VB Weekly Report on Internet Healthcare (20150105): Industry Insights and Product Updates

Events & Perspectives

At the start of the new year, industry leaders seized the tail end of the 2014 capital boom, sparking another wave of investment. In late 2014, TianGe Interactive invested RMB 14 million to acquire a 26.28% stake in Xihe Information, a company specializing in health management informatics, becoming its second-largest shareholder. Fosun acquired U.S. insurer Meadowbrook at a transaction price of USD 8.65 per share in cash (approximately USD 433 million in total).

Regarding the intensity of healthcare reform, Gao Qiang, former Minister of Health of China, sharply criticized the numerous problems in the new healthcare reform, stating that “drastic measures” are still needed. Abroad, President Obama declared that he would “wield the veto pen” in 2015 to defend the healthcare reform and other legislation. It appears that both domestically and internationally, the path to successful healthcare reform remains long and arduous.

Last week, Neusoft Group, which secured RMB 3.8 billion in investment from Hony Capital and Goldman Sachs last month, launched a healthcare app called “Palm Zhongshan Sixth Hospital.” This marks the first time that mobile terminals have been seamlessly integrated and interacted with existing hospital systems, fully connecting all in-hospital consultation processes and enabling an end-to-end patient experience.

Note: According to British media reports, Yahoo is setting its sights on the mobile market, with a focus on wearable devices.

As the year draws to a close, various institutional media outlets have begun their reviews of 2014 and forecasts for 2015 trends:

Canaan Partners, a U.S. venture capital firm, predicts that the core of the U.S. healthcare system will undergo significant changes in five areas in 2015: 1. Walmart will become your insurer (insurance); 2. Pharmaceutical companies will acquire health tech startups (pharmaceuticals); 3. Amazon will disrupt the medical supply chain (suppliers); 4. Hospitals will become P2P lending channels (healthcare services); 5. Latinos will become highly sought-after potential customers (payment).

Seven Potential Trends in the Wearable Industry for 2015: Trend 1: Volatility in the Capital Market; Trend 2: Rationalization of the Industry; Trend 3: Further Intensification of Hardware Fragmentation; Trend 4: Device Interoperability Will Become a Trend; Trend 5: Continued Exploration of Industry Standards; Trend 6: Vertical Segmentation Will Become Mainstream; Trend 7: Mobile Health Will Gain Momentum.

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Data

U.S. Digital Health Investment in 2014 Surpassed the Total of the Previous Three Years:Data released by Rock Health for the fourth quarter and the full year indicate that investment in the digital health sector exceeded $4.1 billion in 2014, surpassing the total combined investment of the previous three years. Compared with the previous year, the growth rate reached 124% based on this year’s total investment of $4.1 billion.

New Technologies

Netherlands: Successful Development of Implantable Medical Device to Alleviate Rheumatic Pain

Dutch researchers have developed an implantable medical device, no larger than a metal coin, that can be placed under the skin of the neck. This device is designed to replace pharmacological interventions by delivering comparable therapeutic effects to alleviate arthritis pain and treat rheumatism. Furthermore, the device can stimulate the vagus nerve, which innervates most of the body’s organs and plays a critical role in regulating vital functions such as respiration and heart rate.

Journal of Clinical Investigation: Key Protein Leveraging the Regenerative Capacity of Hematopoietic Stem Cells Discovered for the First Time

Scientists at the University of California, Los Angeles (UCLA) have discovered for the first time that a protein (protein tyrosine phosphatase) plays a key role in regulating how hematopoietic stem cells replicate: it modulates how HSCs begin to grow and produce healthy blood cells after transplantation.

Sleep Journal: Novel Measurement Technology Developed for Diagnosing Sleep Disorders in Children

University of Adelaide scientists have elucidated the complexities of pediatric sleep through their research, which may provide insights and assistance for improving the diagnosis of sleep-related breathing disorders in children.

Capital

Shen Nanpeng of Sequoia Capital: Opportunities in the industrial Internet are becoming increasingly apparent, with the integration of the Internet and traditional industries such as healthcare growing more evident, thereby generating B2B opportunities through this convergence.