TikTok Company buys China’s largest hospital chain for women and children

ByteDance, the Chinese company that owns the controversial video blogging platform TikTok, quietly took control of China’s largest chain of private obstetrics and gynecology hospitals in June.

The South China Morning Mail (SCMP) on Friday reviewed documents showing ByteDance is acquiring full ownership of Beijing Amcare Medical Management Company.

This completed an acquisition process that began in September 2021 when ByteDance’s healthcare investment subsidiary, Xiaohe Health Technology, bought 17 percent of Amcare. Xiaohe later bought another 13 percent. Amcare recently withdrew from the Shenzhen public exchange, paving the way for the final phase of the company takeover.

The acquisition agreement was approved without reservations or conditions by the Chinese state market regulation administration in mid-June. SCMP report. Several ByteDance executives quickly appeared on Amcare’s board of directors.

ByteDance is apparently striving to establish itself in China’s growing online healthcare market, a product that exploded in popularity during the coronavirus pandemic. The Xiaohe division of ByteDance launched two medical apps at the end of 2020: an online “medical consultation” app for people seeking health services and a matchmaking app that validates the credentials of doctors who want to list themselves as healthcare providers.

The SCMP quoted estimates that online healthcare was an industry worth 22 billion yuan in 2020, but will grow to 198 billion yuan ($29 billion) by 2025. Most Chinese tech giants are entering the market, including heavyweights like Tencent and Alibaba.

In the same vein, Amazon.com acquired a chain of 188 clinics called One Medical last month, with a view to establishing an online service that would become the clinics’ digital “front door”.

Amazon’s business planners believed they could significantly improve the “consumer experience” in the clinics, presumably by handling all office functions and paperwork online, so patients spend less time on-site waiting for doctors.

China’s Online Healthcare Systems Involving some remote interaction between doctors and patients, sometimes eliminating the need for patients to visit physical clinics at all. Before the outbreak of the Wuhan coronavirus pandemic, a pioneering project, Wuzhen Internet Hospital, provided online diagnoses and direct shipment of drugs to the patients. Wuzhen Internet Hospital maintained the smallest physical facility possible to comply with Chinese law, with only 20 beds for the entire operation.

China’s Rapidly Growing Online Healthcare Market got a blow in November 2021, when the communist government published a set of stricter rules, including a ban on the use of online consultations to make an initial diagnosis, and a ban on the use of artificial intelligence systems to answer patient questions instead from a qualified human physician.

Apparently, those practices were rife, as online health care providers lost up to 30 percent of their stock value overnight. Chinese state media hinted that there would be more regulation on prescription drug sales and user privacy, further weighing down the industry.

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