On March 3, Bloomage Biotech (688363.SH) published the full text of a speech delivered by the company’s chairwoman, Zhao Yan, at the President’s Office Meeting on its official WeChat account. According to the article, the former “Personal Health Consumer Goods Division” of Bloomage Biotech will be renamed the “Skin Science Innovation and Transformation Division” and will undergo organizational and business adjustments.
In addition, Bloomage Biotech has launched an “anti-corruption campaign.” In her internal speech, Zhao Yan stated, “All corrupt personnel, regardless of their position, must come forward and confess their issues and submit their resignations by March 31. Those who fail to do so within the deadline will be handed over to judicial authorities without internal resolution.”
Not long ago, Bloomage Biotech released its 2024 performance report. The company reported a net profit attributable to shareholders of RMB 164 million in 2024, marking a 72.27% year-on-year decline. It is evident that, under performance pressures, Bloomage Biotech is undergoing a sweeping and profound reform.
Renaming of the “Personal Health Consumer Goods Division”
“Based on the proposal of Bloomage Biotech Chairwoman and President Zhao Yan, the former ‘Personal Health Consumer Goods Division’ will be renamed the ‘Skin Science Innovation and Transformation Division’ and will undergo organizational and business adjustments.” This was the only bolded passage in Zhao Yan’s internal speech, highlighting the importance Bloomage Biotech places on this change.
Compared to the name “Personal Health Consumer Goods Division,” the new title “Skin Science Innovation and Transformation Division” emphasizes the company’s life sciences foundation, bearing similarities to L’Oréal’s Dermatological Beauty Division.
To some extent, this adjustment also reflects Bloomage Biotech’s “return” to its roots—at a time when its functional skincare business is facing difficulties, the company is reinforcing its identity as a biotechnology enterprise.
The establishment of the Personal Health Consumer Goods Division was closely tied to the growth of Bloomage Biotech’s functional skincare business.
In 2018, as the world’s largest hyaluronic acid producer, Bloomage Biotech officially entered the consumer market. That same year, it launched the phenomenon-level product “BIOHYALUX·Forbidden City Lipstick” in collaboration with the Palace Museum. By the following year, its functional skincare business had generated RMB 634 million in revenue, marking a 118.53% year-on-year increase.
In 2020, to accelerate the growth of its personal health consumer goods business, Bloomage Biotech established the Personal Health Consumer Goods Business Group. Fan Yuan, who had managed the BIOHYALUX and Bio-MESO brands, was appointed General Manager of the group, overseeing the skincare business. The following year, Liu Zhe, formerly of Procter & Gamble, became the R&D Director for the division.
Over the next four years, Bloomage Biotech’s functional skincare business experienced explosive growth, reaching over RMB 4.6 billion in annual revenue within just five years. The segment maintained a yearly growth rate of over 100%, peaking at over 70% of the company’s total revenue—propelling Bloomage Biotech into the ranks of China’s top beauty companies.
Thanks to this outstanding performance, Fan Yuan was promoted to Director and Vice President of Bloomage Biotech in 2022. However, in the same year, the functional skincare business—once regarded as Bloomage Biotech’s “growth engine”—suddenly lost momentum. After four years of rapid expansion, the segment began to decline, and this downturn continued into the first half of the following year. The contraction of the functional skincare business also led to a simultaneous drop in Bloomage Biotech’s total revenue.
In response to declining performance, Bloomage Biotech stated in its 2023 financial report that it was actively implementing a “four-pillar” business strategy, moving away from reliance on past success while pushing forward a comprehensive management transformation.
In 2024, Bloomage Biotech announced that it had entered its “Year of Transformation,” launching a series of reform initiatives, including business process restructuring, organizational and talent transformation, performance and KPI system adjustments, and enterprise digitalization. The company publicly acknowledged that “the pressure on rapid growth mainly stems from the fact that business expansion outpaced internal organizational and management capabilities, which now need improvement.”
That same year, the “Zhi Fanfan incident” and the departure of several key technical personnel drew public attention to Bloomage Biotech’s organizational restructuring, raising questions about how the company would navigate the turbulence in its functional skincare business.
Now, Zhao Yan has provided a definitive answer. In her internal speech, she stated, “We are a biotechnology company. All of our products should identify growth opportunities from a life sciences perspective.”
Renaming the “Personal Health Consumer Goods Division” as the “Skin Science Innovation and Transformation Division” and initiating organizational and business adjustments is clearly Bloomage Biotech’s new approach to the future of its functional skincare business.
“True Transformation Is a Transformation of People—And It’s Only Just Beginning!”
CHAILEEDO observed that Zhao Yan mentioned the word “organization” 23 times in her internal speech. The first section of her speech, titled “Strictly Building the Team and Governing the Organization,” explicitly focused on reflecting on the company’s organizational structure.
“Of course, every organization is prone to mistakes. Whenever growth happens too fast, some people start to lose their grounding, thinking their success is purely due to their own abilities,” Zhao Yan remarked.
She also pointed out that Bloomage Biotech’s performance adjustments over the past two years were partly due to market conditions, but more importantly, because the company recognized that its organization and talent had not kept up with the changing times, prompting a proactive slowdown.
Regarding the current progress of Bloomage Biotech’s transformation, Zhao Yan provided insights and a clear stance: “In 2024, the company entered a phase of transformation and adjustment. The first phase focused on process adjustments, and many may think that this phase is now complete. However, process adjustments only corrected the company’s misaligned actions and exposed previously hidden problems. The true transformation is a transformation of people—and that is only just beginning!”
As early as October last year, Bloomage Biotech issued an open letter stating that the company was undergoing an “unprecedented organizational and management transformation.” It had also engaged IBM’s globally renowned management consulting team, which conducted a four-month in-depth study and systematic diagnosis, resulting in 48 transformation projects.
In the letter, Bloomage Biotech acknowledged, “During this transformation, we regretfully observed that a very small number of employees have severely violated company regulations, undermined corporate culture, spread false information, infringed on the company’s reputation, and engaged in malicious attacks or defamation through fabrication, distortion, and exaggeration.”
It is now evident that Bloomage Biotech’s transformation is ongoing—and it is deepening further. Zhao Yan emphasized, “The transformation of people must start with strict recruitment, rigorous team development, and stringent organizational governance.”
According to CHAILEEDO’s analysis, since the beginning of 2024, Bloomage Biotech has seen multiple personnel changes. Key technical personnel such as Wang Yongzhi and Ma Shouwei resigned last year for personal reasons, and in January this year, Bloomage Biotech’s Chief Scientist Guo Xueping retired upon reaching the statutory retirement age.
Moreover, Zhao Yan strongly criticized past tendencies within the company to blame external conditions and chase market trends without true market insight. She stated, “Don’t think that simply claiming to be ‘market-oriented’ means you truly understand the market. Short-sighted trend-chasing will inevitably fail. This is not what Bloomage Biotech should be doing—it completely contradicts our original mission of pursuing life sciences and creating value for life.”
Additionally, Zhao Yan stressed the importance of “staying close to the front lines of business and returning to the front lines.” In her view, the rapid growth of financial and influence resources had caused the team to lose the problem-solving drive and critical thinking skills that were present in the company’s early, resource-scarce startup phase.
“Building a brand is a long-term endeavor,” Zhao Yan asserted. The first step in this transformation was to adjust processes and reclaim many outsourced financial approval rights, explaining that “the company’s strategy had not been properly executed, and core capability development was significantly delayed due to excessive outsourcing.”
“Moving forward, our team members must elevate their thinking, stay close to business operations, and return to the front lines—where the real challenges are happening,” Zhao Yan emphasized. “The core focus must shift away from simply riding trends, assembling quick combinations, and relying on outsourcing. Outsourcing should only be used for efficiency improvements, ecosystem development, and open collaboration—not as a substitute for building our own core capabilities.”
Issuing a “Final Ultimatum” to Corrupt Personnel
In addition, Zhao Yan emphasized the company’s transformation toward “returning to a startup-style organization.” In her view, the talent dynamics of a startup organization are completely different from those of an established corporate structure. Established companies operate based on predefined processes, with roles and actions driven by structured rules, whereas startup organizations are self-driven, with teams proactively identifying, uncovering, and solving problems.
Zhao Yan further stated, “The next priority is to dismantle inefficient, bureaucratic teams engaging in pseudo-work and rebuild a startup-oriented organization while fostering an entrepreneurial team spirit.”
In her internal speech, Zhao Yan also noted that Bloomage Biotech has not yet emerged from its crisis. However, this crisis is not due to declining performance. On the contrary, Bloomage Biotech remains globally competitive in several key strategic biomaterials. The company retains an undisputed global leadership position in the full-chain development of synthetic biology, from small-scale trials to industrial-scale production.
“These strengths have enabled us to maintain a robust technological foundation in the life sciences and synthetic biology sectors, while also achieving healthy growth in pioneering segments like consumer medical aesthetics,” Zhao Yan remarked. “The real crisis lies in the fact that our organization’s internal entropy has increased far beyond what this era can tolerate—it has reached a point where drastic measures are necessary.”
Beyond pinpointing the company’s management and business challenges, Zhao Yan also made a bold declaration of war against internal corruption, issuing a ‘final ultimatum.’ She acknowledged that a previously lax corporate management environment had allowed numerous internal issues to fester. However, she asserted that the company has now begun a deep, uncompromising internal cleansing process, with zero tolerance for past misconduct.
Zhao Yan issued a firm directive: “All corrupt personnel, regardless of their position or rank, must come forward and confess their misconduct by March 31 and submit their resignations. Failure to do so will result in immediate referral to judicial authorities—there will be no internal handling.”
She also made it clear that the company can continue to function without anyone except for its founder—herself. “This company can reorganize without anyone, but the only indispensable person is me,” Zhao Yan stated.
This nearly 4,000-word internal speech clearly reflects Zhao Yan’s perspective as the top leader of Bloomage Biotech regarding the company’s current challenges and future direction.
Industry experts note that Bloomage Biotech’s organizational transformation is particularly significant in the context of China’s evolving domestic beauty industry.
“Despite being the world’s largest hyaluronic acid producer with strong R&D capabilities, Bloomage Biotech has only been in the cosmetics sector for about seven years,” one expert explained. “Compared to legacy domestic beauty brands, its organizational structure and team development lack long-term experience. Now, with the disappearance of online traffic dividends and a cooling macroeconomic environment, the true value of Bloomage Biotech’s past success is being tested. Furthermore, how much more can be innovated with hyaluronic acid in skincare remains a major question mark.”
However, based on Zhao Yan’s speech, Bloomage Biotech has reached a pivotal moment of “awakening” as the beauty industry enters a phase of high-quality development.
