NIE 2023 | BDI Medical's Golden Fleet: Building an Innovative Ecosystem for Medical Devices

Jin Jia first briefly analyzed the differences between medical devices and biomedicine, pointing out that although both belong to the field of healthcare, there are significant differences in their underlying R&D logic and commercial operations. Jin Jia noted that the development of innovative medical devices is more complex; for the same disease, different medical devices can be used for treatment; the vast majority of drugs undergo continuous testing in laboratories, from small-scale trials to medium-scale trials and then to commercialization, while medical devices are rarely developed in laboratories. Instead, new needs are mainly discovered by clinicians during actual operations, which in turn drive the development of medical device products.

Jinjia Analysis points out that the innovation and development of medical devices have undergone a transformation from closed innovation to open innovation. Closed innovation mainly refers to when doctors develop new medical devices on their own after having an idea, while open innovation includes early-stage internal and external cooperation (such as industry-university-research cooperation), collaborative development of production processes, and cooperative commercialization.

Subsequently, Jin Jia further analyzed the current situation of innovative medical devices in China:

First, overseas introduction. The vast majority of medical device products in Chinese-funded foreign companies are imported from abroad, which have already been produced and registered. However, with the Chinese government's encouragement of innovation and the expansion of the Chinese market, the proportion of domestically produced medical devices has continuously increased, currently reaching an overall level of 10% to 20%.

Second, local R&D. Domestic enterprises rely on local R&D, while foreign-funded enterprises invest relatively less in local R&D personnel compared to domestic enterprises. Third point, imitation and improvement. Currently, many domestic enterprises still adopt the strategy of imitation and improvement, developing 'me better' products that can even be launched faster domestically than original foreign-funded research and development enterprises. Fourth and fifth points, technology transfer and technology introduction. Technology transfer includes License-in and License-out; domestic enterprises can introduce overseas products through methods such as equity investment and investment. Technology introduction and transfer actually come from two sources: one is importing from abroad, and the other is collaborating with doctors. Foreign-funded enterprises face strict compliance requirements when contacting doctors in China, which also limits their R&D and production.

Thirdly, commercialization capability. The commercialization phase of innovative medical devices must start with promotion from leading hospitals, leading doctors, and leading medical resources. Since foreign-funded enterprises possess new technologies and products, they have a relative advantage.

Jin Jia pointed out that the current foreign cooperation models for domestic medical devices are mainly divided into two parts: R&D cooperation and commercialization cooperation.

During the R&D phase, the first cooperation model is joint R&D, where foreign-funded enterprises collaborate with domestic companies to develop a product. Most of the technology for the product comes from domestic enterprises, while foreign-funded companies provide guidance and optimization. The second model is OEM (Original Equipment Manufacturer), where after successfully developing a product, foreign-funded enterprises use domestic production processes to assist in production, with foreign-funded companies taking responsibility for sales.

In the commercialization phase, agency sales and OEM sales are two typical models. The difference is that the latter involves placing the brand of foreign-funded enterprises, which correspondingly requires a higher quality verification and standards for products. In addition, there are also acquisitions and external licensing collaborations, where foreign-funded enterprises license their products to domestic enterprises, who undertake tasks such as product sales.

Jin Jia cited several cases where Bidei helped domestic enterprises successfully go global: The first case involved a domestic A-share listed company providing an IVD raw material to Bidei Medical, who then developed testing reagents and supplied them to overseas markets; the second was helping a listed company act as an agent for products in Europe; the third was assisting a domestic company with agency sales of its products both domestically and internationally, forming a synergistic effect with a major product of Bidei; the last case was where a domestic enterprise helped Bidei with OEM production and subsequently obtained FDA approval in Bidei's name.

Jinjia shared the BD Medical's innovative medical device ecosystem that combines 'medicine and engineering'. BD Medical has made various attempts at promoting medical device innovation through different models: the Medical Innovation Camp trains doctors to guide them in inventing medical devices; the Acceleration Camp mainly helps innovators accelerate the transformation of ideas into products; and the Creative Camp assigns tasks to participants for inventing medical devices. In addition, BD Medical has opened an innovation center in Hangzhou this year, including animal laboratories, wet and dry laboratories, etc., providing venues for doctors, partners, hospitals, etc., to promote multi-party interaction.

Finally, Jin Jia stated that he hopes that in the future, more investors and startups in related fields can communicate and cooperate more frequently to jointly promote the innovative development of medical devices in China.