Since March this year, a dispute between former QUADHA executive, Zhi Fanfan (Cheng Fei), and his former employer, Bloomage Biotech, has been escalating. Just recently, Zhi Fanfan took to social media to claim that he has been subjected to workplace bullying and announced his intention to formally sue Bloomage Biotech for “infringement of reputation rights.” Despite Zhi Fanfan’s frequent attacks, Bloomage Biotech has remained silent and has not provided a direct response to the matter.
Tonight, Bloomage Biotech’s official public account released a statement titled “Declaration Regarding Violations by Certain Former Employees of Bloomage Biotech,” which appears to be their first public response to the dispute. In response, CHAILEEDO immediately contacted both Bloomage Biotech and Zhi Fanfan to gather more details. However, as of the time of writing, Bloomage Biotech has yet to respond, while Zhi Fanfan stated to CHAILEEDO, “They did not mention names, so I shared some thoughts on the impact on me and my brand.”
Zhi Fanfan, the former QUADHA executive, appears to have responded to the previous dispute by denying benefiting from personal intellectual property (IP).
In March of this year, Zhi Fanfan released a video seemingly hinting at his departure and exclusively responded to CHAILEEDO, stating, “Our founders were collectively laid off,” confirming the rumors of his departure for the first time. Meanwhile, rumors of a dispute between the QUADHA brand and distributors began circulating on major social media platforms. Despite the official announcement of his departure, the dispute between Zhi Fanfan, Bloomage Biotech, and the QUADHA brand did not come to a halt.
In June of this year, Zhi Fanfan posted on his personal social media accounts, claiming to have been bullied by his former company, filing a lawsuit against Bloomage Biotech, and demanding a public apology and clarification of the facts (details can be found in the CHAILEEDO article: Bloomage Biotech Caught in Disputes Again). However, Bloomage Biotech had remained silent on the matter.
Today, Bloomage Biotech appears to have finally responded to the dispute with Zhi Fanfan, publicly. Notably, in their statement, Bloomage Biotech describes the events as “former employees of Bloomage Biotech maliciously hyping their departure and publicly releasing information related to competing brands in the industry.”
CHAILEEDO observed that the statement primarily consists of three parts. The first part mainly discusses how Bloomage Biotech’s development in the functional skincare business was benefited by the rise of China’s synthetic biology industry and the “gift of the era.” It also states that none of Bloomage Biotech’s brands have ever been developed based on personal image or individual abilities, seemingly refuting the claim that Zhi Fanfan’s personal IP contributed to the development of the QUADHA brand.
The second part mentions that “due to historical reasons of rapid development, Bloomage Biotech has encountered a mix of personnel during recruitment, with certain individuals exhibiting questionable behavior and a lack of principles.” It further states that “these individuals quickly demonstrated a lack of principles, ideals, exaggerated personal IP, and a disregard for laws and regulations. Their personal style clashed with the temperament and corporate culture of Bloomage Biotech and naturally became the focus of organizational adjustments in this round of transformation.”
The statement also claims that “these individuals show no reflection, no awareness of the law, and continue to fabricate illogical concepts through malicious attacks to hype their personal IP, attempting to attract attention and followers using outdated methods for their non-compliant business.”
In the third part, Bloomage Biotech asserts that they have “fully grasped all the facts of the individual’s infringement of intellectual property rights, violation of non-competition agreements, and improper acquisition of economic benefits” and will “defend the rights and interests of investors and the normal order of the market.” This may be interpreted as a positive response to Zhi Fanfan’s establishment of a personal brand.
Both sides hold their own views, and the conflict plunges into a “Rashomon” situation.
Regarding the statement released by Bloomage Biotech, Zhi Fanfan also posted on her personal Xiaohongshu (Little Red Book) account, stating, “My previous company issued a statement.” Zhi Fanfan mentioned, “I cannot respond to this unnamed statement,” and questioned, “This legal statement clearly does not meet the standards expected of a publicly listed company. Who is responsible? What happened? This statement does not clarify anything.”
Zhi Fanfan further pointed out that if she is specifically named in the future, she and her legal team will respond accordingly. She bluntly stated, “This statement is filled with various false information,” and declared, “This time, no one and nothing can stop me from introducing my new brand, Fanzhuang, to all of you.”
Public reports indicate that Zhi Fanfan played a crucial role in the establishment of the QUADHA brand in June 2018. In public reports, she has frequently spoken or been interviewed as the “QUADHA spokesperson” and has been deeply involved in decisions regarding product development and channel planning for the QUADHA brand.
However, recently, an informed source stated to the media, “She (Zhi Fanfan) is one of the members of the QUADHA brand’s founding team, possibly responsible for some brand communication work, serving in a role similar to a brand director, rather than the so-called brand spokesperson.” The source further mentioned that Zhi Fanfan has always referred to herself as the QUADHA brand spokesperson, but none of Bloomage Biotech’s brands have a designated spokesperson.
In response to the allegations against Zhi Fanfan, individuals close to Bloomage Biotech previously stated publicly, “This is merely her own account. Substantial evidence is required in a legal dispute, and we have not received any relevant legal litigation information.” However, Zhi Fanfan disagrees with the claim that Bloomage Biotech has not received any notification of a lawsuit and told CHAILEEDO, “They did receive it.”
It is worth mentioning that Zhi Fanfan’s latest certification on Xiaohongshu has been changed to the founder of the Fanzhuang brand, among others. According to CHAILEEDO’s previous investigation, Zhi Fanfan has announced the launch of her own brand, Fanzhuang. It is noteworthy that the initial product released by Fanzhuang, the Second-Generation Essence, is quite similar to QUADHA in terms of product name and positioning.
Regarding the brand positioning, Zhi Fanfan stated in a public interview, “Using the standards of high-end skincare products and ingredients that big brands dare not use, we innovate and create truly effective and superior formulas that are reasonably priced for everyone.”
QUADHA may reconsider its positioning, and Bloomage Biotech enters a “difficult period.”
The dispute involving Zhi Fanfan may reflect the current reality that Bloomage Biotech is facing a bottleneck in the growth of its functional skincare products and needs to improve its management model.
In April of this year, Bloomage Biotech released its annual report for 2023. The company’s revenue for 2023 was 6.076 billion yuan, a decrease of 4.45% compared to the same period last year, which was 6.359 billion yuan. The revenue from Bloomage Biotech’s functional skincare products reached 3.757 billion yuan, a decrease of 18.45% compared to the previous year, accounting for 61.84% of the company’s main business revenue, reflecting the growth bottleneck faced by the efficacy skincare business.
Furthermore, this year, two key technical personnel of Bloomage Biotech, Ma Shouwei and Wang Yongzhi, both resigned, adding a bit of uncertainty to the company’s development.
It is worth mentioning that the 2023 financial report did not disclose the specific performance of Bloomage Biotech’s major skincare brands, including QUADHA. In fact, after three years of rapid growth, QUADHA also experienced a decline last year. According to Bloomage Biotech’s financial report for the first half of 2023, QUADHA’s revenue in the first half of last year was 543 million yuan, compared to 604 million yuan in the same period in 2022, a year-on-year decrease of 10.1%.
Entering this year, QUADHA’s market performance has also faced significant challenges. According to CHAILEEDO intelligence data, the GMV (Gross Merchandise Volume) of the QUADHA brand in online channels (Taobao, JD.com, Douyin, Kuaishou) decreased by 9.08% year-on-year in the first five months of this year. Among them, the GMV on Taobao increased by 16% year-on-year, while the GMV on Douyin decreased by 40.8%. In the 2024 Tmall 618 Beauty and Skincare Brand Ranking, QUADHA ranked 20th.
According to the 2023 financial report, QUADHA’s next work plan includes highlighting technological strength at the product level, leveraging the company’s strong technological capabilities to create high-quality domestic products in the anti-aging field, strengthening its competitive advantage in traditional channels such as Tmall and Douyin, continuously expanding into new channels, and emphasizing self-created content.
Recently, an insider close to the QUADHA brand told CHAILEEDO, “After experiencing rapid growth in the past, the QUADHA brand will further refine its positioning and develop steadily this year.” In today’s “Statement,” Bloomage Biotech once again mentioned, “Regardless of any short-term disruptions, Bloomage Biotech will firmly promote management changes and lay a solid foundation of technology and organizational culture for long-term, high-quality development, comprehensively completing the exploration from science and technology to Chinese brands!”
However, in the first quarter of this year, Bloomage Biotech’s revenue successfully rebounded, with a total revenue of 1.361 billion yuan, a year-on-year increase of 4.24%. The net profit attributable to shareholders of the listed company was 243 million yuan, a year-on-year increase of 21.39%. However, in an era that values investment efficiency more, whether Bloomage Biotech can reshape its past glory still needs to be tested by the market.
