美妆禁刷医保 70万药店渠道变天

This article covers a new Chinese regulation that bans the use of medical insurance to purchase cosmetics including face masks. By the end of September this year, local authorities will roll out a whitelist of products eligible for medical insurance reimbursement at designated retail pharmacies, and products not on the list will no longer be covered by insurance. Key takeaways for consumers:

1. There is a roughly 3-month transition period before the new rule takes full effect. Currently, some pharmacies in multiple Chinese cities still allow medical insurance purchases of qualifying cosmetics, and many are running clearance promotions for last-chance purchases. Consumers who want to buy these products with insurance can take advantage of this window.

2. It is important to note that "mechanical-numbered" medical dressings, a popular category of medical skincare products, are classified as medical devices rather than daily skincare. They are designed for post-cosmetic procedure recovery or problem skin repair, and even consumers with sensitive skin should not use them long-term blindly.

3. After multi-item discounts at most pharmacies, prices of these products are roughly on par with official online flagship stores. Consumers can choose their preferred purchasing channel based on demand and do not need to stock up excessively.

The new medical insurance regulation has introduced major changes to beauty brands' over-the-counter (OTC) channel strategies. Key insights for brands:

1. Industry background: Facing widespread performance pressure in recent years, beauty brands have turned to pharmacy channels—valued for their community traffic and user trust—as a new growth driver. As of 2025, multiple leading brands including Proya and Pechoin have entered this space, with some achieving annual sales exceeding RMB 1 billion. Giant Biogene and Baillei together hold over 60% of the market share in this segment.

2. Impact of the new regulation: Previously, around 60% of sales of mechanical-numbered beauty products relied on medical insurance reimbursement. The ban on insurance coverage will directly reduce purchasing intent among some consumers, requiring a full re-evaluation of channel value. Compliance has now become the core prerequisite for brands operating in this channel.

3. Current industry moves: Leading brand Proya remains committed to building OTC as its second growth curve and plans to introduce AI tools to optimize customer service. Many other brands have pivoted to Class III mechanical-numbered products and deliberately exited the OTC channel. Price wars and homogenized competition have already emerged in the space.

The new medical insurance regulation sets clear standards for beauty product sales through pharmacy channels, with key implications for pharmacy operators:

1. Policy overview: The rule requires all regions to complete the rollout of the medical insurance reimbursement whitelist by the end of this year, banning insurance coverage for non-pharmaceutical products and non-compliant mechanical-numbered beauty products. Several regions including Shanghai have already tightened restrictions ahead of the deadline, leaving a 3-month transition period during which products can still be reimbursed normally in some cities.

2. Risk warnings: Illegal medical insurance reimbursement is explicitly targeted by regulators. Pharmacies must comply with requirements after the regulation takes effect to avoid penalties. In addition, around 60% of previous sales of these products relied on insurance coverage, so the new rule will likely lead to the loss of some existing customers and a potential drop in performance.

3. Opportunity notes: The OTC channel remains highly concentrated and retains inherent advantages in community traffic and consumer trust. Only payment methods are changing, not underlying consumer demand. Pharmacies can partner with brands to upgrade services—for example, by introducing personalized skin problem matching solutions—to boost average order value and repeat purchases. They can also run clearance promotions during the transition period to recover cash flow.

The new medical insurance regulation has triggered shifts in the mechanical-numbered beauty product segment and the OTC channel, with key insights for manufacturers:

1. Shifting product demand: Previously, large numbers of beauty brands rushed to develop Class II mechanical-numbered dressings to capture OTC channel traffic. After the regulatory tightening, more brands are shifting to Class III mechanical-numbered products, driving sustained growth in demand for compliant production and design of this product category.

2. Rising compliance requirements: Previously, many brands operated in a gray area, repackaging regular cosmetics as mechanical-numbered dressings to qualify for medical insurance. Now that regulators have explicitly tightened rules, factories must upgrade their compliant production capabilities for medical devices to meet brand and regulatory requirements and avoid violations.

3. New business opportunities: Most leading beauty brands still view the OTC channel as a second growth curve, and compliant mechanical-numbered beauty products will retain stable market demand. Factories can align with brands' channel needs to develop compliant products that fit whitelist rules, while also adapting to brands' growing demand for digital services to support their new channel strategies.

The new medical insurance regulation has reshaped the beauty OTC segment, creating new opportunities for industry service providers:

1. Industry trends: After facing slowing growth online, beauty brands have increasingly turned to offline OTC pharmacy channels as a new growth driver, leading to a flood of new entrants to the space. Combined with regulatory-driven industry compliance, this has generated strong new service demand from both brands and pharmacies.

2. Core current pain points: Brands lack clarity on future medical insurance whitelist rules, creating uncertainty for channel planning, and most lack operational experience in the OTC channel. For their part, pharmacies lack professional capabilities to match user demand, making it hard to capture new customers brought by brands, and also face compliance risks.

3. Solution directions: Service providers can launch targeted compliance consulting services to help brands verify product compliance and align with medical insurance policy requirements. They can develop AI skin detection tools adapted for pharmacy scenarios to help stores improve conversion. They can also build matching platforms connecting brands and chain pharmacy networks to help brands rapidly expand distribution, meeting the collaboration needs of both parties.

The combination of beauty brands' expansion into OTC channels and the new medical insurance regulation has brought new adjustment directions and opportunities for retail pharmacy platforms:

1. Core current needs from brands and pharmacies: A large number of beauty brands looking to expand into OTC need access to chain pharmacy resources and clarity on the latest medical insurance compliance rules. Physical pharmacies need a stable supply of compliant branded products, and operational tools to improve in-store conversion and compliance capabilities.

2. Adjustment directions for platform operations: Platforms can launch dedicated OTC investment services for beauty brands to connect them with chain pharmacy resources, opening up new revenue streams. They can also optimize in-platform product management, pre-screen non-compliant products, and assist merchants in making compliant adjustments.

3. Risk management: Platforms should closely monitor the rollout of local medical insurance whitelists, push the latest policy updates to participating merchants, and remind merchants to stop non-compliant insurance reimbursement to help merchants avoid regulatory penalties. They can also capitalize on clearance demand during the transition period by launching relevant marketing activities to boost platform transaction volume.

This article documents the latest policy and industrial changes in China's beauty OTC channel, providing fresh first-hand material for industrial research. Key insights:

1. New industry trends: Facing slowing growth in China's beauty industry in recent years, the pharmacy channel has become a sought-after second growth curve for brands thanks to its advantages in community traffic and consumer trust. As of 2025, multiple leading beauty brands have entered the space, with top medical beauty brands holding over 60% of the market share. The new medical insurance regulation marks the official entry of the segment into a compliance-driven development stage.

2. New research questions: After the tightening of medical insurance reimbursement, the value of the OTC channel needs to be re-evaluated. It remains unclear whether the segment will see healthy growth after weeding out non-compliant players, or whether market enthusiasm will cool rapidly. In addition, price wars and homogenized competition have already emerged in the segment, and the causes and impacts of these issues merit in-depth research.

3. Policy implications: The new whitelist system introduced to crack down on improper medical insurance misuse for cosmetics provides a reference for the regulation of cross-border health and beauty categories, and confirms that compliance is an inevitable trend for the development of cross-sector consumer categories. It offers useful insights for research on regulatory policy for health-focused consumer goods.