Cover Story: The Rise and Fall of China’s ‘Fentanyl King’ in Corruption-Fueled Bankruptcy

The rise and fall of Ai Luming and his conglomerate, Wuhan Dangdai Science & Technology Industries Group Co. Ltd., reflect the turbulent journey of China’s private sector over the past four decades. Ai, a descendant of a Nationalist general, began with a mere 2,000 yuan and a business extracting urokinase from urine, eventually building a billion-dollar empire centered on Humanwell Healthcare, China’s leading fentanyl producer [para. 1][para. 3][para. 10]. However, in April 2025, after a court-sanctioned restructuring driven by overwhelming debt, Dangdai’s core asset—Humanwell—was handed over to state-owned China Merchants Group, marking the end of Ai’s reign [para. 3].

Dangdai’s origins trace back to 1988, in the wake of China’s economic reforms, when Ai and his university classmates turned from government careers to entrepreneurship [para. 16]. Their initial venture—extracting urokinase from public toilet urine—proved unexpectedly lucrative, creating a foundation that would remain integral to Humanwell Healthcare decades later [para. 17]. Subsequent strategic acquisitions of failing drugmakers, such as Yangtze River Pharmaceutical and Yichang Pharmaceutical Group, transformed Dangdai into a pharmaceutical powerhouse with pioneering licenses for fentanyl production [para. 20]. By 2024, Yichang Humanwell alone generated 2.7 billion yuan in net profit and held over 90% of China’s opioid painkiller market [para. 20][para. 22].

In the 2000s, as China liberalized further, Dangdai diversified into real estate, tourism, and education. While real estate projects like Dangdai Tianyu and investments in private universities initially flourished, they faltered due to bankruptcy, market turmoil, and shifting government policy. Despite these forays, pharmaceuticals continued to comprise 70% of group revenue [para. 22]. The expansion, however, was fueled increasingly by debt; by 2017, Dangdai’s liabilities exceeded 30 billion yuan [para. 5].

Ai’s ambition extended beyond industry to finance, prompted by the notion that controlling financial institutions would accelerate company growth [para. 25]. Early investments in banks and insurance were profitable, but the 2002 acquisition of Tianfeng Securities marked a turning point. Under the leadership of Ai’s protege Yu Lei, Tianfeng grew in size and reach, but it also became deeply entwined with Dangdai through opaque related-party transactions, asset shuffles, and circular financing [para. 32][para. 37]. By 2019, Dangdai’s liabilities topped 60 billion yuan, and internal risk warnings were ignored [para. 41].

By 2022, defaults erupted en masse as Dangdai’s financing products imploded, affecting 4,000 families and exposing regulatory gaps exploited via the Wuhan Changjiang Crowdfunding Exchange [para. 8][para. 46]. Embezzlement scandals embroiled top Dangdai executives, and key holdings like Dangdai Mingcheng sunk over 10 billion yuan through unprofitable entertainment and sports ventures [para. 51]. Meanwhile, Tianfeng’s attempts to outpace the crisis led to hasty asset transfers, incomplete records, and a collapsed share price [para. 61].

Attempts at private restructuring failed; only a court-managed process offered hope. By late 2023, after a competitive bidding process, central SOE China Merchants Group secured control of Humanwell for 11.8 billion yuan—setting a national record for pharmaceutical restructuring [para. 70][para. 74]. Most creditors recovered pennies; Ai and founding shareholders lost everything [para. 13][para. 79]. Ai, however, insists he may return with new ventures, holding to the resilience that once drove his success—but as those close to him warn, the era that enabled his rise is over [para. 14][para. 83].