In June 2022, Anjie Securities Research Department organized an online roadshow meeting of Qiming Medical (2500.HK), which was attended by Lu Jinyuan, the company's chief information officer, and Chen Wenjuan, IR. The following is a summary of the online meeting:

The epidemic is gradually under control, and elective surgery is expected to recover. In terms of implant volume, the company implanted about 1500 transcatheter aortic valve replacement (TAVR) products from January to May this year, and the closure in Shanghai has a phased impact on the company's implantation. we expect that as the epidemic is gradually controlled, the volume of surgery in 3Q22E head hospital is expected to recover quickly, followed by waist and tail hospitals. The management maintains the guidelines on the total number of two TAVR products implanted for the year 5000-5500, of which the proportion of second-generation TAVR products is expected to increase from 35% in 2021 to more than 50%. In terms of price, the prices of the two TAVR products remain stable. at present, the terminal price of the first generation TAVR product VenusA-Valve is 18-200000 RMB, the terminal price of the second generation TAVR product VenusA-Plus is 22-230000 RMB, and the comprehensive ex-factory price of FY21A two TAVR products is about 120000 RMB. In terms of hospital coverage, FY21A covers 360 hospitals and is expected to cover 400 hospitals this year.

TAVR consumables are included in the payment scope of health insurance in Shanghai, and related products are expected to be sold in the short term. In May 2022, Shanghai Medical Insurance Bureau issued a notice on the trial of performance-based payment for some medical consumables, proposing: 1) pay for cardiac valve (folding) consumables according to performance, and select the immediate success rate after TAVR operation or the incidence of perioperative serious complications as evaluation indicators; 2) Medical institutions with less than 30 cases are not included in the assessment. 3) the TAVR consumables that meet the target requirements shall be included in the scope of health insurance payment according to the average payment level of the medical insurance fund (80%). In this regard, the management believes that: 1) the policy encourages hospitals with a small number of cases to increase the amount of TAVR surgery implantation; 2) the policy guides manufacturers to pay attention to clinical efficacy and device quality, which is conducive to the release of TAVR products with sufficient data, good safety and excellent performance; 3) the policy does not adjust the price of consumables, and there is little possibility of price negotiation in the short term. 4) Shanghai plant amount accounts for 6% of the company's total plant quantity. 8% of the company's total plant quantity is expected to be released in the short term after the introduction of TAVR consumables into Shanghai health insurance. 5) the policy of Shanghai Medical Insurance Bureau is forward-looking and weather vane effect, and is expected to be extended to other parts of the country.

VenusP-Valve 's approval for a listing in Europe is expected to boost overseas revenue. VenusP-Valve, a product of transcatheter pulmonary valve replacement (TPVR) in April 2022, was certified by the European Union CE MDR for the treatment of moderate and severe pulmonary valve regurgitation with or without right ventricular outflow tract (RVOT) stenosis. Management said that the current commercial team in Europe reached 10 + people, and VenusP-Valve was priced at about $15000 overseas. FY22E implants are expected to reach about 500 units, with sales of about US $8 million. TriGUARD3 expects FY22E's overseas revenue to reach $2 million; company FY22E's overseas revenue is expected to reach about $10 million, accounting for about 10% of total revenue for the year. In terms of overseas R & D progress, VenusP-Valve expects to submit an application for IND in the United States by the end of 2022, and FY23E will conduct clinical trials in the United States; the feasibility of transcatheter bicuspid / tricuspid valve replacement (TMVR/TTVR) product Cardiovalve in Europe is under way, with nearly 30 patients enrolled by the end of May, and FY26E-27E is expected to be approved for listing in Europe. The main aortic valve products Venus-PowerX and Venus-Vitae plan to launch global multicenter clinical trials, and FY26E is expected to be approved for listing overseas; the European clinical study of Liwen RF, a percutaneous transmyocardial radiofrequency ablation product introduced by Nuocheng Medical, is expected to start at the end of 2022, and FY25E-26E is expected to be approved for listing overseas. Management said that FY26E overseas revenue is expected to account for 40%, the sea area will be concentrated in the mainstream markets in Europe and the United States, developing countries are not the focus of development areas.

VenusA-Pro China has been approved to be listed on the market, and the progress of the pipeline continues. In terms of domestic R & D progress, VenusAPro was approved in China in May 2022, and VenusP-Valve and TriGUARD3 are expected to be approved for listing in 3Q22E and 4Q22E in China, respectively. Three aortic valve products Venus-PowerX, Venus-Vitae and Venus-Neo have completed the first human (FIM) clinical trial, and FY23E is expected to complete all patients in the group, and open Chinese registered clinical trials by the end of 2023. Liwen RF is conducting a multicenter clinical trial in China, the patient enrollment is expected to be completed by the end of 2022, and FY24E is expected to be approved for listing by NMPA; in 2021, the company introduced a new generation of nephrectomized sympathetic denervation (RDN) innovative devices from Israeli company Healium Medical to treat intractable hypertension, and 2H22E-1H23E is expected to launch FIM in China.

Maintain the buy rating and maintain the target price at HK $22.10. We did not adjust the model and maintained the forecast of FY22E/23E/24E revenue at RMB 690 million / 1.07 billion / 1.5 billion respectively, with a corresponding growth rate of + 65.4%, 55.9% and 39.9% respectively, and diluted earnings per share of-0.84 lap 0.70 lap 0.49 yuan respectively. Risks: 1) repeated uncertainties brought about by the COVID-19 epidemic have a serious impact on the company's sales; 2) a large number of competitive products enter the market so that the company's product prices drop significantly or lose market share; 3) policy risks such as higher-than-expected price reductions due to collection; 4) the introduction of innovative products in the market makes the company's products uncompetitive; and 5) the progress of pipeline product research and development is not as expected.