China's medical and aesthetic industry status quo and trend analysis: "Internet and value economy" driven, light medical beauty accounted for 70% of the market
> the development of China's medical beauty industry <
According to Article 2 of the Measures for the Administration of Medical Beauty Services, medical beauty refers to the repair and replaining of human appearance and the shape of various parts of the human body using surgery, drugs, medical devices and other traumatic or invasive medical techniques.
Medical beauty is divided into surgical and non-surgical medical cosmetics according to the need for surgery, and is performed by registered professional physicians and medical professionals.
For the united States, South Korea and other major medical and Aesthetic countries, China’s medical and Aesthetic industry started late, its development process can be roughly divided into three stages:
Figure 1: The development course of China’s medical and aesthetic industry is compiled according to public information
From 1949 to 2008, with the first establishment of plastic surgery in public hospitals as a sign, the domestic medical and aesthetic industry began to sprout. In 1949, The third hospital of Peking University established plastic surgery for the first time in China, marking the budding of China’s medical and aesthetic industry.
Since then, a number of public hospitals have set up plastic surgery departments, such as the Chinese Academy of Medical Sciences Plastic Surgery Hospital. During this period, the main demand for medical beauty comes from post-injury repair, correction and other passive plastic surgery.
2008-2014 is the initial stage of the industry, upstream raw materials manufacturers are developing well, leading to the emergence of private medical institutions.
This phase has three characteristics:
The first is a number of related companies listed or listed, such as Huaxi Bio Hong Kong listing in 2008, 2010 Huahan Plastics was established;
Second, the industry integration and mergers and acquisitions frequently, Langzi shares, Suning Global, Fosun, etc. are through mergers and acquisitions to the medical and aesthetic industry layout;
The third is the further deepening of China-ROK cooperation, with Langzi, Evergrande as the representative, and constantly introduce Korean technology and doctors and promote.
From 2014 to the present, capital has helped the industry to prosper, and the wave of “Internet Plus” has given birth to the Internet Medical Beauty Platform. Driven by the dual drive of mobile Internet and consumption upgrading, the Internet medical beauty platform has grown and become the hub link of medical beauty industry chain. Since 2014, New Oxygen, more beautiful, Yuemei network and other Internet medical and beauty platforms favored by the capital market, has been a number of rounds of financing.
> Medical Beauty Industry Chain Profile <
According to the upstream and downstream relationship between medical and beauty products from manufacturing to serving consumers, the medical beauty industry chain can be divided into upstream raw material equipment manufacturers and downstream medical and aesthetic institutions, upstream raw materials including equipment, needles and auxiliary materials, through direct or distribution manufacturers to reach downstream private or public institutions, to provide appropriate services for medical and Aesthetic consumers.
In addition, with the development of Internet technology and the infiltration of consumer groups, the Internet Medical Beauty platform on the one hand through the link to medical and aesthetic institutions, to help upstream manufacturers simplify the distribution process, on the other hand, to assist consumers to make efficient decisions. Related service providers include medical and aesthetic industry information service providers, medical beauty APP, medical and aesthetic insurance and so on.
Figure 2: Medical beauty industry chain
> the current situation of China's medical beauty industry <
With the improvement of economic conditions and the continuous improvement of living standards, while Chinese consumers are affected by the new trend of international medical beauty, medical and aesthetic consumption consciousness gradually awakened, medical beauty market shows a rapid development trend. China’s medical and U.S. market reached 176.9 billion yuan in 2019 and CAGR was 28.54 percent in 2015-2019, a faster growth rate than in the same period around the world.
Figure 3: Global and Chinese Medical and Beauty Market Size 2015-2019 Source: Lemon Aimee, Ari, et al
Upstream: raw materials and equipment overall concentration is high, domestic accelerated replacement
Medical beauty can be divided into surgical category (re-shaping) and non-surgical category (light medical beauty), of which China’s light medical beauty market capacity has been steadily expanded, accounting for a stable proportion of the overall medical and Aesthetic market size.
Surgical medical beauty programs include eyelid shaping, nasal plastic surgery, oral orthodontics, hair implants and other head and face projects, breast augmentation and other chest items, as well as liposuction and other body items. Non-surgical medical beauty programs include botulinum toxin, bouric acid and other injections, facial youth programs such as photonic skinning, and other items such as dental beauty.
China’s light medical beauty market accounted for the overall medical beauty market size of the proportion is much higher than the surgical cosmetic plastic surgery market, in recent years stable at about%-70% In 2018, China’s light medical U.S. market size was 102.8 billion yuan, up%；2019年，中国轻医美市场规模为1191亿元，同比增长15.86%
Figure 4: China’s light medical U.S. market size accounts for a high proportion of the overall medical U.S. project size Source: Aerie Consulting
Figure 5: China Light Medical Beauty Market Size Source: Aerie Consulting
Light medical raw materials, injection fill class to uric acid, botulinum toxin-based.According to ISAPS data, the use of botulinum toxin and bouriic acid plastic surgery projects reached 5.03 million cases and 3.3 million cases, accounting for a total of%，根据新氧大数据，我国注射医美中，玻尿酸和肉毒素的占比达到66.59% and 32.67,%，占比共计99.26%
Figure 6: Distribution of Injecting Medicine in China Source: New Oxygen Data
Upstream products have high technical barriers, strict listing approval, resulting in a high concentration of upstream manufacturers.In our country, to get the medical device certificate of bouric acid III needs 3-5 years, and to get botulinum toxin drug market registration certificate is 5-8 years, therefore, the medical and American upstream drug chain by virtue of strict policies and technical barriers, has a high moat advantage.
Up to now, a total of 16 enterprises in China’s mainland market have NMPA issued a medical device registration certificate, while there are only 4 enterprises with botulinum toxin biopharmaceutical registration certificate, of which only 1 domestic.
Source: NMPA, Firestone Creations
Hyaluronic acid (commonly known as bouriic acid): is a natural polymer adhesive polysaccharide consisting of N-acetylamine glucose and D-glucoalic acid as structural units, widely found in connective tissue and body fluids in vertebrates, with unique viscosity and excellent water retention properties.
At present, pharmaceutical-grade hyaluronic acid end products mainly cover three applications: medical beauty, orthopaedic treatment and ophthalmology treatment. In 2018, the medical beauty market is larger than other applications, reaching 3.70 billion yuan, and the growth rate is higher than in other areas, with a CAGR of 32.3% in 2014-2018. In 2020, China’s medical beauty hyaluronic acid end products market size is expected to reach 4.82 billion yuan.
Figure 7: China’s pharmaceutical-grade hyaluronic acid end products market size (RMB 100 million) Source: Frost suliivan
China’s uric acid market import-led, domestic alternative space is larger. At present, through the State Drug Administration (NMPA) of the bouric acid subdivision products have more than 20 kinds. In terms of sales, the top four companies in the market size of bouric acid products are all foreign-funded enterprises, with a combined 68% share in 2019, with imported products dominating the market.
From the sales point of view, domestic uric acid sales in 2018 has exceeded 40% of the gradual rise of domestic brands. With the continuous improvement of the cross-linking method and production process of domestic bouric acid products, the gap between domestic products and imported products in terms of concentration, cross-linking degree, particle size, hardness, cohesion and so on will gradually narrow, and the process of domestic replacement of bouric acid will be deepened day by day.
Figure 8: China Medical AND HA Product Sales Rankings 2019 Source: Frost suliivan
Figure 9: China Medical AND HA Product Sales Rankings 2018 Source: Frost suliivan
Botox endotoxin (commonly known as Botox): Is a toxic protein secreted by Botox during reproduction, with strong neurotoxicity.
Botulinum toxin, as a nerve agent, can be irreversibly cut neurotransmitter conduction complex, inhibit nerve endings to release acetylcholine, thus causing muscle relaxation paralysis.
However, its biggest application is not in the medical field, but for dynamic wrinkle correction, thin face, thin legs and other medical needs. The overall market size of Botox in China is in the stage of rapid growth. According to Limu Information Consulting, the size of the botulinum toxin market sold through formal channels in China has accelerated since 2015, reaching 3.92 billion yuan in 2018, an increase of 32% year-on-year.
Because the product is more toxic, it is strictly regulated by the state.At present, China’s official certification of only four (domestic “heng force”, the United States imported “Baodu fit BOTOX”, the United Kingdom Epson production of “Lishuto Dysport” and South Korea’s Hugel company developed “Lottie Letybo”);
Looking at the world, the United States Baoduxi a unique, South Korean large botulinum toxin manufacturers have a Chinese layout, there are a number of manufacturers botulinum products in research, Britain, Germany, Russia and India have product layout.
Laser beauty equipment: medical equipment market a wide variety of equipment, including laser beauty equipment through the “light intervention” way to achieve the effect of plastic surgery, beauty and medical market has become the backbone. Laser beauty instruments can be used in soft skin, de-mole, wrinkle removal, hair removal and other fields.
According to public information, China’s laser beauty equipment market is developing rapidly, with a market size of 2.84 billion yuan in 2019, up 19.73 percent year-on-year.
Laser beauty instruments rely on imports, domestic in the market is gradually recognized. Although China’s laser medical beauty equipment enterprises, but the mainstream equipment for imported products. In the optoelectronic equipment industry, foreign giants and local advantage enterprises are relatively mature, and the concentration of the industry is high.
Currently common suppliers of imported laser medical equipment are Alma, Lumenis in the United States, Cynosure in the United States, etc., accounting for up to 80% of the formal equipment, dominated.
Domestic medical and aesthetic equipment industry started late, the enterprise technology base is relatively weak. Through extended investment and mergers and acquisitions and independent research and development, domestic laser medical beauty enterprises continue to enhance their research and development capabilities, improve product quality, market share has been gradually improved.
Specific products, Wuhan Qiqi laser photonic therapy instrument and semiconductor laser epilator, Shenzhen Peninsula Medical acne treatment instrument, Shenzhen GSD multi-rflendi beauty instrument and other products, in the market is gradually recognized.
Downstream: beauty and plastic hospital industry entry barriers are low, distribution imbalance, in the “Internet plus” trend is expected to reconstruct the medical and aesthetic industry ecology.
China’s current medical and beauty hospital market, the service terminal is mainly divided into public hospital plastic surgery and private beauty hospital two lineups.
Overall, private specialist beauty hospitals and its clinics account for the vast majority of the market space. However, because the public hospital concentrates the industry’s top experts and surgeons, with the most advanced medical and aesthetic resources and technology, management norms, high degree of trust, public hospitals are still a very important part of the domestic medical and aesthetic industry.
Public hospitals are expected to revitalise in the market competition of medical beauty and jointly promote the rapid development of China’s beauty industry with private capital.
At present, medical and Aesthetic institutions, professionals are mainly concentrated in the developed areas in the east.Although the market coverage in the location of the cross has achieved the expansion to the central cities in the Midwest, but the market breadth of the Midwest second- and third-tier cities market space is still blank, product promotion and business expansion is still lack of channels, downward expansion will take time.
Overall, China’s medical and aesthetic market has formed to Beijing, Shanghai, Nanjing, Guangzhou, Hangzhou, Shenzhen, Wuhan, Changsha, Chongqing, Chengdu as the center of gravity layout, can be roughly divided into east, north, south, central and western China four sectors, of which North, East, South China market occupies the vast majority of the share.
Figure 10: China’s medical beauty market geographical distribution
Through the relationship between Medical America and consumers, Internet platforms are expected to lead the transformation of Medical Andy’s institutions.The main problem facing private beauty hospitals is that the cost of selling and receiving customers is too high, and consumers are also faced with the embarrassment of asymmetrical information on supply and demand of medical and aesthetic products.
Medical-American APP platform mainly through the content of the community, e-commerce or appointment referral form to gather users, build a B-side institutions, doctors and C-side customers to communicate the bridge, improve the efficiency of user decision-making, but also reduce the organization’s marketing costs. From 2011 to now has emerged such as new oxygen, Yuemei, the United States medical beauty and dozens of medical apps.
Medical Beauty App to a certain extent to clean up the industry, the medical and Aesthetic industry to transparency, standardization, to a certain extent, the collapse of the use of information between buyers and sellers do not charge the phenomenon.
But from the present point of view, the relevant Medical Andy APP has not found a sustained and sound profit model, short-term business exploration-oriented.
> future development outlook <
At present, China’s medical and aesthetic market is in the process of rapid development, facing the following more prominent problems:
The market is more chaotic: medical and american raw materials and drugs are more chaotic, there are overpacking items, excessive consumption of drugs, etc.
Industry concentration is very low: the market share of head enterprises can only reach about 5%, most of the market is concentrated in the middle and long tail of some enterprises;
Medical resources can not meet the demand: doctors, nurses and other expert teams, as well as hospital management personnel are relatively scarce, with the rapid expansion of the medical market, the industry’s medical resources will become more and more tight;
The industry’s regulation is still lacking: many medical and aesthetic regulatory systems and policies are still in the process of being explored and perfected.
Since 2002, China’s medical and aesthetic industry supervision is becoming more and more strict. The state has issued the management methods, institutional standards and hierarchical management directory of medical beauty services, and issued the evaluation standards and rules of medical and aesthetic institutions.
In 2016, The China Plastic and Aesthetic Association was established, and the medical and aesthetic services agency officially entered the era of compliance. In 2020, the Health And Health Commission and other eight ministries jointly issued the “Notice on further strengthening the comprehensive supervision and enforcement of medical beauty”, to crack down on black medical beauty, and further rectify the medical and aesthetic industry.
With the increase of non-surgical items in the global medical beauty market today, injection filling projects are favored, consumers for medical beauty institutions after-sales service, quality and contract complaints increased, relevant departments should be in accordance with the trend of the industry market, targeted medical beauty services and drugs supervision, further promote the reform of the structure of the medical beauty industry, improve the industry to regain customer marketing, light professional medical adverse phenomenon.
> concluding remarks <
In the wave of “value economy”, the heart of beauty is everyone, the rise of disposable income per capita is a rapid amplification of the “love of beauty heart” an important factor. In the medical and Aesthetic industry chain, upstream raw materials and equipment domestic substitution acceleration, downstream industry is more chaotic.
However, the trend of “Internet plus” is expected to reconstruct the medical and aesthetic industry ecology, while the state issued a series of policies to guide the industry to standardization and healthy development, driving the healthy development of the industry.
Source: Firestone Creations