150 Handwritten Letters from Pharma Professionals Reveal Three Major Transformations Over Five Years

“I still remember the first time I saw the dazzling array of traditional Chinese medicinal herbs, each corresponding to the treatment of different ailments. I was deeply impressed by how magical Traditional Chinese Medicine (TCM) is. That moment planted the seed of TCM in my heart and turned me into a devoted follower...”

“Listing the depth of our friendship could take a day and night to fully recount... Together, we are exploring what pharmaceutical e-commerce will bring: more rational medication use for every patient, or a bridge facilitating direct communication between pharmaceutical companies and patients?”

(Some letters handwritten by the staff of Ali Health Pharmacy for their pharmaceutical partners)

A Love Letter, Deeply Rooted in Medical Devotion.

On September 16, 2021, as Ali Health Pharmacy celebrated its fifth anniversary, its partner pharmaceutical brands unexpectedly received 150 heartfelt handwritten letters. Penned by the platform’s operation specialists, these letters eloquently conveyed gratitude and respect, as well as reflections on growth and achievements over the past five years, with every stroke imbued with warmth.

Five years ago, Alibaba Health Pharmacy set sail with just seven employees and seven desks, building teams, establishing standards, and seeking partners—ultimately carving out a new path. Coincidentally, many pharmaceutical brands also began their digital transformation around that time, advancing from zero to one in the realm of digital healthcare.

Over the past five years, amidst dynamic changes and the passage of time, this period has represented not only the five-year journey of Ali Health Pharmacy but also a significant chapter for all stakeholders in the pharmaceutical industry.

In the 2015 Government Work Report, the “Internet Plus” action plan was proposed for the first time. The “Plus” signifies cross-sector integration, transformation, openness, and the reshaping and convergence of industries.

For the pharmaceutical industry, “Internet + Healthcare” is not merely a technological innovation but also an innovation in retail models. More critically and challengingly, it involves how to take the “first step” in digital transformation.

For Novartis, one of the world’s top three pharmaceutical companies, taking this step was no easy feat. It was not until February 2019 that Novartis formally established its retail division and an e-commerce department staffed by just one person, reflecting its initially cautious approach to the e-commerce model.

In the past, pharmaceutical brands viewed e-commerce platforms merely as “drug-selling” channels, essentially no different from traditional marketing media such as television, newspapers, and radio, and thus generally adopted a wait-and-see approach. However, with the finalization and subsequent expansion of relevant policies, pharmaceutical companies are facing greater challenges. Compounded by the impact of the pandemic, traditional pharmaceutical enterprises that rely primarily on offline channels are under even more severe market pressure. Consequently, key areas for breakthrough have become optimizing product portfolios, increasing R&D investment, reducing production costs, expanding sales channels, and enhancing product value-added.

Currently, the pharmaceutical distribution network represented by e-pharmacy is regarded as one of the “Three Great Inventions” of China’s internet healthcare sector and has served as a backbone force in the online fight against the pandemic. This is primarily because e-commerce platforms possess inherent advantages in enhancing the accessibility of medications.

It is reported that since 2020, Novartis has spun off its e-commerce division, expanding the team from one to six members and taking charge of all major e-commerce channels. Within Novartis, there is growing recognition of the growth potential of e-commerce. Particularly after enduring a year of the pandemic, the company realized that e-commerce is not merely an online channel for purchasing medications; it offers many more possibilities. The value of innovative models such as internet hospitals is being increasingly tapped into.

Taking Novartis’ heart failure medication, Entresto, as an example, its initial collaborative trial with Alibaba Health Pharmacy on online platforms has doubled drug distribution efficiency under the e-commerce model. For patients, pharmaceutical e-commerce has made purchasing medications more convenient. It is evident that the population reached by pharmaceutical e-commerce platforms and the speed of feedback they generate differ markedly from those of traditional retail channels.

AstraZeneca, a pharmaceutical “veteran,” has also risen from being overlooked to taking on a leading role by placing its e-commerce strategy on the agenda.

Lin Xiao, Vice President of AstraZeneca China and Head of the Respiratory & Autoimmunity Business Unit as well as Digital Business, stated, “The pandemic has significantly accelerated the development of pharmaceutical e-commerce. Key areas such as promotional sales, warehousing, and logistics—segments that face substantial challenges and pressures in offline operations—underwent a comprehensive ‘stress test’ within a short period. Ultimately, the e-commerce model has been repeatedly validated as viable.”

Over the past five years, a large number of new pharmaceutical brands have emerged like “newborn calves,” rooted in the soil of the internet, full of vitality, and growing rapidly. The rapid development of these new pharmaceutical brands is largely due to their alignment with internet thinking, with “Mandi” being a typical example.

In 2001, based on observations from offline hospitals, the hair loss prevention product “Mandi” was launched. Twenty years later, what even “Mandi” did not anticipate is that preventing hair loss and safeguarding the hairline have become a top priority for many young people, even evolving into a phenomenal topic among contemporary internet users. According to survey data released by the National Health Commission in 2019, the number of people suffering from hair loss in China exceeds 250 million, meaning one in every six individuals experiences hair loss. Among them, approximately 163 million are male and 88 million are female. The proportion of individuals experiencing hair loss before the age of 30 reaches as high as 84%, which is 20 years earlier than the previous generation, indicating a clear trend toward younger onset.

“We have calculated with hair-specialized hospitals across China that only 1 million patients seek solutions for hair loss in hospitals each year. In contrast, there are 250 million people online who require treatment for hair loss, which means that 99% of individuals suffering from hair loss are attempting to find effective treatments on their own but repeatedly encounter obstacles,” said Yu An, General Manager of Zhejiang Wansheng Pharmaceutical under Sansheng Group. He added that the most efficient way for doctors’ most powerful weapons against hair loss to reach over 200 million people is through the internet and e-commerce platforms.

According to Yu An, the key to the rapid growth of new brands, such as innovative and specialty drugs, lies in a shift in management thinking. In the past, when pharmaceutical companies conducted hospital-based promotions, they had to start from the needs of hospitals; however, due to limitations in manpower investment, the coverage of doctors and hospitals was extremely limited. Furthermore, the research and development (R&D) of innovative and specialty drugs was significantly influenced by government demands, resulting in relative lag in processes and design, and an inability to respond quickly. Nowadays, user-centric thinking has become the dominant model for the R&D of innovative and specialty drugs. “The initial attempt to launch OTC hair loss treatments like ‘Mandi’ stemmed from an in-depth analysis of pharmaceutical e-commerce: it allows direct connection with users; patients can directly search online for prescription drugs for chronic diseases; and consumers also look for brands online.”

“When we found ourselves unable to keep up with the many rapid-response demands of e-commerce, Dr. Lou Jing, Chairman of the Group, vigorously drove reforms by spinning off the e-commerce department and establishing a ‘green channel.’ All processes were reoriented around the user, including adherence to platform requirements and rules, covering everything from product development and design to partnerships and campaign implementation, all processed through the ‘green channel.’ In previous years, 3SBio Inc.’s primary focus was on biologics, which require cold-chain transportation and storage. However, limited by the cold-chain technology available at the time, comprehensive online engagement was not feasible. Leveraging the pharmaceutical e-commerce model, ‘Mandi’ emerged as the brand best suited for connecting directly with consumers.”

Nowadays, many pharmaceutical brands have also chosen e-commerce platforms as their primary channel for innovative drugs. Taking biologics as an example, new and specialty drugs launched by traditional pharmaceutical companies in recent years are facing increasing competitive pressure in the market.

Over the past year, multiple innovative drugs have chosen to launch first on Alibaba Health’s pharmaceutical platform. Previously, new and specialty medications—including Takeda Pharmaceutical’s novel-mechanism acid-suppressing drug Vocinti (vonoprazan), GlaxoSmithKline’s (GSK) triple-combination inhaler Trelegy for chronic obstructive pulmonary disease (COPD) treatment, AstraZeneca’s targeted lung cancer therapies gefitinib and osimertinib, and Qingdao Baiyang Pharmaceutical’s new-formulation metformin-nateglinide combination—were successively launched exclusively on Alibaba Health Pharmacy.

A relevant executive from Alibaba Health also revealed that the Alibaba Health pharmaceutical platform has established in-depth collaborations with a cohort of renowned pharmaceutical companies, including AstraZeneca, Bayer, Merck & Co., GlaxoSmithKline, Merck KGaA, Pfizer, Servier, Novo Nordisk, and Novartis. In the future, the platform will work jointly with these pharmaceutical enterprises to launch a series of blockbuster drugs.

Ali Health Pharmacy Celebrates Its Fifth Anniversary Amidst Profound Changes in the Pharmaceutical IndustryOver the past five years, as the pharmaceutical industry has undergone significant transformation, this comprehensive digital upgrade—from internal operations to external engagement—has been driven by professionals who have maintained a craftsman’s dedication, deeply rooted in the forefront of medical advancements. With decades of experience in the sector, these industry veterans recognize that professional pharmaceutical digital marketing talent or teams must not only master pharmaceutical and marketing knowledge but also possess internet operational capabilities, maintain data sensitivity, and skillfully leverage digital tools, among other essential competencies.

“You mentioned that, due to your age, you were not quick to pick up digital operations. Yet, you demonstrated precise and insightful interpretation of brand data, drawing inferences from one instance to apply to others, and provided us with many new ideas. If a successful entrepreneur like yourself can master these skills so rapidly, how can we afford to fall behind?” recalled an Alibaba Health Pharmacy associate in a letter, describing such a scene.

Another Alibaba Health team member wrote in a “love letter” to Tongrentang: “A few years ago, we were fortunate to launch our e-commerce collaboration, and the scale of our partnership has grown year by year. Leveraging the digital capabilities of Alibaba Health Pharmacy, we have introduced Tongrentang to a younger consumer demographic; meanwhile, Tongrentang’s century-long commitment to benevolent, high-quality medicines has strengthened consumer trust in Alibaba Health Pharmacy. Our mutual success has brought greater convenience and affordability to consumers when purchasing medications.”

The transformation in the digital era has far-reaching implications for traditional pharmaceutical companies, emerging brands, and healthcare professionals alike.

With the original aspiration of craftsmanship, starting from 5, we explore new beginnings.