JD.com and Donghua Software Announce Strategic Partnership to Advance Prescription Fulfillment and Online Medical Services

Recently, VCBeat (WeChat Official Account: vcbeat) learned that JD.com and DHC Software have signed a strategic cooperation agreement to jointly develop a closed-loop business ecosystem for the internet-based healthcare and pharmaceutical industries.Both parties will leverage their respective strengths,Provide “Smart Hospital” solutions to physical hospitals, jointly creating an internet-based medical and health closed-loop service built around physical hospitals.

Donghua Software Co., Ltd. is a company listed on the Shenzhen Stock Exchange. The companyPossesses over 800 software products with independent intellectual property rights,a key software enterprise within the national planning layout and a key high-tech enterprise under the National Torch Programa technology enterprise, and one of the earliest software companies in China to achieve CMMI Level 5 certification for Software Capability Maturity Model Integration, representing the most comprehensive top-tier qualifications in the industry.

Beijing Jingdong Century Trading Co., Ltd. is a company listed on the NASDAQ Stock Exchange in the United States, with its core business spanning three major sectors: e-commerce, finance, and logistics.

Currently, JD.com has becomeAs China’s largest self-operated e-commerce enterprise, JD.com has conducted in-depth research and strategic layout in the financial and logistics sectors, while maintaining the continuous development of its core business, establishing JD Finance successively.The Group and its JD Logistics subsidiary are comprehensively building a “one-stop mobile platform for financial services and lifestyle” and a “green logistics system characterized by speed, environmental friendliness, innovation, and intelligence.”

1、Jointly expand closed-loop healthcare and pharmaceutical services, such as external prescription fulfillment and online consultations.. The two parties intend to combine their respective strengths in hospital information system solutions, as well as pharmaceutical retail and distribution capabilities, to jointly leverage their medicalhospital clients, jointly developing closed-loop medical and pharmaceutical services such as external prescription dispensing and online consultations. Under this collaboration, each party shall bear its own inputs and costs while sharing the revenues. Both parties have agreed to establish within six monthsA typical case, followed by widespread promotion and replication.

2、JD.com Pharmaceuticals Joins Donghua Software's Cloud Clinic Platform. Fully leverage JD.com's advantages in pharmaceutical retail and distribution, as well as the agility of its cloud clinic platform, by integrating JD.com’s self-operated pharmaceutical products comprehensively into Donghua Software’s Cloud Clinic.Create sales opportunities for JD.com by enabling cloud clinic users to place orders on behalf of clinic patients.

3、Donghua Software’s Jiankangle Launches on JD.com Platform. Doctors, live-streaming services, and related content from the Donghua Software HealthLe platform are listed on JD.com’s online e-commerce platform; JD.com provides brand exposure and other traffic-driving opportunities for the collaborative projects.Yes.

4、Corporate Health Management Service Partnership. Kangle’s health management service packages for high-end clients can be sold on the JD.com e-commerce platform, with both parties collaborating in identifying high-end clients and engaging JD employeesFurther Discussion on Corporate Health Management Services.

Analysts believe:

In the reform of separating prescribing from dispensing, policies governing prescription outflow and the circulation of outpatient prescriptions outside hospitals have become increasingly clear. The 2017 healthcare reform tasks explicitly called for “exploring the interconnectivity and real-time sharing of prescription information from medical institutions, health insurance settlement data, and retail drug consumption records,” with a focus on removing systemic barriers to the circulation of outpatient prescriptions outside hospitals.

This means that drug supply and pharmaceutical care services previously provided by hospital pharmacies will be gradually phased out and taken over by other drug distribution channels, primarily retail pharmacies.

Based on the estimate that prescription outflows will account for approximately one-fifth of total prescriptions within the next five years, and considering the overall growth of the pharmaceutical retail market, it is projected that by 2018, prescription outflows will generate an incremental value of over RMB 250 billion for retail pharmacies. By 2020, off-hospital prescription purchases are expected to reach one-third of the total prescription volume, with the market size approaching RMB 800 billion.

The prescription outsourcing collaboration between Donghua Software and JD.com aligns with the national “Separation of Prescribing and Dispensing"Reform trends are poised to make this an exemplary case of collaboration in prescription outflow."

According to VCBeat, Jiankangle Software Co., Ltd. was established on March 31, 2014, formerly known as Jiankangbao Software Co., Ltd., with a registered capital of RMB 100 million, founded by Donghua Software Corporation and BeijingDonghua Hechuang Technology Co., Ltd. was established with capital contributions from its two major shareholders.

HealthLe has invited over 200 top-tier (Grade A tertiary) hospitals in China, along with their specialized departments and renowned experts in the field, to join its platform. It provides users with pre-hospital services (including disease prevention, health assessment, health consultation, appointment registration, etc.), as well as in-hospital(mobile payment, waiting, navigation, report viewing, etc.), post-discharge (follow-up, rehabilitation guidance, etc.) comprehensive internet healthcare closed-loop services.

Relationship Diagram among Jiankangle, Cloud Clinic, and Donghua Software:

As a flagship mobile healthcare platform launched by DHC Software, HealthLe will engage in deep cooperation with JD.com, establishing an independent display section within JD Medicine City and launching the “HealthLe JD Flagship Store,” while also leveragingLeverage JD.com’s advantages in pharmaceutical retail and distribution to provide post-consultation pharmaceutical logistics channels for Health Le Yun Clinics, thereby enhancing the competitive edge of these cloud-based clinics.

Regarding this collaboration, Jin Enlin, General Manager of JD Medicine City, stated, “The ‘JD + DHC Software’ partnership model will promote the decentralization of high-quality medical resources, enabling physical hospitals to overcome geographical barriers.”limitations, significantly expanding the service radius.

Secondly, it will enhance the patient experience by saving time and effort through online consultations at smart hospitals.

Meanwhile, JD Health has established offline self-operated retail pharmacies.The store stocks medications in accordance with the hospital’s drug formulary, enabling patients to purchase all prescribed medicines at a single location and providing them with reliable and convenient pharmaceutical services. It is reported that JD.com’s self-operated pharmacy is staffed with experiencedRich in licensed pharmacists, providing professional pharmaceutical services, including prescription review, medication consultation, medication tracking, patient education, etc.

Han Shibin, Vice President of DHC Software and General Manager of its Healthcare Division, stated that the smart hospital solutions provided by JD.com and DHC have enriched hospitals’ service scope and business models.

Furthermore, in combination withHealthLe, the internet healthcare platform under Donghua Software, also provides hospitals with a tool for proactive patient management, enabling physicians to track and record patients’ conditions in real time and initiate active interventions when necessary.Follow-up visits: enhancing efficiency while fully demonstrating and safeguarding physicians' value.

Online pharmaceutical sales were once regarded as a blue-ocean market; however, in the absence of a sound regulatory framework, numerous internet companies have crossed regulatory red lines during drug sales due to their lack of requisite qualifications.

Some pharmaceutical industry observers have stated that the “Smart Hospital” solution proposed by JD.com and DHC Software may represent a tentative foray by the pharmaceutical e-commerce sector amid the trend of separating prescribing from dispensing.