[Edaily Reporter Shin Ha-yeon ] On the 3rd, independent research firm Growth Research assessed that #Finemedix Co., Ltd. is increasing its market penetration in the domestic gastrointestinal endoscopic procedure device market—which has long been dominated by foreign products—by leading with domestically manufactured products. In particular, given that endoscopic procedure devices generate recurring revenue once adopted by hospitals, the firm projected that operating leverage will begin in earnest as the company expands its overseas sales. The firm did not provide an investment opinion or a target stock price.

Han Yong-hee, an analyst at Growth Research, stated, “We believe the company is currently in the early stages where revenue growth and the effects of operating leverage are taking full effect, and expectations for future profit growth remain valid.”

Finemedix Co., Ltd., established in 2009 and listed on the KOSDAQ market in 2024, is a manufacturer specializing in gastrointestinal endoscopic surgical instruments. Therapeutic endoscopes account for 58.3% of revenue, diagnostic endoscopes for 15.5%, and other segments for 26.2%.

Its flagship products include the hybrid ESD knife, as well as EUS FNA and TBNA devices. While conventional ESD procedures required separate knives for marking and incision, Finemedix Co., Ltd. developed a hybrid ESD knife capable of performing both marking and incision with a single instrument.

An analyst explained, “Previously, a device approximately 2 meters long had to be repeatedly removed from and reinserted into the endoscope channel; however, by developing the hybrid ESD knife—which enables both marking and incision with a single instrument—we have significantly reduced the number of instrument changes and shortened procedure time.”

He added, “With regard to tissue biopsy needles (EUS FNA and TBNA), existing products required the use of both hands or assistance from a nurse to secure the needle. However, we have improved procedural convenience and accuracy by adopting a button-style mechanism that secures the needle with a single finger and a design that enhances ultrasound visibility.”

Based on this product competitiveness, analysts assess that the replacement of foreign-made products is gaining momentum. Finemedix Co., Ltd.’s ESD knife has secured a market share of 20–30% in the domestic market, which was previously virtually monopolized by Olympus. According to the report, sales at major tertiary general hospitals in the Seoul metropolitan area in the first quarter of this year increased by 85% compared to the same period last year, while sales at Asan Medical Center in Seoul rose by 296%.

The strategy of supplying endoscopic equipment and consumables together was also cited as key to expanding domestic market share. Since last year, Finemedix Co., Ltd. has served as the exclusive distributor in Korea for SonoScape, China’s leading domestic endoscopic equipment manufacturer.

An analyst noted, “The company is pursuing an equipment-and-consumables bundling strategy, using the installation of endoscopy equipment as a foothold to enter hospitals and linking it to sales of its own consumables, such as ESD knives and biopsy needles,” adding, “Going forward, based on turnkey supply—where equipment and consumables are provided simultaneously—we expect the company to achieve customer lock-in and expand its market share in the domestic endoscopy market, which is currently dominated by foreign products.”

The company is also accelerating its expansion into overseas markets. While the current ratio of domestic to overseas sales is approximately 7:3, the long-term goal is to reverse this ratio to 3:7. The company has secured approximately 50 buyers across 47 countries, including Russia and Japan, and is pursuing a dual strategy of direct exports under its own brand and original design manufacturing (ODM) for global partners.

In particular, the U.S. was identified as the largest market—accounting for approximately 30–40% of the global endoscopy market—and a key region for overseas growth. Finemedix Co., Ltd. has secured U.S. Food and Drug Administration (FDA) approval for 13 product lines, including the second-generation ClearTip TBNA.

An analyst explained, “We have finalized a distribution agreement with GI Matrix for the bronchial ClearTip TBNA, and since we are targeting annual sales of over 10,000 units with GI Matrix in particular, our U.S. business has moved beyond the regulatory approval stage and entered the phase of generating actual revenue.”

ODM is another factor driving earnings growth. The company is currently in discussions with UK-based Creo Medical regarding an ODM supply partnership for two ClearTip models.

An analyst assessed, “If these ODM contracts are fully implemented, the company will not only be able to rapidly expand production volume without the burden of brand-building and marketing, but inclusion in the portfolios of global companies will itself serve as a reference proving the product’s quality, leading to improved profitability driven by higher capacity utilization.”

In particular, given that most endoscopic instruments are single-use, the analyst projected that increased penetration into hospitals would translate into recurring revenue.

One analyst noted, “There is a significant first-mover advantage due to the high switching costs for physicians and regulatory barriers for individual product approvals.” They added, “In particular, since most endoscopic surgical instruments are single-use consumables, adoption by hospitals generates recurring revenue tied to the number of procedures performed. Furthermore, because the selling price is high relative to the cost, a sales leverage structure is formed where revenue growth rapidly translates into profit improvement based on high margins.”

The company has also entered a turnaround phase in terms of earnings. While Finemedix Co., Ltd. posted revenue of 9.52 billion won and an operating loss of 2.58 billion won last year, revenue in the first half of this year rose 43.7% year-over-year to 6.26 billion won, and the company returned to profitability with an operating profit of 39 million won.

An analyst predicted, “In the second half of the year, expanded sales of premium products and the full-scale launch of endoscopy equipment sales are expected to contribute to revenue growth,” adding, “Overseas growth will also continue, driven by requests from GI Matrix in the U.S. to increase supply volumes and higher shipments of hepatobiliary products, which will support a return to profitability for the full year.”