Sinolink Securities: Sixth Batch of National Medical Consumables Procurement Documents Released—Rules and Volume Align with Expectations

Sinolink Securities released a research report stating that the centralized procurement of drug-coated balloons and urological interventional medical consumables will standardize procurement and usage practices, improving industry dynamics. While short-term price reductions may impact profit margins for some companies, leading domestic firms are expected to gain market share through successful bids. The report recommends focusing on companies with strong cost-reduction capabilities and favorable procurement volumes.

Key points from Sinolink Securities: On December 22, 2025, the National High-Value Medical Consumables Joint Procurement Office announced the centralized procurement document (GH-HD2025-1) for drug-coated balloons and urological interventional consumables. Bid submissions and disclosures will occur on January 13, 2026. The procurement cycle runs from implementation until December 31, 2028.

Procurement categories include: - **Drug-coated balloons**: - Coronary drug-coated balloons: Annual demand of 614,778 units. - Peripheral vascular drug-coated balloons (for arteriovenous fistula dialysis access): 6,884 units. - Peripheral vascular drug-coated balloons (above-knee): 61,434 units. - Peripheral vascular drug-coated balloons (below-knee): 7,002 units.

- **Urological interventional consumables**: - Ureteral guidewires: 1,372,386 units. - Ureteral sheaths (without pressure measurement): 500,833 units. - Ureteral sheaths (with pressure measurement): 49,279 units. - Ureteral balloon dilation catheters: 15,881 units. - Ureteral stone retrieval baskets: 284,665 units. - Disposable flexible ureteroscope catheters (without pressure measurement): 326,518 units. - Disposable flexible ureteroscope catheters (with pressure measurement): 18,442 units. - Nephrostomy kits: 188,317 units.

Procurement volumes align with expectations, with domestic firms dominating key segments. For coronary drug-coated balloons, Lepu Medical ranks second (16% share), while Shandong JW (subsidiary of Blue Sail Medical) holds fifth place (8%). MicroPort Medical and Acotec Scientific have smaller shares. In peripheral drug-coated balloons, Acotec, Chansu Vascular, and MicroPort account for 71% of the market.

The procurement maintains the AB group classification: - **Group A**: Top 85% of demand volume with nationwide supply capability. - **Group B**: Other qualified bidders.

Selection rules involve multi-round bidding to improve success rates: 1. **Rule 1**: Price-based selection (60%+ success rate), requiring bids below 1.5x the "anchor price" (higher of 65% average or lowest bid). 2. **Rule 2**: Unsuccessful bidders may re-bid below 70% of the maximum price and 1.4x the anchor price. 3. **Rule 3**: Further re-bidding below 1.3x the anchor price.

The framework ensures price reductions while stabilizing industry growth. Unallocated demand (80% of non-winning bids and unsubmitted bids) will be distributed among winning bidders, excluding Rule 3 winners.

**Risks**: Excessive price cuts, exclusion from insurance coverage, rising costs, slower-than-expected sales, and R&D delays.