High-growth Enterprise|Rite-Tech Bio: Looking for the “Blue Ocean” of Ophthalmic Repair in “Medical Waste”

Author: Liu Lixia

Editor丨Li Zhen

Figure Source丨Tu Worm

The “amniotic membrane” is the membrane that wraps the baby in the womb. In 1910, maternal amniotic membrane was first reported as a material for surgical skin grafting, and its potential as a material for regenerative medicine began to be discovered.

Compared with other biosynthetic materials, amniotic membrane has better toughness and tension resistance, and contains natural and rich bioactive factors, which can accelerate wound recovery without producing repulsion. Nowadays, more and more eye repair surgery will use amniotic membrane, but there is no product that can really meet clinical needs in the domestic market, which makes practitioners who have been deeply involved in regenerative medicine materials for many years to find huge business opportunities.

“At present, in the ophthalmology market in China, the homemade amniotic membrane of the original hospital has declined sharply with the upgrading of health supervision, and foreign amniotic membrane products cannot come in. There are only 2 enterprises (one in Jiangxi and Ruitai) with qualifications for the production of ophthalmic amniotic membranes. There is huge space for our wet amniotic membrane to enter the market.” Recently, Lin Yongliang, founder and general manager of Guangzhou Ruitai Biology, said in an interview with a reporter from Southern Finance and Economics.

(Lin Yongliang, founder and general manager of Guangzhou Ruitai Biology, photo courtesy of the interviewee)

Established in 2014, Ruitai Bio is an innovative medical device enterprise focusing on ophthalmic regenerative medicine in Guangzhou Huangpu Development Zone. The first domestic wet ophthalmic repair material. This is an active biomaterial that can solve various ophthalmic diseases from the ocular surface to the fundus, covering more than 15 application fields, and the most widely used direction is ocular surface reconstruction.

After more than a year of listing, Ruitai’s wet-state amniotic membrane products have been launched in 24 provinces, and quickly covered more than 300 tertiary hospitals and well-known private chain ophthalmology institutions across the country. In April of this year, Ruitai Bio completed tens of millions of yuan in Series A financing (Huimei Capital led the investment, and Guangzhou Industrial Investment and other institutions followed the investment). In 2021, the sales revenue will be more than 20 million yuan, and the overall profit will be made. Although this year is seriously affected by the epidemic, the revenue and profit have still achieved a growth of more than 50%.

Image source/enterprise check

Looking for the “blue ocean” from the former “medical waste”, Ritetech found a “shortcut” in the subdivision track and walked out of the “valley of death” of enterprise entrepreneurship. For the forecast of the market usage of wet amniotic membrane in the next five years, Lin Yongliang believes that the two biggest application directions are: ocular surface reconstruction, especially pterygium; and glaucoma. “In the field of regenerative medicine materials, 5-8 years is still a bonus period for first movers.” Lin Yongliang said.

According to data from the industry, China’s amniotic membrane market is expected to reach a market size of 9.6 billion yuan by 2027, with a compound annual growth rate of 14.7% during the analysis period from 2020 to 2027. The global amniotic membrane market was estimated at 20.5 billion yuan ($3.1 billion) in 2020 and is expected to reach 43.6 billion yuan ($6.6 billion) by 2027. 

The second entrepreneurship cut into the “amniotic membrane” track 

Before choosing to cut into the ophthalmic amniotic membrane track to start a business, Lin Yongliang had 15 years of accumulation in the research and development of the third type of implantable regenerative medical device products. Previously, he worked in a well-known listed regenerative medicine company in Guangzhou. As a technical backbone, he led the team to focus on one thing – to find a replacement for the human cornea.

Corneal disease is one of the three major blindness diseases in the world, but in China, a country with corneal blindness, the number of corneal transplants every year is only about 5,000 cases. The main reason is that the transplant materials are hard to find.

Lin Yongliang’s team found a breakthrough in the research and development of biological cornea, independently developed products and obtained patents, but with the deepening of this research and development, the team also realized the limitations of the direction, “artificial cornea, as a substitute for human cornea, is a cornea. Blind patients bring good news, but they also have certain limitations, so the market for this product is relatively small.”

Since then, under the guidance of industry experts, Lin Yongliang’s team shifted the research direction to the amniotic membrane.

Amniotic membrane products belong to tissue and cell products, and overseas products cannot enter China. At present, there is only one domestic manufacturer of freeze-dried biological amniotic membrane products. Before that, the amniotic membranes used in China were mostly homemade in hospitals. In order to ensure the effect of the operation, some doctors use homemade amniotic membranes and need to process the placenta in the hospital, but the homemade products lack a charging path, and doctors have to bear the risk of infection and face legal compliance issues.

How big is the demand for amniotic membrane from the ophthalmology clinic?

“At that time, the academician of Qingdao Eye Hospital told me that only as a repair material, the hospital alone needs thousands of pieces every year, and this is just a need. After the patient’s operation, the entire ocular surface is exposed, and every blink of an eye It was a torture. In the past, hospitals were self-made. If we can develop amniotic membrane products that are close to fresh, it will be a good news for patients and solve compliance problems for doctors, and the market will be very impressive.” Lin Yongliang told Southern Finance and Economics reporter.

A major challenge in wet amniotic membrane technology is ensuring sterilization while still maximizing the biological activity of the amniotic membrane. “This is the strength of our team.” Lin Yongliang introduced.

But even so, there are still many difficulties encountered in the early stage of entrepreneurship. Lin Yongliang admitted that the clinical process was not easy, and the clinical trial was not completed until 2018. After obtaining the registration certificate in 2019, the product was launched in 2020 and encountered an epidemic. “But even so, more than 3,000 tablets were sold in 2020, which shows that the market demand is very large.”

From the perspective of clinical practice in ophthalmology, amniotic membrane is currently most used for pterygium, corneal epithelial defect, glaucoma and other surgeries, “especially pterygium, the annual number of surgeries in China is as high as 1.5 million, usually simple excision, about half of the patients will The recurrence rate can be reduced to 5.8% after combined amniotic membrane transplantation. In addition, when the defect area is large, amniotic membrane transplantation can avoid iatrogenic damage caused by large-scale removal of conjunctiva and reduce scarring.”

In fact, there is also a huge commercial development market for the treatment of glaucoma.

Amniotic membrane is used after glaucoma filtration to inhibit scarring. About a quarter of the global glaucoma patients are from China, which will reach 21 million in 2020, and the number of blind people will reach 5.67 million. The commonly used surgical procedure for glaucoma is conventional trabeculectomy, with a success rate of only 11%-52%. Scarring of the subconjunctival filtering bleb is the main reason for the failure of glaucoma filtration surgery, and patients often require repeated surgery. Combined with amniotic membrane transplantation, the amniotic membrane is placed under the conjunctival margin and scleral flap, and the anti-fibrotic properties of the amniotic membrane can be used to improve the prognosis. 

Choose the right segment to outperform the market

The amniotic membrane market has huge potential.

According to Apollo Research Reports, the global bio-amniotic membrane market has reached US$3.26 billion this year. In addition to ophthalmology, wound repair and orthopedics are huge markets. In the future, as a high-performance regenerative medicine material, amniotic membrane can be expanded to dozens of fields, benefiting hundreds of millions of dollars. patient.

In Lin Yongliang’s view, there are many subdivisions in the amniotic membrane market. Even in the ophthalmology track, there are still many subdivisions. Finding the market requires a forward-looking awareness, not to follow the trend, but not “too cutting-edge”. “Just like the artificial cornea before, we have done it for a long time but it is not easy. In the ‘blue ocean’ market, it is easier to win with innovative products. The bonus period for the first mover is about 5-8 years.”

In fact, in addition to wet amniotic membrane, Ruitai Bio has also targeted a number of emerging fields in its product line layout, such as advanced amniotic membrane (also called sutureless amniotic membrane) based on wet amniotic membrane, and a Scleral lenses, glaucoma micro-brackets, ok lenses and defocusing soft lenses in the field of juvenile optometry.

In general, the clinical application of amniotic membrane in the eye relies on surgical suture, and sutureless fixation can reduce the difficulty for doctors to get started and reduce suture irritation. The amniotic lens, similar to the contact lens, is an innovative solution that can be worn without seams. Except for pterygium, amniotic lens can be applied to the scene of keratectomy without debridement and laser treatment, and it can be removed and put on in outpatient clinic.

According to Lin Yongliang, Rite-Hite’s amniotic lens is still in the research and development stage, and it is a direction that will be developed in the future. The material used for scleral lenses for people with dry eye is no longer amniotic membrane, but it is also a promising track in the field of ophthalmic regenerative materials.

“At present, for the scleral lens technology, we have adopted the method of advanced digestion and absorption, and obtained the agency rights of a product in Australia. This does not mean that we do not engage in research and development. At present, the production and research and development base of the company has been settled in Wenjiang Medical City, Chengdu. The total land area is 50 mu and the total investment is 1 billion yuan.” Lin Yongliang said.

Compared with the more mature amniotic membrane market in the United States, China’s amniotic membrane market has huge potential.

The US amniotic membrane products benchmarking listed company Mimedx’s revenue in 2020 reached 1.64 billion yuan; the benchmarking company Osiris Therapeutics was acquired by Smith & Nephew at a price of 4.36 billion yuan in 2019. There are three major benchmark companies in the United States: Mimedx (NASDAQ:MDXG), Osiris Therapeutics (NASDAQ:OSIR) and TissueTech.

In Lin Yongliang’s view, in the context of the current great development, the number of sick people in China has continued to grow in recent years, and the demand for amniotic membrane has also continued to increase, which will promote the sustained and rapid development of my country’s amniotic membrane industry. Demand brings supply, so in the future, more companies will break through the technical bottleneck of amniotic membrane production and enter the amniotic membrane industry, and the production capacity of the entire amniotic membrane industry will be rapidly increased. In addition to the existing amniotic membrane products, other new amniotic membrane-related products will appear in the future, such as amniotic membrane extract, amniotic membrane beauty mask, and amniotic membrane stem cell bank.

“Innovation is the key to enhancing the market competitiveness of enterprises. To truly realize the competitiveness of products, it is still necessary to rely on the products themselves.” Lin Yongliang introduced that at present, R&D personnel of Ruitai Biotechnology account for 75%, and R&D investment accounts for 10% of revenue. above, and is still increasing year by year.

Based on ophthalmology, it is committed to the research and development of innovative products for ophthalmology. At present, Rite-Hite is in the research and development or registration stage of many innovative Class III medical devices that have been established, and will bear fruit in the next three years.

However, Lin Yongliang told the Southern Finance and Economics reporter that at present, amniotic membrane transplantation covering the eyeball cannot replace corneal transplantation, and the improvement of vision is limited. Pig cornea (acellular corneal graft) was developed more than ten years ago. I am very excited. As a developer, I still have a wish that in the amniotic membrane product line, I can really develop China’s own corneal replacement products in the future.

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Editor of this issue, Jiang Peipei intern Wu Ziying