After the dust settles on the reorganization case of the former Hengkang Medical [now renamed as "New Milestone (002219)"), New Milestone Health Group *** referred to as "New Milestone Health Group") has put forward the strategic goal of "becoming the most trusted and respected world-class health group". In anticipation of the accelerated arrival of aging, the realization of this strategic goal will also be an urgent "new milestone" for China's medical and health industry.
Lin Yanglin, Chief Executive Officer (CEO) of New Milestone Health Group, said in an exclusive interview with the reporter of "Yingcai": "There is never a perfect time, but the development consensus can create opportunities. ”
Benchmarking against the world's first-class
In the 2023 Fortune Global 500 list, there are only 32 companies related to the pharmaceutical industry. There are only 4 Chinese companies in the top 32. On the other hand, in recent years, the proportion of Chinese companies in the world's top 500 companies has been increasing, and the number of Chinese companies on the list in 2023 will reach 142, surpassing the 136 in the United States, ranking first in the world.
The blueprint of four companies to support a healthy China is obviously not enough. Under the pattern of the huge population base and the accelerated arrival of aging, the cause of people's health has been identified as an important symbol of socialist modernization.
The demand side is strong and the supply side is insufficient" has become the status quo of the industry.
Lin Yanglin, CEO of New Milestone Health Group, told the "Elite" reporter that there is still a certain gap between the current domestic medical group and being labeled as "world-class".
In his view, benchmarking against world-class medical and health groups requires a large enough scale, innovative business models, international management and the embodiment of social value.
According to public data, among the enterprises with more than 10,000 beds in domestic medical groups, General Technology Group has relied on the integration of PetroChina's medical institutions Baohua Medical Group and PowerChina's medical institutions in recent years. 51,000 beds were coveredAfter years of investment and integration, New Milestone Health Group has achieved coverage of more than 19 provinces, municipalities and autonomous regions and 30,000 beds in 2022 after the completion of the reorganization of Hengkang Medical and officially becoming the controlling shareholder, following General Motors and Sinopharm, and owning the third largest medical group in the country.
The expansion of scale has brought New Milestone Health Group to the threshold of becoming a world-class group, but in Lin Yanglin's view, the core competitiveness of New Milestone actually comes from strategic restructuring, business innovation and tactical empowerment, that is, building strategic barriers, innovating business models and international operation and management.
The world-class health group will not only do medical care, but also the driving force of its market value and value growth will make medical care a development engine, medical care can be a scene, can be infrastructure, and finally form a competitive technological innovation, product innovation, business model innovation and production relationship innovation. Of course, strategic barriers are the premise of business model innovation. Lin Yanglin said.
Focusing on international operation and management, standardization and refined management are regarded as one of the core competitiveness of Lin Yanglin. Lin Yanglin said that standardization and fine management are mainly reflected in three aspects, "First, each hospital should have a very clear strategy, and form more than 5 years of development advantages through the strategy;Second, the governance system of each hospital should be very open, transparent and efficient, and implement modern enterprise managementThird, both clinical and operational aspects must be sufficiently standardized. After these three things are completed, the dividends of standardization and refined management will be released. Lin Yanglin emphasized that building an international management system is also the differentiated advantage of New Milestone Health Group from other enterprises in the same industry, in short, it is to allocate enterprise resources through international means and market-oriented methods, so as to achieve efficient operation and optimal value of each business entity's employment system, distribution system and decision-making system.
From the point in time, New Milestone Health Group first achieved scale expansion through mergers and acquisitions;After that, the four pillar industries of "medical care, health care, medicine and insurance" were empowered and developed in a coordinated manner, and the strategic upgrade of disruptive innovation was startedAfter the successful reorganization of Hengkang Medical, the listed company's new mileage (002219) achieved a significant turnaround in performance in only one year through standardization and refined management.
Finally, Lin Yanglin also said that whether it is the self-operated closed-loop management model of "insurance + hospital + doctor" built by Caesar Medical, or the collaborative open platform of "insurance + health management + pharmaceutical service" of United Health Group, it provides a model for the business model innovation of medical and health groups. However, what New Milestone Health Group wants to build is managed care with Chinese characteristics that can reflect extremely high social value - that is, to promote the progress of social payment methods, precision health management, and medical pension models in the urban area, so that medical insurance can pay less, people can reduce the burden of medical treatment, and health care will be supported, and pension payment will be guaranteed.
At present, in every aspect of benchmarking against the world's first-class, New Milestone Health Group is exploring, practicing and innovating.
"Medical" + empowerment
30,000 - is the current number of beds owned by New Milestone Health Group. This figure is second only to General Motors and Sinopharm in the echelon of central enterprises. In the expansion of the network mainly composed of medical institutions, the scale effect of New Milestone Health Group has occupied the top echelon.
However, under the mainstream pattern of "general hospital management and profits are not as good as specialized hospitals", Lin Yanglin told the reporter of "Yingcai": "The chassis logic of the new mileage health group to build four pillar industries is to rely on the support of comprehensive medical capabilities to empower health care, medicine and insurance. ”
On both sides of the high-quality development equation of New Milestone Health Group, on one side is a "world-class health group", and on the other side is a closed loop of the big health industry built by the four major industries of "medical treatment, health care, medicine and insurance". In Lin Yanglin's view, general hospitals are the "infrastructure" in the four-dimensional development equation of "medical care, health care, medicine and insurance".
After Hengkang was reorganized and renamed as New Milestone (002219), it began to implement standardization and refined management, and continued to rewrite the "old knowledge of the industry" with its continuous good revenue and profit performance.
According to the data, after the acquisition of New Milestone Health Group, the revenue of New Milestone (002219) medical service business maintained growth, and the gross profit margin continued to increase. In the first half of 2023, the medical services segment contributed a net profit of 14.8 billion yuan, net profit margin of 106%, net profit increased by 58 million yuan year-on-year, and net profit margin increased by 37%。During the same period, the net profit margin of the core assets of listed companies such as Wafangdian Third Hospital and Lankao First Hospital also increased significantly.
According to the first one, with the gradual implementation of the three-year high-quality development plan of the new mileage, the profit margin of medical services is expected to remain at a reasonable level of 9%-10% in the future.
Lin Yanglin believes that after the expansion of the bed scale, the replicable standardized management of general hospitals will promote the continuous improvement of operations, and promote the integration, coordination and empowerment of upstream and downstream industrial chains.
In the pharmaceutical business segment, on November 8, 2023, Duyiwei Pharmaceutical and Foren Pharmaceutical, two enterprises rooted in Longnan City, Gansu Province, held a merger and acquisition closing ceremony locally. According to public information, after the completion of the merger and acquisition, Duyiwei Pharmaceutical holds 80% of the shares of Foren Pharmaceutical. From the completion of the reorganization of Hengkang, to the capital increase and expansion of Duyiwei after the reorganization, and then to the alliance between Duyiwei and Foren Pharmaceutical, the layout of the whole industrial chain of traditional Chinese medicine built by the new milestone rooted in Longnan City has been completed.
According to the data, after the completion of the delivery, Duyiwei Pharmaceutical will add 46 batch numbers of Chinese medicine quasi-words, add 58 acres of factory area, add more than 600 employees, and expand its business scope to the upstream Chinese herbal medicine planting and Chinese medicine decoction piece processing, purchase and sales.
Lin Yanglin told the "Yingcai" reporter that the development of the traditional Chinese medicine industry is in line with national policies;But at the same time, there is a mismatch between China's TCM brands and market capabilities. Many excellent traditional Chinese medicine brands with a history of decades or even hundreds of years have not built strong market capabilities, such as channel construction, sales capabilities, R&D capabilities, brand building, etc., resulting in insufficient value and promising market opportunities. "Pharmaceutical + consumption" will become the direction of the traditional Chinese medicine business of New Milestone Health Group. Pharmaceuticals are the best needs to solve diseases, and consumption is to solve the health management needs of aging.
It is understood that New Milestone Health Group will take the national well-known trademark "Duyiwei" as a platform to integrate the upstream and downstream industrial chains, lay out healthy consumer products, integrate high-quality brands, etc., expand and strengthen the traditional Chinese medicine sector, and realize the connotation upgrade of pharmaceutical IP + consumer IP. The merger and acquisition of Duyiwei Pharmaceutical and Foren Pharmaceutical is a successful practice of this development strategy.
The completeness of the medical infrastructure actively built by New Milestone Health Group and the empowerment of standardized and systematic management have been clearly verified in the performance announcement of New Milestone (002219), a listed company positioned as a two-wheel drive of "medical + pharmaceutical". In the first three quarters, listed companies achieved revenue of 250.7 billion yuan, a year-on-year increase of 75%, deducting non-operating net profit 13.9 billion yuan, a year-on-year increase of 143%;Among them, the medical service business achieved revenue of 211.3 billion yuan, a year-on-year increase of 57%%, medical service profit 18.7 billion yuan, a year-on-year increase of 569%。
Four-dimensional equations
Today, New Milestone Health Group is writing the four-dimensional equation of "medical care, health care, medicine and insurance".
Lin Yanglin said that the acceleration of aging, the pressure on medical insurance will be increasing, and the development of commercial insurance is one of the active options to deal with the aging of the population. New Milestone Health Group is also taking advantage of the trend and is promoting the construction of a deep integration of medical treatment, health care and insurance, forming a continuous service industry chain of "medical health care and insurance".
At the beginning of January 2023, New Milestone Health Group subscribed for the new registered capital of Aixin Life Insurance Co., Ltd200 million yuan, which holds 1584% equity, becoming the largest shareholder of Aixin Life. The entry of the insurance field has opened up the road of integration of "medical care + insurance" of New Milestone Health Group.
Lin Yanglin has clear expectations and plans for the empowerment of Aixin Life and the role of insurance in the "four-in-one" value system of Xinmile Life: first, the medical resources of major shareholders will be fully shared and empowered to Aixin Life, so that Aixin Life can establish its own resource endowment and development advantages, so as to form local characteristics and competitive barriers that are different from other small and medium-sized financial institutions;Second, promote the full integration and innovation of insurance products with medical resources and medical capabilities, create specialized and special disease insurance that meets the needs of the aging population, enhance the social security function, and meet the multi-level medical and pension needs of the aging population to a greater extentThird, we should give full play to the characteristics of long-term insurance funds, rationally invest in the layout of large health industry enterprises, especially high-quality head medical and health care enterprises, enhance the empowerment and synergy between health care, insurance and medical care, and develop our own advantages and give full play to our own value in the construction of a healthy China.
However, at the same time, it should also be noted that although New Milestone Health Group hopes to achieve the chemical reaction of "medical +" through the "four-in-one" layout, the objective constraints of the market cannot be ignored. In the environment of aging medical demand and medical insurance cost control, how to achieve the greatest common divisor between enterprise development and patient benefits not only requires enterprises to enter the game, but also needs to move in the same direction as the needs of the times.
On October 31, 2023, Aixin Life and Hebei Tangshan Hongci Hospital, a subsidiary of New Milestone Health Group, jointly launched a lung health management product with the nature of "sick insurance". Obviously, this is an active exploration made by New Milestone Health Group in the connection between specialized diseases and insurance.
Starting from a single specialty and special disease program, the managed care model will be expanded to more specialized and specialized disease insurance projects in the future. Lin Yanglin said that New Milestone Health Group has set up 15 discipline professional committees, aiming to promote the standardization of diagnosis and treatment of specialized diseases, and it is by virtue of the group's accumulated experience and advantages in the field of medical management that it is possible to create and dig deep into the managed medical model and value of "medical + insurance".
Nowadays, the integration of insurance and professional health management services is changing from the primary stage to the integration stage, and new opportunities in the industry are becoming a trend. The "east wind" at the policy level is also blowing, and the development of insurance for sick bodies is frequently mentioned. At the beginning of 2022, the former China Banking and Insurance Regulatory Commission issued the "Report on the Development Issues and Suggestions of China's Commercial Health Insurance" to life insurance companies, pointing out that China's commercial health insurance is still in the initial stage of development, and in terms of product supply, it is simple to turn away the sick and the elderly, which directly refers to the current lack of protection, and it is recommended to provide more protection options for the sick.
As Lin Yanglin said in an interview: "There is never a perfect time, but developing consensus can create opportunities." "New Milestone Health Group is using the writing of the "four-dimensional" equation to promote enterprise operation and even industry progress to achieve high-quality development.