Haohai Biotech's performance plummeted last year, and the good days for its ophthalmology business are gone forever.

Question: How does AI national procurement reshape the competitive landscape of the intraocular lens market?

Ji Mian News Reporter | Li Kewen

Ji Mian News Editor | Xie Xin

On the evening of March 21, Haohai Shengke released its 2025 annual report. In 2025, Haohai Shengke achieved revenue of 2.473 billion yuan, a decrease of 8.33% year-on-year; net profit was 251 million yuan, down 40.3% year-on-year.

This is the first time in the past five years that both revenue and net profit have declined simultaneously for Haohai Shengke, with the medical aesthetics, ophthalmology, and orthopedics segments all under pressure. However, when broken down, the most significant drag on performance in 2025 was still the ophthalmology business.

Haohai Shengke’s ophthalmology segment is divided into cataract surgery products, myopia control and refractive correction products, and other ophthalmic products.

Haohai Shengke 2025 Annual Report

More specifically, the real factor compressing Haohai Shengke’s profit margin in 2025 was the cataract surgery product line within the ophthalmology segment. This is primarily centered on intraocular lenses (IOLs).

In response, Haohai Shengke had to make substantial asset impairment provisions for related subsidiaries. Specifically, for Shenzhen Xinchanye, responsible for importing Lenstec brand IOLs into the U.S., an impairment of approximately 141 million yuan was recorded; for the U.S. subsidiary Aaren, responsible for manufacturing and selling Aaren brand IOLs, an impairment of about 25 million yuan was made for its intangible assets—the brand.

The intraocular lens business has long been a core part of Haohai Shengke’s performance. Its main products are standard spherical and aspheric IOLs. Both are fundamental materials used in cataract surgery to restore vision. Aspheric lenses generally provide better image quality and visual experience than spherical lenses, but both are basic, widely used, and highly competitive market staples.

Changes emerged after the implementation of national centralized procurement. In November 2023, five brands of IOLs and four brands of ophthalmic viscoelastic devices (OVDs) from Haohai Shengke were fully selected in the first national volume-based procurement of medical consumables for intraocular lenses. The results began to be gradually implemented in the first half of 2024, leading to significant price reductions for Haohai Shengke’s IOL models.

Ji Mian News learned that the prices for the non-spherical monofocal IOLs from Shenzhen Xinchanye and Henan Universe, which are part of the selection, are set at 784 yuan and 811 yuan respectively, down 44% and 42% from the highest bid prices.

This indicates that the previous model, relying on baseline prices to support revenue and gross profit, is no longer sustainable, and the price ceiling for Haohai Shengke’s cataract surgery products has been lowered overall.

According to the annual report, in 2025, the gross profit margin for ophthalmic products was 55.5%, down 1.49 percentage points year-on-year. In 2020, the gross margin was as high as 65.97%.

Worse still, while prices fell, sales volume did not increase correspondingly. This is because, with the ongoing promotion of DRG/DIP (Diagnosis-Related Group/Diagnosis-Intervention Packet) payment models, some provinces have adjusted their reimbursement policies for cataract surgeries, fundamentally changing hospital procurement logic.

The reimbursement standards for IOLs are now anchored to centralized procurement prices. For single-focus cataract IOLs, the selected products’ prices are used as the payment standard; non-selected products, both spherical and aspheric, have their maximum reimbursement capped at the highest bid price among the selected models.

In January 2025, the National Healthcare Security Administration issued the “Guidelines for the Establishment of Medical Service Price Items for Ophthalmology (Trial),” which specifically set up “IOL implantation fees,” distinguishing between routine and complex cases. The goal is to clearly separate and standardize surgical technical services and the costs of lenses.

For example, previously, a hospital performing a cataract surgery was more focused on whether the overall procedure could generate a surplus. Service fees, IOLs, viscoelastic agents, and other consumables were generally included in the overall surgical budget. As long as the entire surgery could still leave a surplus, hospitals might accept a lens that is not the lowest price but is more familiar to doctors and supplied more reliably.

Now, the hospital’s accounting approach has changed. The maximum reimbursement for single-focus IOLs is more clearly defined. Basic spherical and aspheric lenses are the most fundamental, homogeneous, and easily comparable products. If they only cost a bit more without additional value, this price difference will be borne by patients or become harder for hospitals to absorb under the new rules.

If a product is slightly more expensive than the basic model but can make high-frequency, standardized cataract surgeries smoother, safer, and more efficient, then that extra cost begins to be justified. Against this backdrop, mid-range pre-loaded aspheric IOLs have seen increased sales.

Pre-loaded aspheric IOLs are essentially still single-focus aspheric lenses but have been upgraded in form and surgical process. The lenses are pre-loaded into injection systems, eliminating intraoperative loading steps, reducing risks like scratches and contamination, and making the procedure more standardized and user-friendly for surgeons.

Especially after the implementation of volume-based procurement, the absolute price gap between pre-loaded and basic non-preloaded models has been significantly compressed. With the revenue elasticity of basic models reduced, hospitals are more willing to adopt pre-loaded options.

Haohai Shengke’s annual report clearly illustrates this product restructuring path.

To offset gross profit loss, Haohai Shengke actively optimized its product mix, replacing basic spherical and aspheric products with mid-range pre-loaded aspheric lenses. In 2025, sales of this type increased by 21.68% year-on-year, and their share of the intraocular lens product line’s revenue rose from 18.37% the previous year to 27.74%.

However, Haohai Shengke was late in making this shift. The structural optimization still isn’t enough to cover the gap caused by the price reductions and declining demand for basic models.

Beyond the cataract surgery segment, Haohai Shengke’s myopia control and refractive correction products are also struggling.

Ji Mian News previously reported that orthokeratology (OK) lenses are no longer the first choice for myopia control in teenagers.

This phenomenon is related to the emergence of defocus frame glasses from competitors. These glasses use special optical designs to utilize peripheral relative positive power, correcting peripheral hyperopic defocus in myopic eyes, thereby inhibiting axial elongation and myopia progression.

The clinical validation of myopia delay efficiency, simple fitting, ease of use, and lower cost have allowed defocus frame glasses to rapidly capture the teenage myopia control market within just two years.

Ji Mian News reported as early as 2022 that there are three major opportunities in the teenage myopia prevention market—after 20 years of promotion, OK lenses are well known to target customers, but defocus frame glasses remain a new concept for most parents. Now, Haohai Shengke admits again in its annual report that defocus frame glasses are taking away customers from OK lenses.