Ping An Good Doctor Reports 106.8% YoY Surge in Online Healthcare Revenue Amid Strategic Upgrade and Industry Barrier Construction
During the pandemic, the importance of internet healthcare as a “second front” was highlighted, with numerous policies introduced to encourage its development. But how did internet healthcare actually fare during this period? As the only publicly listed internet healthcare company, Ping An Good Doctor’s recently disclosed financial report for the first half of 2020 provides a general reflection of the current state of development in the internet healthcare sector.
On August 20, Ping An Good Doctor released its financial report for the first half of 2020.Achieved revenue of RMB 2.747 billion, with its core online healthcare business maintaining robust year-on-year growth of 106.8% despite market headwinds, contributing RMB 695 million in revenue.. To gain a deeper understanding of the development of internet healthcare in the post-pandemic era, as well as strategic shifts among enterprises, VCBeat conducts an in-depth analysis of its data.
From left to right: Ms. Wang Rui, Vice President of Marketing at Ping An Health Medical Technology Co., Ltd.; Mr. Liu Cheng, Board Secretary and Joint Company Secretary; Mr. Fang Weihao, Interim Chairman of the Board and Chief Executive Officer; and Ms. Ye Lan, Assistant to the General Manager and Chief Financial Officer.
The 2020 semi-annual financial report indicates that Ping An Good Doctor maintained a strong overall growth trajectory. From January to June 2020, the company generated revenue of RMB 2.747 billion, representing a year-on-year increase of 20.9%. From this perspective, the pandemic has provided a positive impetus for internet healthcare enterprises. Although Ping An Good Doctor remained in a loss-making position, its net loss narrowed; the net loss for the first half of the year amounted to RMB 213 million, a year-on-year reduction in losses of 22.1%. Notably, the online medical services segment, which constitutes Ping An Good Doctor’s core business, experienced rapid growth in the first half of the year, with a surge of 106.8% and revenue reaching RMB 695 million. This also indirectly reflects the increased demand for online medical services among residents during the pandemic.
Overall Revenue Trends Upward, Membership Business Grows Rapidly
Ping An Good Doctor's business is divided into four segments, namelyOnline Healthcare, Consumer Healthcare, Health Mall, Health Managementand interactive services.As the core business segment of Ping An Good Doctor, the online healthcare division recorded revenue of RMB 695 million in the first half of 2020. Compared with the same period in 2019, the proportion of revenue from the online healthcare division to total revenue increased from 14.8% to 25.3%.. Other segments maintained steady growth, collectively driving the revenue growth of Ping An Good Doctor.
It is worth noting that the growth in the online healthcare segment was, to some extent, driven by the significant increase in Ping An Good Doctor’s membership services and related businesses such as e-prescription medication purchases accompanying online consultations. During the reporting period, the total revenue from Ping An Good Doctor’s existing membership products exceeded RMB 420 million, representing a year-on-year increase of over 200%, indicating robust growth momentum.
Ping An Good Doctor leverages its AI-assisted diagnosis and treatment system to support its in-house medical team, providing users with 24/7 online consultations, referrals, appointment registration, online prescription fulfillment, and medication delivery services. Centered on its professional teams, the company offers diversified one-stop membership products. Notably, Ping An Good Doctor has provided private physician membership services to over 500 corporate clients, delivering flexible, customized end-to-end solutions for their employees. These services include one-on-one online consultations with private physicians, assistance with outpatient appointment registration at offline hospitals, and medical accompaniment, among other one-stop offerings.
In early 2020, Ping An Good Doctor upgraded and renamed its earlier membership product, “Medical Care 360,” to “Health Guardian 360,” earning widespread acclaim for the offering. While offline policy sales stagnated due to the pandemic, the Health Guardian 360 business achieved rapid growth. Meanwhile, in the first half of 2020, Ping An Good Doctor partnered with Ping An Property & Casualty Insurance to launch an innovative membership product, “Peace of Mind – Million-Yuan Medical Insurance,” equipping it with corresponding medical services and providing different types of health management benefits tailored to three scenarios: “serious illness, minor illness, and general wellness.” These membership services collectively contributed to the revenue growth of the online healthcare business.
Nearly 350 million registered users and nearly 3 million monthly paying users
During the peak of the pandemic,The Ping An Good Doctor app has recorded over 1.11 billion visits, with the number of registered users reaching ten times the pre-pandemic level. The average daily number of consultations among new users is nine times higher than before the pandemic. The series of anti-epidemic videos produced by the Ping An Good Doctor team has accumulated 115 million views.。
As of the end of June 2020, Ping An Good Doctor had reached 346 million registered users, equivalent to one in every four Chinese people being a user. In the past six months, the number of registered users increased by 30.98 million; over the past 12 months, the cumulative increase in registered users reached 56.9 million.
The growth in the user base has driven an increase in the average daily consultation volume. In the first half of 2020, Ping An Good Doctor’s average daily consultation volume reached 831,000, representing a year-on-year increase of 26.7%. In June 2020, the platform’s monthly active users (MAU) reached 67.27 million, among which the number of monthly paying users amounted to 2.95 million, representing year-on-year growth rates of 7.3% and 32.3%, respectively. Overall, during the reporting period, the paying user conversion rate increased by 1.4 percentage points from 3.7% in the same period last year to 5.1%. This indicates enhanced user willingness to pay and a further strengthening of Ping An Good Doctor’s commercial monetization capabilities.
Fang Weihao, Interim Chairman of the Board and CEO of Ping An Good Doctor, stated that in the first half of 2020, the number of users conducting medical consultations on registration days increased by 40% year-on-year. Ping An Good Doctor will continue to increase its investment in brand building and traffic acquisition, striving to attract medical-focused users in a targeted manner and consistently drive high-quality traffic to its platform.
The Pandemic Drives the Development of Internet Healthcare, with Policy Guidance Becoming Normalized
The introduction of national policies, coupled with the cooperation of hospitals and enterprises, has driven the further development of internet healthcare. During the pandemic, the pace of internet hospital construction accelerated significantly. In the first five months of 2020, the number of internet hospitals established nearly equaled the total built throughout 2019, and this figure continues to rise. This trend is closely linked to the implementation of these policies.
Since February this year, the state has frequently issued policies requiring vigorous promotion of internet diagnosis and treatment services, explicitly advocating for the inclusion of internet healthcare in the medical insurance payment system. The high efficiency and low risk of internet hospitals have been demonstrated, prompting offline physical institutions and internet healthcare platforms to deploy online diagnosis and treatment services and actively engage in the construction of internet hospitals.
The inclusion of enterprise-led internet hospitals in medical insurance reimbursement fundamentally adheres to the principle of “cost reduction and efficiency enhancement.” Internet hospitals connected to the medical insurance payment system can more easily acquire customers and facilitate subsequent service conversion.
During the integration with the national medical insurance system, the National Healthcare Security Administration imposed stringent requirements on the upgrading of information systems for internet hospitals. These requirements include establishing and properly maintaining electronic medical records, online electronic prescriptions, and medication purchase records for patients, ensuring end-to-end traceability across diagnosis and treatment, prescription issuance, transactions, and delivery, thereby achieving full monitoring of information, capital, and logistics flows. This has further promoted the improvement of infrastructure in internet hospitals. On this basis, internet hospitals are better equipped to meet more diverse healthcare needs and are poised for more rapid development.
Ping An Good Doctor Actively Expands Its Internet Hospital Services and Integrates Medical Insurance Payment
During the pandemic prevention and control period, Ping An Good Doctor also responded swiftly to the national call, continuously advancing the development of its internet hospital and integrating it with medical insurance services.As of mid-August, 14 internet healthcare projects signed between Ping An Good Doctor and offline hospitals across various regions have been put into operation. Notably, the projects in Hubei, Dongguan, and Yinchuan have been integrated with local medical insurance payment systems, providing residents in these areas with more convenient, efficient, and secure online medical services.Among them, the Fuzhou Regional Internet Hospital Platform, which signed its contract before the end of 2019, commenced operations in mid-July 2020. Ping An Good Doctor stated that it will continue to invest resources and capital to integrate online medical insurance payment services, thereby further accelerating the development of its internet hospital infrastructure.
Internet healthcare encompasses not only online medical services such as teleconsultations, health management, chronic disease management, and e-prescriptions, but also a diverse range of offline services, including pharmaceutical delivery, laboratory testing, referral registration, and physical examinations and aesthetic treatments. Ping An Good Doctor is also actively expanding its offline pharmacy network. Approximately 111,000 pharmacies across China have been integrated into Ping An Good Doctor’s Pharmacy Cloud Service. To empower end-point providers, Ping An Good Doctor has launched the Central Warehouse Project in collaboration with partner pharmacies. By leveraging Ping An Good Doctor’s third-party logistics distribution, this initiative has improved the timeliness of same-city pharmaceutical deliveries and enhanced the user experience for online consultations and medication purchases. Through online consultations and e-prescription referrals to partner pharmacies, pharmacy partners can rapidly deliver medications via the Central Warehouse’s express delivery service. This further strengthens Ping An Good Doctor’s offline capabilities.
As of mid-August, the pharmaceutical central warehouse service has been launched in 40 cities, including Guangzhou, Wuhan, Beijing, and Shanghai, significantly improving delivery efficiency. Medications can be delivered within an average of one hour in urban areas, while same-day delivery is also available in suburban areas.
As it refines its online-to-offline ecosystem, Ping An Good Doctor is also exploring ways to solidify its industry-leading position. 2In the first half of 2020, Ping An Good Doctor launched a comprehensive strategic upgrade. Fang Weihao stated, “We will continue to focus on individual users, insurance clients, corporate clients, and our internet hospital platform, allocating more resources to strengthen and expand our online medical services and health management offerings. Meanwhile, we will actively expand our offline partnership network, including physical examination centers, clinical laboratory testing institutions, and fitness and medical aesthetics providers, to build a one-stop closed-loop ecosystem.”。”
Over the past six years, Ping An Good Doctor has achieved a breakthrough from zero to one, accumulating a massive user base, continuously building its reputation, and establishing a revenue model for internet healthcare. The comprehensive upgrade strategy aims to propel the company from one to infinite growth. Ping An Good Doctor stated that it will take building a professional bridge between doctors and patients as its mission, with trust, professionalism, and convenience as its goals, to create China’s largest, most advanced, and most defensible internet healthcare service platform.
Ping An Good Doctor Plans to Prioritize the Development of Its In-House Medical Team and External Network of Renowned Physicians in the Short TermMeanwhile, it will focus on opportunities in internet hospital projects and medical insurance payments, continuously invest resources and capital, leverage the synergistic advantages of Ping An Group, and accelerate business development. In the medium to long term, Ping An Good Doctor will fulfill its role as a pioneer and model in internet healthcare, build resource advantages in the corporate and insurance sectors, continuously expand corresponding channels, and achieve revenue growth through product and service innovations such as chronic disease management and health management. In the future, Ping An Good Doctor will forge solid barriers and comprehensive competitive advantages by leveraging its extensive and high-quality physician resources and leading innovative technologies.
Fang Weihao stated that the pandemic has accelerated the development of internet healthcare, with more market participants investing in its infrastructure.Ping An Good Doctor possesses unique advantages that ensure its market-leading position.
First, as a market pioneer, Ping An Good Doctor has accumulated a large user base and extensive experience in online consultations and internet-based healthcare.. Ping An Good Doctor’s medical services team comprises approximately 2,000 professionals who are well-versed in internet healthcare processes and capable of delivering high-quality, efficient services to users.
Secondly, the AI-assisted diagnosis and treatment system developed by Ping An Good Doctor based on vast amounts of historical data not only helps patients quickly identify health issues but also facilitates physicians’ consultation processes.Ping An Good Doctor possesses technological advantages. Furthermore, Ping An Group can provide Ping An Good Doctor with corporate channel resources and facilitate the integration of insurance products. In addition, during the pandemic, Ping An Good Doctor accumulated substantial traffic and a large user base, establishing a strong reputation. Finally, Ping An Good Doctor leverages extensive social connections and resources, enabling its internet hospital to rapidly integrate with the national medical insurance system.
Ping An Good Doctor aims to become a leader in internet healthcare by building a professional and comprehensive physician network; to pioneer new business models by exploring innovative monetization strategies for internet medical services; and to establish high competitive barriers by leveraging renowned overseas physicians and cutting-edge technologies.