PE / VC waiting for hospital reform CITIC Medical and other "big crocodiles" waiting for opportunities (VC341)

Founders, CITIC, China Resources, Fosun and other large groups have all been deployed in the medical industry for many years, from medicines and medical devices to specialized hospitals to general hospitals. These big groups have gradually entered the core of China's medical system. Then they stopped here and waited for the opportunity. Beside them, there are also various industry funds, VC (venture investment), and PE (private equity investment) waiting.

In the eyes of these waiters, the core of a new round of Chinese medical reform starting in 2009 will be the reform of hospital property rights.

Now, Beijing has issued a clear signal to make waiting worthwhile. It is reported that Beijing's "Several Policies on Further Encouraging and Guiding Social Capital to Host Medical Institutions" is expected to be released this month.

On February 9, 2012, the Beijing Municipal Government promulgated "Several Policies on Further Encouraging and Guiding Social Capital to Organize Medical Institutions (Draft for Comment)", which includes access, water and electricity Preferential policies in 18 areas, such as taxes, fees, talents, prices, and land, are called "Beijing Article 18." This is the first implementation rule promulgated by the local government since the publication of the No. 58 document in November 2011 where the state explicitly encouraged social capital to run medical services.

The predators are in action

The first article of “Beijing Article 18” is to fully open the Beijing medical service market and gradually increase the proportion of socially-run medical institutions. Held ".

Everyone knows that this is an opportunity.

On December 28, 2011, a striking brand CITIC Healthcare was quietly standing on the top of a building on the north of Changhong Bridge in the East Third Ring Road of Beijing. At that time, it had just moved to Beijing.

This company, officially listed on the eighth floor of CITIC Building in Shenzhen on June 18, 2011, integrates a first-level subsidiary of CITIC Group's internal medical industry chain. It has four business departments, including medical, pension, health, and medicine. Subsidiaries and 3 specialized hospitals. It is reported that CITIC Medical has signed a cooperation framework agreement with Tsinghua University. This company will also focus on hospital investment to drive the expansion of its industrial chain companies.

In this industry that needs large capital to promote, CITIC Medical is not the first entrant.

The earliest investment in public hospitals originated from Huayuan Group. In early 2004, the central hospital, the second hospital, the third hospital, the maternal and child health hospital and the Chinese medicine hospital of Xinxiang City, an important prefecture-level city in northern Henan Province, were formally taken over by China Huayuan Life Industry Co., Ltd. The registered capital of the established Huayuan Zhongyuan Hospital Management Co., Ltd. is 150 million yuan, and Huayuan has invested 105 million yuan, accounting for 70% of the shares. The Xinxiang Municipal Government obtained 30% of the equity with the net assets of 45 million yuan from 5 hospitals. Later, due to the capital chain breakage, after Huayuan Group was incorporated into China Resources Group in 2007, China Resources controlled these five hospitals.

With the signal released by "Beijing Article 18", the operating environment of private hospitals will gradually improve. Zhang Yang, president of Sanbo Brain Hospital, believes that the next 10 years must be a blue ocean for the development of private hospitals. Many private hospitals are aware that the door open to social capital will be opened wider.

To endure loneliness and kindness

According to Han Xiaofang, director of the Beijing Municipal Medical Reform Office, the introduction of “18 Beijing” for social medical treatment in Beijing, like the reform of state-owned enterprises in the past, introduced market-oriented competition to enhance the vitality of the medical service market, and forced public hospitals to form public institutions. The hospital has undergone a fundamental transformation.

It is understood that there are currently 22,000 medical institutions above the national level, and the number of social capital medical institutions accounts for 1/3, but only about 10% of the service volume and resource occupancy.

"At present, public hospitals are definitely facing not only basic medical needs, but a large concentration of medical services at all levels." Han Xiaofang believes that under this medical service pattern, the blind expansion of public hospitals will only be managed by the government. Yes, the non-basic piece should be given to the market.

At present, investment institutions such as NEA and Lenovo Holdings in the United States are closely watching the field of private hospitals, and some large domestic pharmaceutical groups are also prepared. In addition, including some real estate developers, they are interested in the impact of a quality hospital on an area, which can drive food, accommodation and transportation in an area and can also improve the quality of life in the community. "Hospitals are not simply doing business. Establishing private hospitals must have a long-term and stable investment awareness." Yu Chunjiang, founder of Sanbo Brain Hospital, bluntly said that the hospital has a brand value and must be a double of economic and social benefits. Return.

"We are doing hospital management with the thinking of enterprise management. The nature of Peking University International Hospital is still a non-profit medical institution." Feng Qiping, senior vice president of Founder Group and CEO of Peking University International Hospital Group, revealed that the group has invested 4 billion yuan to build Peking University International hospital. After the completion of Peking University International Hospital, the group will fully launch the hospital merger and acquisition business. "In cooperation with local or regional general hospitals, we will be represented by hospital management subsidiaries and jointly established hospitals with the local government. Of course, Fang is absolutely controlling."

Unlike the "Central Army" with a state-owned background, Fosun Group focuses on high-end medical services in the field of hospital investment. The United Family Hospital invested by Fosun is regarded as a specialty hospital for obstetrics and gynecology, and the investment in a general hospital will be Fosun's next direction.

According to people familiar with the matter, the big plan for the new medical reform in 2009 is that the social capital-run medical institution is positioned as a provider of high-end medical resources and does not compete with public medical institutions and the government. In the future, the government and public medical institutions will be responsible for guaranteeing basic public services, while social capital-run medical institutions will be aligned with high-end medical institutions.

Li Hongshan, executive vice president of the China Hospital Association, said that the prospects for social capital to run medical services are bright, but it needs to withstand loneliness, because the future demand is high-end services, and the hospital is not profitable within three years. More importantly, the establishment of medical institutions by social capital requires a charitable heart.