Five Chronic Disease Startups Share Insights Ahead of IPO Filings

Chronic diseases, such as diabetes, hypertension, and cardiovascular conditions, represent the primary focus of internet healthcare startups. Following the entrepreneurial boom of 2015, what insights have internet healthcare companies gained in this sector? On December 26, 2015, the fourth salon event hosted by the Internet Healthcare Startup Alliance invited five startups—Tang Hushi (Sugar Nurse), Kangkang Blood Pressure, Yixin Technology, Yi Suifang (Medical Follow-up), and Zhangshang Xindian (Pocket ECG)—to share their experiences in chronic disease management. The following is a summary of the key highlights from the event.




Li Chengzhi, Founder of Tang Hushi

The Most Feasible To-C Entry Point for Chronic Disease Management:Li Chengzhi believes that there are several potential entry points for chronic disease management, such as hospitals/physicians, the government, and commercial insurance. However, considering that the goal of chronic disease management is to reduce costs, none of these entry points are viable from a business logic perspective: Hospitals (including pharmaceutical companies) have an incentive to increase patient spending and lack the motivation to control costs; commercial insurance is still in its early stages in the field of chronic diseases, faces significant operational challenges, and shows no signs of effectiveness in the short term; while the government has the willingness to control costs, it lacks the drive for practical implementation. The most feasible entry point remains the consumer-facing (To C) patients, as they are willing to use and pay for valuable services provided to them.

The Core of Chronic Disease Management Remains Data Operations:Li Chengzhi outlined five strategic options: social networking, doctor-patient interaction, data management, appointment registration, and pharmaceutical e-commerce. He believes that although a successful business model for chronic disease data operations has not yet been identified, it will undoubtedly be the focal point of Tang Hushi’s future development. While pharmaceutical e-commerce and social networking hold promise, they will not constitute Tang Hushi’s core focus. Opportunities in doctor-patient interaction and appointment registration are limited; particularly regarding doctor-patient interaction, Li Chengzhi admitted that interviews conducted with 400 physicians and 700 patients in recent months revealed a lack of acceptance from both sides, rendering it unfeasible.

How to Conduct Data Operations for Chronic Diseases?Li Chengzhi believes that the ideal scenario is to collect data from users and ultimately sell the processed data back to them. Currently, Tang Hushi (Sugar Nurse) generates over 20,000 data entries daily, equivalent to the volume produced by a hospital with 3,000 beds, assuming seven data points per patient per day. The issue is that the current data is incomplete, consisting solely of blood glucose readings. In the future, by integrating data collected from other hardware devices, the company can provide truly effective services to patients, making monetization a natural progression.

How to Cultivate User Behavioral Habits?Some industry peers have criticized Tanghushi’s products for lacking a display screen, requiring users to view data exclusively through a mobile app, which they deemed a step backward. In response, Li Chengzhi stated that Tanghushi had conducted research revealing a 1:5 ratio in app engagement between devices with and without screens. Consequently, Tanghushi opted for a screenless design to cultivate users’ habit of managing chronic diseases via the app. Only after this habit is established can the subsequent rollout of a series of services be effectively pursued.

Zeng Mingfa, Founder of Kangkang Blood Pressure

Wearable Devices Can Drive Impact in the Pre- and Post-Hospital Phases of Chronic Disease Management:Zeng Mingfa believes that chronic disease management can be divided into three stages: pre-hospital, in-hospital, and post-hospital. While wearable devices are ineffective during the in-hospital stage, they can play a significant role in the pre- and post-hospital phases. The medical consultation experience in China is notoriously poor; by integrating wearable devices with mobile apps and various services, patients can address their health issues with minimal hospital visits.

Three Challenges Facing Wearable Devices:Zeng Mingfa believes that current wearable devices face three challenges: medical acceptance, accuracy, and safety.

Zeng Mingfa pointed out that most wearable devices currently remain at the consumer grade, lacking certification from authoritative health authorities and thus unable to provide reference for clinical diagnosis. Moreover, even if certified, such certifications merely represent minimum thresholds and do not guarantee that wearable devices will necessarily deliver significant clinical utility.

Regarding the challenge of accuracy, Zeng Mingfa cited blood pressure monitors as an example. Currently, there are three main measurement methods: upper arm, wrist, and finger. The upper arm method yields the most accurate results because it is at the same level as the heart. Wrist and finger measurements require algorithmic compensation and suffer from significant distortion issues.

Zeng Mingfa also believes that although the physical health data collected by wearable devices has not yet demonstrated significant value, it still constitutes personal privacy, and its security requires robust protection.

Wearable Devices Empower Precision Medicine:Regarding the currently high-profile concept of precision medicine, Zeng Mingfa believes that wearable devices are also relevant. Some medical experts argue that each individual’s optimal blood pressure level is actually unique; some people may have levels higher than the population average, while others may have levels below it. Applying a uniform standard for treatment across the board would lead to indiscriminate therapy and excessive medication. With the advent of wearable devices, dynamic monitoring of individual blood pressure becomes possible, thereby identifying each person’s personalized optimal blood pressure range and avoiding inappropriate treatment and medication.

Lixia, Chairman of Yixin Technology

Current Status of the Domestic Wearable Device Market:Lixia pointed out that the current domestic wearable device sector is primarily driven by startups, which face numerous challenges: a lack of medical expertise to guide product positioning and development direction; poor data reliability and low clinical value; weak independent innovation capabilities in operating systems; inadequate battery life; significant electromagnetic radiation raising safety concerns; and difficulties in achieving real-time network transmission.

Three Major Pain Points in the Development of Medical Wearable Devices:Li Xia believes that the development of medical wearable devices faces three major pain points: accuracy, privacy, and regulation. This view is largely consistent with the three challenges cited by Zeng Mingfa, founder of Kangkang Blood Pressure.

Addressing these pain points, Li Xia believes that wearable devices should move toward product specialization and service systematization. In terms of product specialization, the signals collected by wearable devices should be more accurate and effective, reaching a level suitable for clinical diagnostic analysis by physicians. Regarding services, a systematic approach should be adopted: for patients, this includes health monitoring, early warning, clinical guidance, and rehabilitation tracking; for hospitals, it encompasses functionalities such as patient management, physician management, departmental management, and hospital administration.

Yang Feng, Founder of Yi Suifang

Chronic Disease Management Is the Only Way Out of the Crisis:Yang Feng pointed out that while China’s diabetes market is vast, it harbors deep-seated crises. According to relevant studies, the annual direct expenditure on diabetes in China amounts to RMB 173.4 billion, accounting for 13% of total healthcare spending. From an individual perspective, the medical expenses of patients with diabetes are nine times higher than those of non-diabetic individuals of the same age and gender, with some patients incurring annual total costs exceeding RMB 60,000.

Yang Feng believes that such high expenditures are unsustainable for China’s healthcare insurance system. Based on the experiences and relevant research from the United States, the United Kingdom, and Canada, a chronic disease management system founded on mobile health and tiered diagnosis and treatment is the only viable solution to this crisis.

The specific components of the chronic disease management system include: the "family doctor" responsibility system, mobile health, multidisciplinary team management, a patient-centered philosophy, safe and standardized industry norms, relevant policy frameworks, and a value-based payment mechanism.

Mortality Rate Decreased by 21% After the Transition in Management Model:Yang Feng presented the outcomes of the patient management system developed by WellDoc, a U.S. company with nearly a decade of expertise in the diabetes field: after one year of intensive management, glycated hemoglobin (HbA1c) levels decreased by 1.9%. According to relevant studies, each 1% reduction in HbA1c is associated with a 21% decrease in diabetes-related mortality, as well as reductions of 14%, 16%, 12%, and 37% in the incidence of myocardial infarction, heart failure, stroke, and microvascular complications, respectively.

Medical Follow-up Positions “Patient Release”:Yang Feng believes that there are three core elements to managing chronic diseases through mobile health: first, helping patients clearly understand their condition; second, identifying a treatment and management plan that patients can adhere to long-term; and third, and most importantly, ensuring proper nutrition. For individuals with diabetes, dietary restrictions in daily life are extensive, which can easily lead to malnutrition and decline in physical function—hazards that are no less significant than diabetes itself.

In Yang Feng’s view, the treatment of diabetes should not compromise patients’ quality of life; rather, blood glucose levels should be maintained within a reasonable range while ensuring a high quality of life. Therefore, Yi Suifang positions itself as “empowering patients,” achieving optimal glycemic control through micro-regulation of patient metabolism, thereby enabling patients to enjoy a better quality of life.

Shen Kai, Product Director of Handheld ECG Products

Selecting the Entry Barrier for Startups and Defining Niche Positioning:Shen Kai believes that the ECG vertical sector has a high barrier to entry, unlike app development, which has low barriers and suffers from severe disorderly competition. In Shen Kai’s view, there are three barriers in the ECG vertical: hardware, technology, and regulatory certification. These three barriers, combined with the vast market potential in the cardiovascular field, motivated Palm ECG to choose the ECG sector for its startup venture.

Meanwhile, Pocket ECG has focused its startup efforts on the niche segment of atrial fibrillation (AFib). This is primarily because China has a large AFib patient population, estimated at over 10 million, with a rapidly increasing trend. Furthermore, AFib poses significant health risks, increasing the incidence of stroke by two to seven times and doubling the risk of heart failure compared to the healthy population. Therefore, there is a strong demand for ECG monitoring among patients.

The Development Journey from Bluetooth to Direct USB Connection:Shen Kai reviewed the product development journey of Palm ECG. When the first ECG monitor was launched in 2012, a seemingly sophisticated Bluetooth interface was chosen. However, subsequent user feedback revealed that Bluetooth connections were unstable and the setup process was cumbersome, making it unsuitable for elderly users. Therefore, when the second-generation product was released in 2014, a direct USB connection was adopted. Although this appeared less advanced than Bluetooth, it offered significantly better stability, ease of use, and speed. At the time, using a headphone jack for connectivity was also considered, but due to the lack of unified standards between Apple and Android devices, as well as inconsistencies among Android manufacturers such as Samsung and Xiaomi, the headphone jack solution was ultimately abandoned after careful consideration.