After introducing the working principle of endoscopes and the development status of China's endoscopy market above, it can be seen that China's endoscopy field still has huge development space. What are the competitive companies in the industry? In this article, we will analyze the competitive landscape of China's endoscopy market by introducing foreign enterprises in the endoscopy market and some domestic enterprises with development potential.
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Olympus and Karl Stoess are leading the flexible and rigid endoscopy market respectively, and the domestic enterprises are seeking to catch up
3.1 Olympus: accounting for 70.8% of China's flexible endoscopy market, and actively exploring the market of secondary hospitals<
Olympus is the world's precision instruments, optical technology, one of the representative enterprises, has a hundred years of development history. The company was founded in 1919 at the beginning of the production of microscopes to make a profit, after the success, and then entered the field of endoscopy, in 1950 to become the world's first launch of the gastroscope practical enterprise.
Due to the earlier development time time, the technology is more mature, Olympus mastered the narrow-band imaging technology and autofluorescence imaging technology, the application of GI endoscopy can make the GI mucosal microvascular observation more clear, while reducing the shadow, reduce the rate of misdiagnosis. This technology is ahead of other manufacturers, but also allows Olympus to do the monopoly of the flexible mirror market, occupying 65% of the market in the world, in China is to control 70.8% of the market. In addition, the company is also located in the first echelon in the field of hard lenses, occupying 23% of the market for hard lenses in China, second only to the German company Karl Storz.
Chart 1: Olympus occupies 70.8% of the rigid lens market in China
The company has built a comprehensive product line around endoscopes and provides supporting surgical, maintenance and other equipment, and GI endoscopes are the company's core products. In 2019, the company's total revenue was ￥797.4 billion, of which business revenue related to medical endoscopes accounted for nearly 80%.
Olympus attaches great importance to the Chinese market. The company's official report shows that the Asian market revenue of 168 billion yen in 2019, of which more than 60% comes from China. In order to consolidate its market position, the company has established supporting physician training centers in many places in China, giving many young physicians who are unable to access the clinic the opportunity to familiarize themselves with the company's endoscopic products, and creating a good reputation for their products while improving the level of doctors.
Chart 2: Olympus Asia market more than 60% of revenue from China
Olympus in China's current customers are mainly tertiary hospitals and a small portion of the second level of hospitals, while the grass-roots hospitals accounted for a lower percentage. The company believes that as the health awareness of the Chinese people increases, the demand for early diagnosis will increase day by day, so the market of secondary hospitals and even primary hospitals can be developed.
Chart 3: Tertiary hospitals are the main customers, and the primary hospital market is worth exploring
Comprehensively, Olympus has completed the long-term layout of endoscopic products by virtue of its advanced technology and supporting physician training strategy, and its monopoly of the endoscopic market in China will be difficult to break for a long time in the future.
3.2 Carl Stoss: 2018 revenue of 1.210 billion euros, accounting for 47% of China's rigid mirror market
Carl Stoss was founded in 1945, and in the early days, it mainly produced magnifiers and optical inspection accessories. After getting involved in optical instruments, the company began to step into the field of endoscopy, and today the company has become a head player in the field of endoscopy, with products in medical endoscopy and industrial endoscopy.
Chart 4: Carl Stoss holds 47% of China's hard tube endoscopy market in 2019
The company was the first in the world to launch a full HD 4K camera, and now owns more than 400 patents. 2018 revenue of 1,710 million euros, net profit of 12 million euros. In China's medical rigid tube endoscopy on the company's 2019 market share of 47%, is the leading company in the field of rigid mirror.
It is worth noting that although the company is excellent in the field of hard mirror traditional white light technology, but in the emerging fluorescent hard mirror technology, lagging far behind Stryker, accounting for only 10% of the market in China. Currently, fluorescent hard mirror only accounts for less than 15% of the hard mirror market, but it has both fluorescent and white light modes, with the maturity of the technology, the trend of increasing market share in the future, gradually replacing the pure white light hard mirror is unstoppable, so the company's market size in the future may be greatly challenged.
Chart 5: Carl Stokes fluorescent rigid mirror market share of only 10%
3.3 Keli Medical: endoscopy revenue annual growth rate of more than 100%, the price is lower than imports of products 10%-20%
Keli Medical is China's domestic endoscopy enterprises with the smallest gap between foreign companies. The company has two business pillars: ultrasound and endoscopy.
The company's endoscopy business maintains rapid and steady growth, in 2016, the endoscopy business revenue was only 0.36 billion yuan, while in 2019 there was already 292 million yuan, with a compound annual growth rate of more than 100%, and the endoscopy revenue share has increased from 5.02% to 23.49%, which has become the company's second largest main business.
Chart 6: 2016-2019 Keli Medical endoscopy average annual revenue growth rate of more than 100%
Keli Medical also has a strong R & D capability, the R & D expense ratio is stable at about 20%. The company independently developed the HD500 upper gastrointestinal endoscope, a rare high-end endoscope varieties in China, which uses CMOS sensors, which reduces costs while allowing the company to get rid of the dependence on the core technology and raw materials of the CCD sensors of the three major Japanese enterprises, and obtain the ability of independent research and development. At the same time, the imaging technology adopts photoelectric composite staining imaging technology, which ensures the image brightness and signal-to-noise ratio while enhancing the contrast of mucosal blood vessels, providing richer reference information for clinical disease diagnosis, and the resolution is not inferior to Olympus's 260 series and Fujifilm's 4450HD. In addition to this, the price of HD500 occupies an advantage over other products of the same type, which is 10%-20% lower than that of the imported products. Imported products 10-20% lower, an organization research data shows that the HD500 terminal price of 60-1 million yuan, while Olympus and Fuji's similar products need 70-120 million yuan.
Chart 7: Comparison of Keli Medical with Olympus and Fuji's products of the same type
Thanks to the accumulation of technology in the field of electronic scopes, Keli Medical has also entered the field of scleroscope, listing the first high-definition three-chip 4K scleroscope, with a resolution higher than that of the TC200 of Karl Stoess, and other parameters close to those of Karl Stoess. Other parameters are also close to those of Karl Storz. In addition, the company is also constantly laying out endoscopic therapeutic instruments and peripheral products to enrich its product line, and in 2018 the company acquired Wilson Optoelectronic Instruments Ltd. to obtain biopsy forceps, foreign body forceps, ultrasonic cleaners for endoscopic instruments and other products. Meanwhile, with the technical advantages in the field of ultrasound, the company also launched ultrasound endoscopy products, which were approved for listing in 2019, filling the gap in the domestic market.
To summarize, Kaili medical focus on high-end endoscopic products, with its R & D capabilities and technological advantages to become the leading domestic endoscopic enterprises, compared to foreign leaders and the existence of price advantage, so the future development prospects should not be underestimated, although it is difficult to challenge the leading position of Olympus in a short period of time, but the market share is expected to increase. However, the marketing of high-end endoscopes is not overnight, and requires specialized personnel to carry out academic promotion, which is a great challenge for the marketing team of Kelley Medical.
3.4 Hitech Xinguang: 2019 endoscope-related revenue of 185 million yuan, fluorescent endoscopes into the supplier of Stryker
Hitech Xinguang was founded in 2003, focusing on the research and development of rigid-tube endoscopes and their components in the production. strong> production. The company's endoscopy operating revenue accounts for more than 80% and rises year by year, with revenue of 185 million yuan in 2019, up 29.37% year on year. The company's main products are fluorescent rigid lenses, and the revenue accounted for more than 80% of endoscopes.
Chart 8: Hitech Xinguang's revenue has been increasing year by year, with a year-on-year growth of 29.37% in 2019
The company, with its technological advantages in the field of fluorescent rigid mirrors, has become the only supplier of this equipment in the AIM of Stryker's fluorescent endoscopy whole system in terms of design and production. With the future increase of Stryker's market share of fluorescence endoscopy in China, the company's sales are expected to further increase.
However, the company's business revenue has the problem of over-dependence on Stryker. The revenue sold to Stryker accounted for 65% of the total revenue in 2019, and once Stryker has problems with its future sales in China's market, the market scale of Hitech Xinguang is bound to be affected. In addition, Stryker acquired fluorescence imaging technology developer NOVADAQ in 2017, and obtained the fluorescence technology of endoscopy whole PINPOINT system, used to supplement the AIM system, if Stryker increased the use of PINPOINT system in the future, it will also affect Hitech Xinguang's endoscope export business.
3.5 Myriad Medical: spend 4.5 billion to build Wuhan R&D center, launch 4K HD rigid mirror system
As China's leading medical device company, Myriad has also entered the endoscopy industry in recent years. The company spent 4.5 billion in 2020 to build its second global headquarters in Wuhan, endoscopes and the minimally invasive surgical equipment they require are a major part of the construction of the Wuhan production base. Meanwhile, for the first time in its 2019 annual report, the company's products in the field of life information and support include endoscopy-related products such as surgical laparoscopic camera systems, cold light sources, and optical endoscopes, in addition to the traditional products such as monitors, defibrillators, anesthesia machines, and ventilators. In 2019, the company's revenue in the life information and support category reached 6.341 billion yuan, up 21.38% year-on-year. Although the company has entered the endoscopy industry for a relatively short period of time, it has now launched a new 4K rigid lens system due to its strong R&D capabilities and capital injection. With the volume and capability of Myriad, it is likely that it will enter the field of flexible mirror with higher technical barriers in the future, which will then have an impact on the competitive pattern of the endoscopy market.
3.6 Others: SMEs focus on low-end endoscopic equipment, targeting secondary hospitals and below
In addition to the above companies, there are endoscope manufacturers in China such as Shenyang Shenda, Hock and Tian Song, etc., but the main products are focused on SD low-end rigid mirrors, which have a greater impact on the stability and clarity of the image, the feel of the doctor's operation, and the ability to be inserted. There is a big gap between them and foreign companies. In terms of flexible scopes, in addition to Keli Medical, domestic enterprises such as Shanghai Cheng Yun, Shanghai Medical Light and Shanghai Aohua are involved, among which Shanghai Aohua has launched a high-definition gastrointestinal flexible scopes, but the main customers are concentrated in the second level of hospitals and the following, and there are certain difficulties in entering the third level of hospitals.
In summary, due to the technological updates in the rigid and flexible mirror market, the competitive pattern of China's endoscopy market may change in the future. In the flexible mirror market, although the leading position of Olympus is difficult to shake in a short period of time, but Kaili medical market share may increase significantly, forming a challenge to other traditional advantages of the Japanese companies. In the scleroscope market, with the increasing market share of fluorescent scleroscopes, the leading position of Carl Stokes may be replaced by Stryker; on the other hand, Myriad Medical, with its strong R&D capability and capital injection, is likely to get a share in the scleroscope market. At the same time as the head enterprises compete for the tertiary hospital market with their high-end products, the secondary and lower hospitals may remain the main target of small domestic enterprises with slightly inferior product quality but low prices.