The trademark infringement dispute has not been settled, and the rumors of layoffs have risen again, and Ping An Health's response is a routine management action

Text/Xia Fenglin Editor/Xu Zhe

Recently, it was reported that the good doctor of Ping An (1833. HK, Ping An Health Internet Co., Ltd. (collectively referred to as "Ping An Health") made further layoffs in December. Some netizens revealed on the Maimai platform that "the good doctor institution has retreated, 50% of the staff has been cut, and the whole company has laid off more than 800 employees...... The first stock of Internet medical care, which is embarrassing. ”

Ping An Health denied this. The relevant person in charge of the company told the observation network that it is a routine management action to adjust the organizational structure and personnel from time to time according to the needs of business development.

Behind the rumors that Ping An Health was caught in layoffs, the observer noticed that the company was mired in losses. According to Wind data, as of the 2023 interim report, Ping An Health's total loss was as high as 7.069 billion yuan. Under the huge losses, the company frequently changed its leadership to try to reverse the decline in performance, but unfortunately it has not yet achieved results.

It is worth mentioning that the trademark litigation dispute between Ping An Health and Good Doctor Pharmaceutical Group Co., Ltd. (hereinafter referred to as "Good Doctor Group") has been going on for many years and has not yet been resolved. The above-mentioned Ping An Health staff told the Observer.com that it is currently in a lawsuit in the Supreme People's Court. However, in the process, the "Ping An Good Doctor" app has been renamed Ping An Health.

The loss in 9 years exceeded 7 billion yuan

In July 2015, the State Council issued the "Guiding Opinions on Actively Promoting the "Internet+" Action", which clearly proposes to promote a new model of online medical and health care. With the support of policies, backed by the Internet of science and technology, as well as financial and insurance giants, Internet medical companies, have entered this era that belongs to them, and Ping An Group is also one of them.

With the support of Ping An Group, Ping An Health stood out among the earliest Internet medical companies and was the first to run out, and it was also the first giant to go public.

However, after the listing, Ping An Health faced endless losses.

On September 4, Ping An Health announced its 2023 interim results report. During the reporting period, Ping An Health's total revenue was approximately RMB2.222 billion, down 21.5% from the same period last year. The net profit loss attributable to the parent company in the same period was 245 million, a decrease of 47.1% from the same period last year. The gross profit margin increased by 4.84 percentage points year-on-year to 32.19%, of which the gross profit margin of medical services increased to 42.9%, and the gross profit margin of health services increased to 22.9%.

In addition, as of June 30, 2023, Ping An Health had nearly 45 million paid subscribers in the past 12 months. Among them, the cumulative number of B-end service enterprises has increased to 1,198, and the number of paying users in the past 12 months has reached about 3.9 million; The number of paid users on the F side in the past 12 months exceeded 38 million.

According to public financial report data, from 2015 to 2022, Ping An Health's losses were 324 million yuan, 758 million yuan, 1.002 billion yuan, 912 million yuan, 734 million yuan, 948 million yuan, 1.538 billion yuan, and 608 million yuan, respectively, and the total loss in the first half of this year exceeded 7 billion yuan.

The continuous loss of performance affected the performance of Ping An Health in the secondary market, reaching the highest point of stock price of HK$148.50 on February 16, 2021, and the market value exceeded 100 billion yuan and reached a maximum of 166.1 billion, and then began to fall all the way, as of the close of trading on December 14, 2023, Ping An Health's share price was HK$18.06, with a market value of HK$20.21 billion. In less than three years, the market value has evaporated by about 145.89 billion.

The trademark infringement dispute was brought to the Supreme People's Court

Although Ping An Health's performance has been losing money year after year, after years of development, the Ping An Good Doctor brand has become widely known. According to the brand list released by the Hurun Research Institute in 2020, "Ping An Good Doctor" made the list for the first time with a brand value of 10 billion yuan.

However, shortly after the release of the list, the "Ping An Good Doctor" app was officially renamed "Ping An Health". Regarding the brand name change, Fang Weihao, the CEO of the company at the time, publicly responded: "The name change is based on four considerations: in line with the "Healthy China 2030 Strategy", the theme of disease treatment will be changed into a health theme, the desire of the Chinese people to be "safe and healthy", health includes disease prevention and back-end rehabilitation at the front end of medical care, carrying more content, and it is convenient to collaborate with more departments in the medical ecosystem of Ping An Group. ”

In fact, in order to compete for the "Good Doctor" trademark, Ping An Health has been entangled with the Good Doctor Group for many years.

According to public information, Good Doctor Group started from Daliangshan, Sichuan, started its business in 1986 under the name of "Canonda", and in 2000, the "Good Doctor" trademark was officially approved for registration, and now it has developed into a pharmaceutical and health industry group with 37 wholly-owned subsidiaries and 14 GMP pharmaceutical factories, and has obtained many qualifications and certifications such as national high-tech enterprises, national intellectual property demonstration enterprises, and "Top 100 Chinese Pharmaceutical Industry". In 2010, "Good Doctor" was recognized as a "China Famous Trademark" by the State Administration for Industry and Commerce. At the same time, the "Good Doctor" trademark has also been registered in Madrid and African intellectual property rights, and is protected by trademarks in more than 30 countries such as the United States, Japan and Germany.

Since 2014, Ping An Group has successively applied for the word trademarks "Ping An Doctor", "Ping An Good Doctor", "Ping An Good Doctor", "Good Doctor is Coming" and "Ping An Good Doctor", which is in opposition to the "Good Doctor" brand trademark of Good Doctor Group. This started a protracted trademark litigation dispute between the two parties.

What is the result of the lawsuit tug-of-war between the good doctor group with a volume of tens of billions against the trillion-level Ping An Group?

According to media reports, since 2018, a total of 42 judgments and rulings have been rendered by the Chengdu Intermediate People's Court, the Liangshan Intermediate People's Court, the Sichuan Provincial High Court, the Beijing Intellectual Property Court, the Beijing High People's Court and the State Intellectual Property Office, unanimously determining the fact of infringement by Ping An Health, and Good Doctor Group won the lawsuit.

On January 15, 2020, Ping An Health compensated Good Doctor Group 3 million yuan in accordance with the effective judgment of the court, and on May 12, 2020, Ping An Health published an apology statement in China Consumer Daily in accordance with the effective judgment of the court, and in 2021, under the enforcement of the Chengdu Intermediate People's Court, the Ping An Good Doctor app was renamed Ping An Health.

However, the stock abbreviation of Ping An Health is still "Ping An Good Doctor". In this regard, the staff of the above-mentioned company told the observer network that the case has not yet ended, and it has now been filed with the Supreme People's Court.

Under the huge loss, the coach was changed twice

In addition to huge losses, Ping An Health has been in turmoil.

In May 2020, Ping An Health was reported for "plagiarism". At that time, Ma Jianfei, CEO of Xueyang Technology, said on Weibo on May 9 that the health guard product launched by Ping An Health on May 8 maliciously plagiarized the company's "settlement product". At the same time, Ma Jianfei provided evidence of Ping An Health's suspected "plagiarism".

In addition, in 2020, the flagship product "Ping An Good Doctor APP" was publicly pointed out by the National Computer Virus Emergency Response Center for not clearly informing users of its rules for collecting and using personal information, which attracted widespread public attention and discussion.

In the midst of this turmoil, the founding team of Ping An Health has undergone major changes. On May 15, 2020, it was announced that Wang Tao was removed from his positions as chairman of the board of directors, executive director, and CEO, and was removed from the position of joint company secretary of Lin Yuan. On the same day, the Board appointed Fang Weihao as an Executive Director, Interim Chairman of the Board and CEO for a term of three years.

On the evening of May 19, Ping An Health made a supplementary announcement on the dismissal of Chairman and CEO Wang Tao. The announcement stated that because Wang Tao's performance of management responsibilities did not meet the expectations of the board of directors, the board of directors decided to remove Wang Tao from the position of chairman of the board of directors from May 15, 2020.

According to Caixin, the secretary of the board of directors, chief operating officer (COO), chief product officer (CPO), chief technology officer (CTO), etc., were also removed in this round, all of which were replaced by new management appointed by Ping An Group. Including Wang Tao, these purged key management personnel are all from the "Ali department".

Fang Weihao, who succeeded Wang Tao, although he carried out drastic reforms and actively promoted the transformation and development of Ping An Health, was not glamorous in terms of results, and he still handed over a report card of losses for three consecutive years.

Or for reasons of unsatisfactory performance, Ping An Health once again offered the killer move of changing the commander. On October 18, Ping An Health officially announced the news of Fang Weihao's departure and the new handsome Li Dou taking over.

According to the announcement, Li Dou will serve as a non-executive director of Ping An Health from August 2023. He has senior management experience in a variety of industries, including pharmaceutical, FMCG, insurance, pension, etc. This enables him to have deep insights and rich experience in understanding the real needs of consumers, subsequent product development, channel construction and digital operation.

With the weakening of the Internet medical industry and the tightening of supervision, and the rapid recovery of offline medical business, there is still a question mark over whether Li Dou can lead Ping An Health to turn around.