Akshay Kamath

Big healthcare AI news yesterday as Tempus AI received the first-ever CPT code for an algorithm-only analysis of previously-sequenced, laboratory developed test transcriptomic data. TLDR: AI molecular phenotyping has a new business model. The PurISTSM test uses RNA profiling to identify molecular subtypes in patients with advanced pancreatic ductal adenocarcinoma, which may inform first-line therapy selection and management. While I'm skeptical that payer balance sheets are going to solve the "who pays for healthcare AI" problem, the reimbursement pipes for clinical AI are maturing. I am surprised to see more progress for usage-based vs. performance-based models given the many challenges with FFS economics. It will be interesting to see how payers assess the "medical necessity" and therefore reimbursability of clinical AI as these models come to market. https://t.co/eLe18SmihV

420

8 Comments

Thoughts on this? >> Insurance upstart Clover Health launches new business selling its tech, borrowing from Oscar playbook >> Comment below! >>> lqventures.com #strategy #competitiveintelligence #marketing #pharmaceutical #pharma #biotech #productmarketing #healthcare

1

#Niche-focused #ventures in #HealthTech, such as those #targeting #underserved areas or #specific health conditions, offer several benefits. They can address gaps in the #healthcare system, provide specialized care, and #potentially integrate into broader #ecosystems for comprehensive healthcare solutions. For example, #JVEDTECHMedovation, could explore #partnerships with #niche #HealthTech startups to enhance offerings in healthcare #innovation.

1

We just released our H1 2024 Digital Health funding summary. https://lnkd.in/gAZY64tp H1 2024 Digital Health funding closed at $12.4 billion invested across 719 deals. - Q2 2024 is outperforming Q1 by 34% ($7.1 billion vs. $5.3 billion)! - Digital Health funding has shown sustained investor confidence. Funding in Digital Health in North America is up 14% to $9.5 billion. Investment in Europe is down 10% to $1.52 billion, while funding in APAC dropped by 7% to $1.17 billion. - Partnerships in Digital Health are flat in the first half at 1,730. NVIDIA has been the strongest corporate partner in H1 2024 - 96 M&As, 8 bankruptcies, 5 delistings from the stock market and 3 relistings from NASDAQ to OTC market. The full report will be available for free next week. Feel free to comment and share if you want to receive a copy prior to our official launch 😊 Galen Growth | Insights You Can Trust #funding #digitalhealth #investments #partnerships

15

Healthtech investment 💰 is the force behind innovation 💡. Strategic funding can promote ethical tech use 📱 and even out healthcare disparities 🏥. Each dollar invested in healthtech shapes the future of healthcare 👩‍⚕️. Let's discuss how financial strategies impact healthtech. Thoughts below! 💭

2

These days we’re seeing leading venture firms and key strategic partners investing billons of dollars in AI companies focused on improving patient care, drug development, and clinical efficiency. For example, Spring Health recently secured $100 million to develop the company’s AI platform which matches patients with appropriate care providers and treatment plans. Amazon Web Services (AWS) and GE HealthCare are collaborating to leverage AI models to enhance standard of care in the healthcare sector. And in CytoReason's case, NVIDIA, Pfizer, Thermo Fisher Scientific, OurCrowd, and others are investing in our computational models, so we can develop more disease models in more therapeutic areas, address diverse patient populations with molecular and clinical data, and ultimately empower decision-makers with AI tools intended to help them increase the probability of phase 2 success. https://lnkd.in/dBp9FUuQ

43

2 Comments

One conversation we should be having more, especially in healthcare: is this an AI problem or a policy problem? A big challenge in American healthcare stems from the reality that our healthcare strategy changes with every administration. Throwing AI at problems that are well-addressed by policy innovation (e.g., AI for payer-provider RCM war) feels like a gross misallocation of resources. Solution sets are rarely zero sum – in truth, most problems will require policy, tech, and human interventions, but it's worth asking ourselves whether AI is the best solve when we have a multitude of options.

85

22 Comments

Investing in companies that fill needs for health systems is a growth opportunity for both delivery organizations and start ups. Some systems are jumping in on their own, while others are partnering with like minded systems or with established VC firms. While this is a relatively new trend for systems, health plans have been making similar bets for many years. The benefits of becoming a health system portfolio company can be significant. Data, access to beta populations and real world coaching can be extremely beneficial. Start ups get mentoring and systems have to ability to leverage outside resources to solve relevant business problems. I predict a booming business!

4

ISPOR 2024 musings - Part 1 1) Health is not the outcome It's the things we do in full health as community or an individual that is the true measure of healthcare ROI. Unfortunately, current metrices for assessing healthcare value are too often tied to realizing clinical outcomes or reducing costs. 2) The wrong pocket problem is real When institutions cannot leverage wins in a different sector as a realization of its own KPIs, then we have an issue where health agencies will continue to arbitrate value based on narrowly defined clinical outcomes and cost saving metrices. 3) 1 and 2 are blockers of "whole health" outcomes A bit reductionist, but fundamentally, if there is no concerted effort to reframe value of health from a "whole health" perspective, through reframing of outcomes and introducing shared KPIs for public institutions, "whole health" will remain a utopia. I say its reductionist because there are practical blockers to this other than the philosophical/ideological issues as covered in 4. 4) Data (tracking, integration and linkage) is key We are phenomenal at tracking costs centrally, but we do quite poorly at tracking outcomes and we're especially poor at (or unwilling to) track social determinants of health. At best we have disparate clinical registries funded by companies or clinical societies, which is great for them but unfortunately quite useless in facilitating economic decisions on a country/community level. Unfortunately, this data is exactly what we need to link clinical outcomes from trials to clinical, social and economic ones in the real world to arbitrate value or healthcare ROI appropriately in this pursuit of "whole health". Throw in issues of consent, clarity of guidelines on appropriate RWD collection and use, financial incentives, privacy, trust between stakeholders, and you can see why the ~4000 people in attendance at ISPOR had more questions than answers for this issue. 5) Equity considerations in economic evaluations shouldn't be all about the numbers Economic evaluations, as they are conducted now at the funding decision level, may lead to inequitable outcomes especially if not accompanied by system designs that address social/healthcare inequities concurrently (e.g. through means tested subsidies, public transport infrastructure, food and nutrition programs. etc.). DCEAs, ECEAs and the other equity encompassing methods are great for these settings, but it is incumbent on companies, HEOR practitioners and HTA agencies to carefully scope the populations for which they are incorporating equity effects for. Otherwise, it becomes a free for all in order to obtain higher value judgments, thereby defeating the purpose of these methodologies. That said, no quantitative measure should ever replace the qualitative deliberation in any equity discussion. Economic models are but one (out of many) aspect of a HTA evaluation. All of us would do well to remember that.

18

Unfortunately, I think many DTC virtual clinics + cash-pay, mail-order pharmacies have a tough road ahead. This is all about the mismatch between the VC investment thesis (5-10x valuation increase from latest round) and what is likely a realistic exit outcome for this archetype right now. We know what best-in-class looks like for a DTC virtual clinic + cash-pay, mail order pharmacy: Hims & Hers Health worth $4.6B. They've seen strong investor interest lately, especially related to their GLP-1 compounding initiative. Hims' full year 2024 guidance is $1.20-1.24B in revenue. That represents a 3.7x forward revenue multiple. The challenge is that many smaller DTC virtual clinic + cash pay, mail-order pharmacies raised significant funding in 2020-2022 and now have high exit expectations. Once you raise significant VC funding (series a and beyond) and dilute the cap table, it's really hard to pivot to a sustainable, cash-flowing business. For example, after an angel, pre-seed, seed, and series a round, the founders may own ~50% or less of the company. By this time, there's already a formalized board in place with $1B+ exit expectations. Now if we were talking about DTC skin care, frozen food, or clothing, there's a tried and true pathway to exit the business to a $100B+ conglomerate CPG brand for 8-9 figures like Unilever, P&G, PepsiCo, Nestle, LVMH, or Coca Cola to name a few. The problem is that unlike traditional CPG, DTC health is much smaller and younger. Instead of P&G (worth $398B) or Unilever (worth $143B), the largest acquirer may be Hims at $4.6B. And now that Hims is publicly traded, they may prefer an acquisition that is net income accretive at a reasonably low multiple (1-2x revenue). And they also would have to believe it's not a product/service they could do internally. The $100B+ players in healthcare like UnitedHealth Group, CVS, McKesson, or HCA don't appear to be interested in acquiring niche DTC virtual clinics + cash pay, mail-order pharmacies at this time. Especially hard when their cash yields 5% risk free and the market optimizes for earnings per share. DTC is not their core business and given their mature revenue scale, adding 8 figures of revenue does little. Now the holy grail for these DTC virtual clinics + cash pay, mail-order pharmacies is either a) go public; or b) get bought by a consumer juggernaut that likes healthcare (aka: Amazon). The only issue with Amazon is given the recent dept consolidation news, seems like they're still digesting PillPack and One Medical. The other option of IPO'ing is hard because bankers want to see a $1B+ valuations. If we use Him's 3.7x forward revenue multiple, another DTC virtual clinic + cash pay, mail-order pharmacy needs ~$270M annualized revenue w/ similar margins. That's brutally hard to achieve that scale when growth-stage private funding has dried up for DTC. But this is just my two cents. And I could be wrong, wouldn't be the first or the last time. Thoughts?

145

33 Comments

One key reason why healthcare technologies like AI, telemedicine, and software haven't structurally lowered costs or broadened access for the entire system after decades of experimentation (excluding pure financial engineering of payer contracts) is the limited reimagining of care delivery itself, with asynchronous telemedicine as a notable exception. In the same way that digitizing physical paper failed to exploit the capabilities of a new computing medium for word processing, hosting physician-patient conversations over video does not transform the actual delivery of care. In telemedicine, many of the inputs (e.g., clinician time) and therefore cost structures of in-person care persist, which is why we often see fee-for-service telemedicine companies struggle to achieve economies of scale (i.e., growing revenues non-linearly while growing costs linearly). Until we deconstruct the components of a medical appointment – from intake and triage, to chart review, history gathering, physical examination, diagnosis, treatment, and follow-up – we will continue to be underwhelmed by the disconnect between the transformative potential of these technologies and real-world patient/system impact. I’m optimistic that the emergence of reliable and performant medical AI agents will urge us to perform this deconstruction and redesign the fundamental building blocks of a “medical appointment.”

215

39 Comments

Here’s your recap of last week’s health IT news 🗞️ 👇 🥼AI Clinician Assistant • Suki : The AI scribe announced an SDK and APIs enabling developers to integrate ambient documentation into their applications. • Apricot: The gen AI pre-seed startup focused on reducing documentation overhead for home health nurses launched. • Tampa General Hospital + Palantir Technologies: The health system and the software platform are partnering to develop an AI care coordination and decision support platform. ☎️ AI Contact Center • Mediktor + Sensely: The AI symptom triage solution acquired the conversational member engagement platform. 📋  Patient Administration • Oracle (Cerner) + Loyal: The EHR now offers integration with the patient engagement solution through its Healthcare Marketplace. • HubSpot: The CRM and marketing platform announced it will now offer HIPAA support and sensitive data tools. 🏥 Provider and Practice Administration • LeanTaaS: The AI-enabled facility management solution released updates including: mobile-first live view of OR schedule, predictive staffing automation, and a gen AI solution allowing decision-makers to glean staffing and scheduling insights. ⚕️ Clinical Operations • Keragon: The HIPAA-compliant automation platform launched out of stealth with a $3M funding round. 🧑‍💻 Virtual and At-Home Care • AvaSure + CLEW: The virtual care platform is partnering with the AI-powered remote patient monitoring and analytics company to improve patient outcomes. 🍎 VBC • Evolent + Machinify, Inc.: The VBC org acquired AI Authorization assets from the AI operating system platform.    • ProgenyHealth, LLC + Wildflower Health: The maternity and NICU case management solution is partnering with the women’s health VBC enabler to “help health plans fill gaps, collapse silos and integrate into existing clinical and operational workflows.”    • Health Catalyst + Carevīve: The population health data and analytics company has completed acquisition of the cancer care management solution. 🧠 Food for Thought: • This article provided an interesting look at Nebraska Medicine’s efforts to design a next-generation hospital room, including the four technologies they’ve selected to anchor their work. https://lnkd.in/em-u-a5v    • McKinsey released a survey of 200 global health system executives on their investment priorities. Among the notable findings, 88% listed AI as an area of high potential impact, yet only 40% have implemented any solution thus far and over 20% don’t have plans to invest in the next two years. https://lnkd.in/eK3CeqQ2

38

4 Comments

In case you missed it, last week the Coalition for Health AI (CHAI) released a draft consensus framework for responsible health AI. Developed with input from over 100 contributors representing a diverse network of healthcare stakeholders, this guide proposes actionable evaluation criteria throughout the AI lifecycle—from identifying use cases to deployment and monitoring. Key examples outlined in the guide include: • Predictive EHR Risk Use Case (Pediatric Asthma Exacerbation) • Imaging Diagnostic Use Case (Mammography) • Generative AI Use Case (EHR Query and Extraction) • Claims-Based Outpatient Use Case (Care Management) • Clinical Ops & Administration Use Case (Prior Authorization with Medical Coding) • Genomics Use Case (Precision Oncology with Genomic Markers) The draft framework is open for public review and comment for the next sixty days. Please use this form to submit feedback: https://lnkd.in/eYughFYC Kudos to the CHAI team led by CEO & President, Dr. Brian Anderson, MD, on this milestone. Eric Horvitz Jennifer Goldsack John Halamka, M.D., M.S. Michael Pencina Micky Tripathi Nigam Shah Suchi Saria Troy Tazbaz #healthcare #ai #artificialintelligence #generativeai https://lnkd.in/e7VRv6fD

125

1 Comment

Trending News | Global | M&A in Healthcare and Life Sciences: A Shrinking Margin for Error in Deals In 2023, deal volume declined across sectors, but deal value rose because of notable megadeals in pharma and medtech. The industry is sitting on high levels of cash—$171 billion across pharma companies. Also, top-line growth has a disproportionate impact on total shareholder returns (TSRs) in this industry. In pharma, for example, revenue growth has a seven times greater impact on TSR than margin growth, making inorganic growth especially attractive. It was not surprising that in our survey of M&A practitioners, 80% of healthcare executives predict that they will do as many or more deals in 2024 as they did in 2023. Follow: C-SUITE PARTNERS PL Website: www.c-suitepartners.com #CSuitePartners #Health #Healthcare #TrendingNews #Global #LifeSciences #DealActivity #Pharma

9

Is there a light at the end of the tunnel for healthcare startups looking to raise venture capital? That’s what Rock Health’s half year funding report suggests. It found U.S. digital health startups raised $5.7B across 266 deals in the first half of 2024. And, if these trends persist, this year could be on track to meet or exceed 2019 and 2023 funding levels–getting back to “normal” after the pandemic-fueled peak. https://lnkd.in/gTh3XHuh

5

As the discourse shifts from models to compound AI systems / agents, we need better AI benchmarks to evaluate multi-modal and multi-step task performance, especially in healthcare and life sciences. When we wrote the first paper demonstrating ChatGPT's performance on the USMLE, we chose the US Medical Licensing Exam as a benchmark for accessibility, speed, and ease. This benchmark was never intended to represent AI model performance on real-world clinical tasks. Today, I still see so many research teams and startups using benchmarks (like the USMLE) that are ill-fitted for assessing the true clinical or scientific performance and utility of the models they are developing for real-world contexts. Benchmark development may be seen as a "less sexy" area of research, but it is of paramount importance. Years after the rise of the transformer, we still lack adequate benchmarks for so many single-step tasks in biomedicine. With compound AI systems (i.e., architectures that integrate multiple AI models to perform complex tasks) emerging, we need new benchmarks for agentic behaviors. I'd argue that developing an agent with novel capabilities without at least proposing a companion benchmark (if an industry standard does not yet exist) may hinder the adoption of said agent, especially for high-stakes workflows. Designing more benchmarks that capture/simulate real-world clinical and scientific workflows will help us mitigate the major discrepancies observed between in silico and in vivo performance and better support safe + effective deployment of AI in biomedicine. There are already brilliant people focused here, and we need more. DMs are open if you're researching or working in this area of multi-step/multi-modal benchmarking in healthcare and life sciences! #healthcare #ai #artificialintelligence #generativeai

100

18 Comments

I always read Rock Health's digital health reports as they give a nice pulse feel for what is happening in the digital health funding space. Good to see funds raised in H1 2024 suggest funding in the sector seems to have stabilized at 2023 levels. Its no surprise the report emphasis the buzz around AI and healthcare. There have been clear winners in the AI healthcare space in the area of process and cost optimization and the R&D space. The impact of AI in care and treatment delivery is so far much more muted. One area I never though to look at AI was in its ability to bring together multiple healthcare pathways and digital point solutions into a more holistic seamless experience for the patient. There is a clear trend away from using stand alone digital health point solutions, and could AI address this challenge by facilitating the efficient integration of disparate processes and technology into unified care programs. I can see this happening with digital health products but this will be more tricky to do with physical care programs involving clinicians and HCPs. “AI is helping us combine multiple parts of the care journey, across all care experiences. In the future, benefits navigation, clinical guidance, and care delivery won’t be delivered by separate companies or point solutions within the healthcare ecosystem. They’ll be features that work in concert within products, and they’ll happen in under 90 seconds for a seamless patient experience.” – Glen Tullman, CEO, Transcarent and Managing Partner, 7wireVentures

11

This was a great episode with Amit Garg from Tau Ventures. Together, we discussed the current state of healthcare, startups, AI, and much more. I had so much fun, and learned a lot, and I am sure you will too. For the full episode, check out Delta: HealthTech Innovators. #AIinhealthcare #VC #tauventures

7