Shanghai, China - MicroPort Scientific Corporation (hereafter referred to as the "Company" or “MicroPort®", stock code: 00853) announced on August 30 the interim results of the Company and its subsidiaries (hereafter referred to as the "Group") for the six months ended June 30, 2021 (hereafter referred to as the "Reporting Period"). In the first half of 2021, as most countries and regions gradually entered the stage of normalized epidemic prevention and control, the Group actively promoted the development of its businesses in China and overseas, expedited the promotion of its global business layout, and maintained a leading position in terms of marketing and sales in its core businesses.
In the first half of 2021, the Group achieved revenue of US$384.6 million, representing an increase of 17.7% as compared to the corresponding period of last year. In particular, the heart valve business, the neurovascular devices business, and the endovascular and peripheral vascular devices business, continued their strong growth trend, with revenue significantly increased by 121.8%, 114.5% and 68.6% respectively on year-on-year basis.
The Group recorded US$90.3 million loss attributable to equity shareholders of the Company during the Reporting Period, mainly due to the rapid increase of US$44.3 million investment in research and development, as well as the impact of price reduction due to the state-organised centralised and volume-based procurement policy on coronary stents.
For the year to date, the Group has obtained external financing of approximately US$1.21 billion to support our future R&D investment, showing that our operating strengths and development prospects are well recognized by the capital market. Following the spin-off of Cardioflow Medtech in early 2021, Microport MedBot, our surgical robot subsidiary, and MicroPort EP, one of our associated companies, both have filed application for listing on Hong Kong Limited and Shanghai Stock Exchange STAR board, respectively. Later on, the CRM business received external financing of US$150 million in July, which will help us advance our product pipeline and further enrich the product portfolio for CRM solutions.
In the first half of 2021, the Group’s cardiovascular devices business recorded a revenue of US$66.8 million. In the China market, the Group’s self-developed Firebird2® Rapamycin Eluting Coronary CoCr Stent System (“Firebird2®”) and FirekingfisherTM Rapamycin Eluting Coronary CoCr Stent System (“FirekingfisherTM”) won the bids in centralised procurement, with the total bid-winning quantity ranked the first among all players. During the Reporting Period, the Group overfulfilled the sales of intentional purchase volume ahead of schedule, further expanding our leading advantage in domestic stent market with the largest market share. In overseas markets, despite the significant decrease in the overall number of PCI surgeries due to the pandemic, the Group still actively participated in bidding projects of overseas governments and hospitals. During the Reporting Period, the Group recorded a revenue from overseas stent sales of US$7.1 million, representing an increase of 8.4% as compared to the corresponding period of last year. In particular, the sales amount in the European and the region of the Middle East, Africa and the Commonwealth of Independent States (collectively, the “MEA&CIS”) achieved a year-on-year growth of 251% and 134%, respectively. During the Reporting Period, the Group’s drug eluting stents obtained a total of 10 initial registrations in nine countries or regions, and have been certified for commercialisation in a total of 33 countries or regions and launched to the market for the first time in Singapore, Ecuador and Kazakhstan. The Firehawk® Liberty stent was newly covered by the national medical insurance in countries including South Korea, Belarus and Turkey. Moreover, the balloon products maintained a rapid growth in sales volume with global revenue reaching US$9.5 million, representing a year-on-year increase of 80.0%.
In the clinical aspects, the Firesorb® Bioresorbable Rapamycin Targeted Eluting Coronary Scaffold System (“Firesorb®”) released the major imaging and clinical results of the pivotal study FUTURE II. The results showed that the Firesorb® was comparable to a market-leading metal drug-eluting stent in terms of safety and reliability at the primary endpoint of one-year post surgery. The study was published in the JACC Cardiovascular Interventions, a well-known cardiovascular journal. As for the overseas market, the Group released the latest four-year follow-up result of TARGET All Comers (“TARGET AC”) for the Firehawk® at the EuroPCR, which further proved the long-term safety and effectiveness of the Firehawk® as the world’s lowest drug-loaded coronary drug stent. In addition, the Group initiated the TARGET FIRST clinical study of the Firehawk® in Europe and completed the first patient enrollment, aiming to evaluate that a shorter dual antiplatelet therapy, combined with the unique characteristics of the Firehawk®, is a reliable option for patients with acute myocardial infarction. Meanwhile, the TARGET IV NA clinical study of the Firehawk® is under steady progress and this project will support the registration and commercialisation of the Firehawk® in three major markets, namely the United States, Canada and Japan.
In the first half of 2021, the global orthopedics business recorded a revenue of US$110.1 million, representing an increase of 22.9% as compared to the corresponding period of last year. The international (non-China) orthopedics business recorded a revenue of US$95.0 million, representing an increase of 20.9%. The recovery in certain regions with direct sales was satisfactory. In particular, the revenue recorded in France and Japan achieved a year-on-year increase of 34.2% and 15.1% respectively. The orthopedics devices business in the PRC recorded a revenue of US$15.1 million, representing an increase of 37.5% as compared to the corresponding period of last year. In particular, the revenue generated from made-in-China joint products achieved a year-on-year rapid growth of 116.9%. Moreover, the Group’s self-developed Advance® Medial-Pivot Knee System was assigned the highest rating of “15A” by the ODEP (Orthopedic Data Evaluation Panel), an authoritative rating agency in the global orthopedics industry, being the only PRC enterprise with such rating so far.
In the first half of 2021, benefited from the increased market share and the increase in the demand for surgeries with the normalisation of epidemic prevention and control, the CRM business recorded a revenue of US$108.3 million, representing an increase of 20.0% as compared to the corresponding period of last year. During the Reporting Period, the international (non-China) CRM business recorded a revenue of US$102.3 million, representing an increase of 17.3%. The Group’s product sales in most European countries have recovered to a satisfactory level, and the revenue recorded in the United States and Japan achieved a year-on-year increase of 87.3% and 45.8% respectively. Meanwhile, the CRM business in the PRC recorded a revenue of US$6.0 million, representing an increase of 95.0% as compared to the corresponding period of last year. After more than three years of market promotion, the brand influence and market share of the Group’s made-in-China pacemakers have been significantly increasing. During the Reporting Period, the series of domestic pacemakers recorded a year-on-year revenue increase of 116.0%, further solidifying its leading position with the largest market share among domestic players.
During the Reporting Period, the endovascular and peripheral vascular devices business achieved a revenue of US$55.8 million, representing an increase of 68.6% as compared to the corresponding period of last year. The neurovascular devices business recorded a revenue of US$25.4 million, representing a sharp increase of 114.5% as compared to the corresponding period of last year. In addition, a subsidiary of the Group, being the lead investor, completed its strategic investment in Rapid Medical, an Israeli neurovascular treatment device company. In the future, the Group will continue to deepen its comprehensive strategic cooperation with Rapid Medical in the field of neurovascular disease treatment. During the Reporting Period, the heart valve business recorded a revenue of US$13.4 million, representing a significant increase of 121.8% as compared to the corresponding period of last year, with a substantial year-on-year rise of 11.0 percentage points in profit margin to 55.1%. The VitaFlow® reached a coverage of 19 in top 20 hospitals of the transcatheter aortic valve implantation (“TAVI”) surgeries and gained a leading position in nearly 100 hospitals, reflecting a rapid growth in the overall market share. For the surgical robot business, the Group’s self-developed DFVision® 3D Electronic Laparoscope (“DFVision®”) was approved by the National Medical Products Administration (“NMPA”) for launching to the market, with the Toumai® Laparoscopic Surgical Robot (“Toumai®”) and the Honghu Orthopedic Surgical Robot (“Honghu”) completed the registrational clinical trial for application. During the Reporting Period, the surgical business recorded a revenue of US$2.3 million, representing a decrease of 1.6% as compared to the corresponding period of last year.
While its established business segments are showing rapid growth, the Group is also actively exploring emerging business fields such as the non-vascular intervention, sports medicine, assisted reproduction, rehabilitation treatment, endocrinology, in vitro diagnostics, medical imaging, aesthetic medicine, otolaryngology, ophthalmology and stomatology as well as disinfection and sterilisation through its subsidiaries or associates. In the field of non-vascular intervention, the Group covers the fields of urology, gynecology, digestion and respiration with 14 certified products and 78 patents. During the Reporting Period, Archimedes®, the world’s first long-term implantable balloon rotator cuff system self-developed by an associated company, successfully performed the clinical implantation surgeries and commenced clinical trials in seven large sports medicine centers in the PRC. In the field of assisted reproduction, an associated company’s self-developed Orkid® Intrauterine Insemination Catheter was approved for commercialisation in the PRC, and the Daylily® Embryo Transfer Catheter and the LotusTM Ovum Aspiration Needle were approved for commercialistion in Thailand. During the Reporting Period, the Rehabilitation Group was established that covers rehabilitation medical solutions such as musculoskeletal rehabilitation, cardiopulmonary rehabilitation and neurological rehabilitation. It currently has a total of 6 approved products, multiple commercialised product lines and over 100 technical patents. In the field of in vitro diagnostics, the Group’s self-developed its real-time PCR test, SARS-CoV-2 Nucleic Acid Test Kit received the CE Marking. In the field of medical imaging, the digital subtraction angiography device used to observe vascular diseases and locate and measure vascular stenosis has entered the registration stage for NMPA approval.
Research and Development
As a world leading innovative high-end medical device group, MicroPort attaches great importance to innovative research and development. Our R&D expenses in the first half of the year increased by 60.8% year-on-year, representing over 30% of the Group’s revenue. Such increase was primarily due to the increased investments in the on-going and newly kicked off research and development projects, including extensive clinical studies of Firehawk® in Europe and the United States, and the registrational clinical trials of Toumai® and Honghu surgical robots.
For the year to date, the Group’s R&D projects have achieved fruitful results with a total of 8 products obtaining the registration certificates from the NMPA. The IceMagic® Cardiac Cryoablation System entered the Innovative Medical Device Special Review and Approval Procedure (the “Green Path”). The Group and its associated companies had a total of 21 products being approved to enter the Green Path, ranking the first in the medical device industry for seven consecutive years.
The Group also obtained approvals from FDA for 2 products and the CE Marking for 14 products during the Reporting Period. As for the CRM business, the new Alizea™ and Borea™ pacemakers together with the SmartView Connect™ Home Monitor have obtained the CE Marking under the latest European REGULATION (EU) 2017/745. In addition, during the Reporting Period, the Ulys™, Edis™ and Gali™ defibrillators obtained CE Marking. As for the neurovascular devices business, the Group’s self-developed NUMEN® Coil Embolisation System has obtained the CE Marking. As for the orthopedics devices business, the Profemur® Cemented XM® Femoral Stem, the revision multi-hole cup and augments for the Procotyl® P Acetabular Cup System, and the Hip Head Tensioner Device obtained the CE Marking; the DYNASTY® Dual Mobility Acetabular Hip System obtained certification in Canada; the EVOLUTION® Medial Pivot Knee Kinematic Alignment Instrumentation obtained certification in the United States, Europe, Japan and Canada; and the Anterior PATH® hip replacement instruments obtained certification in the United States, Europe and Canada. As for the surgical devices business, the new generation of membrane oxygenator has successfully completed the clinical enrollment trials.
Dr. Zhaohua Chang, Chairman and CEO of MicroPort®, said, "MicroPort®, as a leading innovative high-end medical device conglomerate, will fulfill its mission and social responsibility by actively developing diversified product lines and integrated solutions through continuous innovation, and aims to continuously bring its innovations, technologies and services to millions of global patients and become a patient oriented global leading enterprise in high technology medical segments represented by minimal invasive and other emerging medical markets.”
*All the revenue growth rates mentioned above are compared to the corresponding period of last year, and also adjusted to exclude the foreign exchange impact. Please refer to the 2021 Interim Results Announcement issued by the Company on August 30, 2021 for the data before excluding the foreign exchange impact.