Medtech service provider HuKui Bio raised US$5.5M for US market expansion
The medtech service provider Hukui Bio (互貴興業) announced that it has raised US$5.5 million in Series C funding, led by Yellowstone Holding AG from Switzerland, totalling US$11.8M funding to date.
HuKui Bio will collaborate with venture capital funds in the Bay area, in addition to the biomedical innovation clusters and accelerators in Europe and the US. The New Business Department and the US subsidiary in the Bay area were founded at the beginning of 2021, with the onboarding of Dr IC Jan (詹益鑑) as its Chief Strategy Officer.
Providing a one-stop service platform for medical devices
HuKui Bio provides Contract Development and Manufacturing Organization (CDMO) commissioned development and manufacturing services. The first CDMO for medical devices in Taiwan.
What is CDMO?
In order to reduce cost, focus on research and development, and shorten the time to market, pharmaceutical companies would outsource most of the production to Contract Manufacturing Organizations (CMO). Due to an increase in competition, cost management is no longer the major factor for cooperation. CMO is transforming into Contract Development and Manufacturing Organization (CDMO), providing a one-stop service platform which includes drug development and manufacturing services that blend into the medical supply chain with increased importance.
Since the onset of Covid-19 pandemic, HuKui Bio has pivoted to a one-stop service platform for clinical trials, prototyping, contract manufacturing and worldwide distribution. It is one of few Taiwanese-owned companies that provides registration, mass production and distribution in China to international customers.
HuKui Bio was founded in 2013, originally assisting Taiwanese medical device manufacturers to enter the Chinese market.
In response to tightened Chinese laws and regulations on electronic medical materials in 2016, HuKui Bio started providing registration consultancy and contract manufacturing services for overseas medical device companies both in China and Taiwan.
Michael Kuo (郭加泳), CEO of HuKui Bio says they have gone through many years of hard work to build an electronic medical material manufacturing plant and obtained production licenses in Chongqing city aiming for a complete production line.
Rethink of its China market strategy
“Although China’s medical market continued to grow in 2020, due to the US-China trade war and Covid-19 epidemic, China has officially decoupled itself from the global markets, making it difficult for both import and export,” said Michael, CEO of HuKui Bio.
As a consequence, the supply chain has to change. Taiwan stands at an advantageous position given its electronic and biomedical industrial clusters in place, along with various OEM experiences from the past, making it the new production spot for HuKui Bio.
Currently, items sold to the Chinese market are manufactured in Chongqing, whereas items selling abroad to Europe and the US are shifted to Taiwan. HuKui Bio strives to play a potential partner in the Asia-Pacific region for global medtech innovators and corporates.
Growing investment on the medtech industry
The investment trend for the medtech industry is growing rapidly. Besides, the growth rate of contract development and manufacturing organization (CDMO) market (outsourcing market) is faster than the overall medical device market (end-market).
From 2019 to 2027, the global medical devices market size is expected to increase from US$ 447.63 billion to around US$ 671.49 billion, with a compound annual growth rate of 5.2%. In contrast, the global CDMO market value is to grow from $148.50 billion to reaching $298.07 billion, with a compound annual growth rate of 9.1%, according to Globe Newswire forecast.
As the electronic medical devices market grows, the specialization of the products creates greater demand for outsourcing development and manufacturing services, the CDMO is thus more needed.
Driven by the fast industry growth and deepened separation between the Chinese market and the rest of the world, more and more Asian companies like HuKui Bio is likely to follow suit.
However, the Covid-19 pandemic has generated great business opportunities in the global testing market. “2020 is a ruthless and challenging year for HuKui, but it also gives us a substantial transformation opportunity,” said Michael.
The increased investment on the testing market during the pandemic, coupled with the significant market expansion of digital health and telemedicine, brought HuKui Bio a huge opportunity. HuKui Bio’s annual financial performance grew 77% against this global economic downturn.
Hukui Bio’s previous investors include NCTU Angel Club, Wistron Group, and Abnova Corporation, integrating the electronic and medical industries.
“Digital healthcare will be the next fast-growing industry with exponential growth,” says new Chief Strategy Officer
“In the first half of 2020, the scale of global venture investment mostly shrunk. Only investment on digital healthcare, fintech and online education grew against this downturn.” Dr Jan, who is excited about joining HuKui Bio, said.
“Besides the scenario of remote working and video conferencing in the tech industry, doctor visits have also been shifted online. Compared to the nearly 50% digitalization of the retail and tourism industries, the pharmaceutical and biotech industries only have 15%. With cloud computing, artificial intelligence and the Internet of Things, digital healthcare will be the next fast-growing industry with exponential growth.”
The mission of the company is exactly the meaning of the Chinese name “HuKui”, which is “Helping One Another To Build A Prosperous Future”.
About Dr IC Jan
As a Visiting Scholar at UC Berkeley and startup mentor for 500 Startups and Berkeley SkyDeck before joining HuKui Bio, Dr IC Jan was formerly the assistant CEO of BioHub Taiwan at National Biotech Research Park, who is experienced in connecting the global tech hubs, startup ecosystems and medtech industries.