Meinian Onehealth Acquires Xin Xin Healthcare to Strengthen Its Integrated Health Ecosystem

Recently, Meinian Onehealth’s wholly-owned overseas subsidiary, Meijian Company, plans to acquire 100% equity of the overseas company Xinxin Health for $27.19 million. Meanwhile, Meinian Onehealth has established collaborations with Tianyi Assets, its controlling shareholder, in areas including genetic testing, medical big data, and remote image reading. These acquisitions and partnerships signify that Meinian Onehealth (Health 100) is progressively implementing its ecosystem platform strategy.

Why Acquire Xinxin Health?

Following its acquisition of Xin Xin Health, Health 100 will indirectly control the objectives of the domestic legal entities Beijing Meizhao Health Examination Center Co., Ltd. (hereinafter referred to as “Beijing Meizhao”) and Shanghai Meizhao Outpatient Department Co., Ltd. (hereinafter referred to as “Shanghai Meizhao”).

Meizhao Health Checkup Group is a patented, automated, internationally professional health examination institution. Founded in Taiwan in 1988, it has grown to become one of the world’s three leading high-end health checkup providers, alongside the UK’s BUPA and Japan’s PL. Meizhao was also among the first international health checkup brands to enter China. The Beijing Meizhao Health Checkup Center, which opened in 2003 as the group’s flagship store on the Chinese mainland, remains one of the few large-scale, modern, and automated health examination institutions currently operating in China.

Meizhao Health Checkup demonstrates significant advantages in data accumulation and examination efficiency. Its proprietary “AMHTS Meizhao Automated Health Examination System” has accumulated hundreds of millions of big data points, with research findings published globally in the prestigious medical journal The Lancet. Furthermore, by leveraging “computerized cross-scheduling,” examinees can complete over 100 tests within four hours. As a pioneer in global health management services, Meizhao was the first to introduce the high-efficiency service model of providing examination reports on the same day as the checkup.

From the perspective of its store expansion model, MJ Health adopts a “central city + flagship store” strategy, with multiple facilities established in Beijing, Shanghai, Taiwan, Hong Kong, Malaysia, and other regions.

Meinian Health Checkup serves both corporate and individual clients in China, with personalized customization as its distinguishing feature. For all clients, whether individual or corporate, Meinian Health Checkup meticulously tailors individualized health examination and health management plans. Professional health consultants provide ongoing follow-up and advisory services, enabling clients to communicate with physicians and nurses at any time. Should medical treatment be required, clients are given priority access to top-tier hospitals in China. Furthermore, if clients require medical resources or health management services in specialized fields, Meinian Health Checkup offers professional advice and exclusive channels.

For corporate clients, MJ Health Checkup strives to understand the unique needs of each enterprise. Regardless of company size or operational model, MJ Health Checkup provides customized health management solutions. For individual clients, adopting a family-centric approach, we closely integrate family dietary patterns, lifestyle habits, genetic medical history, and personal health status. Through elite-level health screening services, we help identify major diseases, chronic conditions, and potential health threats, while formulating personalized and efficient health management plans to meet clients’ long-term health management needs. Furthermore, MJ has introduced a Family Membership Card. Each card must cover immediate blood relatives only. A one-time permanent membership fee is charged based on the number of family members, after which only a modest annual fee and examination fees are required to enjoy lifelong health screening services. The membership is heritable and can be passed down to descendants, with many MJ members choosing to gift this legacy to future generations.

Notably, Shanghai Meinian Onehealth has partnered with renowned physicians to offer select diagnostic and treatment services, achieving an integrated model of health screening and medical care.

In terms of revenue and profit scale, Beijing and Shanghai still have significant room for future growth in both metrics. In 2015, Beijing Meizhao Health Checkup Center generated RMB 65.68 million in revenue and a net profit of RMB 3.4 million. Shanghai Meizhao Health Checkup Center recorded revenue of RMB 28.78 million and a loss of RMB 4.25 million in 2015, primarily because its operations started relatively recently (established in 2009). While per-store revenue is relatively high, its profit margin is lower than that of Meinian Onehealth. Looking ahead, there is still potential to improve profit margins by leveraging synergies in procurement, big data, and other areas.

From a customer perspective, the clientele of Meizhao Health Checkup consists primarily of high-end customers. For instance, corporate clients of Beijing Meizhao Health Checkup Group include special employee programs for China United Network Communications Co., Ltd. Beijing Branch, China National Tobacco Corporation (State Tobacco Monopoly Administration), COFCO Corporation, the General Administration of Customs of the People's Republic of China, and the headquarters of New China Life Insurance Co., Ltd. Clients of Shanghai Meizhao Health Checkup include China Merchants Bank, the Shanghai branch of New China Life Insurance Co., Ltd., AIA Insurance, Morgan Stanley, Industrial Bank Co., Ltd., and Shell (China) Company Limited.

2015In that year, Health 100 also completed the acquisition of Ciming Healthcare Checkup. This enabled Health 100 to operate more than 200 medical and health checkup centers across 29 provinces and municipalities in China, with a full-time team of nearly 20,000 experts, medical and nursing staff, and management personnel. Following this acquisition, Health 100 will leverage the two premium brands, Ciming Aoya and Meizhao, to roll out more specialized high-end health checkups and comprehensive medical services in key cities in the future.

Meinian Onehealth Acquires Haozhuo Data and Meinian Gene to Layout Medical Big Data and Genetic Testing

Recently, Meinian Onehealth Healthcare Holdings Co., Ltd. (“Meinian Onehealth”) proposed to sign the “Investment Cooperation Agreement on Shanghai Haozhuo Data Service Co., Ltd. (“Haozhuo Data”)” with Shanghai Tianyi Asset Management Co., Ltd. (“Tianyi Asset Management”). It plans to use its own funds to purchase 19.90% of the equity in Haozhuo Data held by Tianyi Asset Management, with a consideration of RMB 2,235,964.

Shanghai Haozhuo is engaged in the technical development and application of personal health and medical record establishment, health data services, and health management. By leveraging technologies such as the Health Internet of Things (IoHT), cloud computing, and mobile internet, and integrating the group’s premium medical resources with tens of millions of healthcare data points, the company provides technology-enabled health management services and big data-driven decision analytics for individuals, families, and enterprises. In 2015, Shanghai Haozhuo reported revenue of RMB 380,000 and a net loss of RMB 4.11 million. The mobile app developed by Haozhuo Data is scheduled to be launched at Meinian Onehealth’s nationwide examination centers, offering customers value-added services such as electronic access to medical examination reports, health management, and health consultations.

Furthermore, Meinian Onehealth acquired a 20% equity stake in MeiYin Health Technology Company from Tianyi Asset Management to engage in gene sequencing business, and completed the industrial and commercial change registration on July 4, 2016. Leveraging the vast customer base and health examination data from its check-up institutions, MeiYin Health has developed “preventive healthcare” genetic testing products, including susceptibility gene testing, early cancer screening, pharmacogenomic testing, and microbial gene testing.

Partnering with Daxiang Juyi to Deploy Remote Image Interpretation and Telemedicine Services

Furthermore, Meinian Onehealth has signed a framework cooperation agreement with Daxiang Medical, under which Daxiang Medical will provide remote image interpretation services to subsidiaries of Meinian Onehealth (also known as Health 100). Meinian Onehealth will integrate its imaging equipment with Daxiang Medical’s imaging platform, and Daxiang Medical will assign qualified physicians to deliver remote radiology interpretation services. For CT and MRI interpretations, Daxiang Medical will charge health examination centers service fees based on the number of cases interpreted. In the future, it will also provide consultation services by imaging specialists for patients with positive findings during health examinations as well as general patients.

Elephant Doctor is a company whose primary business focus is remote imaging diagnosis. From January to March 2016, it generated RMB 620,000 in revenue and incurred a net loss of RMB 970,000. Elephant Doctor’s services include: First, expert video consultations. The Elephant Doctor Cloud Imaging Diagnosis Center provides patients with pulmonary nodules with consultation services from leading domestic imaging experts, as well as surgical consultations and hospital bed arrangements at renowned Grade A tertiary hospitals. Its network of physicians includes expert teams led by Dr. Ye Jianding from Shanghai Chest Hospital and contracted specialists from East China Hospital, a well-known Grade A tertiary hospital. Second, remote image interpretation: Leveraging a remote imaging system, the Elephant Doctor Cloud Imaging Diagnosis Center connects with large-scale imaging equipment at health check-up centers and medical institutions, thereby providing these clients with remote image interpretation services.

Meinian Onehealth Is Integrating the Ecosystem of the Greater Health Industry

As a leading private health checkup provider in China, Health 100 possesses vast amounts of health examination data. Leveraging this as an entry point, the company has previously begun to expand into insurance, chronic disease management, and disease referral services. Last year, Health 100, together with internet companies such as Vipshop and Shanda Network, initiated the application to establish China’s first internet-based health insurance company founded on precision data.

Yu Rong revealed that the application for an insurance license is currently proceeding as normal. He stated that physical examination services and health management naturally complement and strongly synergize with the business operations of insurance companies. Years of accumulation in customer resources, channel development, and data analysis are highly advantageous for health insurance companies in developing refined products, implementing precise pricing, and accurately targeting customers. Meanwhile, commercial insurance also facilitates the exploration of solutions to current issues in payment for physical examinations and medical services.

At this stage, leveraging data as the connecting thread, Health 100 has secured its position at the entry point of preventive care and begun to establish a closed-loop business model spanning examination, medical treatment, and payment services. However, in Yu Rong’s strategic blueprint, the goal extends further: to build an open health industry ecosystem that integrates resources from the examination segment with capital, incubation, and product development capabilities. Any innovative services within this sector can be incubated and developed on its platform.

Source: Sinolink Securities

Yu Rong believes that there are two important dimensions for evaluating the future prospects of a company. First, its own business must form a closed loop, establishing competitive barriers and ensuring sustained profitability. Second, it must build a platform that helps partners grow; this is the true value of a platform and the key to the company’s long-term premium. “For the first closed-loop segment, we benchmark against the U.S. Kaiser Permanente model, bundling healthcare services, health insurance, and the entire system into a comprehensive closed loop. For the second, we advocate Amazon’s model, where a single platform enables more enterprises to grow—this is the true value of a platform company,” said Yu Rong.

This article is comprehensively edited from content provided by the Industrial Research Center of Sinolink Securities and The Economic Observer.