On the evening of April 26, Mindray Medical (stock code: SZ.300760) disclosed its 2023 annual report and 2024 first quarter report, and high growth is still the company's "background".
In 2023, Mindray's revenue will be 34.932 billion yuan, a year-on-year increase of 15.04%, and the net profit attributable to the parent company will be 11.582 billion yuan, a year-on-year increase of 20.56%. In the first quarter of 2024, the company's revenue was 9.373 billion yuan, a year-on-year increase of 12.06%, and the net profit attributable to the parent company was 3.160 billion yuan, a year-on-year increase of 22.90%.
Whether it is an annual report or a quarterly report, Mindray's performance data ranks first in the industry, and it is a cliff-like leader. As the absolute leader of medical devices in China, Mindray Medical, which has reached the top of "Taishan", has also taken up the new mission of the times - to lead the transformation of the industry into "digital intelligence", which is also considered to be the commanding heights of future competition in the field of medical devices.
In the 2023 annual report, Mindray disclosed for the first time the development process of "digital intelligence": the company has successfully crossed the first stage of "broad and innovative product layout", realized the second stage of "deep integration of data, equipment, and IT interconnection", and is crossing the third stage of "digital intelligence ecosystem that comprehensively empowers clinical practice".
At present, Mindray has completed the construction of an intelligent medical ecosystem of "equipment + IT + AI", and through the integration and innovation of the "Sanrui" ecosystem and equipment, combined with big data and artificial intelligence, it provides medical institutions with hospital-wide digital and intelligent overall solutions, accelerates medical homogenization, and helps global medical institutions improve their overall diagnosis and treatment capabilities.
The medical device industry is related to human life and health, and "digital intelligence" will once again improve medical efficiency and greatly enhance the ability to save thousands of lives. China is the world's second largest medical device market, but there is no place for Chinese companies in the world's top 20. The "digital intelligence" transformation will provide an excellent opportunity for China's medical industry to bridge the gap and overtake in a straight way.
Looking forward to the distant mountains, Mindray Medical has established a differentiated competitive advantage of "no one has me, no one has me" through the transformation of "digital intelligence", forming a new growth engine for the company, providing greater certainty for the company's long-term and steady growth in the future, and leading China's medical devices into a new era of "digital intelligence".
Race ahead of "digital intelligence"
Among the thousands of industries, the medical industry is a real rigid demand industry. With the improvement of economic level and the enhancement of health care awareness, as well as the continuous acceleration of population aging, the demand for health care has increased significantly around the world, and medical expenditure has increased year by year.
According to the data compiled by the Shenzhen Medical Device Industry Association, the global medical device market size will be 595.2 billion US dollars in 2023 and will maintain growth at a compound annual growth rate of 5.71%, and the global medical device industry will reach 743.2 billion US dollars by 2027.
However, in the face of huge demand, the medical industry also has its own pain points.
At present, the problems of lack of high-quality medical resources and uneven distribution have not been effectively solved. The entire market urgently needs new technical means and more cost-effective products brought by digital intelligence to solve clinical pain points, improve diagnosis and treatment efficiency, and achieve cost reduction and cost control.
In 2023, breakthroughs have been made in global innovative technologies, and ChatGPT was born, becoming an epoch-making application product of artificial intelligence technology and leading the direction of future technological progress. At present, the global medical industry is facing the singularity moment of AI+, and "digital intelligence" has become the standard configuration of enterprises.
Not long ago, the 89th China International Medical Equipment Fair (CMEF) opened in Shanghai. So much so that some voices ridiculed that they were embarrassed to come to the Medical Expo without the concept of AI, and if they didn't mention digital intelligence, they didn't come.
At the Medical Expo, GE Healthcare launched IQ Engine and APM Asset Manager, as well as Haier Biotech's IoT scenario solutions in the field of medical innovation......
With the theme of "Building a Digital Intelligence Innovation Future", Mindray Medical unveiled its AI innovation, hospital-wide informatization solutions and core equipment. In Mindray's 2023 annual report, "digital intelligence" is the focus, and the transformation formula of "equipment + IT + AI" is made public.
In Mindray's definition, the "data" and "intelligence" in digital intelligence represent the integration of IT technology and hardware equipment, and the integration of AI and software systems, respectively. IT empowers hardware to realize real-time collection and transmission of medical big data, and AI empowers software to realize the processing and integration of medical big data. In the end, a reliable and easy-to-obtain diagnosis and treatment plan is jointly generated, helping medical institutions improve their overall diagnosis and treatment capabilities.
However, it should be noted that the transformation of "digital intelligence" can grow into a towering tree, but it must not be pulled out to help it grow.
Algorithms, computing power, and data are the "troika" of artificial intelligence, and they are all indispensable. For medical device companies committed to "digital intelligence", massive medical big data is "rice", and the data acquisition carrier is a broad product layout with innovative technology.
With a broad product layout that goes deep into various medical scenarios and a deep understanding of the pain points and clinical needs of the industry, Mindray is undoubtedly in the ecological niche of a leader in the journey of digital intelligence.
Homework for "top students".
In terms of product layout, Mindray has laid out three production lines of life information and support, in vitro diagnostics, and medical imaging, covering a variety of clinical scenarios such as outpatient and emergency, inpatient department, intensive care department, surgery, anesthesiology department, ultrasound department, laboratory department, and out-of-hospital emergency department, and has sold millions of medical devices around the world.
At the same time, Mindray continues to expand its product line through independent innovation and epitaxial mergers and acquisitions.
This means that Mindray has massive data acquisition capabilities, which gives Mindray a unique barrier and advantage in the process of "digital intelligence".
With data, how to make data "live"? "Medical equipment information islands, lack of data interconnection" is a recognized problem. Only by allowing the data to truly flow, and then mining and analyzing, can we intuitively reflect the clinical picture and make good use of it.
As early as 2020, Mindray Medical cooperated with a large number of medical institutions to build an open and growing "Sanrui" ecosystem ("Ruizhilian" ecosystem, "Ruiying Cloud++" imaging cloud service platform, and "Mindray Intelligent Testing" laboratory solution) to achieve the deep integration of data, equipment, and IT interconnection.
For example, "Ruizhilian" realizes intelligent applications such as equipment IoT and data interconnection, clinical automation, intelligent decision support, and medical equipment management through various intelligent hardware connections to improve the quality of monitoring and diagnosis and treatment. "Mindray Intelligent Inspection" realizes lean operation and whole-process management of the laboratory, while "Rayray Cloud++" focuses on image interconnection, supporting cross-departmental, cross-hospital, and cross-regional remote guidance, online consultation, branch teaching, multi-center research, etc., and meeting the urgent needs of mutual recognition of inspection results and lean equipment management.
On the basis of massive "live" data, Mindray uses artificial intelligence to realize intelligent decision support, clinical automation, telemedicine, and intelligent management, improving the accuracy and efficiency of medical services, thereby reducing medical costs.
So far, it can be seen that whether it is data acquisition or data connectivity and integration, Mindray Medical has worked hard for a long time and has done a lot of "internal strength" to pave the way, which is why it is a matter of course to promote "digital intelligence" in the later stage.
It is not difficult to see that the prerequisites for the transformation of "digital intelligence" are extremely harsh, and the transformation process is easier said than done. The "equipment + IT + AI" intelligent medical ecosystem built by Mindray Medical can be called a homework with a very high threshold for completion, and others cannot copy or learn it.
The extremely high threshold for the transformation of "digital intelligence" also means an extremely deep moat. Relying on the differentiated competitive advantage of "no one has me, no one has me", Mindray Medical has continuously implemented the hospital-level "digital intelligence" overall solution among high-end customers at home and abroad.
According to the 2023 annual report, in China, Mindray Healthcare's hospital-level "digital intelligence" overall solution has been implemented in the first affiliated hospital of Zhejiang University School of Medicine, Zhejiang Taizhou Hospital, Nantong First People's Hospital, Guangdong Provincial Maternal and Child Health Hospital, Fujian Jian'ou Regional Medical Laboratory Center, etc.
Overseas, Mindray's key hospitals include the top 10 IDN medical alliances in the United States, CHS Group hospitals in the United States, the top 100 hospitals in Europe, Ghent University Hospital in Belgium, St. Thomas's Hospital, which ranks first in the United Kingdom, Charité University Hospital in Berlin, which ranks first in Germany, and Toulouse University Hospital, which ranks first in France.
For a long time, high-end hospitals at home and abroad have played the leading role in imported equipment, and domestic equipment and solutions have to experience "ninety-nine-eighty-one difficulties" if they want to enter foreign high-end hospitals.
Judging from the results, Mindray's hospital-level "digital intelligence" overall solution has come to life in top hospitals in Europe and the United States, demonstrating the excellent quality and innovation capabilities of Made in China to the world.
A "new engine" for growth
There is a saying in the business market, "no matter how big a company is, it is not as big as a customer". The underlying logic of Mindray's hospital-level "digital intelligence" overall solution is that the solution directly hits the pain points of customers and truly helps medical institutions reduce costs and increase efficiency.
In terms of specific cases, in the First Affiliated Hospital of Zhejiang University School of Medicine, Mindray's "Ruizhilian" solution opens up the data and information of pre-hospital ambulances, in-hospital emergency departments and intensive care medicine departments, and interconnects the critical care medicine systems of multiple hospital districts and even regional medical centers to achieve remote consultation. The solution successfully interconnected a total of 2,268 devices in 4 campuses of the hospital, helping the hospital improve the efficiency of information transmission and equipment management, and greatly improving the efficiency of treatment of critically ill patients.
In the European market, the Mindray medical team used the "Ruizhilian" smart platform ecosystem to demonstrate a complete product solution and workflow to a German university hospital, as well as the standardized operation of network interconnection, which impressed the hospital's information department and clinical department.
In the follow-up installation process, the Mindray team helped the hospital realize the information interface joint debugging of the original equipment system, broke the monopoly of the original equipment service provider, facilitated the hospital's new equipment procurement, and successfully deployed the central station server and eGateway server, laying the foundation for the follow-up project. With good team service and user feedback, the hospital further deepened the cooperation with the company's project, and finally realized the replacement of nearly one million euros of monitors in the whole hospital.
By the end of 2023, the cumulative number of installed hospitals in the "Ruizhilian" ecosystem in China is close to 700, of which more than 400 will be added in 2023. In the international market, by the end of 2023, the cumulative number of signed projects of "Ruizhilian M-Connect" has exceeded 400.
In addition to the "Ruizhilian" ecosystem, as of the end of 2023, the "Mindray Intelligent Testing" laboratory solution in the "Sanrui" ecosystem has achieved the installation of more than 210 hospitals across the country, of which 80% are tertiary hospitals, and 65 new installations will be added in 2023. The "Ruiying Cloud++" project has covered 31 provinces, municipalities and autonomous regions across the country, with a cumulative installed capacity of more than 10,000 sets, and nearly 5,500 new installations will be added in 2023.
As the installation of the "Sanrui" ecosystem continues to accelerate, Mindray's hospital-level "digital intelligence" solution will also be rapidly implemented and become a "new engine" for the growth of the enterprise.
It can be said that the "Sanrui" smart ecosystem built by Mindray Medical and the overall solution capability of "digital intelligence" at the hospital level have built a new growth model for the company.
Relying on this, in the future, Mindray will be able to improve the company's penetration rate and brand stickiness among the global high-end customer base when it customizes digital and intelligent overall solutions for the personalized needs of global customers and helps global medical institutions improve their overall diagnosis and treatment capabilities. The "flywheel effect" is formed.
At present, Mindray is stepping through the third stage of "a digital and intelligent ecosystem that comprehensively empowers clinical practice", and intends to build a unique large model in the medical vertical field in the future, and realize the self-deep learning and evolution of the model based on the continuously accumulated data resources.
The transformation to "digital intelligence" has become the general trend of the medical device industry. In this new journey, the market needs more leaders like Mindray. Mindray is not only exploring the way for its long-term and steady growth in the future, but also leading the high-quality development of the industry. We have reason to believe that the future of global medical devices lies in China.