China’s healthcare tycoons lose US$17 billion as crackdown spreads

China’s latest anti-corruption crackdown is hammering the personal wealth of the nation’s healthcare tycoons.

The combined fortune of the top 15 Chinese healthcare billionaires has fallen 17 per cent to US$84.1 billion from US$101.4 billion at the end of last year, according to the Bloomberg Billionaires Index.

The drop comes as the country’s top regulators started a sweeping anti-corruption campaign across the nation’s healthcare sector about two months ago. It has resulted in hundreds of hospital chiefs and pharmaceutical executives being probed, sparking a sectorwide share slump as investors chose to sell instead of guessing which companies will be hit by the clampdown.

The focus on healthcare comes after similar market-roiling campaigns to reform the real estate and education sectors, which banned most tutoring companies from making a profit.

“This is a much bigger sector than online tutoring and increasingly dependent on private sector investment,” Alicia Garcia Herrero, chief economist for Asia-Pacific at Natixis, said about the consequences for China’s healthcare sector. “This time around the crackdown could exert additional pressures, dampening investment.”

In dollar terms, Chen Bang, the chairman of Aier Eye Hospital Group, has seen the biggest fall in his personal fortune. It has dropped by US$3.4 billion since the beginning of the year to US$9.5 billion after shares of the ophthalmic medical group fell about 25 per cent since January.