Epitaxial mergers and acquisitions have a driving effect on the company's development.
On the evening of January 28, Mindray Medical (300760., a leading domestic medical device companySZ) announced that it intends to realize the transfer of Huitai Medical (688617., a medical device company listed on the Science and Technology Innovation Board) through the method of "agreement transfer + waiver of voting rights by the original actual controller".SH) Acquisition of Control. If the plan goes smoothly, Mindray Medical will hold a total of 2461% of the shares, becoming the company's largest shareholder.
From the perspective of the two parties, Mindray's main products cover three major sectors: life information and support, in vitro diagnostics and medical imaging, and the product line is the most comprehensive among domestic peers. In addition, the company has made a smooth breakthrough in overseas markets in recent years, and its operating income in 2022 ranks 27th in the global medical device industry, making it a leader in domestic medical devices.
The acquiree, Huitai Medical, has been deeply involved in the cardiovascular track for many years, has a solid position in the fields of cardiac electrophysiology, coronary access, and peripheral vascular intervention, and has mastered the full line of R&D and production capacity from upstream raw materials to products, and is a leading enterprise in the cardiovascular field in China.
Li Chanjuan, an analyst at Huachuang Pharmaceutical, believes that Huitai, as a leading enterprise in the domestic cardiovascular field, has a layout in the fields of electrophysiology, coronary access, and peripheral vascular intervention, and has leading technological innovation capabilities in China, as well as the research and development, production capacity and process of consumables from raw materials to products. Mindray is firmly optimistic about the future development potential of the cardiovascular field, and entering the cardiovascular track will also greatly increase Mindray's accessible market space, which is of great significance to help Mindray achieve rapid growth in long-term performance.
Actually,In recent years, Mindray has paid special attention to the driving effect of epitaxial mergers and acquisitions on the company's development. In 2021, the company acquired HyTest Biotechnology, a world-renowned company in the field of IVD raw materials, to achieve independent and controllable core technology in the field of IVD raw materials, and started the research and development and achievement transformation of new projects based on the acquired technology in the field of in vitro diagnostic business. In 2023, Mindray Medical once again completed the acquisition of Diasys Holdings in Germany, successfully building a global first-chain platform for in vitro diagnostic products, laying the foundation for the comprehensive internationalization of IVD business.
It can be said that each major acquisition has brought a new driving force for Mindray's development and a large-scale expansion of the accessible market space. LikeThe acquisition of Huitai provides a major opportunity for Mindray Medical to quickly enter the segment of cardiovascular products, which has a relatively long cycle of technology research and development, clinical registration, and upgrading. The strong alliance in the industry is expected to give birth to a new industry leader and help the export of domestic medical devices to open up a new situation.
Source: Mindray Medical***
From the perspective of the development of the medical device industry, the leading companies in the industry attach great importance to the importance of high-value consumables in the mature period of development. More than half of the world's top 10 medical device companies are dominated by high-value consumables.
On the other handMindray Medical, the company has made breakthroughs in the global market in recent years and successfully entered the international high-end market, but the high-value consumables involved in the three major business segments represented by life information and support, in vitro diagnostics and medical imaging are relatively limited, and the company as a whole is still mainly engaged in R&D and production of medical equipment.
At the same time, in the context of the aging of the population, the incidence of "geriatric diseases" dominated by cardiovascular diseases continues to increase, and cardiovascular health problems are severe, which provides a broad application space for related high-value consumables. Perhaps it is based on the above situation that Mindray Medical has made a strategic layout to break into the cardiovascular field through acquisitions.
Source: Mindray Medical***
The acquisition target chosen by Mindray this timeHuitai Medical is the leading enterprise in the field of cardiovascular electrophysiology and vascular interventional productsIt is known as the "game-breaker" of domestic interventional medical devices by the market.
Among them, in the field of electrophysiology, the company's electrophysiology electrode catheter and controllable radiofrequency ablation catheter, as well as the floating temporary pacing electrode catheter approved for marketing in 2020, are the first domestic products in China to obtain relevant registration certificates, and have been recognized as national key new products by the Ministry of Science and Technology.
In the field of vascular intervention, Huitai Medical has been involved in two major fields: coronary access and peripheral vascular intervention, and its research and development achievements are also remarkable: its coronary artery guidance extension catheter and thin-walled sheath (vascular sheath group) are exclusive domestic products; The microcatheter (coronary application) and the adjustable valve catheter sheath (catheter sheath group) are the first domestic similar products to obtain the registration certificate in China; The anchored balloon dilation catheter is the first innovative medical device in China that uses balloon anchoring for catheter exchange in the catheter. The peripheral adjustable valve conduit sheath is also the only domestic product approved for marketing in China.
The research report of the Southwest** shows thatThe domestic electrophysiology device market size increased from 24200 million yuan, an increase to 65 in 2021800 million yuan, and it is expected that the market size of electrophysiology devices will reach 157 in 2025300 million yuan. Among them, the market competition pattern is still dominated by foreign capital, and the localization rate is at 10-15%. After Huitai Medical passed the electrophysiology centralized procurement project led by Fujian in 2022, the penetration rate of the company's electrophysiology products in the country's leading centers increased from 27% to 70%.
At the same time, Huitai Medical's peripheral products distal embolization protection system, contrast balloon, transjugular intrahepatic puncture device and peripheral balloon dilation catheter have obtained domestic registration certificates. The products under development, such as peripheral guidewire, peripheral balloon dilatation catheter, carotid balloon dilatation catheter and support catheter, have all entered the registration review stage, and the peripheral product line can be expected in the future.
The breakthrough innovative products have also brought substantial support to Huitai Medical's performance. The annual report data showsHuitai Medical will achieve a net profit attributable to the parent company of 3 in 20225.8 billion yuan, a year-on-year increase of 7219%, and the net profit attributable to the parent company is expected to be 510-5.6.5 billion yuan, a year-on-year increase of 42%-58%. The company's share price has also been stable at more than 300 yuan for a long time, ranking first on the Science and Technology Innovation Board.
It is not difficult to see that the acquisition targets screened by Mindray Medical in the field of cardiovascular business this time can be described as the best of the best, and the market imagination space after the successful "merger" of the two companies is more than that.
Source: Mindray Medical***
Judging from Mindray's previous acquisitions, the company has always been able to play the role of an industrial investment integrator and intensively cultivate new products in the field, bringing direct improvement of product R&D innovation and production and sales capabilities to both parties.
For example, in the field of cardiac electrophysiology, represented by three-dimensional electrophysiology, related equipment and consumables need to be used together. Electrophysiology equipment is directly related to subdivision technologies such as machinery, algorithms, image processing, and engineering, which is also what Mindray Medical, which has been focusing on the production and R&D of medical devices for a long time, is particularly good at. It is believed that in the future, a new pattern of "Mindray medical equipment + Huitai medical consumables" is expected to emerge within Mindray Medical, and Huitai Medical's rich practical experience in the field of consumables is also expected to bring new business opportunities and synergy possibilities to Mindray's three major business production lines.
Source: Mindray Medical***
The cooperation between Mindray and Huitai has also brought more possibilities for domestic medical device products to break into the global market.
At present, Mindray has achieved in-depth coverage in the global marketIt has 53 overseas subsidiaries in about 40 countries in North America, Europe, Asia, Africa, Latin America and other regions, and has a complete marketing and sales service team. In the first three quarters of 2023, the company achieved operating income of 2730.4 billion yuan, a year-on-year increase of 1720%, of which overseas revenue accounts for about 40%.
Huitai Medical is in the early stage of internationalization, but it has shown good explosiveness. According to the financial report data, the company's overseas business increased by more than 90% in the first three quarters of 2023, and the overseas business accounted for about 16% of the company's overall revenue in the current quarter, covering the Asia-Pacific, Latin America, CIS, Western Europe, the Middle East, Africa and other regions.
It is not difficult to imagine that in the future, once the acquisition is successfully implemented, Huitai Medical will be able to sail into a broader global market on the "big ship" of Mindray Medical. After joining forces, the combined competitive advantage and cost-effective advantage will also become a direct weapon for the two companies' products to break through the global market, and then give birth to a new leader, opening a new export market for domestic medical devices.
What else do you know about the medical device industry? Let's talk in the comment section.