Orthopedic Consumables Centralized Procurement Policy Reshapes Industry Landscape: Enterprise Response Strategies and Investment Value Analysis

Orthopedic consumables centralized procurement policy has gradually expanded to sub-segments such as joints, spines, and trauma since the first national procurement of coronary stents in 2021, completely reshaping the industry competition landscape [1]. From the policy development context, centralized procurement has experienced a complete cycle from ‘price reduction shock’ to ‘impact clearance’, and then to ‘performance inflection point’.

The average price reduction of joint products was 82%, spine products 84%, and trauma products about 62.5% [1]. However, in the 2024 joint procurement renewal, prices rebounded—knee joint product prices increased by 69%-141%, indicating a signal that the policy is becoming more rational [2].

Centralized procurement significantly promoted domestic substitution. The localization rate in the joint segment increased from 40% before procurement to 50-60% in the first national procurement, and further to 70% during renewal [2]. Domestic brands’ overall reported volume accounted for more than imported brands, with Akcome Medical, Chunli Medical, and Wellgain Orthopedics becoming the top three domestic players [2].

2024 revenue was 1.453 billion yuan, a year-on-year increase of 13.18%; net profit attributable to parent company was 224 million yuan, a year-on-year surge of 99.22% [0][3]. The company successfully transitioned from ‘centralized procurement impact’ to ‘performance inflection point’.

1. Full Product Line Layout:
   Covers five areas including spine, trauma, joint, sports medicine, and tissue repair. Spine market share is about 14%, trauma 10-12%, joint 10% [2].
2. Digital Empowerment:
   Establishes digital marketing advantages, combines distribution and follow-up systems to improve industrial chain operation efficiency [2].
3. Overseas Expansion:
   2023 overseas business revenue accounted for over 25%, with 7,530 overseas customers including 3,265 hospitals [4].

As the only full-platform orthopedic enterprise, it has scale effect and risk resistance capability, with net profit margin rebounded to 16.5% [3].

2024 expected revenue is 1.394 billion yuan, a year-on-year increase of 27.4%; net profit is about 153 million yuan [1]. Maintains leading position in domestic joint segment.

1. 3D Printing Technology:
   China’s first enterprise to commercialize 3D printing technology in orthopedics, establishing technical barriers in joint replacement, spine, trauma repair, etc. [4].
2. Overseas Layout:
   Actively obtains access qualifications in various countries, builds global sales system, overseas business grows rapidly [1].
3. Product Innovation:
   Has 414 invention patents, R&D investment continues to increase, layouts in digital orthopedics, bone biomaterials, etc. [1].

Joint renewal reported volume accounts for nearly 20%, market share is stable, and technological innovation capability is outstanding.

2024 revenue was 1.058 billion yuan, a year-on-year increase of 15.2%; net profit attributable to parent company was 77 million yuan, a year-on-year increase of 77.03% [0][1]. Performance recovery growth is significant.

1. Sub-segment Deep Cultivation:
   Maintains the first domestic market share in the trauma segment, while expanding into spine, joint, minimally invasive surgery, etc. [1].
2. Cost Control:
   Improves profitability by optimizing supply chain and reducing sales expense ratio [0].
3. Diversified Layout:
   Actively develops new businesses such as minimally invasive surgery, stomatology, neurosurgery [1].

Trauma business has strong stability, has bargaining advantages in centralized procurement, and performance elasticity is large.

2024 revenue was 806 million yuan, a year-on-year decrease of 33.32%; non-net profit was 95 million yuan, a year-on-year decrease of 62.80% [0][3]. Affected greatly by centralized procurement, but has started to stabilize.

1. Joint Specialization:
   As a single-item champion enterprise in artificial joint prosthesis manufacturing recognized by the Ministry of Industry and Information Technology in 2024, it has strong technical strength [1].
2. New Product Expansion:
   Actively layouts new pipelines such as surgical robots, sports medicine, PRP, stomatology [1].
3. Material Innovation:
   Strategically layouts in new materials such as porous tantalum, magnesium alloy, PEEK [1].

Joint segment has high technical barriers, new material layout has long-term potential, and valuation is relatively low.

2024 revenue was 384 million yuan, a year-on-year increase of 18.5%; net profit attributable to parent company was 62 million yuan, a year-on-year surge of 623.19% [0]. Growth rate is the most eye-catching.

1. Spine Specialization:
   Focuses on the spine segment, ultrasound bone knife head shipment growth rate exceeds 50% [0].
2. Market Diversification:
   Has completed price listing in 18 provinces and cities, US regional revenue exceeds 18 million yuan, achieving nearly double growth [0].
3. Product Innovation:
   Core product terminal recognition continues to improve, technical level is leading [0].

Fastest growth rate, excellent overseas market performance, with high growth potential.

From current valuation, there are obvious differences among enterprises:

• Wellgain Orthopedics:
  PE is about 40.5 times (2025 forecast), valuation is relatively reasonable as a platform enterprise [1].
• Akcome Medical:
  PE is about 17.8 times (2025 forecast), Hong Kong stock valuation advantage is obvious [1].
• Chunli Medical:
  PE is about 29.5 times (2025 forecast), at the industry medium level [1].
• Dabo Medical:
  PE is about 30.7 times (2025 forecast), performance recovery drives valuation repair [1].
• Sanyou Medical:
  PE is about 46.2 times (2025 forecast), high growth supports higher valuation [1].

Based on three dimensions: policy risk clearance, performance inflection point establishment, and long-term competitiveness, the recommended ranking is as follows:

Full platform layout has strong risk resistance capability, obvious performance improvement, leading overseas layout, and has long-term allocation value.

Hong Kong stock valuation advantage is obvious, strong technological innovation capability, large overseas growth potential.

Performance recovery growth, but valuation is not low, need to observe new business expansion progress.

Joint leader position is stable, but centralized procurement impact is still in recovery period, new material layout is worth attention.

Eye-catching growth rate but small scale, high volatility, suitable for investors with higher risk preference.

Centralized procurement policy has entered the ‘three stability principles’ (stable price, stable supply, stable market) stage. The next round of renewal is expected in 2027-2028, and enterprises have sufficient time to adapt to the policy environment [1].

In 2023, the CR3 of domestic orthopedic consumables brands was 18.2%, an increase of 5.3 percentage points from 2021; CR5 was 27.9%, a significant increase from 2021, and industry concentration continues to improve [1].

New technologies such as 3D printing, surgical robots, and digital orthopedics are reshaping the industry landscape. Enterprises with technological innovation capabilities will obtain premiums.

Chinese orthopedic product prices are 35%-80% lower than overseas, with significant cost advantages, and internationalization has become a new growth engine [4].

1. Centralized Procurement Renewal Price Reduction Risk:
   If the price reduction magnitude exceeds expectations in the next round of procurement renewal, it will impact enterprise profitability [1].
2. Overseas Expansion Not Meeting Expectations:
   Changes in international situation may affect overseas business development [1].
3. Innovative Product Promotion Risk:
   There is uncertainty in the market acceptance of new products [1].
4. Industry Competition Intensifies:
   Centralized procurement promotes industry concentration, and competition becomes increasingly fierce.

Orthopedic consumables centralized procurement policy has entered the ‘dividend period’ from the ‘impact period’, and the industry landscape has been basically reshaped. Leading enterprises successfully responded to policy shocks through product line expansion, cost control, technological innovation, overseas layout, etc., and their performance showed obvious inflection points. Wellgain Orthopedics has allocation value as a platform enterprise, Akcome Medical has prominent valuation advantages in Hong Kong stocks, and other enterprises are allocated differently according to risk preferences. Investors should focus on enterprises’ technological innovation capabilities, overseas expansion progress, and product line improvement level.

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[0] Gilin API Data
[1] Securities Times - “Is the Inflection Point Here? Q3 Revenue Growth of Medical Device Enterprises Turns Positive” (https://www.stcn.com/article/detail/3478827.html)
[2] Wellgain Shares Investor Relations Activity Record - Wellgain Orthopedics 2024 Operating Status (https://pdf.dfcfw.com/pdf/H22_AN202503281648710031_1.pdf)
[3] Chunli Medical 2025 Semi-Annual Report - Impact of Centralized Procurement and Response Strategies (https://stockmc.xueqiu.com/202508/688236_20250830_3LBC.pdf)
[4] 2025 China Medical Device Overseas Status and Trend Blue Book - Internationalization Strategy of Orthopedic Enterprises (https://pdf.dfcfw.com/pdf/H3_AP202506131690029101_1.pdf)
[5] Guosen Securities Research Report - Orthopedic Centralized Procurement Renewal Analysis and Investment Opportunities (https://pdf.dfcfw.com/pdf/H3_AP202501031641803152_1.pdf)