Innovation-driven breakthrough: KaiLi Medical establishes a benchmark for domestic medical device brands

In recent years, with the release of national medical reform policies and the increasing pursuit of high-quality medical care by the public, the domestic medical device market has seen significant growth. Data shows that from 2008 to the present, the average annual compound growth rate of domestic medical device research and development and manufacturing has been over 20%. High demand has driven the overall improvement of the technological level of domestic medical devices. In the international market, which has long been monopolized by developed countries in Europe and America, the names of leading Chinese medical device companies such as Mindray and Kailite have emerged. For example, China's medical companies are now on par with companies like GE, Siemens, and Philips in terms of high-end ultrasound diagnosis and radiation diagnosis technologies and products. Chinese medical companies are competing with multinational corporations on a broader stage, allowing China's medical innovation achievements to be shared globally.

Feng Naizhang, General Manager of Kailite Medical's Ultrasound Product Line

Focus on R&D, Cultivating a Deeply Rooted Soil for Technological Innovation

At the beginning of this century, the Chinese high-end medical device market was basically monopolized by foreign giants. Coupled with the high maintenance costs of high-end medical equipment, product prices remained high, exacerbating the problem of expensive medical care for the masses. Statistics show that approximately 80% of CT scanners, 90% of ultrasound instruments, 85% of testing instruments, 90% of MRI equipment, 90% of electrocardiographs, 80% of mid-to-high-end monitors, and 90% of high-end physiological recorders were foreign brands.

Independent brands have always risen from hardship. In 2002, Kailite Medical was officially established, marking the beginning of a passionate era for a leading Chinese medical brand.

From its inception, Kailite Medical has adopted a development strategy centered on technology and technological strength. Compared to foreign companies, domestic medical companies have significantly underinvested in R&D. In 2016, the top 10 medical device companies in the United States invested a total of US$10.4 billion in R&D, accounting for 8.14% of total revenue. In the same period, the top 10 medical device companies in China invested only 1.806 billion yuan in R&D, accounting for 5.35% of total revenue.

Feng Naizhang, General Manager of Kailite Medical's Ultrasound Product Line, believes that only technological innovation can lead the company's development. He often says, "Companies perish without technology and prosper with it. Enterprises must provide a good foundation for technological innovation."

Kailite Medical Workshop

Guided by the principles of technology first and R&D-driven, Kailite Medical quickly entered a fast-growing track, and its products have become increasingly high-end and diversified through technological innovation. In 2004, Kailite Medical launched the first 15-inch LCD large-screen full-function portable color ultrasound system in China, which was the first domestically developed fully digital color ultrasound system. According to InMedica data, Kailite Medical's ultrasound equipment has entered the top ten in global market share. The company has also won the German Red Dot Award, the Entrepreneurial Company Award for the European Ultrasound Market from Frost & Sullivan, and the Product Quality Leadership Award from Frost & Sullivan.

Behind its market success is Kailite Medical's unwavering commitment to technological innovation. Feng Naizhang stated that the demand for the three major product areas of medical devices we are involved in remains huge. Taking hospitals as an example, the National Health Commission's "2018 Statistical Bulletin on the Development of China's Health and Health Cause" shows that at the end of 2018, there were a total of 997,434 medical and health institutions nationwide, including 33,009 hospitals, 943,639 primary-level medical and health institutions, and 18,034 specialized public health institutions. This large number of medical and health institutions regularly need to update medical equipment such as endoscopes and in-vitro diagnostic systems. Because technology is constantly advancing, updates must keep pace with technological development to remain competitive.

After 17 years of deep cultivation in the industry, Kailite Medical has transformed from a regional brand into an industry leader. Today, Kailite Medical has established three major product systems spanning ultrasound diagnosis, electronic endoscopy, and in-vitro diagnostics. It has seven R&D centers globally and its Business Scope covers more than 130 countries and regions. Its domestic ultrasound market share ranks second. In recent years, Kailite Medical has invested 18% of its total expenditure in basic research, which is far higher than the industry average and comparable to the top international medical device manufacturers. Currently, Kailite Medical's R&D level in endoscopy and ultrasound diagnostic technologies is at the forefront internationally.

Thanks to continuous investment in technology, Kailite Medical has the strength to compete with top international medical device manufacturers, becoming a leading enterprise in the industry. In 2018, its net profit increased by more than 30%.

Promoting Product Innovation through Technology

Kailite Medical's products in its three product lines have had a wide impact in the industry. In the color ultrasound product field, from China's first fully digital color ultrasound and the first single-crystal probe to the high-end S60 series, Kailite products have ranked among the top ten in the world. In the endoscope market, Japanese companies have always dominated. In 2016, Kailite Medical's first high-definition digestive endoscope system, HD-500, broke the monopoly of Japanese companies, proving that China has the ability to develop similar products. In recent years, Kailite's in-vitro diagnostic products have also achieved remarkable Achievements with the support of technology.

Kailite Medical Ultrasound Product S60

Because the company's leaders come from a technical R&D background, they understand the impact of technology on products, quality, and the company's growth. Therefore, professionalism, focus, and the pursuit of excellence have become the company's motto. Currently, Kailite insists that each product must be compared to competitors' products and cutting-edge foreign technologies, using them as benchmarks for continuous improvement, striving to be the best in its class.

Taking the HD-500 as an example, in 2016, Kailite Medical developed China's first fully high-definition endoscope system with completely independent intellectual property rights. The launch of this system, with its high-definition images and realistic picture quality, broke the monopoly of foreign manufacturers in the digestive endoscope field and brought a new transformation to the domestication of digestive endoscopes. In terms of standards, Kailite insists on developing products with higher requirements than European and American standards and national standards, ensuring that its products are at the forefront of high-precision and cutting-edge technology upon launch, achieving seamless integration with standards.

Supporting Kailite Medical's product technological innovation and catching up with the world's leading companies are the various research centers behind the company. Currently, Kailite Medical not only has domestic R&D centers in Shenzhen, Shanghai, Harbin, and Wuhan, but also international R&D centers in Silicon Valley, Seattle, and Tokyo. The goal is to integrate domestic and international resources and gather top global scientific and technological talents to accelerate the transformation of technology into products.

Technological innovation must also keep pace with the times

    In the era of globalization, competition is becoming increasingly fierce. Whether they are industry giants or small and medium-sized enterprises, all companies face a common challenge in this economic tide: failure to focus on technological innovation will lead to elimination! The medical device industry is no exception. However, while challenges exist, so do opportunities. According to China's national health development plan, the country will further increase investment in the medical industry and support enterprises in pursuing technological innovation. This presents a chance for Kailite Medical to grow even bigger and stronger.

    Faced with the technological tide of 5G and artificial intelligence, senior executives at Kailite Medical, including Feng Naizhang, have already keenly recognized this. Kailite Medical will further increase its R&D investment in line with the country's industrial development plan, firmly grasp the opportunities presented by 5G and AI technologies, actively develop smart medical care and AI, seize the commanding heights of future competition, and strive to achieve continuous breakthroughs in its three product lines, better meet the needs of doctors, and provide patients with a better treatment experience.

Kailite Medical Product Lines 

    To this end, Kailite Medical has made forward-looking strategic plans. Currently, because Kailite Medical has already made preparations in terms of technology, it combines its three existing product lines with 5G, mainly combining them with AI and automation in terms of image transmission and data transmission. The basic structure of the products is compatible with 5G technology, and only needs a technological upgrade. Clearly, being prepared in advance and combining with the 5G technological revolution will inevitably bring a new user experience, better addressing user needs in a more practical manner.

    All the innovation, transformation and breakthroughs show that Kailite Medical is using a dual-drive approach of software-first and hardware innovation, pushing the company to rapidly move towards high-end products, internationalization of its Brand, and cross-border integration. Through innovative transformation, it achieves improvements in both quality and efficiency, advancing into the high-end segment of the global medical value chain.