Summary of Key Points
Core Medical, a leading company in the field of artificial hearts in China, had its initial review for listing on the STAR Market scheduled for July 2nd abruptly canceled by the Shanghai Stock Exchange. The reason is most likely related to the controversy surrounding the “fully magnetically levitated” technology of its Corheart®6 product. This dispute stems from scholars questioning whether it truly utilizes full magnetic levitation or a combination of magnetic and liquid technologies. This not only affects the technical value of the product and the accuracy of the prospectus but also determines whether the company can become the “first stock in China’s artificial heart industry” and its future market competitiveness.
I. The Focus of the Dispute: Is Corheart®6 Really Fully Magnetically Levitated?
The essence of full magnetic levitation is that the rotor is entirely suspended by magnetic force, without any reliance on liquids—just like in a maglev train, where the rotor floats in mid-air without touching any other components. However, scholar Kurt Dasse has pointed out that Core Medical’s Corheart®6 does not meet this standard:
- Authoritative Books Disprove It: The industry-standard book “Mechanical Circulation and Respiratory Support” classifies it as a “magnetically assisted hydrodynamic bearing” (meaning the rotor is supported by both magnetic and liquid forces);
- Product Manual Reveals the Truth: The official manual states that the product will be damaged during air tests and can only operate in a liquid environment, whereas true full magnetic levitation should be possible in a vacuum or air;
- Company’s Vague Response: Core Medical insists it uses full magnetic levitation, but the prospectus describes it as an “non-standard term in industrial terminology,” failing to clarify whether the rotor is truly suspended by magnetic force alone, thus increasing doubts.
II. Why Is the Accuracy of the Technology So Crucial? It Directly Affects the Product’s Fate and the Company’s Value
The technical approach of artificial hearts determines their safety and market position:
- Full Magnetic Levitation as the Benchmark: Products like Abbott’s HeartMate3 (fully magnetically levitated) have no contact with the blood, resulting in less damage and lower risks of thrombosis and stroke; they are currently the most mainstream options;
- Magnetic-Liquid Combination Technologies Are Obsolete: Medtronic’s HVAD (which uses a magnetic-liquid combination) was withdrawn from the market in 2021 due to high thrombosis risks;
- Core Medical’s Positioning Crisis: If Corheart®6 does not utilize full magnetic levitation, its technological barriers and claimed market share (45% as the leader) will be questioned. Investors expect to buy into “the most advanced technology.”
III. The Chain Reaction of the Listing Suspension: Is the IPO in Doubt? Could Rivals Overtake?
The cancellation of this review has a significant impact on Core Medical:
- Low Chances of Successful IPO: Similar cases in history (such as Longlide and Damuren) have mostly failed to list, with only a few (like Guotai Environmental Protection) succeeding. Core Medical’s prospects are now uncertain;
- Intensified Industry Competition: Another domestic competitor, Tongxin Medical, is also vying to be the “first stock in China’s artificial heart industry.” Its product CH-VAD claims to “not require a liquid environment,” which aligns with the characteristics of full magnetic levitation. If Core Medical encounters issues, Tongxin Medical could potentially go public first;
- Market Confidence Shaken: The technical dispute raises doubts about the company’s valuation and future profitability. Even if it applies again, more evidence will be needed to prove the technology’s authenticity.
IV. A Regulatory Signal: HardTech Companies Cannot Play Word Games
The Shanghai Stock Exchange’s action sends a clear message:
- Zero Tolerance for Technical Inaccuracies: The core value of hardtech companies lies in their technology, and the technical descriptions in prospectuses must be accurate and unambiguous (e.g., Core Medical’s use of non-standard terminology to avoid issues);
- Transparency in Information Disclosure: Scholars and regulators demand that companies disclose the details of how rotors are suspended. After all, both investors and patients need reliable information;
- A Warning to Other Companies: It is becoming increasingly difficult for companies to rely on conceptual packaging to go public; real technical capabilities are what matter.
V. Core Medical’s Critical Situation: What Next?
To turn things around, Core Medical must address two issues:
1. Provide concrete evidence of the technology’s effectiveness, such as publicly available test videos showing levitation in air (which true full magnetic levitation should achieve), or have it verified by third-party authorities;
2. Reorganize its information disclosure to clarify the ambiguous technical descriptions in the prospectus and respond to regulatory inquiries. Only by convincing the market and regulators of the technology’s authenticity can the company restart the listing process.
Otherwise, not only might the IPO fail, but the sales of its existing products could also be affected (patients are more likely to trust products with full magnetic levitation). This technical dispute has escalated from a theoretical issue into a battle for the company’s very survival.