Question

how is it simplified

Answer 1

If you use the chain rule to compute the last derivative:

$-\frac{1}{2}K\frac{d(h^{2})}{dx} = -\frac{1}{2}K \times 2h\frac{dh}{dx} = -Kh\frac{dh}{dx},$

you find that it is indeed equal to the previous expression.