Recently, Shanghai Hanyu Medical Technology Co., Ltd. (hereinafter referred to as Hanyu Medical) has been listed on the Hong Kong Stock Exchange, the company is a medical technology company, mainly committed to heart valve intervention medical device research and development, production and sales.

The company has a leading position in China's transcatheter mitral valve (TMV) market. Its core product ValveClamp is expected to become the first domestically developed TMV device, as well as the world's first heart-to-heart edge-to-edge TMV repair (TMVr) device.

With the experience of developing ValveClamp, the company is involved in a wider range of structural heart disease treatment and monitoring areas, establishing diversified and synergistic product lines, including 5 transcatheter heart repair products, 3 transcatheter valve replacement products and 2 electrophysiological products, providing comprehensive medical solutions.

First, ValveClamp establishes the influence of the industry.

Hanyu Medical's core product is the mitral interventional device ValveClamp, which is used for minimally invasive interventional treatment of mitral regurgitation (MR) and establishes the company's influence in the cardiac valvular interventional medical device market.

MR valvular heart disease is a common type in the field of structural heart disease, and it is also the fastest developing direction in the field of cardiovascular intervention in recent years.

At present, the treatment methods for MR mainly include drugs, surgical treatment and interventional therapy, but there is no specific drug for primary MR, so the risk of surgical treatment is high. In China, the penetration rate of surgical treatment is seriously insufficient due to the lack of effective and affordable interventional therapy.

In recent years, rapid progress has been made in interventional treatment of structural heart disease, including transcatheter TMV repair (TMVr) that can repair mitral valve and transcatheter TMV replacement (TMVR) that can implant new mitral valve.

Compared with the two, TMVr is minimally invasive and safe. In the interventional therapy of MR, margin-to-margin TMVr is actually the most effective and widely used treatment, and it has become the first choice of international TMV treatment, and has accumulated more than 100000 operations worldwide.

The use of edge-to-edge transcatheter interventional repair to treat MR has the advantages of small wound, high safety and easy operation compared with traditional surgery, and can reduce the physiological and psychological burden of patients and operators.

ValveClamp, an interventional device for mitral regurgitation, uses edge-to-edge technique to enter the mitral valve through apical intervention. Compared with other TMVr devices with femoral intervention, the intervention path is shorter and easier to operate.

According to Frost Sullivan, in ValveClamp's early FIM clinical trials, the average catheterization time during surgery was only 26.8 minutes, significantly shorter than the 2-4 hours commonly required for transmarginal TMVr instruments.

1. It is about to be commercialized and has a high status in the industry.

ValveClamp won the Best Innovation Award at the International Cardiovascular system Innovation Conference (ICI) in December 2018 and was awarded the Special Review qualification for innovative Medical Devices in September 2020, becoming the first TMV product to receive this qualification.

TMV products are highly technical and difficult to develop. At present, global TMV products are relatively scarce. A total of seven TMV repair or replacement products have been certified, of which only MitraClip (Abbott Laboratories) (which uses edge-to-edge repair technology) has been certified in Europe, the United States and China.

In addition to the only approved TMV device MitraClip in China, 6 kinds of TMV devices are undergoing clinical trials, of which 4 are for repair and 2 are for replacement.

From a global point of view, Hanyu medical technology is leading, and the product has been registered. ValveClamp has completed the confirmatory clinical trial in March 2021, and now more than half of the patients are out of the group. it is expected to complete registration and appear on the market in the first quarter of 2023, becoming the first TMVr product in the world and the first commercial domestic TMV product in China.

2. Large market space and accelerated internationalization strategy

With the leading technology and R & D progress, ValveClamp is expected to meet the huge unmet clinical demand in China and seize the market opportunity.

There are a large number of MR patients in China, for example, there are about 10.6 million mild to severe MR patients in 2019, but less than 1% of moderate and severe MR patients receive surgical treatment. Unmet clinical demand is the biggest driving force in the MR treatment market.

With the rapid development of interventional therapy represented by Hanyu Medical, 2021 will be the first year of commercialization of TMVr. The size of China's TMVr device market is expected to increase from 52.5 million yuan in 2021 to 1.669 billion yuan in 2025, with a compound annual growth rate of 137.5%.

Another parallel area of TMVr, transcatheter aortic valve replacement (TAVR) has incubated Edward Life Sciences, which has a market value of nearly US $50 billion, and listed companies with a market capitalization of tens of billions of dollars in domestic companies such as Xintong, Qiming Medical and Peijia Medical. And the high growth space brought by the advanced nature of TMVr technology will also bring opportunities for the rapid development of medical care in this field.

In addition to the Chinese market, Hanyu Medical also speeds up the registration of overseas products, promotes international strategies, and makes every effort to capture the huge growth potential of global TMV markets such as Europe and Southeast Asia. The company expects to submit ValveClamp's CE certification application within 2021 and is expected to be approved within 2023.

Second, establish the development potential of multi-track.

Through the development experience in the field of TMV devices, Hanyu Medical has gradually realized the development model of flying together in the whole field of structural heart disease and electrophysiology. In addition, the company has also created three types of hot products for the pet market, multi-track development to establish the company's growth potential.

1. Seize the 10 billion electrophysiological track

Hanyu Medical has research products HyPulse and CardioMcare in the field of electrophysiology, and plans to continue to actively promote the independent development of other electrophysiological products in the future, including pulsed electric field ablation (PFA) of atrial fibrillation and implantable cardiac event recorder (ICM).

In the cardiovascular field, electrophysiology is mainly used for the diagnosis and treatment of arrhythmias. With the steady increase in the treatment rate of cardiovascular diseases such as arrhythmias, China's electrophysiological equipment market continues to expand. In 2024, the market scale of electrophysiological instruments in China will reach 18.78 billion yuan.

In this 10 billion emerging market, the current domestic production rate is less than 15%, Hanyu Medical cut into electrophysiology is expected to seize the golden track outside the TMVr.

2. Pet medical devices open room for growth.

Based on the leading advantage of the core product ValveClamp, Hanyu Medical product line extends to the field of pet heart intervention medical devices, and enters the global pet medical market with broad industry prospects.

Mitral regurgitation in pet dogs is very common in small elderly dogs, with an incidence of 20-30%.

Hanyu Medical subsidiary, a research and development and commercialization platform for pet medical devices, is the first company in the world to develop mitral regurgitation intervention medical devices in pet dogs. At present, it has formed a combination of products for the treatment of pet structural heart disease, such as V-Clamp, V-Closer, pet multi-functional ECG monitoring system and so on.

V-Clamp is a miniaturized ValveClamp specially designed for mitral regurgitation in small and medium-sized pet dogs. Hanyu Medical's V-clamp has entered the clinical application stage in China, the United States, Italy, Japan, Israel and other countries, and has become the only TMVr product in the world to treat pet dog MR.

In 2020, the company earned 500000 yuan from providing pet treatment services and general pet health services, and is expected to achieve large-scale sales in the second half of 2021.

Two other pet devices are also about to enter the clinical application stage, pet multi-functional ECG monitoring system products started pilot sales in mid-2021, while V-Closer plans to launch pilot sales in 2022.

Third, have the comprehensive strength of the whole cycle of medical device development.

According to the latest prospectus, Hanyu Medical has established a complete procurement, production and marketing system, with comprehensive strength covering the whole cycle of medical device development from R & D to commercialization.

1. Research and development

Excellent and advanced R & D capability is the key to promote the rapid and sustainable growth of Hanyu Medical. In 2019 and 2020, the R & D expenditure of the company's core product ValveClamp reached 26.5 million yuan and 24.8 million yuan respectively, accounting for 90.1% and 77.3% of the total R & D expenses in the same period respectively.

The company has established a core R & D team of nearly 50 people and has successfully led the development of a variety of products. The company has 30 patents in China, including 8 invention patents and 22 utility models; the international patents in Japan, South Korea, Australia, Russia and the European Union have been authorized, and the patents in the United States are also being announced.

Strong independent R & D capabilities can help companies identify unmet clinical needs in the market in time, rapid medical research and product iterations, and quickly bring innovative and cost-effective medical solutions to underserved structural heart disease areas.

To complement independent research and development, Hanyu Medical also cooperates with third-party medical institutions to acquire relevant intellectual property rights from third-party medical institutions, transforming early medical concepts into innovative medical devices in the clinical stage.

2. Production

In order to cope with the fast-growing market demand, Hanyu Medical has independently developed the core technology of proprietary production process and continuously increased its production capacity to cope with large-scale production.

The production process and process of interventional instruments are complex, involving cross-disciplinary specialties such as medicine, engineering, material science and so on. The company has independently developed proprietary production process core technologies such as the design and production technology of precision controlled operable conduits, which can effectively ensure the physical, chemical and biological compatibility of the candidate products. At the same time, proprietary production technology will also help to reduce costs and increase efficiency, and provide products with competitive prices to the market.

Hanyu Medical is located in Shanghai Minhang GMP compliance production base with an annual production capacity of about 6000 sets of transcatheter equipment; the production base in Xinzhuang has an annual capacity of about 100000 sets of transcatheter equipment is expected to be put into production by the end of 2023, laying a solid foundation for commercial mass production of ValveClamp and other products under research.

3. Commercialization

With the help of its advanced market position, Hanyu Medical focuses on academic marketing in its commercialization strategy. On the one hand, it plans to rapidly expand more hospitals in first-and second-tier cities, and on the other hand, to establish a distribution network to rapidly promote the R & D and commercialization of ValveClamp, ValveClasp, ReAces and other products under research.

At present, the company has established a long-term relationship with the top hospitals of structural heart disease in China, PI and KOL, and established cooperative relations with 12 top third-class A hospitals in the country, giving full play to the domestic industry first-mover advantages, competitive strength and cost advantages of ValveClamp, and bringing low-price and high-quality products to the vast number of MR patients in China.

Summary

Hanyu Medical, as a leading medical technology company in the world, and with the unique competitive advantage of ValveClamp, the company has won a leading market position in the global and domestic advanced TMV device field.

In the expectation of the market, in the next 1-3 years, the company expects that a number of products under research will be listed one after another, especially ValveClamp can not only seize the domestic market opportunities, but also look at the market access and product sales of developed countries such as the European Union, the United States and Japan, so as to benefit the majority of MR patients and create greater economic and social benefits.