Yidu Tech Inc. (“Yidu Tech” or “the Company”, together with its subsidiaries and consolidated affiliated entities, “the Group”, HKEx: 2158), a leading corporate in China’s healthcare intelligence industry, announced the interim results for the six months ended 30 September 2022 (“the first half of FY2023” or “the Reporting Period”).
Despite the challenging and uncertain external environment, the Group remained committed to improving profitability with a strategic focus. The Group continues to focus on applying digital and intelligent applications to multiple use-case scenarios, concentrating on key disease research areas such as solid tumors, hematology, ophthalmology and immunology to further strengthen its core competence, improve customer experience and increase customers’ average transaction value. During the Reporting Period, the Group reported a total revenue of RMB474.4 million and adjusted net loss narrowed to RMB224.8 million, a decrease of 30.3% year-on-year. Total operating expense as a percentage of revenue decreased by 32.1 percentage points.
Ms. Gong Yingying (Rujing), Chairlady and Founder, Executive Director and Chief Executive Officer of Yidu Tech, stated, “The Group has taken proactive and effective measures to enhance operational efficiency and has successfully narrowed its loss and adjusted net loss significantly during the Reporting Period, which is a testament to the effectiveness of our business development strategy. We expect a continued improvement in operation efficiency going forward, and we will continue to make progress toward achieving profitability. Yidu Tech will adhere to its original vision of ‘green healthcare’, continue to enhance its core technology capabilities, and deepen its efforts in the three scenario categories of research, diagnosis and treatment, and public health, in order to create more value in the healthcare intelligence industry.”
Deep cultivation of three major scenarios with strategic focus on aiding commercialization
During the Reporting Period, Yidu Tech proactively enhanced its profitability with a strategic focus on four major areas: business, customers, diseases and organization.
In terms of business, Yidu Tech continues to focus on scenarios in three major categories, namely research, diagnosis and treatment, and public health. The Company promotes multi-scenario applications based on the three categories, achieving scenario-driven optimization of intelligence. Driven by innovation, the Group continuously upgrades its portfolio of high-quality professional products and services to meet the diverse demands of its core customers.
In terms of customers, Yidu Tech focuses on serving core hospitals and core pharmaceutical companies with high revenue retention. In the Big Data Platform and Solutions (“BDPS”) segment, the Company upgraded and launched the All Disease Data Platform, which facilitates the DIY creation of disease registries by hospitals. In addition, in the Life Science Solutions (“LSS”) segment, the revenue retention rate for the top 10 clients reached 119%.
In terms of diseases, during the Reporting Period, the Group concentrated on key disease research areas including solid tumors, hematology, ophthalmology and immunology. Regarding organization, based on the intelligent “medical brain” YiduCore and the overlapping applications of its core capabilities, Yidu Tech continued to enhance the synergy among the three business segments and to increase customer awareness. Meanwhile, the Group continuously improved the business penetration and internal operating efficiency, and continued to reduce the ratio of total operating expense to revenue during the Reporting Period, which was brought down by 32.1 percentage points year-on-year.
Continuous Technological Innovation to Drive the Development of the Healthcare Intelligence Ecosystem
Guided by the national strategy of high-quality development driven by innovation, the “14th Five-Year Plan” and the “Healthy China 2030” policy, China has put in place series of policies to encourage scenario-driven proprietary innovation. As a leading corporate in the healthcare intelligence industry, Yidu Tech has continuously improved its capabilities in independent R&D and innovation, focusing on solving the pain points faced by the healthcare industry as it undergoes an intelligent transformation.
Over the years, Yidu Tech has independently developed YiduCore which consists of algorithms and insightful medical knowledge that are continuously accumulated and constantly iterated as the Group expands its use-case scenarios with proper authorization. In the first half of FY2023, Yidu Tech continued to invest resources in cooperation with renowned hospitals and experts, to continue empowering its ability to build and enrich a disease labelling system that encompasses various fields of diseases. As of 30 September 2022, YiduCore’s medical knowledge graph covers over 80,000 medical objects, of which the number of diseases covered by the disease knowledge graph has exceeded 10,000, an increase of over 1,000 compared to six months earlier.
With YiduCore’s strong data processing capabilities and AI algorithms, as well as its accumulated medical knowledge, insights and disease models, Yidu Tech has undertaken a total of 19 scientific research projects with its partners, including renowned hospitals, regulators and universities, of which 8 are national-level research projects sponsored by the Ministry of Science and Technology of China and other national ministries. As of 30 September 2022, the effectiveness and accuracy of its pandemic response and prediction algorithms have been validated in 22 cities.
In terms of privacy protection, the Company participated in the preparation of the Research Report on the Application of Privacy Computing (2022) issued by the Institute of Cloud Computing and Big Data of the China Academy of Information and Communication Technology (CAICT). In addition, by virtue of its outstanding remote operation and maintenance technology, Yidu Tech obtained the Certificate of Remote Operation and Maintenance Safety Capability Inspection issued by the Internet Health Care Industry Alliance and CAICT.
Balanced development of three business segments, demonstrating strong business resilience
During the Reporting Period, the revenue of all three business segments maintained a balanced development, demonstrating strong business resilience.
The Big Data Platform and Solutions segment generated revenues of RMB 124.0 million during the Period. One aspect of this segment is Yidu Tech’s provision of AI-based intelligence platforms and data analytics-driven solutions to regulators and policy makers. During the Reporting Period, the Group led a consortium and won the contract for the Infectious Disease Intelligent Multi-point Surveillance Early Warning Platform for Beijing. With AI-empowered analytical tools and top-notch simulation models, the Group has expanded its solution offerings from public health to population health. During the Reporting Period, the Group won the construction of regional healthcare profiling for local residents in Chaoyang District, Beijing.
The other aspect of this segment is the Group’s continued effort to deepen its insight into diseases. In the field of hematology, the Group has partnered with two of China’s only three hematologic diseases National Clinical Research Center (NCRC) hospitals in developing a hematologic disease research network to conduct efficient clinical trials and multi-institutional real-world studies. Meanwhile, the Group has assisted its clients to develop a number of disease registries and large clinical research cohorts for major hematological diseases, including leukemia, coagulation disorders and aplastic anemia. With the successful precedented cases in hematology, the Group made breakthroughs in the field of dermatology by winning the contract with Institute of Dermatology, Chinese Academy of Medical Sciences, one of China’s top two hospitals in the field of dermatology, to build a disease research platform.
The Life Science Solutions segment achieved revenue of RMB 146.5 million during the Reporting Period. With accumulated credentials in focused disease research areas, as of 30 September 2022, Yidu Tech has performed 232 clinical research trials, including clinical trials sponsored by pharmaceutical companies and investigator-initiated trials (IIT). The Group has performed 185 prospective and retrospective real-world studies. Its Intelligent Site Management Organization (iSMO) services have covered 163 sites, more than doubling the number from last year. It is worth noting that, during the Reporting Period, the Group conducted a comprehensive retrospective real-world study which related to the evaluation of the efficacy, safety and treatment modalities of a new drug for patients with complex abdominal infections in ICU for a top 20 multi-national pharmaceutical companies (MNC) client to assist it to obtain the approval from the Center for Drug Evaluation, National Medical Products Administration (CDE).
The growing track records has enabled the Group to continuously develop the LSS segment and maintain its high-quality customer base. As of 30 September 2022, there were 143 active clients. Among its top 20 clients, there were 7 MNC and 16 listed companies.
The revenue of the Group’s Health Management Platform and Solutions segment amounted to RMB 203.8 million. Leveraging medical insights powered by YiduCore and AI empowerment, Yidu Tech facilitated its customers’ ability to design and develop innovative insurance products, enabling faster and more accurate insurance underwriting and expediting claim processing. During the Reporting Period, the Group continued to increase the market penetration of the Hui Min Bao business, serving 3 provinces and 10 cities. Yidu Tech has assisted three of the four municipalities directly under the central government in China to launch Hui Min Bao products, including Tianjin, Beijing and Chongqing. As of 30 September 2022, the number of active users who have completed at least one transaction on Yidu Tech’s health management platform reached 15 million.
Furthermore, the Group’s advanced intelligence technologies greatly improve the operating efficiency of Hui Min Bao. As the main operating platform for Jiangsu Hui Min Bao, the Group underwrote more than 3 million Jiangsu Hui Min Bao policies and approximately 76% of total claim amounts were completed by the Group’s intelligent claim settlement services. Compared with traditional methods, the Group’s intelligent claim settlement services tripled the productivity of processing claims, reducing the financial burden of the insured and further encouraging participation.
As the market leader with the largest market share in the healthcare intelligence market, the medical institutions and regulatory agencies healthcare intelligence market as well as the emerging healthcare intelligence market in China, Yidu Tech is committed to contributing to the intelligent transformation and upgrading of the healthcare industry, as well as the high-quality development of the healthcare industry. In the future, Yidu Tech will continue to adhere to its two-pronged strategy, expand its infrastructure network, deepen its research into diseases, maintain its strategic focus on business, customers, diseases and organization, and contribute to creating the healthcare intelligence ecosystem, upholding its mission to make value-based precision healthcare accessible to everyone and create more value for healthcare industry participants.