Digital Health is Underfunded

digital health is underfundedOverall venture capital funding made a sharp decline in the last two quarters amid worries (justifiable or not) of a bear market and a funding bubble in technology investments. In contrast to the tech market, however, digital health funding continues to grow at a record pace. According to Rock Health, $4.5B was invested in digital health in 2015 (an increase from $4.3B from 2014) and $981 million has already been invested in the first quarter of this year. It seems on pace to be another stellar year, which is remarkable considering what is going on in other sectors.

Many are skeptical about the investment potential of healthcare technology investments and have been wary to enter the market (perhaps especially so with all the negative media that companies like Theranos and Zenefits have attracted). Additionally, regulatory barriers and the longer timeline needed with healthcare innovations tend to scare potential investors away.  But anyone familiar with the sad state of technology in healthcare can see, even with the record-breaking investments thus far, that there continues to be an enormous untapped opportunity in healthcare–greater, I believe, than in any other sector.

Digital health is vastly underfunded.

Technology is taking over most of our personal and professional lives with indispensable apps, wearables, and other connected devices and software. At home, we have smart appliances, lighting, thermostats, security systems, media systems, and even smart cars. And we have Siri, Cortana, and Alexa doing our bidding. But in healthcare, we’re still in the Stone Ages in terms of technology. Communication via faxes, for example, is still common between hospitals and doctors offices. There are small glimmers of hope, such as patient portals, higher-functionality EMR systems, and telehealth services, but the fact is that we are still a far cry from the ideal vision for healthcare, which includes a seamless cloud-based network of devices and software that can track and record a vast spectrum of patient information, the ultimate goal being the use of computational technology to help prevent, predict, diagnose, and yes, even treat disease. Ultimately, collecting information on large populations of patients could have profound impact through public health measures that can prevent disease and thereby reduce healthcare costs. This can only be accomplished with a wide-spread network of software and devices, that includes electronic health records, wearables, devices based in the hospital, office, and at-home, and with telehealth capabilities. In addition, there are too few companies working to collect, store, manage, and interpret health data.

There is still a lot that needs to be done.

According to MarketResearch.com, the healthcare “internet of things” (IoT) is expected to reach $117B by the year 2020. The fact is, the full potential of digital health won’t be seen until every hospital and doctor’s office and home is connected via cloud-based devices and software and with the development of machine learning platforms that can make sense of the reams of health information.

It is a little challenging to think of all of this in the abstract, so here are a few examples of the potential of the healthcare IoT. Imagine that a spike in certain population health data (like temperature) is detected in a region of the country that alerts public health officials to early to a disease outbreak that can then be contained to prevent an epidemic. Imagine that a change in an individual’s biometric data alerts that person to seek medical care, detecting a life-threatening disease, like cancer, early and improving the chances of cure. Imagine chronic health conditions like diabetes are monitored routinely and continuously with real-time blood glucose levels, with immediate adjustment by doctors of insulin dosages, thereby preventing hospitalizations due to uncontrolled diabetes, and also preventing long-term diabetic complications, such as kidney disease.

These are only a few examples.  There are countless other opportunities in healthcare.

In addition to the opportunity to improve healthcare delivery, there is the opportunity to improve the quality of care through tools that provide greater communication and transparency of information with patients and improve care coordination between the providers of those patients. And by changing the focus of medical care to prevention and early diagnosis of disease, there is the opportunity to decrease the outrageous cost of healthcare as well, by decreasing the need for excessive medication, surgery, unnecessary visits, and hospitalizations. According to the Commonwealth Fund, in the US we spend an outsized proportion of our GDP on healthcare versus other countries. Other developed countries spend between 8.8%-11.6% to our 17% of GDP, related in part to better-connected health IT networks.

It’s hard to fathom how much digital health tech is needed to serve a US population of 318 million and a global population of 7 billion, but one thing is certain: the market is huge.  We should stay bullish on health tech investments now, and probably for a long while to come.

 

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:

Website 

Twitter

Facebook

Innovation for All

Innovation-in-Healthcare

I was in an interesting discussion yesterday with some colleagues on Medstro (a social media site for doctors).  We were talking about the pace of innovation at academic medical centers, but the topic got me thinking more broadly about who is driving innovation in healthcare right now.  The short answer seems to be:  “everybody”.

Innovation happens wherever people are desperately trying to solve problems.  On a global level, we have organizations like the Gates Foundation pouring funding into research and innovation to help eradicate deadly diseases in underdeveloped countries.  On a national level, our legislators and President have brought about the Affordable Care Act in recent years in an effort to improve healthcare disparity, cost, and quality.  (I’m going to have to defer the final verdict on this for another blog post in the future…).  On the healthcare delivery side, in the life sciences, among employers and insurers, we see efforts to innovate and improve healthcare quality, access, and/or cost.  In private industry, we see the proliferation of healthcare tools–apps, wearables, and other devices.  And, lately I’ve heard about some of the most inspiring innovators:  patients.  Recently, I read a couple of stories about patients hacking their diabetes devices to better suit their needs and another story about patients’ families starting biotech companies to work on developing drugs for rare diseases that have been typically neglected by industry.

Healthcare is big business.  A recent study by Deloitte estimates aggregate US healthcare spending at $3.8 trillion dollars for 2013..!

So, the question is:  who should be working on innovations that improve healthcare?

Is it appropriate for our government to fund efforts (as they’ve done with the CMS Centers for Innovation) to develop new models of care?  Should it be left to insurers?  Employers?  Should improving healthcare be left to the experts, scientists and doctors at elite academic institutions?  What about private citizens with the deep pockets, like Bill and Melinda?  What about all the companies making those wearables?  Have any of these devices even been shown to be helpful?  Are people just wasting their time on all these devices and collecting all this useless data that will only drive their doctors nuts and cause them to just order more tests and drive up healthcare costs some more?  Is it appropriate for patients with their non-medical backgrounds to drive healthcare innovations?

Among doctors (and others), these are controversial topics.

I have my own opinion and it is this:  Everyone that identifies problems within healthcare (and feels inspired) should work on finding solutions.  I admit that this may not be a popular answer if your only goal is to reduce that $3.8 trillion bill.  But, I like to think that we can actually reduce healthcare spending…but the key is not to start with that as the primary goal in mind.  The primary goal should be to cure disease and to improve quality of life and longevity.  One never knows  where the next great revolutionary idea will come from (maybe from a kid in a garage jailbreaking his medical device)?  Maybe this idea will transform not just the health and wellbeing of individuals, but solve the healthcare financial crunch we’re in.  After all, if someone finds a way to solve the obesity epidemic, they will effectively decrease a host of other very expensive diseases, like diabetes, heart disease, and cancer.

What are your thoughts?  Should innovation in healthcare be democratized and open to all, public and private, expert or not?  Or should it be left to the realm of scientists and doctors, the experts in the field?