Beyond Tradition: How True Innovation Is Reshaping China's Healthcare and Wellness Sector

The interplay between tradition and innovation has always been the focal point of the healthcare industry.

Driven by the aging population in China, which has spurred demand for elderly care and medical health services; urbanization and consumption upgrades, which have fueled demand in the broader consumer sector; and industrialization, which is upgrading traditional manufacturing through digitalization—particularly the disruptive integration of big data, cloud computing, artificial intelligence, and the Internet of Things (IoT) across various industries—these trends are currently reshaping all sectors, including the healthcare industry. As a result, healthcare and medical services are increasingly becoming a critically important field.

However, the healthcare sector continues to grapple with the mismatch between supply and demand. Digitalization on the supply side—leveraging data tools to enhance productivity and optimize processes, while integrating the supply chain—represents a critical dimension of current innovation in the medical industry. Innovation requires not only starting from small-scale initiatives but also demanding that innovators possess a holistic perspective and the ability to devise strategic blueprints.

We have observed that a large number of startups in China, after achieving breakthroughs in specific niche areas, are attempting to implement comprehensive strategic layouts. In fields such as wearable sports and health technology, smart elderly care, mobile internet, and internet healthcare, some outstanding entrepreneurs are leveraging new technologies and incremental business models to break free from the constraints of traditional medicine and bridge the gap between supply and demand.

Here are some of the standouts. By mapping out the logic of industry development and engaging in dialogues with entrepreneurs, we have observed that, under the prevailing trend of medical innovation, new products, technologies, and business models are reshaping the landscape of the broader healthcare industry.

The wearable sports and health industry is experiencing rapid growth in the global market. Garmin, the global leader in sports watches, has a market capitalization exceeding $19 billion. Apple, Huawei, and Xiaomi have also launched their own smartwatches, significantly driving the development of the entire industry.

Codoon, based in Tianfu Software Park, is a star enterprise in this sector. Chengdu is one of the earliest cities in China to develop startup incubators, and Codoon has been stationed in Tianfu Software Park since its inception, receiving considerable assistance and support.

Sports watches and traditional smartwatches serve different positioning purposes. Smartwatches aim to take over some functions of mobile phones, but their standby time is very short, and health features are only a minor ancillary part.

Codoon’s smart sports devices are positioned as professional sports watches, such as the Codoon Sports Watch X3. Moreover, Codoon offers robust professional online workout courses and services, integrating software with hardware. Codoon’s core competitiveness lies in its comprehensive intelligent sports platform for fitness enthusiasts, which combines hardware, software, and services, all underpinned by big data on physical activity.

During Codoon’s development, there have been several critical turning points:

1. The Codoon app was officially launched in early 2012, marking the transition of Codoon’s services from web-based to mobile internet platforms;

2. In mid-2013, Codoon partnered with Baidu to launch the Codoon Smart Band, becoming the first in China to do so and establishing itself as a pioneer of smart hardware in the country;

3. In 2015, Codoon pioneered online marathons. To date, Codoon has hosted over 700 online marathons, with more than 100 million participants, making it the largest online event operation platform in China;

4. In 2017, Codoon launched its smart sports strategy, adopting a Peloton-style model of “hardware + services”;

5. In early September 2019, Codoon released the X3, a professional-grade sports watch;

The latest development is the upcoming launch of the Codoon Health Elf. Its intelligent exercise solution is supported by the Joint Laboratory of Codoon Health Big Data at Sichuan University, leveraging the analysis and translation of millions of health data points to provide authoritative validation of parents’ daily exercise and well-being.

As of now, Codoon boasts 180 million sports users, delivering comprehensive smart fitness services through its highly professional software, hardware, courses, and content. Its primary revenue streams stem from the research, development, production, and sales of smart fitness hardware, as well as advertising and e-commerce services.

Facing numerous competitors, Shen Bo, founder and CEO of Codoon, commented on the company’s differentiated advantages: “Codoon is committed to building a specialized hardware and software service system for various niche sports markets. Codoon has continuously launched multiple AI-driven fitness courses based on sports data, such as live-streamed and interactive classes, along with new smart fitness hardware.”

Codoon’s vision is to get everyone moving. By dedicating itself to innovative technologies, both software and hardware, Codoon focuses on delivering high-quality products and acquiring new users through word-of-mouth.

As population aging intensifies, elderly care has become a global issue. In the face of the severe challenges posed by an aging demographic, it is an urgent priority to ensure that every older adult can enjoy their later years with dignity, enable elderly care enterprises and institutions to operate with greater efficiency and lower costs, and empower government agencies to make precise decisions and manage effectively.

As a populous province in China, Sichuan also faces the challenge of an aging population. Against the backdrop of underdeveloped elderly care services in China, particularly community-based care, the foundation for elderly care remains weak. Issues such as “homogeneous service models,” “inconsistent service quality,” “low operational efficiency,” and “outdated and inefficient management methods” have become common labels for the current elderly care industry. In this context, Sichuan Province is actively exploring the development of smart health and elderly care. Among these efforts, smart elderly care service platforms represent a key area for breakthrough.

Located in Tianfu Software Park, Quanshiyun, as the technology provider for the “Smart Elderly Care” cloud platform, has dared to deconstruct and restructure the business processes of the elderly care industry. Through bold innovation, it has developed a comprehensive operational solution that integrates the “Internet + Elderly Care/Disability Assistance/Medical-Nursing Integration” model.

Based on in-depth research and analysis of the actual needs at the frontline of elderly care services, Fulltime Cloud has integrated and developed a multi-terminal interconnected smart elderly care cloud platform (FSAP—Fulltime Senior Assist Platform) that combines features such as "dynamic information management," "visualized services," "multi-dimensional statistics," and "streamlined settlement."

The All-Time Smart Elderly Care Cloud Platform addresses service supply-demand matching, unified data management, fund disbursement and settlement, end-to-end service supervision, as well as alerts for solitary living and positioning for dementia patients. Functionally, it achieves an integrated triad of internal management, external services, and intelligent oversight.

The company has innovatively adopted multiple high-tech solutions to internet-enable the following initiatives: “Application Review and Implementation Oversight of Subsidy Funds (for elderly care, disability assistance, advanced age, etc.),” “Assessment and Management of the Elderly, Persons with Disabilities, and Service Institutions,” and “Blockchain-Based Mutual Aid Elderly Care Involving the Elderly, Volunteers, Caring Organizations, and Public Welfare Groups.”

Specifically, what are the benefits? This approach not only resolves the inefficiency in management that service institutions struggle with under traditional operational models, but also assists the government in addressing numerous challenges inherent in conventional regulatory frameworks. Through the comprehensive application of a system platform, it provides local governments and other stakeholders with a complete suite of informatization solutions.

“China’s elderly care sector started late; to bridge the gap with developed countries, it particularly requires the empowerment of internet and information technologies,” said Liu Yu, CEO of Quanshi Cloud. “Quanshi Cloud facilitates the interconnectivity of data accumulated through its operations—including senior citizen profiles, nursing home operational data, service order records, practitioner information, and distribution of elderly-related funds—thereby driving the formation of a comprehensive closed-loop ecosystem. On one hand, establishing a multi-dimensional, dynamic database centered on older adults enables precise matching of their needs. On the other hand, providing data services to business departments supports government decision-making with greater precision and helps authorities achieve real-time, efficient regulatory oversight.”

Currently, Quanshi Cloud has established a nationwide business layout in China, with Chengdu as its R&D base and Beijing, Shanghai, Guangzhou, Chongqing, and Harbin as its operational centers. Leveraging innovations in technology and business models, the company secured tens of millions of yuan in Pre-A series financing in July 2016 and was honored as one of the Top 10 Startups at Tianfu Software Park in the same year. In July 2018, it was included in the Catalogue for the Promotion of Smart Health and Elderly Care Products and Services, formulated by the Ministry of Industry and Information Technology, the Ministry of Civil Affairs, and the National Health Commission.

As a hub for high-tech enterprises in Chengdu, Tianfu Software Park has gathered numerous Fortune 500 companies and startups. To support the development of businesses within the park, Tianfu Software Park not only provides capital and talent but also actively aligns with current hot industry topics by organizing events. Its comprehensive startup acceleration services are a key reason why entrepreneurs continue to choose this place for both work and life.

Li Zhuodong, founder of Fanmi Technology, who has overseas work experience and was listed on the “Forbes China 30 Under 30,” returned to China to start his business, drawn by the vast Chinese market and Chengdu’s strengths in R&D and technology.

This company has a highly tech-forward positioning: it is a comprehensive technology firm that boasts China’s first washable IoT chip based on non-woven fabric, enabling mobile internet data analysis and collection, as well as demographic characteristic analysis.

In its early stages, the company primarily focused on incremental innovations in maternal and infant products. When Fanmi was first established, it leveraged the team’s core patented technology, “Ion Sensing Detection,” to drive product and system innovations centered around diapers for detecting infant excretion. Its flagship product, “Fanmi Xiaodou,” is a smart hardware device paired with a mobile app. By utilizing ion sensors, it helps parents monitor their baby’s bowel movements and reminds them to change diapers in a timely manner. Additionally, the system calculates the baby’s food intake and analyzes intestinal health based on excretion data, thereby optimizing dietary plans accordingly.

Subsequently, Vanmi Technology gained a profound understanding of the constraints within the semiconductor chip industry. Leveraging the fact that more than half of its team members had backgrounds in semiconductors, the company began researching semiconductor chips based on maternal and infant products, particularly those involving non-woven fabric processes. In December 2018, it successfully developed such chips, becoming the first chip company in China to achieve semiconductor manufacturing processes using non-woven fabric technology.

Founder Li Zhuodong stated, “If electronic products achieve Internet of Things (IoT) connectivity, it is merely a small step toward intelligence. However, when everyday hygiene products and even clothing become IoT-enabled, that will represent a major leap forward in smart technology. True intelligence does not necessarily need to be visible or tangible; rather, it is achieved when smart capabilities are seamlessly integrated into people’s lives without their conscious awareness.”

If we were to summarize Fanmi Technology’s innovation in one sentence, it would be that the company has been deeply cultivating and accumulating core industry technologies while consistently pursuing cross-disciplinary innovation.

In Li Zhuodong’s view, the policies and business atmosphere at Tianfu Software Park are highly conducive to entrepreneurship, offering access to numerous like-minded talents and partners. From the very beginning, when his small team of just a few people was cramped into a modest room of several dozen square meters in western Chengdu, Tianfu Software Park provided venue support and assisted in applying for housing subsidies. Moreover, located in the High-Tech Zone—a hub for talent convergence—Tianfu Software Park has greatly facilitated recruitment. Regular corporate visits have also enabled the Fanmi Technology team to learn from grassroots entrepreneurial practices and achieve standardized operations.

Finally, during several periods of financial difficulty for Fanmi, government-funded subsidies recommended by the industrial park provided timely support. Throughout Fanmi’s development, the company encountered numerous challenges. Li Zhuodong candidly remarked that this is simply part of an entrepreneur’s reality. Encouragingly, Fanmi Technology’s core technologies, honed through years of dedicated effort, have brought disruptive changes to the industry and are gradually being applied in fast-moving consumer goods (FMCG) accessible to the general public.

As a unicorn enterprise in the internet healthcare sector, what new changes has Medlinker, also located in Tianfu Software Park, undergone?

In November 2019, Boehringer Ingelheim, a global leading multinational pharmaceutical company, signed strategic cooperation agreements with seven domestic internet hospitals, including WeDoctor, at the second China International Import Expo.

Under the agreement, the collaboration focuses on numerous therapeutic areas for chronic diseases, with cooperation spanning internet healthcare, pharmaceutical distribution, disease management, and physician-patient education. This enables patients to fully enjoy one-stop medical convenience services provided by internet healthcare, including online consultations, prescription issuance, medication dispensing, and access to cutting-edge diagnostic and treatment information.

This collaboration between Boehringer Ingelheim and domestic internet hospitals will fully integrate medical care with pharmaceuticals, ensuring the provision of high-quality treatment plans for patients while establishing a stable channel for drug supply. Furthermore, Boehringer Ingelheim and its partners will leverage their respective strengths in “online patient-physician education,” aiming to disseminate the most advanced international diagnostic and therapeutic concepts to more healthcare professionals, and to deliver accurate scientific information on disease prevention and control to chronic disease patients and their families.

Furthermore, in the realm of “Internet-based patient and physician education,” the “JAMA Early Access” column, jointly developed by Medlinker and JAMA—the authoritative official publication of the American Medical Association (AMA)—was launched on the Medlinker platform in late October. The “JAMA Early Access” column integrates international and domestic medical hot topics, selecting highlights and abstracts from articles published in JAMA and its subsidiary journals under the JAMA Network. These materials are translated into Chinese for online learning by physicians in China. The introduced academic content covers key clinical specialties, including oncology, cardiology, internal medicine, surgery, ophthalmology, pediatrics, and neurology, with a focus on the latest clinical research findings, cutting-edge research methodologies, and current affairs in international medicine.

In the second half of 2017, Gilead Sciences, a U.S. pharmaceutical company, was extensively screening for strategic partners in China. At that time, Gilead’s first new hepatitis C drug, Sovaldi, had already been approved and launched, while its blockbuster hepatitis C medication, Epclusa, was on the verge of receiving new drug approval. With strong momentum, Gilead aimed to make its novel hepatitis C treatments accessible to more patients in China. Medlinker, with its extensive network of physician resources and robust innovation capabilities, came into Gilead’s sights. In October, Medlinker became Gilead’s strategic partner in China.

Through persistent exploration, Medlinker has established a comprehensive ecosystem in the field of hepatitis C, seamlessly integrating key processes including disease screening, physician education, patient management, patient follow-up, electronic prescribing, Direct-to-Patient (DTP) delivery, and patient payment. This has created a successful model for the end-to-end management of a single disease entity.

In the view of Wang Shirui, founder and CEO of Yilian, against the backdrop of policies such as the “Two-Invoice System” and the elimination of drug markups, the pharmaceutical distribution industry will undergo a major reshuffle, with DTP (Direct-to-Patient) businesses and the outflow of prescriptions poised for rapid growth.

In the second half of 2018, Medlinker designated internet hospitals as its strategic development direction and undertook a major restructuring of its internal business architecture to focus on the growth of its internet hospital operations.

How Do Internet Hospitals Operate? Taking a Chronic Disease Specialty as an Example, After Initial Diagnosis and Treatment Through an In-Person Visit, Patients Can Engage in Doctor-Patient Communication and Follow-Up Consultations with Physicians via the Yilian Internet Hospital. On the Yilian Internet Hospital Platform, Patients Can Purchase Medications Online Using Electronic Prescriptions; Orders Are Assigned by the Platform to Pharmacies for Offline Delivery, Enabling Patients to Access High-Quality Medical Services from the Comfort of Their Homes.

The involvement of e-prescriptions and offline delivery necessitates that Medlinker strengthen its pharmaceutical supply chain capabilities. In the field of specialty medications, Medlinker has gradually established a comprehensive supply chain system. Its Cloud Pharmacy offers over 10,000 SKUs and collaborates with more than 6,000 pharmacies, encompassing self-operated pharmacies, partner pharmacies, and other drug sourcing channels. In June 2018, Medlinker entered into a strategic partnership with Dingdang Kuaiyao, whose drug delivery capabilities serve as a significant complement to Medlinker’s pharmaceutical supply chain.

It is worth noting that on December 29, 2018, the first electronic prescription for Gilead’s new hepatitis B drug, Vemlidy (tenofovir alafenamide), following its launch in China, was issued via Medlinker Internet Hospital. Upon the market debut of this new hepatitis B medication, the initial batch of products listed on Medlinker Cloud Pharmacy sold out completely within 20 minutes. This not only demonstrates the significant time advantage internet hospitals offer in improving access to new drugs but also underscores the strength of Medlinker’s platform in connecting physicians and patients.

Furthermore, Medlinker has partnered with renowned domestic insurance companies and public welfare organizations to alleviate patients’ financial burdens through programs such as Patient Assistance Programs (PAP), and to manage patients’ disease risks via commercial insurance. From screening and prevention, diagnosis and treatment, follow-up management, and patient education to insurance coverage, Medlinker Internet Hospital strives to create a patient-centered, comprehensive solution.

Having successfully established a closed-loop system for liver disease management, Medlinker quickly defined its subsequent development direction: to build a leading specialized chronic disease management platform in China. Wang Shirui, Founder and CEO of Medlinker, stated, “Both domestically and internationally, the lack of proper post-treatment management for chronic disease patients is a widespread societal issue. Therefore, chronic disease management represents a shared priority among the government, enterprises, healthcare institutions, and patients.”

Driven by this mission, Medlinker has not only implemented significant internal organizational restructuring and staffing adjustments to fully commit to chronic disease management, but also continuously introduced and developed new technologies, conducting in-depth exploration in the fields of artificial intelligence and big data. By addressing specific specialty diseases one by one and adhering to the core principle of being “patient-centric,” Medlinker provides professional medical and humanistic care services to patients with specialized chronic conditions. Currently, Medlinker has established a closed-loop business ecosystem on its platform, integrating healthcare providers, patients, pharmaceuticals, and insurance.

Taking the hepatology specialty as an example, after two years of in-depth exploration, the Medlinker platform has connected thousands of practicing hepatologists, established a comprehensive medical record database for hepatology patients, and formed robust doctor-patient relationships, significantly enhancing patient adherence to the platform. On the patient side, hundreds of thousands of liver disease patients have, to date, benefited from services such as online consultations, follow-up visit prescriptions, and intelligent health reminders on the Medlinker platform. These offerings provide tangible convenience and benefits to patients, while Medlinker’s professional management model in the field of hepatology has become an industry benchmark.

In addition to its liver disease business, Medlinker has expanded its coverage since 2019 to include multiple therapeutic areas such as HIV, endocrinology, diabetes, oncology, and orthopedics. More specialties are expected to join the Medlinker Specialty Chronic Disease Management Platform in the future. Having successfully established a closed-loop chronic disease management model, Medlinker has attracted an increasing number of enterprises and medical institutions to collaborate with it.

In the short term, monetizing pharmaceutical services remains the primary profit model for internet healthcare companies. However, in the long run, pharmaceutical services themselves are not the ultimate goal of internet hospitals. Yilian aims to focus on chronic disease management and become a provider of full-process medical services. Such services represent the business profit model that a company should ultimately pursue for genuine, long-term sustainability.

Under this objective, the development direction of Medlinker’s Specialty Chronic Disease Management Platform is also very clear: centering on patients’ core needs to provide high-quality specialty chronic disease management services, ultimately integrating an increasing number of chronic disease specialties, establishing a closed-loop system, and benefiting society.

Policies, funding, and technology are intertwined, interacting, influencing, and compounding one another to collectively propel healthcare toward the future. As a benchmark industrial park in Western China and across the nation, Tianfu Software Park has continuously attracted and incubated unicorn-level enterprises in fields such as digital technology and healthcare, creating a strong industrial clustering effect.

The aforementioned enterprises and industrial parks are merely a microcosm of the booming development and continuous innovation in the medical and health industry. Driven by current policies, the sector is poised to usher in a new wave of development opportunities and momentum.