Zhongpuda: Professionalizing Mobile Healthcare to Better Serve Patients

Zhongpuda was established in 2008 and entered the mobile healthcare industry in 2014. Its business now covers five major regions—East China, South China, North China, Southwest China, and Northwest China—spanning nearly 20 provinces, with its solutions adopted by close to 300 hospitals. At a time when the mobile healthcare sector is navigating a period of uncertainty, Zhongpuda’s rapid growth stands out as particularly remarkable.

On June 21, 2016, Zhongpuda successfully listed on the National Equities Exchange and Quotations (NEEQ), becoming China’s first publicly traded company in the “mobile healthcare operational services” sector. Lan Yunfeng, Chairman of Zhongpuda, mirrors the company’s style—low-key, steady, and rigorously logical. He substantiates every viewpoint he puts forth with comprehensive data and case studies.

Lan Yunfeng believes that the prospects for mobile health are broad, fundamentally because there is genuine, inelastic demand among the vast patient population. Although there are currently many practitioners in the field, few have performed well. This is primarily due to two reasons: first, the vast majority of companies in the sector lack the capability to create or integrate core value resources; second, the development pace of these enterprises is mismatched with that of the industry as a whole, resulting in misalignments in timing and sequence.

“Mobile healthcare should first pursue specialization, then mass adoption,” stated Lan Yunfeng. He emphasized that mobile healthcare should initially adopt the “healthcare + internet” model, enabling medical institutions to implement it and allowing patients to experience and perceive its value within institutional services. Subsequently, the “internet + healthcare” model can be leveraged to enrich applications and enhance patient experience. This is the key to encouraging patients to proactively embrace mobile healthcare services.

Lan Yunfeng stated that mobile healthcare should develop in four stages: first, enabling the effective mobility of data and information within hospitals; second, ensuring the secure transmission of hospital data and information to external environments; third, facilitating the practical application of data and information in professional institutions; and fourth, allowing data and information from derivative businesses to be transmitted back.

Lan Yunfeng believes that, on the premise of ensuring the security of medical data, mobile healthcare should first enable medical staff at healthcare institutions to adopt mobile application products themselves. “Mobile healthcare must first serve healthcare institutions well, so that patients can benefit from valuable mobile health services.”

However, Lan Yunfeng also pointed out that mobility should not be pursued for its own sake. For instance, mandating the interconnection of hospital intranet data with the public internet from the outset would inevitably encounter resistance due to data security concerns and would constitute an irresponsible approach. “Mobile applications that can effectively enhance the operational and managerial capabilities of healthcare institutions, as well as improve work efficiency, should be deeply integrated into their business processes. Only by making mobile applications essential daily tools for healthcare professionals can medical information be mobilized effectively.”

Step 2: How to securely move hospital data out of the institution to create extended value?

Lan Yunfeng believes that only by enabling the mobile transmission of medical information can “resource sharing between small or community hospitals and large hospitals be achieved, thereby extending the reach of resources from large hospitals to broader areas.” However, direct transmission of data over the public internet is insecure. It is preferable to establish private network access through the Regional Health Application Integration Platform built by the National Health and Family Planning Commission, creating an extensive private network that encompasses both intra-hospital and extra-hospital environments to ensure information security. Currently, the most suitable networking technology is the mobile private network solution provided by telecommunications operators.

VCBeat has learned that the core members of the Zhongpuda team hail from China Potevio, bringing over 15 years of experience in the telecommunications sector. In light of the specific characteristics of mobile healthcare data transmission, they have proposed leveraging 4G private network technology as a supporting infrastructure. This approach offers four key advantages: first, it eliminates the substantial costs associated with healthcare institutions building their own mobile local area networks; second, it enhances the security of data and information; third, it expands data coverage areas, thereby enabling the extension of medical resources; and fourth, it reduces the operational and maintenance burden on hospitals.

Step 3: Where should data information be implemented?

Lan Yunfeng believes that data and information should first be implemented at community hospitals or lower-tier institutions within medical consortia, thereby allowing patients to experience the convenience of professional information services and tiered diagnosis and treatment, which in turn will enhance their acceptance of mobile healthcare services. “Current regional health application integration platforms mainly focus on resident health records and follow-up functions, lacking cloud applications tailored specifically for patients. This presents a favorable entry point for companies operating in the mobile healthcare sector.”

Step 4: How to migrate data from derivative businesses back?

First, it is essential for community hospitals or lower-tier entities within medical consortiums to synchronize patients’ diagnostic and treatment information back to tertiary hospitals, thereby providing data support for follow-up visits and referrals. Second, the “Cloud Medical Care” platform can host a wide range of mobile cloud applications and supports private network access for various mobile medical terminals; the resulting data can serve as a reference for medical institutions in research and clinical practice.

Lan Yunfeng stated that only with the maturity of the aforementioned four components can “Internet + Healthcare” establish a solid foundation for robust development, thereby delivering more direct convenience and tangible benefits to patients.

Lan Yunfeng believes that B2B mobile health products currently available in the Chinese market mainly fall into two categories: one type enhances the operational and management capabilities of healthcare institutions but entails high implementation costs, thereby hindering widespread adoption; the other type features low or even free pricing but fails to integrate deeply into hospital workflows, resulting in limited value and poor uptake.

To enable healthcare institutions to rapidly optimize and extend medical services through information technology, thereby benefiting patients, Zhongpuda has adopted an innovative business model: partnering with telecom operators and leveraging 4G mobile private network technology, it offers a “bundled, build-first-pay-later” virtual operation model tailored for healthcare institutions. This approach addresses the three major challenges faced by healthcare institutions in deploying mobile services—high costs, significant risks, and difficult decision-making.

In terms of the specific operational model, Zhongpuda provides mobile nursing hardware and software products, platforms, and services, while account managers from telecom operators are responsible for promotion, with both parties sharing the revenue from communication service fees. This approach is much faster than Zhongpuda negotiating cooperation with each hospital individually: in 2015, Zhongpuda’s products entered seven provinces, and they have now reached nearly 20 provinces across China. “Medical services have regional characteristics, so it is important to achieve comprehensive coverage in each region rather than pursuing scattered individual hospitals nationwide,” said Lan Yunfeng.

According to data from the National Bureau of Statistics, there were approximately 200 million hospital discharges nationwide in China in 2014, with about 68% of these patients requiring transitional care. Although numerous mobile health applications based on public clouds are available in the Chinese market, few have gained the participation and trust of healthcare institutions due to concerns over data security and other issues, significantly diminishing their service value. Lan Yunfeng stated, “Compared to developing mobile health solutions for the out-of-hospital market, the in-hospital market presents higher barriers and greater challenges. However, he believes that starting within hospitals and then extending services to the community will better earn patient trust and establish stronger competitive barriers in the long run.”

Lan Yunfeng told VCBeat that Zhongpuda has remained profitable since its inception. The company currently employs over 200 people and expects to reach around 300 by the end of this year. In early 2015, Zhongpuda had only 50 employees.

Behind the rapid expansion of its workforce is Zhongpuda’s continuously rising business volume. According to VCBeat, Zhongpuda’s mobile nursing business is growing rapidly, adding 20 to 30 hospitals each month.

It is reported that Zhongpuda, in alignment with the national promotion of the tiered diagnosis and treatment system, has initiated the development of a “Cloud Medical and Nursing Platform” based on a SaaS architecture. The platform aims to facilitate data exchange between large hospitals and community health centers, thereby meeting patients’ specific needs for post-discharge rehabilitation and home-based nursing care.

However, Lan Yunfeng believes that Zhongpuda’s core advantage lies in its product superiority, with a strategic focus on delivering high-quality products. Since its inception, Zhongpuda has allocated an average of 20% of its annual revenue to research and development, a practice rarely seen among internet healthcare companies.

According to the Outline of the National Healthcare Service System (2015–2020), by 2020, the number of hospital beds per 1,000 people was to reach six, the number of registered nurses per 1,000 permanent residents was to reach 3.14, and the total number of registered nurses was to reach 4.55 million. The total demand for mobile nursing products exceeded two million units. Clearly, Zhongpuda still has significant market potential in the field of mobile nursing.

Regarding Zhongpuda’s development roadmap, Lan Yunfeng stated that the company aims to achieve its “100-1,000-10 Million” initiative within two years: connecting “Cloud Medical and Nursing” to 100 regional health information platforms, providing “Mobile Nursing” services to 1,000 standalone hospitals, and delivering end-to-end care for tens of millions of patients.

On June 8 this year, Premier Li Keqiang delivered a speech titled “Developing Health and Medical Big Data in Areas of Urgent Public Need,” injecting greater vitality into the industry. Key initiatives mentioned at the meeting, such as tiered diagnosis and treatment, mutual recognition and sharing of examination and test results, and the diagnosis and management of chronic diseases, can only be effectively realized through deep engagement with the B2B sector. As the company with the most extensive B2B footprint in the “Internet + Healthcare” space, Zhongpuda’s development model aligns naturally with the national market planning and strategic layout, pointing to substantial future growth prospects.