio with one approved product (DFVision) and eight product candidates at various stages of development, including two candidates (Toumai and Honghu) in the NMPA registration application stage. The core product is the Toumai laparoscopic surgical robot. </p></div><div><p>MicroPort MedBot has launched an HKEx IPO to raise net proceeds of HK$1,332.3 ($171 million) at the mid-point of the IPO price range of HK$36.00-43.20 per share. The IPO raise is materially below the rumoured target of up to $1 billion. </p></div><div><p>Seven cornerstone investors have agreed to invest about $95 million in the IPO (51.6% of the offer shares at the mid-point of the IPO price range). The cornerstones are Aspex Management, Hillhouse, LAV, Snow Lake Capital, Yorkool, CloudAlpha Capital and Artisan Partners.</p></div><div><div>
<p>In <a href="https://www.smartkarma.com/insights/microport-medbot-ipo-initiation-helping-mechanical-hands" target="_blank" data-smartkarma-citation="insights:58411" rel="noopener">MicroPort MedBot IPO Initiation: Helping Mechanical Hands</a>, we stated that MicroPort MedBot’s three flagship products (Toumai, Honghui and DFVision) have been admitted to the Green Path, an elite program under which the NMPA grants priority review and accelerated approval. Crucially, the three flagship products are either approved (DFVision commercial launch in 4Q21) or at the registration approval stage, which provides near-term market visibility. We concluded that MicroPort MedBot is worth a closer look.</p>
<div class="content-highlight"><p>However, our valuation analysis suggests that the IPO price range is full and we would remain on the sidelines awaiting a better entry opportunity. </p></div>
</div></div>

Shanghai MicroPort MedBot Group (MMG HK) is a global surgical robot company and a subsidiary of Microport Scientific (853 HK), a 54.61% shareholder. MicroPort MedBot has developed a portfolio with one approved product (DFVision) and eight product candidates at various stages of development, including two candidates (Toumai and Honghu) in the NMPA registration application stage. The core product is the Toumai laparoscopic surgical robot. MicroPort MedBot has launched an HKEx IPO to raise net proceeds of HK$1,332.3 ($171 million) at the mid-point of the IPO price range of HK$36.00-43.20 per share. The IPO raise is materially below the rumoured target of up to $1 billion. Seven cornerstone investors have agreed to invest about $95 million in the IPO (51.6% of the offer shares at the mid-point of the IPO price range). The cornerstones are Aspex Management, Hillhouse, LAV, Snow Lake Capital, Yorkool, CloudAlpha Capital and Artisan Partners.
In MicroPort MedBot IPO Initiation: Helping Mechanical Hands, we stated that MicroPort MedBot’s three flagship products (Toumai, Honghui and DFVision) have been admitted to the Green Path, an elite program under which the NMPA grants priority review and accelerated approval. Crucially, the three flagship products are either approved (DFVision commercial launch in 4Q21) or at the registration approval stage, which provides near-term market visibility. We concluded that MicroPort MedBot is worth a closer look.
However, our valuation analysis suggests that the IPO price range is full and we would remain on the sidelines awaiting a better entry opportunity. 


China

Microport Cardioflow Medtech Corporation develops and sells medical devices. The Company manufactures and sells vitaflow aortic valve system, alwide balloon catheter, and other products. Microport Cardioflow Medtech markets its products throughout China.

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Microport Cardioflow Medtech (2160 HK)

Peijia Medical (9996.HK) Vs Venus MedTech (2500.HK) Vs CardioFlow (2160.HK)-Pain Points and Solution

We analyzed the TAVR business of Venus, MicroPort CardioFlow and Peijia. We also analyzed the competition pattern, concerns, pain points of TAVR...

Xinyao (Criss) Wang

China Healthcare Weekly (Jan.7)-China's Drug Spending,Logic Behind China/US Biotech, Anesthetics VBP

The insight mainly analyzed the relationship of drug spending with GDP growth, different logic behind China/US biotech companies and related risks...

Xinyao (Criss) Wang

MicroPort MedBot IPO Trading - Decent Demand But Upside Is Limited from the Top-End

Shanghai MicroPort MedBot Group (MM), a surgical robot company, raised around US$200m in its Hong Kong IPO. In this note we will talk about the...

Sumeet Singh

HeMo Bioengineering (禾木生物工程) Pre-IPO: Signs of Lacking Innovation

We look at HeMo Bioengineering's main products. We are not convinced that its aspiration catheter products are innovative and competitive.

Ke Yan, CFA, FRM

MicroPort MedBot IPO: Valuation Insights

Our valuation analysis suggests that the IPO price range is full and we would remain on the sidelines awaiting a better entry opportunity.

Arun George

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