Guanxin Lab Breaks the Unprofitable Cycle of Internet Healthcare with Non-Pharmacological Digital Therapeutics for Mental Health

The situation regarding the development of mental health issues is becoming increasingly severe.

According to the World Health Organization (WHO) 2020 report, over 27.8% of the global population suffered from sleep disorders in 2020. These disorders are often closely associated with anxiety and depression. Data show that, influenced by the COVID-19 pandemic, the prevalence of major depressive disorder and anxiety disorders increased by 28% and 26%, respectively, worldwide in 2020. The number of individuals affected by anxiety reached 374 million, while those affected by depression reached 350 million. The WHO predicts that by 2030, depression will become the leading cause of global disease burden.

In China, the situation is equally grim. According to the 2021 White Paper on Exercise and Sleep released by the Chinese Sleep Research Society, more than 300 million people in China currently suffer from sleep disorders. Furthermore, the Report on the Development of National Mental Health in China (2019–2020) published by the Chinese Academy of Sciences indicates that the combined prevalence of anxiety and depression has reached nearly 20% of the population, affecting over 200 million individuals. Of greater concern is the fact that 70% of these individuals have not received medical diagnosis or treatment.

How to Provide Solutions for the Increasingly Severe Public Mental Health Crisis?

A large number of internet-based mental health service platforms have emerged in the industry, each striving to address existing challenges. Guanxin Lab, established in 2020, is one such platform.However, unlike other mental health service platforms, Guanxin Laboratory places greater emphasis on “therapy” rather than “counseling.” Rooted in mindfulness, it has opted not to adopt a predominantly one-on-one (1V1) model, but instead focuses on group psychotherapy.

Despite the fact that a large number of patients have not yet received diagnosis and treatment, there remains substantial demand in the field of mental health services due to the vast patient population. Han Zhiqi, founder of Guanxin Laboratory, pointed out that,The domestic mental health services market in China currently holds immense potential for development.In the United States, the penetration rate of related services can reach 10%, whereas in China, the current penetration rate is less than one per thousand, leaving room for growth by a factor of thousands or even tens of thousands.

2020 was undoubtedly a significant milestone in the development of China’s mental health industry. The pandemic led to a surge in demand for online psychological consultations, and the proliferation of free online mental health services further increased public awareness of digital mental health platforms.

However, the problem is also evident. While the mental health services sector is showing positive development trends, there remains a significant imbalance between the massive demand for services and their supply: medical institutions continue to face substantial shortages of psychiatrists (and psychotherapists), as do counseling agencies in terms of licensed psychological counselors.

ButMerely focusing on “supply-demand imbalance” often overlooks the underlying issues—

① From the perspective of healthcare institutions (hospitals) providing servicesCurrently, China has only 40,000 psychiatrists and 5,000 psychotherapists, and the “supply imbalance” of medical service talent is a widely recognized issue within the industry. More importantly, medical institutions in China often rely exclusively on pharmacological therapy. Due to physicians’ limited time, non-pharmacological psychotherapy services are available in only a few regions. Compared with the combined approach of psychotherapy and pharmacotherapy commonly adopted in Europe and the United States, the drug-only treatment model prevalent in China often has certain shortcomings and may even cause secondary harm to patients.

② From the perspective of psychological counseling institutions providing services, overall supply still needs to be supplemented. It is reported that the current number of registered psychological counselors is 1.4 million, but only about 200,000 are actually practicing. Furthermore, most current psychological service institutions mainly provide shallow-level services such as listening, companionship chatting, and psychological counseling, lacking "therapeutic" capabilities. Even though a small number of top-tier psychological counseling professionals possess "therapeutic" capabilities and can provide "treatment" services to patients, the cost of one-on-one consultations is often unaffordable for patients.

In response to the numerous issues within the current mental health service delivery system, Guanxin Laboratory has opted for model innovation to address these systemic challenges, thereby mitigating industry-wide problems such as medication overuse, a shortage of psychological counselors, and excessive financial burdens on patients.

So, what are the distinctive features of the solutions provided by Guanxin Lab?

In the field of mental health, there is a widespread phenomenon: many psychological counselors initially entered the profession to address their own personal issues. Unable to find competent counselors, they often resorted to self-study and ultimately chose to practice as psychological counselors out of a desire to help others facing similar struggles.

There is a similar story behind the establishment of the Guanxin Laboratory.

Han Zhiqi, founder of the Guanxin Laboratory, worked at an investment firm from 2017 to 2020. This job once caused him significant anxiety. In 2019, the surge in popularity of Calm, a U.S.-based app offering meditation and sleep aid services, brought “meditation” and “mindfulness” into Han Zhiqi’s view. After reviewing extensive literature and journals, he enrolled in mindfulness courses and rediscovered his own sense of “inner peace.”

Han Zhiqi’s decision to embrace “mindfulness” and launch a startup was driven more by his insight into industry trends—At that time, “Complementary and Alternative Medicine” (CAM) abroad, which refers to health interventions through non-pharmacological means, was becoming a trend. “And mindfulness, as a form of CAM,” Han Zhiqi added, “has extensive literature supporting its effectiveness. Moreover, as a new generation of clinical psychology techniques, it is aimed at addressing medical conditions and is more aligned with medical theory.”

Turning to the domestic market, online mental health platforms have gained increasing acceptance and recognition during the pandemic. A large number of offline counselors have gradually transitioned to online practice, and some mass-market platforms have also begun supporting live-streamed mental health services. These trends enabled Han Zhiqi, a veteran with 20 years of experience in the internet industry, to identify a strategic opportunity. He ultimately chose to develop a proprietary online group psychological rehabilitation camp, centered on mindfulness-based psychological techniques and integrated with third-wave, evidence-based clinical psychotherapies. This online training program provides psychotherapeutic services to individuals suffering from mental and psychological disorders such as insomnia, depression, and anxiety.

Compared with existing mental health service institutions and psychological counseling agencies, the mental health services provided by Guanxin Laboratory have some significant differences—

First, the third-generation evidence-based cognitive-behavioral psychological technologies currently adopted by Guanxin LaboratoryDistinct from the traditional one-on-one psychoanalytic approach commonly used in psychological counseling, this is a standardized psychological technique that has been proven effective through large-scale evidence-based research. It effectively avoids significant variations in counseling outcomes caused by differences in individual counselors’ competencies. The therapeutic techniques currently employed include MBSR, MBCT, ACT, CBT, and DBT. Within the American Psychological Association’s (APA) Division of Clinical Psychology framework for Evidence-Based Practice in Psychology (EBPP), these techniques are all rated as having strong clinical evidence.

Secondly, unlike the one-on-one psychological counseling model, Guanxin Laboratory adopts a group-based online training camp model.By adopting evidence-based cognitive-behavioral techniques, Guanxin Laboratory is able to deliver psychoeducation and training through online courses, achieving outcomes consistent with those of in-person sessions. Compared to one-on-one therapy, this approach not only helps alleviate the current shortage of high-quality psychological counselors and further amplifies their service capacity, but also reduces the financial burden on patients.

Guanxin Lab Online Teaching

Furthermore, it provides services covering patients with moderate to severe conditions, thereby reducing the physical burden on those requiring long-term medication.(Note: This information is intended for the audience targeted by corporate service providers and does not constitute treatment recommendations from VCBeat.)According to Han Zhiqi, current psychological counseling agencies often provide services for issues such as family disputes and emotional problems. When aware that a patient is already taking psychiatric medications, they frequently refuse to provide services and instead refer the patient to hospitals for treatment. In contrast, Guanxin Laboratory differs from other psychological counseling service providers; leveraging its affiliated online psychiatric and psychological hospital, it offers psychotherapy services to patients with moderate to severe conditions who are on medication. By employing non-pharmacological psychological interventions as the primary treatment approach, it is possible to gradually achieve dose reduction or discontinuation of medication, thereby minimizing the secondary harm caused by drug dependence.

After deciding to enter the mental health market with “mindfulness,” Han Zhiqi gradually built a team of more than 50 people.

Within the team,The core executive team includes Partner Hao Jianyao (with nearly 20 years of internet industry experience, formerly Vice President at Jianke, a leading internet healthcare platform), and Head of Technology and R&D Han Bing (Master’s in Psychology from the National University of Singapore, with 13 years of experience as a psychotherapist in overseas hospitals and top-tier tertiary psychiatric hospitals in China. He is a psychotherapist certified by the National Health Commission, and an expert in Morita Therapy and Naikan Therapy under the Chinese Mental Health Association).. Other team members include the psychological counseling team and the sales team, which are composed in a 1:1 ratio.

The composition of the psychological counseling team actually offers a glimpse into Guanxin Laboratory’s business expansion strategy—

The psychological counselors at the Guanxin Laboratory consist of three categories of professionals.One group consists of relatively junior psychological counselors responsible for science popularization, primarily conducting public education and user acquisition on mass-market platforms. Another group comprises “class teachers” for online group training camps and psychological counselors with extensive case experience; these professionals are mainly responsible for delivering group psychotherapy services and providing a limited amount of one-on-one (1V1) mental health services (according to Han Zhiqi, 1V1 mental health services currently account for less than 5% of total revenue). The third group includes frontline practitioners certified in specific psychotherapeutic modalities, who hold degrees from overseas universities such as Oxford, MIT, and Brown University; they are primarily responsible for teaching therapeutic theories and training, developing psychotherapy products, and conducting internal training.

From a business process perspective, for example, patients often learn about Guanxin Laboratory through third-party platforms. Initially, patients can experience the effects of “mindfulness” through introductory sessions. Once patients decide to join the Guanxin Laboratory Online Group Counseling Bootcamp (typically capped at 50 participants per cohort), they usually undergo a two-month psychological training program. During this process, patients will undergo relevant scale assessments before, during, and after the camp. Finally, Guanxin Laboratory will compare the ten factors of the SCL-90 scale for patients with anxiety and depression to evaluate the improvement effects and provide further solutions based on the patients' conditions.

“Guanxin Lab evaluates its psychological counselors based on patient improvement rates and satisfaction.” Hao Jianyao, a partner at Guanxin Lab, added that this also sets Guanxin Lab apart from other psychological counseling and therapy institutions, noting that “there are no similar enterprises in the entire industry.”

Currently,Based on the core of "mindfulness" technology, Guanxin Lab has developed multiple products.In December 2020, Guanxin Lab launched its first service pipeline, primarily targeting individuals with psychogenic sleep disorders. In May 2021, the lab introduced its second service pipeline, mainly serving patients with anxiety disorders, depressive disorders, obsessive-compulsive disorder, and post-traumatic stress disorder. This year, Guanxin Lab rolled out its third service pipeline, which focuses on adolescent psychological issues and provides family-based group therapy. Reportedly, the launch of this product was driven by user needs.

During psychotherapy, Guanxin Lab trains patients and strives to transform their cognitive patterns. Achieving this latter goal often requires interactive engagement to foster group dynamics, thereby genuinely improving patients’ mental health. To accomplish this objective, Guanxin Lab’s rehabilitation camp courses adopt a model combining live-streamed instruction with supportive coaching, effectively enhancing treatment adherence.

Hao Jianyao emphasized that Guanxin Laboratory aims to become an internet-based “digital pharmaceutical” company, providing therapeutic services to patients through remote treatment and subsequently developed digital therapeutics, rather than merely maintaining online doctor-patient relationships. Relevant collaborations and outcomes have further validated his assertion. According to the introduction,Currently, the mindfulness-based therapy offered by Guanxin Laboratory has served 30,000 users. Compared to the 60% treatment efficacy rate of standard CBT-I, the real-world data (RWD) efficacy rate of Guanxin’s Mindfulness-Based Sleep Program (MBSP) can reach up to 90%. Some elderly patients who previously relied heavily on medication for sleep have gradually transitioned to reducing their dosage or achieving nearly 5–6 hours of sleep without medication.

In 2022, Guanxin Laboratory even entered into a partnership with the Mountaineering Management Center of the General Administration of Sport of China, becoming the provider of psychological training and support services for rock climbing athletes competing in the Asian Games and the Olympic Games, helping them cope with psychological stress during training and competition. During the several months when Guanxin Laboratory’s psychological counselors accompanied the team, the athletes achieved outstanding results at the World Championships.

Hao Jianyao pointed out that, from the perspective of the overall development of internet healthcare, most companies have still failed to break free from the vicious cycle of “selling drugs to subsidize medical services.” For patients, the core rigid demand likely remains follow-up consultations and prescription renewals. Internet healthcare has largely shifted offline scenarios to online platforms. From another perspective, internet healthcare companies face a rather awkward situation: on one hand, they generate no revenue without selling drugs; on the other, drug sales yield little profit. Very few enterprises have managed to achieve profitability through medical services alone. If internet healthcare platforms continue to focus on drug sales as their core business, they will lack competitiveness compared to established large-scale platforms and inevitably revert to previous predicaments.

Guanxin Laboratory has broken away from this model and established a viable commercial profitability model by leveraging services that directly create value.“At our core, we are a ‘pharmaceutical company’ that provides digital therapeutics and digital medicines. We are genuinely delivering internet-based ‘treatment.’”

This actually reflects Guanxin Lab’s perspective on the development of internet healthcare. In their view, the evolution of internet healthcare can be divided into five stages: Stage 1 focuses on content services such as medical popularization and health education; Stage 2 features light consultation and appointment registration services; Stage 3 involves pharmaceutical e-commerce services; Stage 4 centers on online consultations through internet hospitals; and Stage 5 integrates “Internet + digital therapeutics” for remote treatment.

The decision to focus on online channels stems from Guanxin Laboratory’s belief that the traditional offline psychotherapy system has been too weak and its penetration rate too low, thereby creating opportunities for the development of online mental health platforms. Just as e-commerce platforms emerged rapidly due to the underdeveloped state of offline retail and payment systems, it is highly likely that online mental health service platforms will achieve more rapid growth once the general public becomes accustomed to accessing mental health services through digital channels.

They chose to leverage the internet for “treatment” and strategically position themselves in “Internet + Digital Therapeutics Remote Consultation,” as they recognized the overall development trends of internet healthcare.

Guanxin Lab Provides Mindfulness-Based Stress Reduction EAP Services to Medical Staff at Beijing Huilongguan Hospital and the Beijing Psychological Assistance Hotline

Currently, Guanxin Laboratory is also collaborating with research institutions to develop digital therapeutics and integrating with hospital systems to deliver in-depth services. It is reported thatGuanxin Lab achieved profitability in its second year of operation and realized ultra-rapid business growth through self-sustaining revenue generation.Currently, Guanxin Laboratory is planning to raise funds to support the regulatory approval and certification of its digital therapeutics, as well as market expansion within hospitals.

Han Zhiqi stated that, in line with the company’s slogan, “Heal Every Suffering Mind,” Guanxin Laboratory will leverage online remote consultations to deliver digital therapeutics and digital pharmaceuticals, ultimately improving the mental health of the Chinese population and contributing its share to the Healthy China 2030 initiative.