MedicalSystem Biotechnology Invests RMB 30 Million to Establish Huzhou Medical Testing Laboratory, Expanding Its Third-Party Diagnostics Footprint

VCBeat (WeChat ID: vcbeat)On November 6, it was reported that Meikang Biotechnology Co., Ltd. (hereinafter referred to as “Meikang Bio”) announced that it would invest RMB 30 million from its own funds to establish a wholly-owned subsidiary, Huzhou Meikang Shengde Medical Laboratory Co., Ltd. (hereinafter referred to as “Huzhou Medical Laboratory”), further expanding its presence in the third-party medical testing market.

The announcement shows that Huzhou Medical Laboratory was established on October 25, 2017, with its headquarters in Huzhou, Zhejiang. The legal representative is Zeng Qi. The company mainly engages in medical laboratory testing, pathology, and the development of new diagnostic reagents and technologies, including but not limited to clinical hematology and body fluid testing, clinical chemistry testing, clinical immunology testing, clinical microbiology testing, clinical cellular and molecular genetics testing, and clinical pathology.

Its parent company, Meikang Bio-Technology, was established on July 22, 2003. Headquartered in Zhejiang Province, with Zou Bingde serving as its legal representative, the company was listed on the Shenzhen Stock Exchange on April 22, 2015. Its core business involves the research and development, manufacturing, and sales of in vitro diagnostic (IVD) reagents and instruments.Prioritize the development of an in vitro diagnostics (IVD) product portfolio, cloud-based testing platforms, and medical laboratory service systems; establish a diagnostic and treatment network covering primary healthcare institutions and households; and promote centralized procurement for regional medical laboratory centers and hospital clinical laboratories., develop managed services, and strive to become a supplier of integrated systems for medical laboratory testing.

Meikang Biotechnology established the Huzhou Medical Laboratory with an investment of RMB 30 million, primarily because the company has achieved rapid development in third-party medical diagnostic services in recent years, accumulating extensive successful experience and possessing the strength and talent reserves necessary for nationwide expansion.

Moreover, in recent years, with the advancement of medical laboratory technology, relying solely on traditional healthcare institutions such as hospitals as the exclusive providers of medical laboratory services has become inadequate to meet the actual demands of industry development. From the perspectives of economies of scale and cost efficiency,The concentration of medical testing services in specialized independent clinical laboratories has become an industry development trend.

Therefore, on the basis of continuously expanding its in vitro diagnostic product portfolio through in-house production, acquisitions, and distribution agreements, Meikang Bio alsoExpand new medical laboratory testing services through greenfield development, partnerships, and mergers and acquisitions, thereby establishing a full industry chain layout encompassing upstream reagent raw materials, midstream instruments and reagents, and downstream third-party laboratories.

The establishment of Huzhou Medical Laboratory through this investment is conducive to advancing the company’s strategic layout of building a nationwide chain of regional medical testing centers, which will help fully leverage the company’s “"Integrated Business Model of Diagnostic Products and Diagnostic Services"competitive advantages.

In fact, the Huzhou Medical Laboratory is not Meikang Biology’s first foray into the third-party medical testing sector. As early as March 2016, Meikang Biology’s wholly-owned subsidiaryNingbo Meikang Shengde Medical Laboratory Co., Ltd.was approved by the National Development and Reform Commission as one of the first batch of demonstration centers for genetic testing.This marks Meikang Bio's formal and in-depth entry into the third-party medical testing sector.

Since then, Meikang Biology has actively established a nationwide network of differentiated regional medical laboratory centers. By fully integrating with regional public health resources, developing regional medical laboratory platforms, and promoting the construction of regional Laboratory Information Systems (LIS), the company has achieved interconnectivity and mutual recognition of test results within these regions.

It is reported that,Currently, Meikang Bio has completed its initial layout in Zhejiang, Jiangxi, Henan, and other regions.The establishment of Huzhou Meikang Shengde Medical Laboratory Co., Ltd. through this investment serves to further deepen our strategic presence in the Zhejiang region, therebyA Comprehensive Medical Laboratory Platform Centered in Huzhou and Serving the Surrounding Regions, gradually expand Meikang Biology's market for medical laboratory services in Huzhou, thereby continuously increasing its market share in the medical testing business.