China Renaissance Capital 2021 Annual Review of the Medical and Life Technology Industry｜Diagnosis and Life Sciences

2021 is the second year that we are coexisting with the new crown epidemic.
New changes and opportunities are constantly emerging in the field of medical and health care: frequent capital market policies in China and the United States, the ups and downs of epidemic-themed and testing companies, and further advances in digital therapy and Internet medical care.
Penetration, AI companies obtain evidence and move to the capital market, and more medical device companies land in Hong Kong stock IPOs.
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At the time of Vientiane's renewal, the Huaxing Medical and Life Technology team, which has been deeply involved in the industry for many years, will use four issues of articles, from diagnosis and life sciences, pharmaceuticals We will review the development trend of the global medical field in 2021 and look forward to a broader future of innovation and upgrading in the medical field
.
The first article will focus on the diagnostics and life sciences track, so stay tuned for the follow-up sharing in other fields
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On the whole, unlike the outbreak of the diagnosis industry in the first year of the new crown (2020), the diagnosis industry will experience a phased adjustment in 2021
.
Judging from the transaction situation in the primary and secondary markets, the pace of private financing has slowed down, and the transaction amount has dropped significantly
.
On the one hand, it is caused by the short-term vacuum brought about by the outbreak of the industry in 2020, and on the other hand, it is also directly related to the huge shocks in the secondary market environment at home and abroad
.
However, the M&A and IPO markets are still very hot, with both the value and number of transactions hitting record highs, with companies seizing the opportunities brought about by the COVID-19 pandemic leading the pack
.

 








 
From the perspective of industry development , we have summarized the following insights and prospects: tumor is still the most popular, innovation driven by "involution", domestic encouragement of neck-stuck technology, industry integration under post-epidemic, cross-border integration under the digitalization of life
.

 
Diseases: Tumors are still the most popular, and the whole life cycle extension to create integrated diagnosis
Tumors will still be the most sought after diseases in the capital market in 2021
.
The companion diagnosis and early diagnosis and early screening of tumors continue the hot development trend
.

 
Development
in the field of tumor diagnosis In the field of tumor companion diagnosis, companies such as Jiyinga, Simcere Diagnostics, Tongshu Gene, and Zhiben Medical have completed the latest round of financing.
round of financing
.
The pattern of the first echelon of the track has basically been determined.
From the competition to the head effect, the latecomers in the industry are already facing survival pressures such as financing difficulties; the stock prices of Burning Rock and Genetron Health have shrunk sharply, which also gives the first echelon The IPO of other players brings huge pressure; how to get out of the value depression and how to break through the industry predicament is the common thinking of everyone
.
Burning Rock Medicine was the first to deploy pan-cancer early screening to create the second growth curve, and Zhenhe Technology used MRD to cut into prognosis evaluation and recurrence monitoring to create differentiated competition barriers
.
The industry is facing reshaping.
In the future, early screening companies will also extend backward along the clinical path.
Tumor diagnosis will move towards full life cycle management, including early diagnosis and early screening, precise drug use and efficacy evaluation, postoperative prognosis evaluation, and recurrence monitoring.
And so on, to achieve more accurate diagnosis and treatment
.


Intense competition
in the colorectal cancer market In the hottest colorectal cancer market segment in the field of early tumor diagnosis and early screening, Nuohui Health has completed a Hong Kong stock market listing, and companies such as Kang Liming Bio, Emerson, and Mirui Bio have completed a new round of financing
.
In addition, the application of early screening has also been extended from colorectal cancer to other solid tumor types, among which liver cancer has become the next hot cancer type; in addition to Genetron Health, which has already been launched on the market, early-stage liver cancer planners such as Herui Gene and Aorui Gene have also completed A new round of financing has been raised, and players in the early screening of bowel cancer such as Nuohui Health have also begun to actively enter
.


Development
of technology platforms From the perspective of technology platforms, various detections for tumors have expanded from the pure nucleic acid dimension to the detection of more omics biomarkers such as proteins, from technologies centered on NGS and PCR to multi-platform combined with automation.
The evolution of the overall solution trend
.


From a policy
perspective, with the implementation of the centralized procurement of IVD reagents in Anhui Province and the negotiation of medical insurance prices for tumor treatment drugs, diagnosis as the front-end of the clinical pathway has also begun to face enormous pressure from the normalization of centralized procurement
.
In terms of early screening of colorectal cancer, Beijing took the lead in incorporating gene methylation testing into medical insurance.
It is expected that this operation will be replicated in other regions in the future, and the market competition will become increasingly fierce; and continuous optimization at the business model level
.

As one of the largest and fastest-growing disease diagnosis and treatment markets in China, oncology will continue to be an area of ​​keen interest in the capital market for a long time to come; It may become a follow-up popular disease
.

 
Technology: Driven by innovation under "involution", multi-omics emerging
genetic testing has been widely used in multiple clinical directions
including NIPT, tumor, genetic disease, microbial detection, etc.
The industry has matured and the momentum of "involution" has begun to appear
.
Innovative technologies have attracted much attention, including multi-omics technologies such as proteomics, metabolomics, single cells, and phenotypes, leading the industry into the "post-genome" 2.
0 era
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The domestic multi-omics track enters an active period
With the listing of American multi-omics platform technologies such as Seer, Olink, Somalogic, Quantum-Si, Nautilus and other related companies, the domestic multi-omics track has entered an active period
.
Metabolomics representative companies Gloria, Maiwei Metabolism, Nomi Metabolism, etc.
have successively completed financing; proteomics rookie Xihu Omi has completed two consecutive rounds of financing within half a year, and the rapid increase in valuation also highlights the capital market's interest in emerging hot competitions Tao's attention
.

 
Mass spectrometry has ushered in an important development
.
Proteome and metabolome can better reflect the current information of diseases, which is of great significance for understanding life activities and disease treatment.
One of the core technology platforms for related omics research is mass spectrometry
.
Due to its excellent high-throughput, sensitivity, specificity, analysis speed, and simultaneous detection of multiple indicators in complex sample detection, mass spectrometry is very suitable for the discovery of innovative markers and clinical translation applications
.

In 2021, with the successive breakthroughs in mass spectrometry instruments and supporting reagents, the launch of a one-stop clinical mass spectrometry IVD solution from preprocessing to post data services, and the improvement of China's LDT market, mass spectrometry detection has ushered in an explosion
.
In the upstream field, Hexin Instrument, a domestic instrument developer, landed on the Science and Technology Innovation Board, and Rongzhi Bio and Relais completed financing
.
In the field of midstream products and downstream service providers, Yingsheng, Baichen, Haosi, etc.
have also received strong support from leading investment institutions
.
While the track is hot, the homogenization competition is also becoming increasingly fierce, and the crowdedness of the clinical mass spectrometry track has intensified.
Everyone began to look for the second growth curve.
In addition to thinking about breakthroughs in preprocessing and automation, multi-omics has become a must for all companies.
place
.

 
Chinese companies are expected to overtake in the field of multi-omics transformation applications.

Currently, overseas leading companies such as Somalogic and Metabolon are mainly used in scientific research and new drug research and development, while clinical application and industrial transformation have just started
.
China has the soil to nurture leading global multi-omics companies.
Based on the policy support of LDT's gradual opening up, the abundant domestic clinical cohorts, and the increasing capabilities of multi-omics data collection, mining and bioinformatics interpretation, Chinese companies are expected to innovate at the source.
The application field of omics transformation realizes overtaking on curves and leads global industry changes
.

 
With the outbreak of "post-genome", the update and iteration of technology, and the expansion of application scenarios, multi-omics will break through the limitations of a single omics, and the integration between omics will become more frequent, such as Cayley spectrum and new cells ( Metabolomics and single-cell omics), cooperation with Xihu Omi (metabolomics and proteomics)
.
In addition, with the continuous emergence of more cutting-edge technologies such as spatiotemporal omics, future diagnosis and treatment will be more accurate and personalized
.

 
Industrial chain: raw materials and high-end life science instruments are highly sought after in the upstream industry.

Domestic brands have huge development space
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Under the logic of domestic substitution of industry development, facing the upstream raw materials and high-end equipment market with the highest market share of international brands, domestic brands have with huge room for development
.
At the same time, as an important link in the upstream of the diagnostic industry chain, strong bargaining power and a clear business model also ensure stronger and more stable profitability, with very high investment value
.


Policy and Macroeconomic Impacts
At the policy and macroeconomic level, the state's strong support for innovation and the continued favorable procurement of domestically produced products, such as the Chairman's Decree No.
103 issued at the end of the year ("The Law of the People's Republic of China on the Advancement of Science and Technology") Amendment), reiterated the restrictions on foreign investment access, and the "14th Five-Year Plan for the Development of the Medical Equipment Industry" stated that key support will be given to seven major areas including diagnostic testing equipment
.

 
The domestic primary and secondary market pays great attention to raw material companies
in the upstream raw material field.
Benefiting from the favorable epidemic situation at home and abroad and the policy environment to solve the "stuck neck" problem, the domestic primary and secondary market pays unprecedented attention to raw material companies.

.
Yiqiao Shenzhou and Novizan have been listed on the Growth Enterprise Market and the Science and Technology Innovation Board successively, and their market value has been outstanding; the listing applications of Feipeng Biotechnology and Kangwei Century have been accepted; Aibotech and Hanhai New Enzyme have completed about 1 billion yuan Private equity financing in RMB; Hytest, the world's top veteran upstream raw material supplier, acquired Mindray's cash acquisition of about 545 million euros, setting a new high in the industry
.
Raw materials have a significant impact on the quality and cost of diagnostic products.
At present, overseas giants still occupy most of the market share.
However, with domestic substitution and the internationalization of domestic enterprises, we expect domestic upstream enterprises to gradually build a complete technology platform and improve product categories.
, to break the market monopoly pattern of foreign giants
.
In addition, some upstream companies in the industry have also begun to actively deploy equipment and testing reagents, which are expected to reshape the industrial chain.

.
 
 
The field of high-end life science equipment is strongly supported by the capital market
, especially in the direction of sequencing equipment and automation applications.
Under the benchmarking effect of MGI's science and technology innovation board meeting, the industry has received strong support from the capital market
.
Internationally, Oxford Nanopore Technologies is listed on the London Stock Exchange; in the domestic market, Qitan Technology, Anxuyuan, Jinshi Technology, Zhenmai Biotechnology, etc.
have also been recognized by the capital market while their business is developing rapidly
.
Around some specific application scenarios, such as CAR-T, DNA read/write storage, laboratory equipment and integration, a full-chain domestic substitution trend has begun to appear.
Faster and higher quality development
.
 
 
Single-cell and single-molecule-level innovative technologies have become market hits
.
Driven by unmet scientific research and clinical needs, single-cell and single-molecule-level technologies, omics and manipulation have become the hottest hits in the market, including Xinge during the year.
Origin Bio, Wancheng Gene, Xun Yin Bio, Mozhuo Bio, Cai Ke Bio and other companies have emerged and completed financing one after another.
Under the heat of upstream innovative life science equipment, they will continue to be hot spots in 2022
.

 
Pattern: "In the post-epidemic era, the industry has entered a period of integration.

Since 2020, many companies have completed rapid accumulation of performance and wealth through the new crown testing business and successfully listed.
At the same time, industry leading companies in various tracks in the primary market have also raised a large number of These funds not only support the endogenous development of enterprises, but also allow enterprises to quickly complete the supplement of business/product lines through foreign investment or mergers and acquisitions
.

 
In 2021, mergers and acquisitions in the diagnostic and life sciences markets will begin to appear clue
.
In the domestic market, traditional IVD listed companies whose performance has skyrocketed under the new crown seeks a second growth curve by acquiring innovative technology platforms, including Shengxiang Bio’s attempt to acquire Kehua Bio (the two parties established a joint venture after the failure) and investment in Zhenmai Bio and Mingde Bio The acquisition of Sequlite by Nuoyin Bio, Fipon Biotech, and the acquisition of Yurogen by Aibotech; and the acquisition of Hytest by Mindray Medical have solved the upstream stuck neck technology and accelerated the breakthrough of product R&D capabilities and the process of internationalization
.
There have also been a number of large-scale M&A transactions in overseas markets, including the successful acquisition of Ortho Clinical Diagnostics by Quidel after its planned acquisition of Qiagen failed, Novo Holdings’ acquisition of BBI, and Perkin Elmer’s acquisition of BioLegend
.

 
Since the dividends of the new crown business are still continuing, it is enough to foresee that the industry integration will intensify in 2022, and it will reflect the characteristics of high frequency, large amount, and internationalization.
Molecular diagnostics and POCT have stronger business synergy with traditional diagnostic companies.
The field will become a hot spot for investment
.

 
Our Outlook
for 2022 Looking forward to 2022, under the industry themes of "post-epidemic" and "post-genome", tumors will still be the focus of the capital market this year.
In the stage of prognosis guidance and health management, there will be more detection technologies and products.
We focus on industry breakers who can provide high-quality detection, take into account the accessibility of products, and achieve commercialization
.
The industry under "involution" will face reshuffle and integration.
Enterprises with strong innovation ability, high technical barriers, and long slopes and thick snow will continue to be favored by capital, and enterprises caught in homogeneous competition can also choose to exit through mergers and acquisitions
.
The bottom layer of multi-omics is data.
Combining single-cell and single-molecule technologies can realize multi-dimensional and more accurate personalized diagnosis and treatment, and can also greatly promote the systematic, digital and intelligent development of life sciences.
We believe that the diagnostic industry will develop in 2022.
There will be more cross-border integration, innovation and change empowered by AI & big data
.

 
From the perspective of industry development

Diseases: Tumors are still the most popular, and the whole life cycle is extended to create integrated diagnostic















technologies: innovation driven by "involution", multi-omics emerges















Industry chain: raw materials and high-end life science instruments are highly sought after in the upstream















industry Times Industry Enters Consolidation Period






2022 Our Outlook




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SF UAV cooperates with Luohu People's Hospital to carry out normalized medical distribution