Tangi Medical IPO: Revenue Grows but Profits Shrink, Losses Expand 18% Year-over-Year, Weight-Loss Drugs Slashed to "Bone-Breaking Prices" - How Much Survival Space Does GBS Have Left?

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Produced by: Sina Finance Medical Studio

Author: Tianli

Recently, Hangzhou Tangji Medical Technology Co., Ltd. (hereinafter referred to as “Tangji Medical”) officially submitted its prospectus to the Hong Kong Stock Exchange, planning to list on the Main Board. The company focuses on innovative medical devices for metabolic disease treatment, with its core product being the intestinal intervention device “Gastric Bypass Stent System” (GBS).

The principle of GBS is quite imaginative: through endoscopy, a soft sleeve-like tube is placed in the duodenum and proximal jejunum, allowing food to pass through without contact with the intestinal wall, thereby reducing nutrient absorption. Meanwhile, the bypass effect alters intestinal hormone secretion, giving the brain a sense of fullness. Compared to stomach cutting, GBS is minimally invasive, incision-free, and reversible. Compared to medication, GBS is a one-time intervention, eliminating the need for long-term drug use.

With GBS, Tangji Medical is expected to carve out a “third way” in weight loss after stomach surgery and medication. However, behind this differentiated narrative, the company’s net losses are widening, with cash on hand only 33.737 million yuan, enough to support about six months of operations. Its asset-liability ratio has soared to 136%, and the founder has even had to personally guarantee a loan of up to 103 million yuan. Additionally, amid the full-scale price war of GLP-1 drugs, with original drugs like Semaglutide lowering prices and generics about to enter mass production, the potential market space for GBS may be quite limited.

Heavy reliance on a single product, sales surge 15-fold but losses expand by 18%

The prospectus shows that Tangji Medical was founded in 2016. In 2017, the company began developing its core product, the EBMT therapeutic device. In January 2024, GBS received approval from the National Medical Products Administration, becoming China’s first and the world’s first commercially approved intestinal intervention device for obesity treatment, dubbed the “exclusive business” in weight loss.

In April 2024, GBS entered commercial sales. In the first three quarters of 2024, the number of GBS procedures was 94; by the same period in 2025, this number increased to 1,419, more than 15 times year-over-year. As of the latest feasible date, the product has been adopted by over 300 hospitals, with more than 2,500 commercial implantations completed.

Financially, in 2024, the company’s revenue was 12.709 million yuan, and in the first three quarters of 2025, revenue reached 20.863 million yuan, a year-over-year increase of 554.8%. Meanwhile, gross profit margin slightly decreased from 80.9% in 2024 to 78.7% in the first three quarters of 2025, still significantly higher than the industry average for medical devices.

However, despite the growth in sales and revenue, the company’s net loss has further widened. In 2024, net loss was 65.957 million yuan; in the first three quarters of 2025, net loss increased from 46.38 million yuan to 54.942 million yuan year-over-year. The main reason for “increased revenue but not profit” is the significant rise in expenses.

In the first three quarters of 2025, the company’s total expenses for sales and marketing, administration, and R&D amounted to about 69.763 million yuan, more than three times its revenue. Sales and marketing expenses increased from 11.239 million yuan in the same period last year to 16.944 million yuan, a 50.8% increase, accounting for 81.22% of revenue. Meanwhile, administrative expenses grew by 67.3% to about 20.3 million yuan; R&D expenses increased by 26.7% to 32.5 million yuan.

This indicates that GBS is still in the early commercialization stage, and scale effects have yet to fully materialize. The company’s goal to turn profitable depends on further product volume expansion.

From the product structure perspective, 100% of Tangji Medical’s revenue comes from GBS. Although the company disclosed in the prospectus that it is expanding GBS indications for lower BMI populations and developing multiple research-stage products—including GBS-SH for obese patients with MASH, GBS-DM for type 2 diabetes with obesity, and biodegradable gastric balloons (DIGB)—these products are still far from commercialization.

Among these, GBS-SH plans to start international multicenter registration trials by the end of 2027; the biodegradable gastric balloon (DIGB) is expected to complete key clinical studies by the end of 2027; the retrievable gastric balloon (RIGB) is still in preclinical design. Therefore, in the near future, the company’s performance will depend entirely on GBS’s market performance.

Weight-loss drugs hit “fracture prices,” how much room is left for GBS?

However, in the weight-loss track, the market has become highly competitive, and how much market share GBS can capture remains uncertain.

According to recent market developments, Novo Nordisk expects a 5%-13% decline in sales in 2026, marking the first such decline in nine years. The company also announced a comprehensive price reduction for Semaglutide, with both injectable and oral forms cut by 50% starting January 1, 2026.

Similarly, as of March 9, 2026, the latest price for Mounjaro 0.5ml: 2mg*2 vials per box on Meituan’s pharmacy platform is about 339 yuan, roughly 200 yuan lower than two weeks prior; Tirzepatide has also experienced a 20%-30% price drop over the past half month. The price reduction for Tirzepatide is mainly due to national negotiations, as it was included in the national medical insurance catalog on January 1, 2026, pushing its price to a new low with an 80% cut.

The reasons behind this price war include the increasing number of similar products and the imminent patent expiration of key products. Public data shows that Novo Nordisk’s Semaglutide patents will expire after March 2026, and the impact of domestic generics is imminent.

Currently, over 15 domestic companies are developing generic Semaglutide, with more than 10 in late-stage clinical trials (such as Jiyuan Genetics, Livzon Group, CSPC), some have submitted marketing applications, and more than ten are in Phase III trials. A fierce price war among generics is imminent.

For Tangji Medical, this is undoubtedly disastrous. The cost of a single GBS treatment in public hospitals (including delivery and retrieval systems) is about 36,000 to 39,000 yuan, roughly 30,000-50,000 RMB per treatment. After the price halving of GLP-1 drugs, annual medication costs for patients could drop to just a few thousand yuan.

Furthermore, regarding approved indications, GBS targets patients with BMI ≥32.5 for simple obesity, or BMI 30-32.5 with metabolic syndrome or comorbidities—serving “patients.” However, the true explosive market and premium potential come from those with BMI below the threshold but suffering from body image anxiety and willing to pay for beauty. This suggests that GBS’s market potential may not be as promising as initially envisioned.

As of September 30, 2025, the company’s cash and cash equivalents were only 33.737 million yuan. During the same period, net cash outflow from operating activities was 49.043 million yuan, averaging about 5.45 million yuan per month. Without external financing, the cash on hand could only sustain operations for about six months.

In fact, to maintain cash flow, the company has leveraged all available resources. As of September 30, 2025, short-term interest-bearing bank loans totaled 75.04 million yuan. The total liabilities reached 106 million yuan, with total assets of 78 million yuan, and net liabilities of 28 million yuan, with an asset-liability ratio of about 136%. The current ratio is only 0.5, indicating short-term repayment pressure.

Notably, the company’s founder, Zuo Yuxing, personally provided guarantees for several bank loans on December 31, 2024, and September 30, 2025, with a maximum guarantee amount of up to 103 million yuan.

From a valuation perspective, Tangji Medical’s angel round in 2017 valued the company at 50.5 million yuan; Series A in 2019 jumped to 150 million yuan; after attracting Baidu Ventures in Series B in 2021, valuation rose to 455 million yuan; in 2023, Series B+ doubled to 920 million yuan. Just before submitting the prospectus in November 2025, Hangzhou Gaoxin (rights protection) invested 50 million yuan, pushing the post-investment valuation to 1.32 billion yuan. In just eight years, valuation increased 26-fold.

Amid the ongoing price war of GLP-1 drugs and rapidly changing market landscape, how investors view a consistently loss-making, single-product, heavily modeled, high-valuation “third-party” story remains to be seen and will be proven over time.