One of the Most Promising Verticals in the Medical Device Investments Space: Cardiovascular

The global healthcare innovation has been booming for quite some years now. Investors find this sector attractive and are looking for opportunities to invest into. The global healthcare innovation ecosystem has raised $35B in 2020.This is led by the US with $22.6B (65%), followed by China with $6.7B (19%) and Europe with $5.5B (16%).

Venture Capital in Healthcare

  • While 2017’s first three quarters of funding were relatively slow, the year ended with health-tech’s Ping An Healthcare and Technology’s staggering $2.2B deal in December

  • 2018’s historic $8.1B in venture-backed healthcare was primarily fueled by two marquee events: Ping An Medical and Healthcare Management’s $1.2B round and WeDoctor’s $500M round

  • 2019 funding was up slightly from 2017 but down nearly 30% from 2018. This decrease in funding can largely be attributed to a drop-off in biopharma and health-tech investments

  • Q2 2020 sported the second-largest quarterly investment total for venture-backed healthcare companies in China led by MGI’s $1B deal and Mabwell’s $278M deal

Medical Device Investment Focus – Cardiovascular

Cardiovascular health has become an important part of everyone’s lives and people have started focusing on ways to keep their heart healthy. Diseases like Coronary Heart Disease (CHD), heart attacks, heart failure, and coronary artery disease have been on the rise.

Due to a growing geriatric population in China and increased incidence of cardiovascular health problems, the market for cardiovascular healthcare has shown stellar growth. In 2019, more than 11% of China’s population were aged 65 years or above, according to a United Nations Department of Economic and Social Affairs report. With more awareness and better technology for cardiovascular health, the demand for these services has been rising constantly. In China, the average revenue for top 10 cardiovascular companies has been increasing at a CAGR of nearly 38.1%. Cardiovascular device deals also lead the pack from 2018-2020 in Mainland China and Hong Kong.

 
 

Major players in the Cardiovascular Sector

The major players in the cardiovascular health-tech sector in China are:

  • Abbott Laboratories

  • Boston Scientific Corporation

  • Medtronic PLC

  • Lepu Medical Technology (Beijing) Co. Ltd.

  • Terumo Corporation

The market concentration in this space in China lies between fragmented and consolidated markets. Hence, this presents a great opportunity for new market players to enter without being prevented by dominant players. Investors looking to invest in this space have tremendous growth potential and can benefit from this sector.

 
 

Bridge Point of View

With an increase in awareness regarding cardiovascular health and large improvements in technology in this sector, investors have been presented with a great opportunity to benefit from this growing sector. Higher incidence of cardiovascular health issues has also pushed the scope of continued growth in this sector. In the second part of this 2-part series, we will look at case studies in this domain and discuss the factors fueling their success.

InsightsBridge Point Capital