经销模式

In addition to direct sales, we sell products through a network of distributors to customers in Japan and Korea.

We control channel stuffing risks through our internal management policies for distributors, including keeping track of the information of end customers and regularly monitoring shipments of distributors.

We carry out evaluation on our distributors annually, assessing a range of criteria including sales performance, inventory, technical support, key customer assistance, payment and compliance status, among others.

Under these agreements, we sell products to distributors and recognize revenue when they accept products upon delivery.

We terminated the distributorship with 12, 14 and 15 distributors in 2023, 2024 and 2025, respectively, primarily due to contract expiration, their failure to meet target order amount and their change of business.

Additionally, we do not face channel stuffing risks due to the limited shelf life of our IVD test kits, which is typically no longer than one year.

In 2023, 2024 and 2025, our revenue generated from distributorship amounted to 78.5%, 78.3% and 78.1%, respectively.

We monitor distributors’ inventory by requiring them to submit procurement orders, sales reports, inventory reports, downstream customer orders and shipping documents.

If we identify any discrepancies, such as when a distributor’s inventory levels do not align with the agreed delivery schedule, we would promptly work with the distributor and the relevant customers to investigate and address the issue, thereby minimizing channel stuffing risk.

For the years ended December 31, 2023, 2024, and 2025, revenue generated from our distribution partnership amounted to RMB1,139.2 million, RMB1,238.2 million, and RMB1,248.6 million, respectively, accounting for 70.6%, 70.3%, and 67.0% of our total revenue from product sales for the same periods.

For most of our distributors, we follow a payment-inadvance policy, which effectively eliminates incentives for distributors to hold excess inventory, thereby largely preventing inventory buildup.

As of December 31, 2023, 2024, 2025 and the Latest Practicable Date, the unsold inventories of our products held by the distributors we traced amounted to approximately RMB131.3 million, RMB151.3 million, RMB145.0 million and RMB119.3 million, respectively.

In 2023, 2024 and 2025, revenue generated from our distributors amounted to RMB48.9 million, RMB219.8 million and RMB492.6 million, respectively.

Number of distributors at the end of the year | 101 | 331 | 438

We carefully manage our collaboration with distributors and mitigate the risks of channel stuffing.

In 2023, 2024 and 2025, we had five, five and five distributors, respectively. In 2023, 2024 and 2025, the revenue from our distributors amounted to RMB34.1 million, RMB20.8 million and RMB19.2 million, respectively, representing 24.6%, 13.9% and 10.9%, respectively, of the total revenue for the same years.

We maintain a buyer-seller relationship with our distributors. They directly purchase equipment from us and resell to end users of such equipment. We believe the risk of channel stuffing is remote in our distribution network. We do not impose minimum purchase requirement on distributors and we generally do not allow returns of products sold to distributors, except for defective products.

To the best of our knowledge, all of our distributors are Independent Third Parties.

As of December 31, 2023, 2024 and 2025, we had ten, six and four distributors, respectively.

For the three years ended December 31, 2025, revenue from distributors amounted to RMB34.1 million, RMB25.4 million and RMB28.7 million, representing 5.6%, 3.8% and 3.3% of our total revenue for the respective periods.

We believe the risk of channel stuffing is effectively mitigated due to factors inherent in our business model and relationships with the distributors.

As of December 31, 2023, 2024 and 2025, we collaborated with 88, 130 and 111 third-party agents, respectively.

In 2023, 2024 and 2025, our revenue attributable to third-party agents amounted to RMB11.6 million, RMB13.4 million and RMB15.7 million, respectively, accounting for 1.8%, 1.8% and 2.0% of our total subscription revenues, respectively.

During the Track Record Period, we generally engaged with these agents under either a commission model or a distributor model.

During the Track Record Period, substantially all of our revenue was generated through our expanding distribution network.

Our relationships with these distributors operate on a seller-buyer basis, where they purchase products from us to resell to installers.

In particular, all installed devices must be registered on our online platform, which enables us to monitor installation and activation in real time.

Distribution(2) | 2,107 | 29.0 | 4,823 | 31.0

For the two years ended December 31, 2024 and 2025, 66 and 87 distributors ceased to be our distributors mainly due the expiry of distribution agreements without renewal or extension.

To mitigate channel stuffing and competition among distributors, we adopt a single-tier distribution model without sub-distribution which minimizes pricing differences and removes incentives for cross selling.

Revenue generated from our distributors was RMB4,246.6 million, RMB3,682.0 million and RMB3,418.2 million in 2023, 2024 and 2025, respectively, accounting for 38.6%, 34.5% and 30.4% of our total revenue for the same periods, respectively.

The primary reasons for the termination of our cooperation with exiting distributors during the Track Record Period were our | strategic shift | towards sales to | retailers, institutional customers, and DTC channels, the performance of these distributors, and their own strategic adjustments.

We require prepayment from distributors, and we do not provide financial support to our distributors.

We primarily sell our products through distributors, who purchase our products and distribute them to hospitals and other medical institutions.

We operate a seller-buyer model with our distributors, where they take ownership of the drug products upon acceptance — assuming all associated risks, including unsold stock — and are not entitled to return the sold products unless in cases of product defects, incorrect shipments or verified transit damages.

As of December 31, 2025, our distribution network comprised 278 distributors across 31 provinces, autonomous regions, and municipalities in China.

As of December 31, 2023, 2024 and 2025, we engaged 226, 289 and 311 distributors, respectively. In 2023, 2024 and 2025, our revenue generated from sales to distributors was RMB1,287.1 million, RMB939.1 million and RMB871.5 million, respectively, accounting for 29.0%, 20.4% and 16.4% of our total revenue in each respective period.

In 2023, 2024 and 2025, we terminated cooperation with 86, 19 and 48 distributors, respectively, primarily considering their performance, business focus and market conditions, and to consolidate our channel resources to enhance supply chain management and supervision efficiency.

Our CMMS effectively helps us mitigate substantially all risks associated with channel stuffing.

For the years ended 31 December 2023, 2024 and 2025, revenue generated from wholesales to our franchised stores accounted for 19.2%, 21.0% and 18.9% of our revenue, respectively.

The number of our franchised stores decreased during the Track Record Period mainly because (i) we exercised tighter control of the opening of new franchised stores to consolidate our management of franchised stores; and (ii) some franchised stores ceased their relationship with us primarily due to (a) terminated or non-renewal by us due to failure to meet our store management requirements; (b) failure to renew lease agreements of the premises where the franchised stores were located; and (c) their voluntary termination or non-renewal.

We do not currently enforce minimum purchase requirements on our franchised stores, although such requirements existed before we terminated it on 31 December 2024.

For our jewellery business, generally, sales to our franchisees (including direct franchisees, regional franchisees and sub-franchisees) are buyout sales, which means that we recognise revenue for sale of products is recognized at the point in time when control of the asset is transferred to the franchisees (instead of the end consumers), generally on delivery of the jewellery and handbags to the franchisees.

As at 31 December 2023, 2024 and 2025, we had 1,125, 1,272 and 1,486 franchise jewellery stores covering over 200 cities in China and Southeast Asia.

While certain franchisees are under common control of individuals, on a consolidated basis, no single actual controller contributed to more than 3.0% of the revenue for each year during the Track Record Period.

We sell our products primarily through direct sales with limited distributor partnerships to meet the diverse needs of customers across industries.

Number of distribution partners at the end of the period | — | 7 | 27

Having considered that (i) our relationship with distributors is a seller-buyer relationship, and no return, exchange or refund is allowed except for quality reasons; (ii) our distributors are not subject to mandatory sales targets; and (iii) we generally require payment by distributors before delivery, our management are of the view that we were not subject to material risk of channel stuffing during the Track Record Period.

We began charging franchise management fees of 6% from 165 of our franchised stores in Zhejiang Province since 1 January 2025. Franchise management fees amounted to RMB2.4 million, RMB2.4 million and RMB10.2 million for the years ended 31 December 2023, 2024 and 2025, respectively.

Our results of operation will be affected if we fail to charge our franchised stores the franchise management fees or the fee percentage is reduced.

We began to provide more operational management support and technical service support to our franchised stores in Zhejiang Province to enhance their abilities to perform. We also began to rollout our enterprise resource planning system, which manages inventory level, sales and procurement and also enable us to calculate revenue generated, to our franchised stores in 2023.

As of December 31, 2025, we had established a distribution network comprising 738 distributors.

Given our principal-to-principal sales arrangements, the absence of minimum purchase requirements or mandatory sales targets for our distributors, and our ongoing monitoring of ordering patterns and settlement status, we believe our sales generally correspond to underlying market demand and our distribution model presents a relatively low risk of channel stuffing.

We maintain a principal-to-principal seller-buyer relationship with our distributors.

In 2023, 2024 and 2025, revenue generated from trading company customers amounted to RMB2,888.0 million, RMB2,128.6 million and RMB1,523.0 million, respectively, accounting for 51.3%, 38.4% and 22.4% of our total revenue for the respective periods.

We maintain a buyer-seller relationship with the chemical trading companies, where they purchase products from us for sale to end customers.

We do not enter into distribution agreements with our trading company customers.

As of December 31, 2025, we maintained nine distributors, through which our products have been sold to nine countries or regions.

We had six, six and nine distributors as of December 31, 2023, 2024 and 2025, respectively.

In 2023, 2024 and 2025, we generated RMB327.6 million, RMB466.2 million and RMB694.2 million from sales to direct customers, respectively, accounting for 96.4%, 98.0% and 90.9% of our revenue for the same years.