GV’s Approach to Healthcare Investing: An Interview with Dr. Krishna Yeshwant

google-ventures-story

Please note:  This article was originally published on TechCrunch.com.

Healthcare investments — in particular, investments in digital health — are booming, and don’t seem to be slowing down. According to CB Insights, digital health funding hit nearly $5.8 billion in venture funding last year, surpassing the previous record of $4.3 billion in 2014.

One of the top venture firms, GV (previously known as Google Ventures), recently came out with their year in review, revealing that more than one-third of their investments are in the life sciences and healthcare. (They currently have $2.4 billion under management.) “I can think of no more important mission than to improve human health and global quality of life,” CEO Bill Maris said in a recent announcement.

One of the strengths of the GV life science and health investment team is having a diverse mix of PhDs and MDs as investors, including general partner Dr. Krishna Yeshwant. Yeshwant continues to practice internal medicine part-time at Brigham and Women’s Hospital in Boston, and credits that with helping to keep him in touch with the challenges facing healthcare.

I recently sat down with Yeshwant to talk about GV’s investment strategy.

Yeshwant started his career, interestingly, studying computer science at Stanford. From there, he helped found two tech companies, which were eventually acquired by Hewlett-Packard and Symantec. He could have successfully continued on his path in tech, but decided instead to go to medical school after his father became ill and needed a cardiac bypass. “I remember just being in the hospital thinking this is just messed up. There are so many areas for improvement,” he said.

He went on to pursue an MD-MBA at Harvard. During this time, he became involved in a lot of medical-device work, and even started a diagnostics company. This work eventually led him to work with Bill Maris at Google Ventures.

Thus far, one of GV’s largest investments has been with Flatiron Health, an oncology-focused technology company based in New York City. According to Yeshwant, the concept was developed by two former Google employees who received support from GV. “Flatiron is basically integrating EMR’s (electronic medical records) in the outpatient and hospital setting,“ said Yeshwant, “and it provides data back to physicians as well as aggregating data to aid with discovery and help with regulatory processes.”

Others have also recognized Flatiron’s enormous potential. Flatiron recently announced they received $175 million in Series C funding from Roche Pharmaceuticals. In addition to the funding, Roche plans to be a subscriber to Flatiron’s software platform. Their hope is to use the platform to identify and bring innovative treatments to market faster.

Yeshwant strongly believes in the need for more tech solutions in healthcare like Flatiron Health. “There’s a fundamental need for infrastructure. A single disease type of lung cancer is actually lots of diseases. Other more complex diseases are going to need more data sets, multisite trials, and we need to create infrastructure for that,” he said.

It’s hard to argue with him on that point. Massive amounts of biometric data are being collected in healthcare right now, but there aren’t nearly enough tools for storage, communication and analysis of that data. There’s a great deal of opportunity for healthcare startups that can specialize in data management and analysis.

Three such companies in which GV has invested in this space are Metabiota, which provides risk analytics to prevent and reduce epidemics; Zephyr Health, which uses global health data and machine learning to provide treatment insights to pharma and medical device companies; and DNAnexus, a company that helps companies store their genetic information.

“Once you’re in a world where you can scale up and down your computational analysis, you can ask lots of simultaneous questions of your aggregated data sets and that’s well suited to the cloud environment,” said Yeshwant. “We invest heavily in those spaces.”

Besides software-based companies, GV is investing in a diverse range of other types of companies in healthcare and the life sciences. One such area is the genomics space. Thus far, GV has made major investments in Editas, a CRISPR gene-editing company; 23andMe, which offers chromosomal analysis to consumers; and Foundation Medicine, a company that offers genomic analysis of various cancers.

Yeshwant also feels one of the biggest challenges (and opportunities) in healthcare is helping healthcare organizations shift from fee-for-service to fee-for-value. “That’s the direction we’re going,” he said. “How do we migrate big systems in that direction? That’s the fundamental question.”

GV therefore has made some significant investments in companies that are shaking up the traditional provider model, including the telemedicine company Doctor on Demand and the innovative primary care provider, One Medical Group. “Anything you can do to move healthcare from a high cost setting to a low cost setting is generally going to be successful in that model,” said Yeshwant. “Telemedicine is a good example of that. We have a company called Spruce Health which is essentially asynchronous care. Value based care is a big area for us.” (Spruce Health is a platform for dermatologic care.)

Yeshwant hinted that future projects may be in the areas of population health and chronic disease management, investment in companies that engage consumers directly and possibly even some work in women’s health. One thing’s for sure: We can expect more exciting things to come in 2016 and beyond for GV.

 

 

Investing in Problem-Solving, Not Product: PureTech’s “Proactive” Approach

PureTech Health (PRNewsFoto/PureTech Health)

Step into the sixth floor offices of PureTech Health in downtown Boston and you may feel that you’ve dropped into a rabbit hole and right into a lush wonderland of wall-to-wall greenery. It’s a surprising interior for the otherwise nondescript office building on the heavily trafficked Boylston Street.

But the unique décor might provide a clue about how this innovative company, run by CEO Daphne Zohar, operates. Referred to as an intellectual property (IP) commercialization company, one of a rare breed seen in the U.S., it licenses and develops health tech and life sciences patents from academic and independently-run labs. The model is common in the U.K.–PureTech Health went public on the London Stock Exchange this past May, raising nearly $200 million—but is radically different from how typical biopharma or venture capital firms operate.

“We start with the problem–take obesity or other disorders, like schizophrenia, ADHD–where we feel like there really isn’t a very good way to address it, and we bring together a network of 50 plus experts from around the globe, people who have really thought deeply about this problem and others who may be in slightly different disciplines,” explains Julie DiCarlo, PureTech’s SVP of Communciations and Investor Relations. “They look at the problem from different perspectives and start vetting potential technologies or science to address it. So it’s really different than a company that might say, ‘Here’s a really cool technology that we want to invest in.’”

After the think tank identifies potentially useful innovations, PureTech tests the concepts to see if previously reported results are reproducible. DiCarlo adds, “From there, we might find that there’s one that really stands out as a really potentially exciting and game-changing opportunity and if it passes all of our rigorous tests, we’ll start a company around it.”

This process of search and discovery has lead to the founding of some of the most innovative healthcare-focused companies, with diverse treatments ranging from drugs and biologics, to devices and digital health.

Akili Interactive Labs develops video game therapies for treating cognitive disorders, which have been found to improve cognitive ability and executive function among the elderly. In the future, Akili hopes to also develop treatments for those suffering from disorders like ADHD, autism and depression.

Vedanta Biosciences hopes to treat autoimmune and infectious diseases by modulating a patient’s microbiome. At this stage, Vedanta is isolating specific strains of organisms in order to learn which combinations result in particular, desired phenotypic expressions and outcomes.

Gelesis has developed an oral hydrogel capsule for the treatment of obesity (and related disorders, such as diabetes) which works mechanically, causing early satiety and decreased appetite, before dissolving and being eliminated by the body.

Tal Medical is working on a tabletop medical device (modeled like a much smaller MRI machine) that has been shown to rapidly reverse depression through neurostimulation. A single treatment with the device has been found to have an effect equal to four to six weeks of traditional pharmacologic treatment.

PureTech has 12 companies currently in their portfolio with a goal to add an additional one to two each year. Although each is independently-run, they are all majority-owned by PureTech, sometimes for the long-term. This approach allows for more flexibility than at a typical life sciences or VC firm. These companies have the potential to become completely independent, be sold to larger biopharmas, develop partnerships with other healthcare organizations, or may be retained by PureTech to continue growing the company’s product lines.

Executive Vice President of Science and Technology Erik Elenko calls PureTech’s approach “100 percent proactive.” “Think about a typical entrepreneur who has one technology and they [sic] get really excited about it but there could be 10 others out there. We’re reaching out to people, we’re not having companies come and pitch us…The key is that you start with a problem and come up with a solution, rather than investing in a technology which may or not be useful.”

The company also draws on a large, interdisciplinary panel of experts—including outside experts in addition to members of its own scientific advisory board—who look at complex healthcare problems from a multitude of angles. Among the most valuable and in-demand consultants are those working in digital health. According to Elenko, healthcare and IT have radically different cultures and “different ways of approaching the world,” so finding individuals that have connections in both worlds is invaluable in solving today’s complex healthcare challenges.

PureTech has ambitious plans for the future.

“If you look at our fundamental goal, it’s to solve the most difficult healthcare problems that exist through interdisciplinary and unexpected solutions,” shared Elenko. “Success is getting therapies to market for patients, reaching more patients through partners and helping patients by looking at their toughest problems.”

This article was originally published on MedTech Boston.


What’s Hot in Boston Biotech

Xconomy

Popular business and technology news site Xconomy held its eighth annual life sciences forum on April 8, 2015 at the Broad Institute in Cambridge, Mass. This year’s theme was “What’s Hot in Boston Biotech” and drew a who’s who of industry leaders, scientists, and entrepreneurs. The sold-out event packed the 250-seat auditorium of the Broad Institute and drew a dynamic crowd from all segments of the life sciences industry.

So, the burning question… what is hot in Boston biotech?

New Treatments for Neurodegenerative Diseases

Adam Koppel, Senior VP and Chief Strategy Officer at Biogen, discussed exciting new treatments that are in the pipeline for some of the most challenging neurodegenerative disorders. Highly anticipated medications include aducanumab for Alzheimer’s disease, anti-LINGO for multiple sclerosis, and ISIS-SMN for spinal muscular atrophy. Aducanumab has gotten a lot of attention in the news recently as a result of the positive results of a clinical trial showing a dose and time-dependent reduction in amyloid plaque.

Another company working on therapies for Alzheimer’s (and other neurodegenerative diseases such as Parkinson’s and ALS) is Yumanity. Tony Coles, CEO, and Susan Lindquist, Scientific Founder, discussed Yumanity’s use of yeast as a neuronal model that could tackle the protein folding problems at the root of many neurodegenerative diseases.

Exciting Frontiers in Synthetic Biology

James Collins, Professor of Medical Engineering and Science at MIT, and Amir Nashat, Managing Partner at Polaris Partners, discussed new opportunities in synthetic biology. Notable innovations include the development of therapeutics and diagnostics that can be affordably embedded in paper, cloth, or made into pellet form, as well as the synthetic engineering of microbes to fight diseases. The speakers also discussed the importance of ethical considerations and the need for safeguards as this area of science advances.

Immuno-Based Cancer Therapies

Chuck Wilson, CEO and President of Unum Therapeutics, and Ben Auspitz, Partner at Fidelity Biosciences, discussed a bold new avenue for cancer treatment that involves re-engineering a patient’s own T-cells with antibodies that respond specifically to their cancers. Currently, the therapy has been successfully used in the treatment of acute lymphoblastic leukemia, but it holds great potential in treating other cancers – and also for possibly developing a cancer vaccine.

Harnessing the Microbiome 

Another exciting area of research in biotech is in the development of therapies that aim to modulate the microbiome to treat disease. Bernat Olle, Principal of PureTech Ventures, and Marian Nakada, VP of Venture Investments at JNJ Innovation, spoke about a joint venture – Vedanta Biosciences – focusing on microbiome treatments for autoimmune and inflammatory diseases.

The Future of Genetic Therapy

In a fantastic panel on the potential and pitfalls of gene therapy, led by moderator Michelle Dipp, Co-founder and CEO of Ovascience, panel members discussed the fact that gene therapy is still in its nascency. Many underestimate the time that it will take to develop effective therapies. Panel members included: Steven Paul, President and CEO of Voyager Therapeutics; Olivier Danos, SVP of Gene Therapy at Biogen; and Peter Kolchinsky, Managing Member and Portfolio Manager at RA Capital Management. Other challenges are in developing better gene vectors and anticipating how the broad adoption of genetic carrier testing in the future may affect the development of gene therapies.

The Potential of Precision Medicine

Samantha Singer, COO of the Broad Institute, moderated an interesting panel on precision medicine, with speakers David Altschuler, Executive VP of Global Research and CSO of Vertex Pharmaceuticals, and Alexis Borisy, Chairman of Foundation Medicine and Partner at Third Rock Ventures. Altschuler said that the advantage of precision medicine is that it will enable companies to target therapies more specifically and to “fail less often.” Efficiency, pace, and the success of drug development are likely to be enhanced as a result of better knowledge of the genetic basis of disease.

Scalability Challenges

Noubar Afeyan, Managing Partner and CEO of Flagship Venture, gave an entertaining talk about the challenges and opportunities of the biotech industry in Boston and Cambridge. He shared that he felt this was an unprecedented environment for biotech, in large part due to the co-existence and collaboration of large biotechs and pharmas along with smaller, entrepreneurial companies that engaged in more radical innovation.

He went on to discuss that he felt that scalability was the biggest challenge for Boston biotechs, in terms of resources, people, the process, and other externalities (such as space, the regulatory environment, and the development of partnerships). This is where much of the focus should be in the industry in order to encourage further growth.

This story was originally published at MedTechBoston.com.

Precision Medicine: Pros & Cons

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23 chromosomes (image from Scientific American)

This past week, President Obama announced a $215 million proposed genetic research plan, called the Precision Medicine Initiative.  According to the plan,  the NIH would receive $130 million towards a project to map the DNA of 1 million people, the National Cancer Institute would receive $70 million to research the genetic causes of cancer, the FDA would receive $10 million to evaluate new diagnostic drugs and devices, and finally, $5 million would be spent on tech infrastructure to analyze and safely store this data.

Not surprisingly, this announcement sparked some online controversy.  If internet pundits are to be believed, this plan is going to prevent you from ever finding a mate, an employer, get health insurance, cause us all to become part of a giant genetic experiment to tailor human beings, and will also put us into crippling debt and line the pockets of Big Pharma.  I’m not even sure I covered it all…The complaints ranged from reasonable to ridiculous.  The most amusing are the conspiracy theorists who are certain that Obama must be plotting a genetic apocalypse.

But, in all seriousness, I have to admit I have concerns as well, despite being mostly optimistic about this news.

Here are some of the exciting positives offered by the precision medicine plan:

  • New diagnoses:  We may finally be able to identify genetic causes of diseases that were previously unknown.
  • Prevention vs. disease management:  Knowing genetic risks ahead of time can help us to focus more on preventing disease rather than reacting after-the-fact, once the disease occurs.
  • Early diagnosis:  We may be able to detect diseases earlier and at a more treatable stage.
  • Protective genes:  Some people have certain genes that protect them against diseases or prevent them from “expressing” their bad genes.  Studying these differences may help us to learn how to protect ourselves against those diseases.
  • Drug development:  Therapies can be developed in a faster and more efficient way by targeting certain genetic problems, rather than using the traditional trial-and-error method.
  • Personalized treatments:  Treatments can be tailored to a patient’s unique genetic aberration and we can avoid giving treatments to patients that we know may cause adverse reactions or that will fail to work.
  • Population health:  We can study genetic patterns in populations of patients to find out causes of diseases, develop treatments, and find ways to prevent disease.
  • Healthcare costs:  There’s a potential to reduce healthcare costs if focus changes to prevention rather than treatment of disease and also if we can streamline drug development.

But, let’s also look at the potential downsides:

  • Data storage:  We already know that gene sequencing of an individual produces MASSIVE amounts of data.  The sequencing of a million people is going to produce unimaginable amounts of data.  How will we store all this big data and analyze it to make any sense of it?
  • Privacy/Security:  Is there anything more personal and vulnerable to cyber-attack than your genetic information?  I wonder if the $5 million allotted to this effort will really be enough.
  • Data relevance:  According to Obama, the data will be collected from 1 million volunteers.  That’s not a random cross-section of people in the US and may not represent the population adequately in order to make population health recommendations.  I’d argue that only certain types of people would sign up and other types won’t.  Would we miss certain disorders? Would we see too much of another disorder in a population of volunteers for this project?
  • Culture:  How do we prevent people from abusing this information and not using it to screen potential partners, deny insurance coverage, denying jobs?  How will this affect culture?  Will we be cultivating a different kind of racism, on a genetic basis?  Are we on the path to a real-life version of the movie Gattaca?
  • Ownership:  Who will claim ownership of this data?  Will it be the government?  I’d argue that this data should be owned by the individuals from whom it comes, but the experience of the genetic sequencing (now genetic ancestry) company 23 & Me is worrisome.  For the time being, the FDA has blocked the company from allowing individuals from having access to their own genetic information.  Will this change as part of the new initiative or not?
  • Drug/device industry:  Genetic research and development of treatments has been very promising and productive in the private sector.  How will government involvement affect research?  Will our governmental agencies work cooperatively with them or competitively?  Again, if the experience of 23 & Me is any indication, this is a real concern.
  • Healthcare Costs:  Yes, there’s potential to decrease costs, but there’s also potential in greatly increasing costs.  It’s no small feat to genetically map a population, analyze the information, store it safely and securely, and develop recommendations and treatments.

Part of me is excited about the potential and I think that it probably does take a huge governmental initiative to tackle and impact population health, but another part of me is concerned about government invading a space that is so personal and private and I wonder if it could slow down progress in developing life-saving therapies in the private sector.

What do you think?  Are you excited or nervous about President Obama’s Precision Medicine Initiative?

Cool Startup: Bloom Technologies

bloom tech sensor
checking for contractions with the Bloom sensor

It’s hard to read Peter Thiel’s Zero to One book and not start thinking in an entrepreneurial way.  Afterwards, I thought about where we have gaps in healthcare.  There is a lot of technology out there (apps, wearables) right now that has empowered patients to take charge of their own health.  One area that seems to be lacking is in women’s health.

There are a number of critical challenges in women’s health right now that could benefit from innovation.

First is the growing problem of access to women’s health providers, particularly Ob/Gyn’s, which will only increase in the years to come.  Demand remains constant, while supply is dwindling, because of factors such as an aging workforce and its low appeal to medical students related to demanding work hours and professional liability.  The Association of American Medical Colleges anticipates a shortage of 159,300 Ob/Gyn’s by the year 2025.

Second is the persistent scourge of preterm birth.  According to the CDC, preterm birth affects 1 in 9 of pregnancies and is the number one cause of infant death and long-term neurologic disability in the U.S.  It has been estimated that preterm birth costs our healthcare system more than $26 billion a year, though the societal costs are likely much greater.

Thinking about these two major problems made me wonder if anyone out there is working on technology that could positively impact either of these problems.  That’s how I stumbled across and connected with Bloom Technologies, a healthcare tech startup based out of San Francisco.  Bloom is currently developing a wearable contraction monitor that could help pregnant women determine first, if they are having contractions, and second, if those contractions are of the true, labor-inducing variety, or the false, Braxton-Hicks, variety.

Obviously, this product could have a great deal of potential.  It’s almost a right-of-passage in pregnancy for women to make frequent visits to the hospital only to be sent home, after being told that it’s not “real labor” yet.  Might this wearable device be able to tell patients when it’s the real deal?  And are there patients that would be interested in such a thing?  Molly Dickens, the head of Content and Consumer Experience at Bloom, feels that women are often confused and overwhelmed by all the rapid changes of pregnancy and anything that could help them to better understand what’s going may be welcome.

I think the Bloom sensor has even greater potential beyond just the obvious.  In light of our impending Ob/Gyn shortage, might we be able to use this device to remotely monitor patients in the future?  Could this be integrated into a telehealth approach for obstetrical care in the future?  Remote visits could obviously help to decrease over-utilization and costs of healthcare.  Also, in light of our epidemic of preterm birth, might this help us to detect preterm labor earlier, and therefore intervene in a more timely manner?  I would love to see this device studied in clinical trials.

The other thing that I find exciting about this product is that Bloom is developing this device to be of clinical-grade quality, one that could potentially rival current inpatient systems for contraction monitoring.  Currently, in Ob/Gyn, we use tocodynamometers, which measure pressure changes in the abdomen to get information about contractions.  Toco’s (as they’re called) are accurate as far as determining the timing of contractions, but pretty dismal at telling the strength of uterine contractions.  Bloom CEO, Eric Dy, shares that he and his colleagues are working at the circuit level on the signal, size, quality, and power of these devices to assure an exceptional product that–unlike traditional tocodynamometers–will measure electrical signals much like cardiac monitoring (the uterus, after all, is a muscle, too).  If these devices are better than the traditional toco’s used at every hospital across the country, we might see a real transformation of inpatient obstetrics as well.

I, for one, would also love the convenience of being able to just check my phone to see what’s going on with my patient & her baby, instead of having to solely rely on a single, static inpatient site to evaluate them.

In addition to contraction monitoring, Bloom is also working on other technologies that will help women to gain valuable information about their health from conception to the postpartum period, which they hope will ultimately help to drive better outcomes.

If you’d like to learn more about Bloom, check out their links below:

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