Kindstar Global Reports First Half-Year Results Post-IPO: Driving Rapid Expansion in Specialized Clinical Testing

On August 30, KingMed Diagnostics, the leading domestic provider of specialized clinical testing services, disclosed its first semi-annual performance report since listing on the Hong Kong Stock Exchange.

In the first half of the year, KingMed Diagnostics achieved an operating revenue of RMB 439 million, with its core business (excluding COVID-19-related activities) generating RMB 427 million, representing a 27.4% year-on-year increase. The gross profit margin of the core business steadily rose to 53.4%, a year-on-year increase of 4.6 percentage points. During this period, the company’s various business divisions reported an operating profit of RMB 94 million, up 54% from the same period last year. Of this amount, RMB 42 million was allocated to research and development, marking a 33.3% year-on-year increase. After deducting expenses such as administrative costs and taxes, the net profit stood at RMB 28.9 million, making it one of the few recently listed companies on the Hong Kong Stock Exchange that is currently profitable.

The blood testing business continues to hold its leading position, with a revenue growth rate of 28%, achieving RMB 268 million in revenue. Notably, Kindstar Global has seen remarkable revenue growth in other specialties: oncology testing grew by 49%, genetic and rare disease testing surged by 45%, while infectious diseases and neurology specialties recorded growth rates of 22% and 19%, respectively. This demonstrates that Kindstar Global is delivering on its strategic promise to replicate the success of its hematology specialty across other clinical areas. Consequently, Kindstar Global is transitioning from a one-stop specialized clinical testing provider focused on hematology into a multi-disciplinary clinical specialized testing platform characterized by rapid product iteration.

"Few companies have taken clinical specialty testing to the extreme quite like Kingstar Global."

The first impression that Kingstar Global conveys to the outside world is its possession of China’s largest portfolio of specialized clinical hematology tests and the highest volume of clinical samples. Indeed, with over a decade of deep engagement in the field of hematology testing, Kingstar Global offers more than 2,300 specialized clinical hematology test items, far exceeding the 100–1,000 items typically available from most third-party medical laboratories on the market. In China, clinical testing primarily takes place within hospitals; only samples or test items that exceed the internal testing capabilities of a hospital are usually sent out for external analysis. In other words, medical laboratories do not serve patients directly but rather provide B2B services to healthcare institutions. Therefore, it is particularly important to offer one-stop, end-to-end solutions that address all issues within a given segment. This has been Kingstar Global’s guiding philosophy from the outset: they view their offering as a service rather than a product, assisting clinicians by integrating sample processing, technical platforms, reagent formulations, and other factors to identify the optimal solution for accurately assessing a patient’s health status.

In terms of clinical sample accumulation, Kingstar Global Health is virtually the “Whampoa Military Academy” of specialized clinical testing for hematology in China. According to its previous prospectus, Kingstar Global Health performed a total of 1.7 million specialized clinical tests in 2019 alone, of which 870,000 were for hematological diseases. In other words, Kingstar Global Health’s medical laboratories in Wuhan, Beijing, and Shanghai receive an average of more than 4,600 clinical samples from across China every day, with over half used for hematological testing. Nationally, 42% of all spending on clinical hematological tests flows to Kingstar Global Health each year. Even founder Huang Shiang has told employees that one year working in Kingstar Global Health’s laboratories exposes them to a greater volume and complexity of samples than ten years in many other settings.

Perhaps due to the nearly uncontested competitive advantage accumulated over years in specialized clinical hematology testing, Kingstar Global attracted significant capital attention even during its primary market phase, drawing investment from prominent firms such as Ruifu Medical, Qiming Venture Partners, and CPE Yuanfeng.

However, for Kingstar Global, the stage has long extended beyond hematology.

Starting from its 10th year of operation, Kingstar Global has progressively expanded into specialized fields including genetic diseases, infectious diseases, solid tumors, and neurology. Specifically, in 2013, 2014, and 2016, Kingstar Global successively launched specialized testing services for genetic and rare diseases, infectious diseases, oncology, and neurology, and established a research and development team comprising 253 medical and scientific experts in hematology, genetics, oncology, and other specialized disciplines. By 2020, Kingstar Global’s specialized testing businesses for genetic and rare diseases, infectious diseases, oncology, and neurology had expanded to 735, 1,281, 246, and 1,106 hospitals and institutions, respectively.

However, instead of adopting a slash-and-burn approach to pioneer new specialty fields, Kingstar Global has chosen to leverage the reuse of talent and standardized processes.

KingMed Diagnostics boasts 664 full-time specialized testing personnel, along with an internal team of experts and scientific advisors. These specialists possess an average of over five years of experience in their respective vertical fields and handle more than 1,900 clinical samples per person annually at KingMed Diagnostics. They are highly experienced in integrating test results from diverse technical platforms and analyzing test reports, serving as a sharp vanguard for companies engaged in clinical specialized testing as they expand into new markets.

Through long-term practice, our technical team has developed unique insights into diseases and established specialized standards for clinical special testing. This comprehensive system of experience and knowledge enables Kingstar Global to overcome barriers across various specialty fields, significantly reducing the time required for learning. Taking NGS testing as an example, it is often necessary to distinguish between germline and somatic gene mutations, as germline mutations are typically benign, whereas somatic mutations are closely associated with the onset and progression of leukemia. Accurately differentiating between these two types of mutations requires substantial data accumulation, the establishment of sequencing workflows specifically for germline samples, and comprehensive judgment based on patients’ clinical manifestations. Without sufficient experience, achieving this level of accuracy is indeed challenging.

Meanwhile, in selecting new specialties, KingMed Diagnostics considered both the growth potential of demand for specialized testing in these diseases and the possibility of significant synergies with its hematology specialized testing capacity. The core of the hematology testing system involves MICM, namely: Morphology (M), Immunology (I), Cytogenetics (C), and Molecular Genetics (M). The "Morphology" technology platform mainly includes traditional pathology and immunohistochemistry, which are also the primary methods for diagnosing solid tumors; the "Immunology" technology platform primarily consists of flow cytometry analysis, an important tool for assessing immune function in conditions such as solid tumors and genetic disorders; the core technologies of "Cytogenetics" are karyotyping and FISH, widely used in the clinical diagnosis and treatment of genetic diseases, solid tumors, neurological disorders, and other related conditions; the "Molecular Genetics" technology platform mainly includes PCR and sequencing, which have become essential tools across nearly all disease-specific specialized tests. Thus, it is evident that the approach and technological platforms of hematology-specific specialized testing can be effectively replicated across different disease-specific specialized tests.

As a result, Kingstar Global’s new specialty clinical testing business is rapidly expanding across China. According to the prospectus, while it took Kingstar Global eight years to roll out its hematology specialty testing services nationwide, it achieved national coverage for genetic and rare disease testing as well as neurology specialty testing in just three years. In the first half of 2021, Kingstar Global saw substantial volume growth in its clinical specialty testing portfolio for infectious diseases, genetic disorders, and neurology. This indicates that the scalability of Kingstar Global’s business model across different specialized testing markets has been preliminarily validated.

In the first half of the year, the sales growth rate for multi-steroid hormone testing reached 253% compared to the previous six months. Rapid, accurate, and comprehensive multi-steroid hormone testing can assist in the clinical diagnosis and subtyping of congenital adrenal hyperplasia (CAH), providing complementary insights from a metabolomics perspective for variants of uncertain significance identified in genomics. Additionally, for patients requiring lifelong medication, multi-steroid hormone testing can monitor therapeutic efficacy. Wuhan Kingstar Medical Inspection Co., Ltd. stated that over the past two years of promoting multi-steroid hormone testing products, recognition among pediatric endocrinology clients has significantly improved, laying the foundation for further market penetration.

KingMed Diagnostics’ neurology product line can be regarded as a successful example of its exploratory expansion into specialized clinical testing. Financial reports indicate that, following comprehensive academic promotion and outreach, the number of tertiary hospitals collaborating with KingMed Diagnostics on its specialized neurology tests reached 2,241, representing an increase of 1,356 hospitals compared to 2020. Furthermore, in the first half of the year, KingMed Diagnostics completed serum screening and validation assays for one diagnostic antibody for myasthenia gravis and one diagnostic antibody for autoimmune autonomic ganglionopathy, with clinical testing expected to commence in mid-to-late August.

Meanwhile, Kingstar Global has begun to expand into the cardiovascular specialty. Cardiovascular disease is the leading cause of death in China, with its prevalence rising year by year; it is estimated that there are currently 330 million people living with cardiovascular conditions. Kingstar Global will focus on a series of cardiovascular diseases, including adult coronary heart disease, acute myocarditis, and acute myocardial infarction, as entry points. By integrating multi-omics technologies, the company will develop comprehensive diagnostic service solutions, providing a range of products and services such as ultra-early prediction for high-risk populations and patients, rapid acute testing, and prognostic follow-up monitoring.

As this discussion draws to a close, it is evident that Kingstar Global has demonstrated strong determination and execution capability, whether in defending its stronghold in specialized hematology testing or in launching new campaigns to drive the exponential growth of its specialized clinical testing services.

However, building a clinical special testing platform that covers multiple specialty areas is an unprecedented endeavor. Although both clinical special testing and general clinical testing aim to address in-hospital laboratory needs through centralized off-site operations, their underlying logics differ significantly. Clinical special testing emphasizes academic research, education, and deep specialization within medical disciplines, placing substantial demands on the core team’s learning agility and strategic focus. This explains why only a few companies have reached the pinnacle in the highly fragmented landscape of clinical special testing specialties. Whether Kingstar Global can leverage its accumulated resources and experience to evolve into a true platform player in the clinical special testing sector remains to be seen.