VB Weekly No.1130: What's Behind Jiangsu Sanyou, Baidu, and Taikang's Recent Moves?

————————————Events and Perspectives————————————

Recently, the medical community has been abuzz with conferences of all sizes, as industry leaders have been actively sharing their insights across various platforms. It’s been so overwhelming that this editor’s brain cells just can’t keep up! What to do? Turn to VCBeat!

The most exclusive closed-door healthcare venture capital meetup. No bystanders at the pitch session (⊙o⊙)… not even the cleaning lady), a strictly closed-door setting (…a dark room), and pure pitches only (…not even refreshments provided... /(ㄒoㄒ)/~~). In short, it’s a highly nourishing experience for the mind, more effective than any supplement.

Click here if you're interested: “December 3: Call for Startup Projects and Investors for the Most Exclusive Healthcare Venture Capital Closed-Door Meeting ☞ Eggshell Roadshow Episode 1”。

Now, onto the main event you’ve all been eagerly anticipating... Let’s see what drama is unfolding.

Zhang Ligang Issues Open Letter Rejecting Acquisition by Jiangsu Sanyou

On the evening of November 29, as the industry was engaged in heated discussions about Jiangsu Sanyou(In August 2015, Meinian Onehealth completed its A-share listing by backdoor listing through Jiangsu Sanyou.)As the evening announcement revealed its intention to acquire iKang Guobin, at 10:00 p.m., “An Open Letter from Zhang Ligang, Chairman and CEO of iKang Guobin, to iKang Employees, Customers, and Partners” was published on iKang Guobin’s official WeChat account.

In the letter, Zhang Ligang further stated: “The consortium is fully aware that this acquisition lacks the support of both myself and iKang’s management team, yet it intends to issue a competing offer at a critical juncture in iKang’s privatization process. I believe this is undoubtedly hostile and malicious. Currently, competition between iKang and Meinian Onehealth Healthcare is intensifying. This takeover bid may be intended to cause psychological disruption among iKang’s employees, customers, and partners, thereby gaining an unfair competitive advantage. I trust that everyone can clearly see this intention. Myself and the iKang team will spare no effort to protect iKang from harm. iKang welcomes competition, but opposes any malicious competition and all forms of unfair competition that attempt to impede iKang’s development or disrupt market order.”

This open letter directly targeted the announcement released by Jiangsu Sanyou that evening regarding its acquisition of iKang Guobin.

In fact, Meinian Onehealth has already completed a back-door listing by acquiring Jiangsu Sanyou for RMB 5.5 billion, and its shares are currently suspended pending the planned acquisition of a 72.22% stake in Ciming Health Checkup along with supporting financing. If it successfully participates in the privatization of iKang Guobin, all three major health checkup providers could potentially be brought under the umbrella of either Jiangsu Sanyou or, more accurately, Meinian Onehealth.

Data from Haitong Securities indicates that, according to the previous restructuring report of Jiangsu Sanyou, the annual reports of iKang Healthcare Group, and the official website of Ciming Health Checkup, the number of health checkups conducted in 2014 by China’s top three health examination companies—Meinian Onehealth, iKang Healthcare Group, and Ciming Health Checkup—were 5.28 million, 3.60 million, and 2.00 million, respectively.

Baidu Ventures into the Internet Insurance Business.

Last week,Allianz Insurance, Baidu, and Hillhouse Capital Announce Joint Establishment of an Internet Insurance Company。

It is reported that the joint venture insurance company will be named Bai’an Internet Insurance Company, with travel and accident insurance products serving as its initial focus. The strength of Bai’an Insurance’s three major shareholders should not be underestimated. Industry insiders believe that if the collaboration between Baidu and Allianz Insurance can fully

By leveraging the complementary strengths of both parties, the scope of insurance services will be significantly expanded, and the forms of insurance products will be innovated, thereby fundamentally injecting vitality into the development of the insurance industry.

In essence, this means that insurance services such as policy application, underwriting, risk assessment, and claims processing will all be available online in the future.

“Yi” Becomes “1”: 111.com.cn’s Logo Gets a Major Makeover.

On November 23, Yihaodian, China’s largest B2C pharmaceutical e-commerce platform, announced a comprehensive rebranding. Its official website has been renamed from “Yihaodian” to “111.com.cn,” and its mobile app, formerly known as “No. 1 Pharmacy,” has been synchronously rebranded as “111.com.cn.” The company also unveiled a new logo featuring a three-colored capsule figure composed of red, yellow, and blue. Additionally, starting December 15, the online medical platform app “Yizhen,” operated under 111.com.cn, will be renamed “1Zhen.”

This systematic rebranding connects the various business modules of 1YaoWang through the numeral “1.” 1YaoWang, 1Zhen, and the B2B service “Fangkuai 1” form a “troika” that underpins the entire “1” series Internet-plus-pharmaceutical-and-health ecosystem.

It is understood that 1YaoWang, 1Zhen, and FangKuai1 serve as the integrated “three pillars,” jointly building an Internet-plus-pharmaceutical ecosystem. This system comprises an online pharmaceutical retail platform, an online medical service platform, and an online pharmaceutical wholesale platform. Adopting “1” as a unified brand identifier helps consolidate the external image of the “three pillars” and enhance consumer recognition.

Taikang’s First Rehabilitation Hospital Opens, Pioneering “1+N” Butler-Style Medical and Elderly Care Services.

On November 28, 2015, the first secondary-level geriatric specialty hospital invested in by Taikang Life Insurance—Taikang Yan Garden Rehabilitation HospitalTaikang Community·Yanyuan, a senior living community located in Changping District, Beijing, has been completed. With a total investment of RMB 290 million and a gross floor area of approximately 13,000 square meters, the facility initially provides 100 beds and will gradually open to the public. Among its offerings, the “Medium- and Long-Term Care Zone” of Taikang Yanyuan Senior Living Community is now fully open, while the “Assisted Living Zone,” “Skilled Nursing Zone,” and “Memory Care Zone” are accepting reservations from seniors with varying physical conditions.

Philips Launches Handheld Ultrasound Device That Plugs Into Smartphones.

Recently, Royal Philips launched the Lumify device in the United States. This handheld ultrasound tool can be plugged into a smartphone and connected to an image management application (app). To promote the device, the company offers a subscription model at $199 per month, which not only generates a steady stream of revenue for the company but also provides users with simple and comprehensive ultrasound services, including access to two sensors, the app, and the portal website.

Longma Information Approved for Guizhou Internet Healthcare Pilot Program.

On November 23, Longmaster Information released a midday announcement stating that the company had received, several days prior, the “Implementation Plan for the Pilot Program of Internet Hospitals in Guizhou (Trial)” and the “Detailed Rules for the Implementation of the Pilot Program of Internet Hospitals in Guizhou (Trial),” jointly issued by the Guizhou Provincial Health and Family Planning Commission and the Guizhou Provincial Food and Drug Administration.

According to the announcement, this pilot program was conducted from July 2015 to December 2016 in four phases. It relied on provincial-, municipal (prefecture)-, and county (district, city)-level hospitals as supporting institutions, with community health service centers (township health centers), community health service stations (village clinics), and pharmacies serving as patient reception points, to carry out the internet hospital pilot work.

The specific pilot initiatives include: exploring the establishment of a tiered diagnosis and treatment model based on “Internet+” healthcare services, using internet hospital pilots as the vehicle to organically integrate medical resources at all levels. This will be achieved by leveraging regional comprehensive sharing platforms to facilitate medical collaboration between hospitals and primary healthcare institutions, thereby providing tiered diagnosis and treatment along with health management services; exploring service models for internet hospitals. With high-quality medical resources as the core, and community health centers (township health centers), community health stations (village clinics), and pharmacies as extensions, the aim is to enable residents to access timely and nearby medical care; and exploring and establishing operational mechanisms, policies, regulations, and administrative measures for internet hospital pilots.

Langma Information stated that, leveraging its internet hospital, decentralized medical services represent one of the key directions for its internet healthcare initiatives.

Anke Biotech Acquires Zhongde Meilian for RMB 450 Million, Accelerating Its Layout in Precision Medicine.

Anke Biotechnology, which had originally planned to acquire a 25% equity stake in Zhongde Meilian this July to expand its precision medicine portfolio, has shifted its strategy four months later from a minority investment to full ownership. The company now intends to spend RMB 450 million in cash to acquire Zhongde Meilian in its entirety. Based on the previous valuation of RMB 112.5 million for a 25% stake, the current offer of RMB 450 million remains consistent with the valuation from four months ago.

Regarding this acquisition, Anke Biotechnology stated that the transaction will facilitate the company’s research and development and industrialization of gene sequencing technologies, expand its core business into the target company’s precision medicine sector, and accelerate the realization of its diversified development strategy.

As early as July 13, Anke Biotechnology announced the signing of a letter of intent for equity cooperation, proposing to acquire a 25% stake in Zhongde Meilian for no more than RMB 112.5 million in cash. Zhongde Meilian specializes in a rather “niche” segment of the genetic testing industry—the forensic sector.

The Japanese Government Approves Robots as Medical Devices for the First Time.

On the 25th, Japan’s Ministry of Health, Labour and Welfare officially approved the listing of “robot suits” and “Hybrid Assistive Limbs (HAL) for medical use” as medical devices for sale in Japan, to be used for improving walking function in patients with diseases such as amyotrophic lateral sclerosis and muscular dystrophy. This marks the first time the Japanese government has approved wearable robots as medical devices, and it will further study whether to include them under insurance coverage.

On the 10th of this month, an expert panel convened by Japan’s Ministry of Health, Labour and Welfare recommended classifying such robots as medical devices for the treatment of intractable conditions, including muscle weakness and muscular atrophy. This recommendation was officially approved by the Ministry on the 25th.

The Final “Uproar” IsAlibaba Health's Recently Released Interim Report:For the six months ended September 30, 2015, revenue was HK$21.371 million, representing a year-on-year increase of 14.6%; gross profit was HK$4.791 million, with the gross profit margin increasing by 22.4% year-on-year; additionally,Loss of HK$130 million.

Regarding the growth in mid-term revenue, the report indicates that it was primarily driven by fees from retail pharmacies listing on the Tmall Health Pavilion and other value-added services. The increase in gross profit margin was mainly attributable to higher revenue from the Drug Electronic Supervision Network. As evident from Alibaba Health’s income statement, sales and marketing expenses were 7.8 times those of the previous year, administrative expenses were 2.4 times the prior year’s level, and product development expenditures were 2.3 times those of the preceding year.

Regardless of whether the outcome is a profit or a loss, please be sure to

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————————————Healthcare Reform————————————

In 2025, revenue from traditional Chinese medicine (TCM) health tourism reached RMB 500 billion, and national demonstration zones for TCM health tourism were established.

The National Tourism Administration and the State Administration of Traditional Chinese Medicine jointly issued the “Guiding Opinions on Promoting the Development of Traditional Chinese Medicine Health Tourism.”

The “Guiding Opinions” propose eight key tasks: developing traditional Chinese medicine (TCM) health tourism products, building TCM health tourism brands, strengthening the TCM health tourism industry, expanding the TCM health tourism market, innovating development models for TCM health tourism, cultivating a workforce of TCM health tourism professionals, improving public services for TCM health tourism, and promoting the sustainable development of TCM health tourism.

A clear timeline has been established: By 2020, the number of tourists participating in Traditional Chinese Medicine (TCM) health tourism will account for 3% of the total tourist population, with TCM health tourism revenue reaching RMB 300 billion. Nationwide, 30 TCM health tourism demonstration zones, 200 TCM health tourism demonstration enterprises (bases), and TCM health tourism complexes will be established. By 2025, the proportion of tourists engaging in TCM health tourism will rise to 5% of the total tourist population, with revenue reaching RMB 500 billion. Nationwide, 50 TCM health tourism demonstration zones, 500 TCM health tourism demonstration enterprises (bases), and TCM health tourism complexes will be developed. Additionally, a group of TCM health tourism service enterprises and well-known brands with international recognition and market competitiveness will be cultivated and established.

Guangzhou: Schizophrenia to Be Included in Outpatient Medical Insurance Coverage
According to the Guangzhou Social Security Bureau, starting from the 1st of next month, four major mental disorders, including schizophrenia in Foshan, will be included in the outpatient medical insurance reimbursement scope for residents. The resident medical insurance fund will cover 70% of the costs up to a specified limit. Currently, patients with schizophrenia account for approximately half of all mental disorder cases in Foshan. Inclusion in the outpatient medical insurance scheme means that patients can have their long-term medication expenses reimbursed directly through outpatient services without requiring hospitalization.

Guizhou: Filing Management Implemented for Physicians’ Multi-Site Practice; Hospital-Level Leaders of Public Hospitals Prohibited from Participating
Recently, Guizhou Province released the new version of the “Guizhou Province Measures for the Administration of Multi-Site Practice by Physicians (2015 Edition)” (Draft for Comments), which clearly encourages and supports licensed physicians to engage in multi-site practice at medical institutions—including both public and private ones—in grassroots, remote, and medically underserved areas. Meanwhile, physicians from other provinces as well as from Hong Kong, Macao, and Taiwan are also encouraged to practice at multiple sites within Guizhou Province, and those engaging in multi-site practice will be required to register accordingly. This was learned by reporters from the Provincial Health and Family Planning Commission yesterday.

The Measures specify that physicians engaging in multi-site practice at primary healthcare institutions, with an accumulated duration exceeding three months based on actual days, may have this period counted toward the mandatory grassroots service time required for promotion to senior professional titles. Individuals holding hospital-level leadership positions in public hospitals are prohibited from engaging in multi-site practice. Furthermore, physicians practicing at multiple sites shall not serve as the legal representative or principal person in charge of any other medical institution where they intend to practice.

Joint Notice from the Ministry of Human Resources and Social Security and the National Health and Family Planning Commission: Research Papers and Foreign Language Proficiency Will No Longer Be Mandatory Requirements for Title Promotion Among Primary Care Physicians
On November 24, the National Health and Family Planning Commission, in conjunction with the Ministry of Human Resources and Social Security, issued the “Guiding Opinions on Further Reforming and Improving the Title Evaluation System for Primary Healthcare Professionals.” The Guiding Opinions state that foreign language test scores will no longer be a prerequisite for title applications at the primary healthcare level. Furthermore, there will be no mandatory requirements regarding publications or scientific research; however, these may serve as reference criteria during the evaluation process.

CIRC Issues the Statistical System for Critical Illness Insurance
The China Insurance Regulatory Commission (CIRC) revised and improved the original "Statistical System for Critical Illness Insurance (Trial)" and formulated the "Statistical System for Critical Illness Insurance." In accordance with the System, insurance companies conducting critical illness insurance business must strictly submit statistical data in compliance with the indicators, definitions, and requirements stipulated herein, so as to ensure that the statistical data on critical illness insurance are truthful, accurate, and complete. The System shall come into effect as of January 1, 2016.

MOHRSS: Accelerate the Promotion of Universal Social Insurance Registration
On November 23, the Ministry of Human Resources and Social Security held a video conference on expanding the pilot program for universal social insurance registration, accelerating the progress of the pilot work. The Ministry will formulate and issue the “Procedures for Household Surveys under the Universal Social Insurance Registration Program” before the end of the year, standardizing the formats and procedures for household surveys, and employing multiple measures to strictly ensure the quality of survey data.

Guangdong Plans to Allow Physicians at Public Hospitals to Open Clinics; Policy Measures to Promote Private Healthcare Are Being Formulated

The Guangdong Provincial Office of Healthcare Reform is formulating the "Several Policy Measures on Promoting the Accelerated Development of Socially-Run Medical Institutions," which proposes to allow physicians registered for multi-site practice in public medical institutions to establish general practice or specialty clinics, traditional Chinese medicine (TCM) halls, and TCM consultation clinics; to allow nurses registered for multi-site practice to establish community nursing institutions; and to permit qualified pharmacies to operate as clinics upon administrative approval.

Beijing to Include Families Impoverished by Major Illnesses in Medical Assistance Program Starting Next Year
The Beijing Municipal Civil Affairs Bureau, the Beijing Municipal Human Resources and Social Security Bureau, the Beijing Municipal Health and Family Planning Commission, and the Beijing Municipal Finance Bureau have jointly issued the “Notice on Issues Concerning Medical Assistance for Families Impoverished by Illness (Trial).” Effective January 2016, urban and rural residents with Beijing household registration (hukou), along with their family members living together, who do not receive social assistance such as the Minimum Livelihood Guarantee for Urban and Rural Residents or low-income support, and who are diagnosed with any of the 134 critical illnesses across 15 categories—including malignant tumors, end-stage renal disease, and leukemia—may qualify for medical assistance. This applies when they seek treatment at designated medical institutions under Beijing’s basic medical insurance or the New Rural Cooperative Medical Scheme, and when, after reimbursement from various basic medical insurances, commercial insurance claims, and other forms of assistance, their out-of-pocket eligible medical expenses exceed their financial capacity, causing severe hardship in meeting basic living needs. In such cases, medical assistance shall be provided by the civil affairs departments of the respective districts and counties.

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Annual Increase of 35% in HIV Infections Among College and Middle School Students in China Over the Past Five Years

Wu Zunyou, Director of the National Center for STD/AIDS Prevention and Control under the Chinese Center for Disease Control and Prevention, revealed that in 2014, more than 15,000 new HIV/AIDS cases were reported nationwide among individuals aged 15 to 24. From January to October this year, over 14,000 people in this age group were infected with HIV. Compared with the same period last year, the number of adolescents infected this year increased by approximately 10%.

Beijing Residents’ Physical Fitness Index Fails to Enter Top Five

Recently, the General Administration of Sport of China released the "2014 National Physical Fitness Monitoring Bulletin." This monitoring primarily covered three aspects: physical form, physiological function, and physical fitness. According to the published data, residents in Shanghai achieved a first-class compliance rate of 97.1% and a comprehensive index of 107.91, ranking first in both metrics. In contrast, the physical fitness index for residents in Beijing, the capital city, failed to rank among the top five.

————————————New Technologies————————————

MIT Launches “Edible” Sensors

MIT Researchers Develop a Sensor That Can Be Swallowed Into the Stomach.

“It is claimed that this type of sensor can facilitate the assessment of patients’ conditions, monitoring of soldiers in combat, long-term evaluation of patients with chronic diseases, and improvement of training levels for professional or amateur athletes.” It can also “calculate heart rate and respiratory frequency based on the unique sounds produced by heartbeats and lung respiration.” This is because the sensor is encapsulated in a silicone capsule roughly the size of a vitamin pill.

Currently, this sensor can only record and report the information it collects, but researchers hope that it will eventually be used to diagnose diseases and deliver therapeutic drugs.

Do not chew this capsule!

Tiny Magnets Track Cancer: More Sensitive and Safer

A study published recently in *Scientific Reports* indicates that the use of iron particles and magnetic probes can help clinicians accurately track the spread of lymph node tumors, offering greater sensitivity and safety than existing cancer monitoring methods. However, this approach is currently in the preclinical trial stage, with researchers working to advance it toward clinical trials.

The iron particles used in this technology can biodegrade at the primary tumor site (which is monitored as part of the procedure). Cells of the immune system then transport the biodegraded iron particles to the lymph nodes (the initial site of metastasis for primary cancers). The injected iron particles accumulate in the same location, and 20 minutes after injection, researchers can detect their magnetism using a magnetic probe.

Wyss Institute Successfully Tests Vibration-Based Device for Preventing Infant Apnea

Recently, in a clinical trial involving 36 infants with apnea conducted at Beit Medical Center in Israel, researchers found that the use of a novel mattress vibration device reduced the number of apnea events by half, while also improving oxygenation levels and reducing the incidence of bradycardia.

This new technology does not wake infants and can be combined with standard caffeine therapy to independently prevent apnea in infants. The novel device was “incubated” at the University of Massachusetts Medical School and ultimately developed by the Wyss Institute at Harvard University.

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