Hyaluronic Acid Empire Collapses: Huarui Biotech's Fight for Survival from 140 Billion to 21.7 Billion | 【Deep Thinking】

Raw Material Leaders Rush to Consumer Markets: The Globalization Cycle of China’s Upstream Medical Aesthetics Industry

“Deep Thinking Research Group”

By the end of February 2026, Huaxi Biological’s 2025 earnings report was released: total revenue of 4.217 billion yuan, down 21.49% year-over-year; net profit attributable to parent company of 291 million yuan, a 67.03% increase. This report, marked by both contraction and rebound, reaffirmed its position as a former leader in the medical aesthetics industry and signaled the beginning of China’s upstream medical aesthetics sector shifting from dividend expansion to structural competition.

In daily life, Zhao Yan often wears traditional Chinese knot tops and neat short hair, speaking restrainedly and making decisive decisions. From a university teacher to cross-industry investor, she built a landscape spanning biotech, cultural and sports, and real estate using hyaluronic acid, and experienced the industry’s entire process from wild growth to compliance reshuffling. Now, shelves in Watsons and beauty chain stores display Runbaiyan, Kofomei, and Hi-Body products together, with the three giants collectively targeting the C-end, marking China’s upstream medical aesthetics industry entering a full-chain, global, and full-cycle hardcore competition.

1. Financials and Origins: Huaxi Biological’s Rise, Fall, and Full-Chain Transformation

Huaxi Biological originated from Shandong Furui Da’s hyaluronic acid laboratory. In 2000, Zhao Yan acquired core assets for 12 million yuan, breaking international monopoly with microbial fermentation technology, establishing a global raw material leader. Listed on the STAR Market in 2019, its market value once exceeded 140 billion yuan, with the “Hyaluronic Acid Queen” reaching the industry peak.

Beneath prosperity, hidden dangers emerged. Driven by traffic, dispersed multi-brand strategies, chaotic channel pricing, and industry downturns, Huaxi fell from its throne, with current market value around 21.7 billion yuan. In 2025, Zhao Yan returned to the front line to implement “stop bleeding reforms,” significantly reducing sales expenses, streamlining organizations, and clearing inefficient businesses. Profits rebounded, but revenue remained in adjustment. Upstream raw material business holds over 40% global market share with an 84% gross margin, becoming a ballast; medical terminal sales grew steadily; functional skincare is still in recovery.

A key change occurred offline: Watsons, Yanli, and chain pharmacies became new battlegrounds. Runbaiyan, Kuadi, Mibeier compete alongside giants like Kofomei and Aimeike in medical aesthetic skincare. The three giants are simultaneously shifting from B2B to B2C, moving from raw material supply to brand operation, attempting to strengthen brand influence and expand moats through terminal touchpoints. This is not just channel extension but a necessary move for Chinese upstream companies to shed “OEM dependence” and build consumer assets.

2. The Three-Strong Pattern: Founders, Finance, Industry Tracks, and C-End Battles

China’s upstream medical aesthetics industry is dominated by Huaxi Biological, Aimeike, and Juzhi Biotech, with clear differentiation in founder backgrounds, financial performance, and strategic paths. The C-end has become the decisive battlefield.

Huaxi Biological (688363): Led by Zhao Yan, a scholar with cross-industry and dual-drive in capital and industry. In 2025, revenue was 4.217 billion yuan (-21.49%), net profit 291 million yuan (+67.03%), with a market value of about 21.7 billion yuan. Full industry chain layout, self-sufficient raw materials, coverage of medical aesthetics, skincare, and food sectors, rapid offline expansion through channels like Watsons, and multi-brand matrices targeting efficacy skincare consumers.

Aimeike (300896): Led by Jian Jun, Tsinghua MBA, focused on products and blockbuster hits. In the first three quarters of 2025, revenue was 1.865 billion yuan (-21.49%), net profit 1.093 billion yuan (-31.05%), with a market value of about 43.3 billion yuan. Focused on medical aesthetic injectables, Hi-Body and Ruwaitian build high-margin barriers, gross margins exceeding 93%; recent efforts in B2C through professional endorsement, entering pharmacies and beauty chain stores.

Juzhi Biotech (02367.HK): Led by Yan Jianya, partnering with Dr. Fan Daidi to establish a technological foundation. In the first half of 2025, revenue was 3.113 billion yuan (+22.52%), net profit 1.182 billion yuan (+20.23%), with a market cap of about 42.5 billion HKD. Heavy investment in collagen restructuring, Kofomei’s strong penetration into over 6,000 Watsons stores, online and offline synergy, becoming the strongest challenger in the hyaluronic acid system.

The competition among the three is a battle over hyaluronic acid stock and collagen incremental growth, as well as the evolution of B2B capabilities toward B2C. Huaxi maintains its core business and expands into multiple scenarios; Aimeike defends its professional barrier and extends downward; Juzhi leverages new materials for overtaking. The fierce competition on offline shelves reflects a shared industry consensus: whoever can capture user mindshare and control terminal touchpoints will dominate the next cycle.

3. Global Landscape and Cycle Challenges: China’s Next Decade of Medical Aesthetics

On a global scale, the industry is undergoing structural reshaping: the global market continues steady expansion, with Asia-Pacific as the growth core, and China firmly holding the second-largest market position. Light medical aesthetics is increasing its share, with compliance, technology, and diversification as main trends worldwide. Chinese companies have achieved leading capacity and technology in hyaluronic acid and recombinant collagen, producing over 80% of global raw materials, with recombinant collagen led by China.

However, macro pressures and industry challenges are unprecedented. Rationalized consumption and shrinking budgets lead to lower per-transaction prices; normalized regulation ends wild growth, increasing compliance costs; overseas brands continue to expand into China, exerting dual pressure on local firms. Huaxi and others must answer three key questions for breakthrough.

First, C-end capabilities determine long-term valuation. Cost reduction can only provide short-term profit repair; brand and channel are the foundation for growth. Shifting from traffic investment to product, reputation, and scenario-driven strategies, streamlining pricing and stabilizing offline terminals are essential.

Second, globalization and the second curve of technology are the industry’s ceiling. Beyond hyaluronic acid, future market value depends on collagen, poly-L-lactic acid, synthetic biology, and regenerative materials. Going overseas involves not just product export but global R&D, registration, and supply chain deployment to hedge against single-market cycle risks.

Third, cycle resilience depends on structure and governance. The industry is moving away from universal growth to phases of high-quality capacity integration and inefficient supply cleanup. Companies need to balance scale and profit, R&D and marketing, short-term performance and long-term assets, shedding founder dependence and establishing professional, compliant, and digital modern operations.

The story of China’s upstream medical aesthetics has long surpassed individual tracks and companies. Huaxi’s rise and fall, the fierce competition among the three giants, the C-end breakthrough, and the global expansion collectively reflect China’s shift from manufacturing to branding. When dividends fade and bubbles clear, what truly endures through cycles are technological barriers, terminal networks, global deployment, and governance capabilities. These are the survival rules for enterprises and the inevitable path for China’s beauty industry to mature.