DES VBP renewal prices continue to rise, and MNC participation rebounds

Overview

This report reviews the results of the second national volume-based procurement (VBP) renewal for coronary drug-eluting stents (DES) in China. Goldman Sachs notes that the key changes in this round include continued price increases, a rebound in multinational participation and share, and still-strong underlying demand after VBP. The report also places the event in the broader context of the continued expansion of VBP coverage for medical consumables and medical equipment in China, and believes that by the end of 2026 consumables VBP coverage may move even closer to full coverage and could extend to capital equipment.

Core views

There are three core views. First, DES renewal prices were raised to Rmb839-949, improving further from Rmb730-848 in the 2022 renewal and reinforcing the view that VBP is a one-time price reset rather than a long-term, sustained margin headwind. Second, MNC participation in China VBP is becoming more active: the submission volume share of major MNCs such as Boston Scientific, Medtronic, and Abbott rose to about 41%, above about 32% in the first renewal, indicating that innovation, product breadth, and local hospital coverage can still support share gains. Third, post-VBP demand remains robust, with submitted demand of roughly 2.73 million units and participating hospitals expanding to 4,468, reflecting PCI growth, broader hospital coverage, and higher penetration.

Analysis framework

The report mainly analyzes the results of the second national DES VBP renewal, compares the 2022 renewal pricing, the price cap, the tiered volume-price allocation mechanism, and the submission shares of MNCs versus domestic companies, and combines PCI procedure volumes, submitted demand, and the number of participating hospitals to assess changes in industry demand and competitive dynamics. It also uses the VBP tracker to observe the pace of provincial coverage and procurement rollout for consumables and medical equipment from 2019 to 2026.

Methodology notes

• Policy and Tender AnalysisVBP Renewal Pricing and Volume-Price Linkage Framework

  Assess the impact of VBP on company pricing, share, and margins through the bid price range, effective price cap, volume-price linkage, and tiered allocation ratios.

  This DES renewal uses a clearer volume-price linkage and tiered allocation mechanism, including an effective price cap of Rmb949 and tiered allocation ratios of 90%/75%/60%, helping companies make more rational trade-offs between price and guaranteed volume.

• Competitive Landscape AnalysisMNC Submission Share Tracking

  Track changes in the submission volume share of MNCs in renewals to measure the recovery of imported brands' competitiveness after VBP.

  The submission volume share of major MNCs rose from about 32% in the first renewal to about 41% in the second renewal, showing that under more affordable pricing, stronger innovation, and robust hospital coverage, multinational brands can still gain incremental share.

• Demand AnalysisProcedure Demand and Hospital Coverage Expansion

  Measure post-VBP end-demand through submitted demand, PCI procedure volume, and the number of participating hospitals.

  Submitted demand was about 2.73 million units, PCI procedure volume increased from 1.29 million cases in 2022 to 2.21 million cases in 2025, and participating hospitals grew from 2,408 to 4,468, supporting the view that demand remains resilient.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• China medical device industry

  Direct beneficiary of improved VBP renewal pricing and more stable policy expectations

  Strengths

  Rising price ranges, demand growth, and hospital coverage expansion, with policy placing greater emphasis on price and supply stability.

  Weaknesses

  VBP still limits room for high-priced products, and industry expansion may bring continued tendering pressure.

  Comparison

  Compared with the early wave of procurement-driven domestic substitution and steep price declines, this renewal shows a more stable pricing mechanism and more rational company pricing behavior.

  Risks

  If future category expansion brings unfavorable pricing rules, margins could still be compressed again.

• Multinational medical device companies (Boston Scientific, Medtronic, Abbott, etc.)

  Their participation and submission volume share rebounded in the DES renewal

  Strengths

  Innovation capability, broad product portfolios, hospital coverage, and physician/patient brand preference support share.

  Weaknesses

  They still have to operate within comparable pricing and volume-price constraints under the VBP framework.

  Comparison

  Submission volume share rose from about 32% in the first renewal to about 41% in the second renewal, showing a rebound relative to the domestic substitution trend.

  Risks

  If future rules tilt more toward lower prices or domestic substitution, share improvement may be limited.

• Leading domestic medical device companies

  Benefit from post-VBP demand expansion and market stability, but face a rebound in MNC competition

  Strengths

  Localization, cost control, and channel capabilities may continue to support share.

  Weaknesses

  MNCs still have competitive advantages in innovation and high-end product portfolios.

  Comparison

  The early post-VBP domestic substitution trend was pronounced, but this DES renewal shows MNC share rebounding.

  Risks

  Without sufficient product innovation, they may face share pressure in a more rational pricing environment.

• Medical consumables and capital-equipment-related sectors

  Affected by the pace of VBP expansion

  Strengths

  Clearer VBP coverage helps reduce policy uncertainty, and some categories may see price stability or improvement in renewals.

  Weaknesses

  More categories being included in VBP will create pressure on tender prices and share reallocation.

  Comparison

  Consumables coverage has already expanded meaningfully, and the report expects broader coverage by end-2026, with possible extension to capital equipment.

  Risks

  Differences between regional pilot programs and national expansion rules may cause price and share volatility.

Key data

• DES second renewal price rangeRmb839-949Higher than the Rmb730-848 range in the 2022 renewal.
• 2022 DES renewal price rangeRmb730-848Used as the comparison baseline for the price increase in this round.
• Effective price capRmb949Above the prior cap of Rmb848.
• Tiered allocation mechanism90%/75%/60%Used for volume-price linkage and guaranteed-volume allocation.
• MNC submission volume share约41%In the second renewal, the share of major MNCs was higher than the roughly 32% seen in the first renewal.
• MNC submission volume share in first renewal约32%Used to compare the rebound in MNC participation.
• Submitted demand约273万支Implied roughly 14% CAGR versus the 2022 renewal.
• Number of participating hospitals4,468家Higher than the previous 2,408 hospitals.
• PCI procedure volume2025年221万例；2022年129万例Data sourced from F&S as cited in the report, supporting the demand growth view.
• VBP coverage trendConsumables VBP may achieve broader coverage by end-2026 and could extend to capital equipmentFrom the report's VBP tracker and the related statements in Exhibits 6/7.

Impact & implications

The implications for China's medical device industry are positive. The rise in DES renewal prices and a more stable volume-price mechanism reduce market concerns about persistent price pressure and long-term margin erosion from VBP. The rebound in MNC share shows that innovation, product breadth, local hospital coverage, and brand preference still matter. Strong submitted demand and expanding hospital participation indicate that end demand has not been materially damaged after VBP. For investors, the key question ahead is whether further VBP expansion will continue to move in the direction of price stability, supply stability, and ecosystem stability.

Risks

• If future VBP expansion or renewal rules once again emphasize larger price cuts, company margins could be compressed again.
• The rebound in MNC share may intensify competitive pressure on domestic companies.
• Submitted demand and hospital coverage expansion may not fully translate into revenue or profit growth, as that still depends on awarded share, delivery volume, and product mix.
• If capital equipment is included in broader VBP, it could create uncertainty for equipment ASPs and order pacing.
• Changes in policy execution, regional alliance procurement, and national procurement cadence could cause volatility in industry expectations.

What to watch

• Whether consumables VBP coverage expands further as expected before end-2026.
• Whether capital equipment is included in broader VBP and, if so, the specific pricing rules and volume-price linkage mechanism.
• The actual awarded volume, delivery volume, and revenue realization for MNCs after DES renewal execution.
• Share changes in China's hospital channel for Boston Scientific, Medtronic, Abbott, and other multinational companies.
• How leading domestic companies respond through innovative products, cost control, and hospital coverage.
• Further growth in PCI procedure volumes, the number of participating hospitals, and actual DES usage.