On December 18, 2023, Beijing Yuanxin Technology Group Co., Ltd., Beijing Yuanxin Technology Group Co., Ltd. (hereinafter referred to as “Yuanxin Technology”) submitted a prospectus to the Hong Kong Stock Exchange to go public on the Hong Kong Main Board. This is another application after it failed four times on October 15, 2021, April 19, 2022, October 21, 2022, and May 29, 2023.
Yuanxin Technology received a filing notice from the China Securities Regulatory Commission on July 26, 2023 for the issuance and “full circulation” of domestic unlisted shares issued and domestic unlisted shares.
Link to Yuanxin Technology's prospectus:
https://www1.hkexnews.hk/app/sehk/2023/106044/documents/sehk23121800924_c.pdf
Main business
Yuanxin Technology, founded in 2015, is a leading healthcare company that provides services focused on the patient's medical service cycle. According to Frost & Sullivan, in terms of revenue in 2022, Yuanxin Technology is the largest offline online medical delivery platform focusing on prescription drugs in China. Dr. Maoshou, a comprehensive online medical service and pharmacy platform owned by the company, was one of the first Internet hospitals in China to obtain a medical practice license.
Yuanxin Technology's services include comprehensive out-of-hospital patient services, supply-side enablement services, and medical industry-side empowerment services.
Out-of-hospital comprehensive patient services
It mainly includes out-of-hospital pharmacy services, out-of-hospital medical services, and pharmaceutical wholesale services. Yuanxin Technology provides personalized and caring services to patients through the national offline pharmacy network Yuanxin Pharmacy and Online Pharmacy Master Doctor. As of June 30, 2023, Yuanxin Technology has opened 321 pharmacies in 30 provinces in China. Of these, 265 are located within 1 km of hospitals, and 121 pharmacies have been designated as dual-channel pharmacies for major medical insurance. The company's offline and online pharmacies provide about 59,700 varieties of products. The product portfolio covers 96 of the 123 innovative cancer treatment drugs approved by the State Drug Administration. In the first half of 2023, Dr. Wonderful Hand had an average of 35.3 million monthly user visits. In addition to providing patients with a wide range of online services (such as follow-up and follow-up prescriptions), Yuanxin Technology also provides a variety of offline medical services through outpatient clinics in 14 provinces, including online consultations, infusion services, pharmacist consultation, medication management, compliance management, and consultation plans. Yuanxin Technology launched a pharmaceutical wholesale service in 2017 to complement the out-of-hospital pharmacy business. It mainly provides a number of new specialty drugs to third-party retail pharmacies and drug dealers, followed by other prescription drugs and non-prescription drugs.
Supply-side enabling services
Yuanxin Technology has introduced a set of standardized and modular services and solutions developed by the company to help hospitals intelligently and optimize their hospital operations, with the aim of enhancing patients' in-hospital experience and addressing their unmet needs for full course management of the disease. Supply-side enabling services mainly include digital services for in-hospital patients and intelligent integrated hospital workplaces. As of June 30, 2023, Yuanxin Technology has cooperated with a total of 467 hospitals, covering 26 provinces and more than 100 cities in China, including more than 180 top three hospitals.
Empowering services for the medical industry
Yuanxin Technology further empowers other industry participants (such as pharmaceutical companies and insurance companies) by providing targeted innovative solutions. The services mainly include disease process management and service packages for patients, innovative marketing services, and insurance services for pharmaceutical companies. The company has established an innovative insurance technology platform, Yuanxin Huibao, to help insurance companies provide innovative payment methods that integrate medical services and data analysis. As of June 30, 2023, Yuanxin Technology has provided services to 177 insurance companies and 8 reinsurance companies, cooperated with insurance companies to launch more than 40 new specialty drug insurance products, helped launch inclusive commercial health insurance in more than 120 cities, distributed a total of 57 health insurance products, and managed 58.3 million insurance policies. Yuanxin Technology also provides marketing services to pharmaceutical companies. As of June 30, 2023, it has provided marketing services to 321 pharmaceutical companies, covering the top ten pharmaceutical companies with the most powerful R&D capabilities in China and 15 of the world's top 20 pharmaceutical companies.
Shareholder structure
According to the prospectus, in Yuanxin Technology's shareholder structure before listing,
Tianjin Chuanyou Group holds 29.82% of the shares (Tianjin Chuanyou Group is controlled by He Tao and He Weizhuang respectively, 92.56% and 7.44%);
The stock reward program platform Yuanmiaoren holds 7.19% of the shares (He Tao has voting rights);
By controlling Tianjin Chuanyou Group and Yuanmiaoren, Mr. He Tao held a total of 37.01% of the shares.
Tencent, holding 19.55% of shares;
Sequoia Capital, holding 15.75% of shares;
SCHP, holding 0.47% of shares;
Qiming Venture Capital, holding 6.90% of shares;
Astral New Economy, holding 6.51% of shares;
Kunling, holding 4.54% of shares;
KL Health, holding 0.78% of the shares;
INCE Capital, holding 1.77% of shares;
CITIC holds 1.60% of the shares;
CICC holds 0.93% of shares
Aobo Capital OrbiMed holds 0.68% of the shares;
Index, holding 0.50% of shares;
Yi Fang, holding 0.31% of shares;
Others include Bank of China International, Qichuang Keyuan, ABI Asia, Guangxi New Channel, B Capital, etc., which together hold 2.70% of shares.
Directors and Executives
The board of directors of Yuanxin Technology consists of 9 directors, including 4 executive directors, 2 non-executive directors, and 3 independent non-executive directors.
Board of Directors (9 members)
Auditors (3)
Executives (5)
Executives include Mr. He Tao, Executive Director, Chairman of the Board and Chief Executive Officer, Mr. He Weizhuang, Executive Director and Senior Vice President, Mr. Luo Dongtao, Executive Director and Senior Vice President, Mr. Zhang Huanchang, Executive Director, and Ms. Wen Jing, Chief Financial Officer.
Company performance
According to the prospectus, in 2020, 2021, 2022 and the first half of 2023, Yuanxin Technology's operating income was 3.629 billion yuan, 5.938 billion yuan, 7.775 billion yuan and 4,645 million yuan respectively. The corresponding net losses were RMB 363 million, 757 million, 805 million and 442 million yuan respectively. The corresponding adjusted net losses were RMB 313 million, 621 million, 696 million and 391 million yuan respectively.
Intermediary team
Yuanxin Technology's intermediary team for this IPO mainly includes: Goldman Sachs and CITIC Securities as their co-sponsors and overall coordinators; Ernst & Young as auditors; Jingtian Gongcheng and Shida are the company's Chinese lawyers and the company's Hong Kong and US lawyers respectively; Tianyuan and Fuerde are their Chinese brokers and Hong Kong and US lawyers; and Frost Sullivan as their industry advisors.
