How New Horizon Health Unlocks the Billion-Dollar Cancer Early Screening Market: H1 2023 Revenue Surpasses RMB 823 Million

On August 21, New Horizon Health released its financial report for the first half of the year (hereinafter referred to as the “H1 Report”). Amidst considerable controversy, there has been significant external anticipation for this report.

Data shows that in the first half of 2023, New Horizon Health’s three core products delivered outstanding performance, driving a significant increase in revenue and turning the company’s overall operational results from loss to profit. Over the past six months, New Horizon Health generated RMB 823 million in principal business revenue, representing a year-on-year increase of 264.4%. Its gross profit margin reached 90.9%, up from 82% in the same period last year. Meanwhile, the company achieved a net profit of RMB 61.3 million.

In recent years, China’s cancer early screening industry has been in the spotlight, with New Horizon Health actively striving to build a new business ecosystem to promote the implementation of early cancer diagnosis and screening. Since its listing in 2021, New Horizon Health has reported year-on-year growth. In its recently released semi-annual report, the company provided detailed data on various dimensions of its revenue growth.

Among them, several highlight data points basically outline the underlying logic of New Horizon Health's rapid growth, which is worth noting.

First, Changweiqing has become the primary source of commercial revenue for New Horizon Health.Financial report data shows that in the first half of 2023, the sales revenue of New Horizon Health’s flagship product, Colotect, reached RMB 490 million, a year-on-year increase of 566%, accounting for 60.02% of the total semi-annual revenue. Among this, products for which testing services were completed contributed 96% of Colotect’s revenue. From a financial perspective, Colotect has successfully entered the domestic early cancer screening market at the commercialization level.

Second, private hospitals and private clinics are currently important commercialization channels for New Horizon Health.In the first half of 2023, Changweiqing completed 172,000 sample tests through hospital channels. Among these, 79,500 samples were returned from private hospitals, and 54,200 samples came from private clinics. Samples confirmed in private medical settings accounted for 77.7% of the total, corresponding to approximately one-third of New Horizon Health’s sales revenue. The extensive penetration into private medical scenarios marks a significant distinction between Changweiqing’s commercialization strategy and the traditional logic of the IVD industry.

Third, the multi-point layout of New Horizon Health in consumer healthcare scenarios is beginning to show conversion results.Beyond clinical application scenarios, consumer healthcare settings—such as health management, commercial insurance, and e-commerce platforms—constitute the second-largest revenue channel for New Horizon Health. In these consumer healthcare contexts, New Horizon Health emphasizes its rigorous medical attributes and the advantages of at-home testing, aiming to drive direct-to-consumer (C-end) sales by influencing health management behaviors.

The logic behind early cancer screening is straightforward: detect cancer at an early stage and complete treatment early. However, from concept to implementation, China lacks ideal commercial models for early cancer screening, with progress being difficult and mired in controversy.

New Horizon Health is one of the early pioneers in China’s cancer early screening market. The company has invested substantial time and effort in Colosure, from model design and clinical trials to scaled mass production and application. Unlike other home-testing products, Colosure has the potential to improve clinical diagnosis and treatment workflows, rather than merely optimizing the patient experience under traditional care models, making it New Horizon Health’s flagship product for its cancer early screening strategy.

In November 2020, Changweiqing received marketing approval, positioned as an independent, serious medical product designed to help individuals at high risk for colorectal cancer rule out their cancer risk through a non-invasive approach. In the nearly three years since its launch, Changweiqing has maintained rapid sales growth.Since its market launch, Changweiqing has cumulatively served over 930,000 individuals for early screening of colorectal cancer by the first half of 2023. Although its scale remains small compared to the approximately 10 million colonoscopies performed annually, Changweiqing has, to a certain extent, optimized the diagnostic and treatment workflow for colorectal cancer.According to the first user testing data report for Colotect, released in April 2023, test results from over 500,000 users indicated that among those who tested positive with Colotect and were found to have abnormalities via colonoscopy, 83.2% had precancerous lesions.

However, due to its relatively high pricing and the ongoing accumulation of large-scale real-world data, there has been considerable debate within the industry regarding the commercialization strategy and growth logic of Changweiqing. Nevertheless, after repeated trials and errors, Changweiqing’s commercialization has now exhibited distinct phased characteristics.

First, in the clinical setting, quantitative changes have begun to take shape.According to the semi-annual report, New Horizon Health recognizes revenue from Colotect after users return their samples and the testing is completed.In the first half of 2023, among the 428,000 Colotect samples with confirmed revenue recognition, 172,000 originated from clinical settings, accounting for over 40%. For any innovative clinical diagnostic product, a testing volume of 172,000 cases within six months is quite remarkable.

For New Horizon Health, the clinical sector is undoubtedly a channel worthy of deep cultivation. “The clinical sector is the largest and fastest-growing revenue channel for Changweiqing.” This statement was repeatedly highlighted in New Horizon Health’s 2022 annual report and its 2023 semi-annual report. According to the semi-annual report, Changweiqing adopts a direct sales model in the clinical sector, with an ex-factory price exceeding RMB 1,200, significantly higher than the RMB 500–600 pricing in traditional channels. Over the past six months, New Horizon Health’s sales team has expanded from 300 to 470 members, covering more than 1,300 medical institutions.

Specifically, on the clinical front, Changweiqing primarily reaches users through departments such as gastroenterology, colorectal surgery, and health examination centers. In the first half of 2023, only RMB 14.5 million of Changweiqing’s sales came from public medical institutions, with the majority of current revenue being generated by private medical institutions. We attribute this to two main reasons.

On the one hand, this is related to differences in market access efficiency across different types of healthcare markets.The clinical adoption of Changweiqing is still in its early stages. In China, the procurement process for private healthcare providers is relatively straightforward, allowing for more efficient market access. In contrast, the pathway for innovative medical devices to enter clinical use in public hospitals is lengthy, involving complex procedures such as pricing approval, purchase requisition submission, and committee reviews. At specific hospitals, innovative medical devices can only be put into use after completing in-house validation with a sufficient number of cases. Taking Peking Union Medical College Hospital as an example, it took three years for Changweiqing to finally be integrated into the hospital’s diagnostic and treatment system in the first half of 2023. According to previous statistical data, significant sales volume for Changweiqing typically began around the third quarter after hospital admission.

On the other hand, this is related to the user profiles of different types of medical institutions.Private medical institutions place greater emphasis on service attributes and the efficiency of diagnostic and treatment workflows, which aligns with the profile of early users of ChangWeiqing. The design rationale behind ChangWeiqing is to identify individuals who truly require colonoscopy. For users with a negative ChangWeiqing test result, colorectal cancer can be ruled out with high probability, making colonoscopy unnecessary in the short term. In contrast, users with a positive result should undergo colonoscopy for further evaluation.

Compared with colonoscopy, Colotect is non-invasive and convenient, yet its pricing is not low. In the early stages of commercialization, only high-risk individuals for colorectal cancer who possess proactive health management awareness and distinct consumption preferences are likely to convert into Colotect users. In private medical institutions in major cities, the density of such populations is relatively high, making centralized sales conversion for Colotect easier. The semi-annual report shows that the average age of Colotect users in the first half of 2023 was 47 years, with the majority residing in Zhejiang Province, Shanghai, and Beijing, which corroborates this point.

Of course, if Changweiqing can later penetrate the public healthcare market, a qualitative transformation in the cancer early screening market may be even more promising.

Secondly, consumer healthcare scenarios are closest to end users and also have significant growth potential.Consumer healthcare is the second-largest sales channel for Changweiqing., and is also the core channel for at-home testing products such as the PuPu Tube and YouYou Tube.

However, the consumer healthcare sector is inherently more uncertain, leading New Horizon Health to adopt a decentralized, broad-based market strategy. During a media briefing for its semi-annual report, Zhu Yeqing, Chairman and CEO of New Horizon Health, stated that any channel capable of rapidly delivering products to end users qualifies as a high-quality distribution channel in consumer healthcare. Whether integrated into health management programs, e-commerce platforms, or commercial insurance offerings, home-testing products with serious medical attributes remain new entrants without clearly dominant distribution channels. New Horizon Health’s strategy involves diversified experimentation, establishing partnerships with as many insurance companies, health management organizations, and e-commerce platforms as possible, and leveraging these B2B collaborations to drive rapid B2C conversion.

To date, New Horizon Health has completed validation of conversion across multiple consumer healthcare scenarios, establishing a replicable commercialization strategy. According to Zhu Yeqing, in the consumer healthcare sector, New Horizon Health has formed a multi-dimensional health management partnership with Ping An Health, encompassing innovative products and services such as customer acquisition through screening, value-added services for clients, and jointly developed affordable health packages.

Finally, by comparison, the contribution of private health checkup institutions and other cancer early screening channels to overall revenue has declined.At the time of its market launch, Colosure’s primary commercial strategy was to drive sales through inclusion in premium health checkup packages offered by leading national screening institutions, which also facilitated the conversion of its earliest user base. Today, as potential users have developed stronger awareness of early cancer screening and Colosure, the product has gradually been incorporated into packages offered by regional leading screening institutions. However, due to high uncertainty in revenue recognition and limited growth potential in this channel, the health checkup institution channel is increasingly giving way to clinical and consumer healthcare settings. According to the semi-annual report, sales revenue from the health checkup institution channel accounted for only 5% of Colosure’s total in the first half of 2023.

Indeed, the growth rates of New Horizon Health and its flagship product, Colotect, have exceeded many expectations. Beyond the data, the more significant value of this growth lies in the insights it offers for the iterative evolution of commercial models within the industry, as demonstrated by this phenomenal cancer early screening product.

Undeniably, the broader market for early cancer screening will remain within public healthcare institutions in the foreseeable future.The same holds true for Changweiqing. According to previous statistics from New Horizon Health, there are as many as 120 million people in China at high risk for colorectal cancer. However, prior to achieving significant volume in public medical institutions, the penetration rate of Changweiqing was less than 1%, yielding minimal impact on improving the current state of colorectal cancer diagnosis and treatment.

In reality, competition among colorectal cancer detection products within public healthcare institutions has become an involutionary red ocean. Data show that more than 20 cancer test kits have entered public hospitals for sale through various channels at this stage, with over half of them used for colorectal cancer detection. Most cancer test kits adopt the traditional IVD reagent promotion model for hospital sales. However, these novel biomarkers struggle to truly integrate into clinical diagnostic and treatment workflows before clinicians’ knowledge systems are updated, resulting in mediocre volume growth and near-inevitable price wars.

One promising aspect of Changweiqing’s future growth in public healthcare institutions is that, as previously mentioned, it currently holds the only approved license for early screening of digestive tract cancers, making it a strictly compliant product. Its model design and commercialization strategy are directly tied to specific diseases, rather than being solely linked to a particular biomarker. This creates a fundamental logical difference between Changweiqing and traditional IVD reagents.

On the one hand, in terms of product design, the negative and positive results of Changweiqing tests are highly correlated with the likelihood of users developing colorectal cancer.Unlike most early cancer screening products that enter clinical application after only simple model validation, Changweiqing completed the registration process for serious medical products before launch and underwent large-scale clinical trials, achieving a negative predictive value of 99.6% and a positive predictive value of 46.2%. This provides an extremely high level of reliability. It is currently the only molecular screening technology recommended by national guidelines for colorectal cancer screening, diagnosis, and treatment, offering clinicians further diagnostic and therapeutic recommendations. This advantage has provided Changweiqing with a 3–5 year commercialization window, enabling differentiated competition.

On the other hand, in terms of commercialization strategy, Changweiqing focuses on clinician education.Since its market approval, Colotect has been incorporated into three clinical guidelines: the “Chinese Guidelines for Colorectal Cancer Screening, Early Diagnosis, and Early Treatment” published in the Chinese Journal of Oncology; the “2021 CSCO Guidelines for the Diagnosis and Treatment of Colorectal Cancer” issued by the Chinese Society of Clinical Oncology (CSCO); and the “Chinese Integrated Guidelines for Cancer Diagnosis and Treatment” released by the China Anti-Cancer Association. This inclusion has facilitated the integration of Colotect into diagnostic and treatment workflows by shaping clinicians’ understanding of disease diagnosis and management. Furthermore, New Horizon Health has established research collaborations with clinicians based on Colotect’s detection technology to deepen mutual understanding. During a media briefing, Gao Yu, Chief Financial Officer of New Horizon Health, stated that Colotect prioritized market education during its hospital adoption process. New Horizon Health had previously disclosed that a substantial portion of its sales expenses in the first half of 2023 was allocated to supporting clinical research conducted by physicians, which has progressively yielded academic publications.

According to the semi-annual report, New Horizon Health has gained access to nearly 300 public hospitals. Among them, Zhejiang Province has seen the most rapid progress, with access secured in 51 public hospitals, including 40 tertiary hospitals.

From the battle for existence to the imminent emergence of the first blockbuster product with over one billion yuan in sales, early cancer screening represents a persistent and ever-expanding real-world demand. For New Horizon Health and other early cancer screening manufacturers, there is undoubtedly still much work to be done.

In China, cancer remains a leading threat to people’s lives and health. According to statistics from The Lancet, in 2020, China ranked first globally in both cancer incidence and mortality rates. Among these cases, the vast majority of patients are already at an advanced stage upon their initial medical consultation, significantly increasing the burden of diagnosis and treatment. In a sense, early cancer screening represents the most critical and indispensable need in health management.

But even now, the supply side of cancer early screening products remains scarce.

On one hand, apart from cancers with relatively mature non-invasive early screening solutions—such as colorectal, liver, lung, and cervical cancers—there are still no effective non-invasive early screening methods for high-incidence cancers like gastric and pancreatic cancers, where prognosis differs significantly between early-stage and mid-to-late-stage diagnoses. This gap is largely due to technical bottlenecks, including the lack of sufficiently sensitive biomarkers and sampling methods, which pose significant challenges and raise higher demands for basic research on disease and detection, as well as for product development. On the other hand, the detection performance and market penetration of currently marketed non-invasive cancer early screening products remain insufficient. At present, awareness of early diagnosis and screening for high-incidence cancers has been established, at least among high-risk populations; however, due to uneven product performance, the penetration rate of specific products remains difficult to increase.

Beyond its three core products, New Horizon Health continues to develop new offerings. At a media briefing, the company disclosed its pipeline product, GongZhengQing.^TMthe latest developments. As the world’s first HPV screening product for cervical cancer based on urine samples, Gongzhengqing^TMBaseline enrollment for the prospective, large-scale, multicenter registry clinical trial has been successfully completed, with a total of over 16,000 screening participants enrolled. Preliminary trial data indicate a high level of concordance between New Horizon Health’s urine and self-sampling tests and clinician-collected cervical HPV testing, further validating the preclinical data presented at the 2022 Chinese Society of Clinical Oncology (CSCO) Annual Meeting. Furthermore, New Horizon Health is advancing prospective clinical trials for pan-cancer screening, rapidly iterating and refining its product pipeline, which is gradually taking shape and is expected to continue generating clinical and commercial value.

The road is long and arduous; have faith in the power of time.