CEO change at GE may mean delay or cancellation of GE Healthcare spinoff–for good or ill

The well-publicized and unvarnished dumping of GE‘s CEO John Flannery after only 13 months has led a leading research analyst to predict that the planned GE Healthcare spinoff will be delayed or even halted. Analyst Jim Corridore of CFRA stated on CNBC that incoming CEO Lawrence Culp, a recent board member who was CEO of Danaher, a scientific, industrial and healthcare conglomerate, may decide that the division should stay. 

At $19 billion in revenue with a profit of $3.4 billion, 15.8 percent of GE’s total sales and 43.2 percent of its operating profit in 2017, the wisdom of a GEHC spinoff always seemed doubtful. The selloff was in line with Mr. Flannery’s strategy of refocusing on GE’s industrial and energy business. However, this was not going terrifically well, at least in the BOD’s view, with a sluggish turnaround, shares dropping off the S&P 500 and the Dow Jones Industrial Average, projections of missing year-end targets, activist investor Nelson Peltz hovering, and exacerbated by problems at GE Power with its new line of natural gas-fired power turbines. Perhaps a few were doubly offended by the selloff of the corporate jets (relative pennies) as well as the expensive and frankly hard-to-justify corporate HQ move from Connecticut to Boston.

Mr. Culp is apparently well-thought of, having retired after a highly successful 14-year run at Danaher, but he has his work cut out for him. He will also need to quickly judge whether to continue the GEHC spinoff process or bring the cattle back into the fold, as the drive was well underway down the trail. Somehow, spinning off 40 percent of your operating profit seems strategically foolish given a plummeting share price.

A jaundiced opinion. Perhaps as an outsider, Mr. Culp can change the ‘death star’ culture at GE. This Editor, in her brief encounter with GEHC as part of an acquired company (Living Independently Group, developer of QuietCare, circa 2008-9) found their business practices and many of their people to be both ruthless and self-referential to the point of stumbling blindness. The LIG acquisition was part of an ill-considered and perhaps ego-driven experiment by GEHC’s CEO at the time to get into home, remote monitoring, and assisted living health, a developmental, small-scale, early-stage area. It was obvious that GE’s vaunted methodology and hospital-based acute care experience were worse than useless when it came to understanding what is still a developmental area. The home health businesses were sold, closed, or (in the case of QuietCare), spun off into a joint venture. That CEO and a few other people leveraged it well; LIG’s employees, shareholders, and others at GEHC did not. 

As Star Wars fans know, Death Stars are destroyed in the final reel.

Butterfly IQ handheld ultrasound offers clinical-quality body imaging for under $2,000

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2018/03/butterfly-iq.jpg” thumb_width=”200″ /]Butterfly IQ is a NYC and Connecticut-based company which has developed a handheld ultrasound that transmits images to a smartphone. Where it differs from current handhelds like GE’s VScan is that it uses a single transducer for all images both near-field and deeper in body, and connects to a iPhone loaded with their software.

Larger machines, even on portable carts like the Philips Lumify [TTA 27 Mar] operate on an older vibrating crystals-based technology. The IQ uses capacitive micro-machined ultrasound transducers or CMUTs. 

It claims to be FDA-cleared for 13 applications. All this is delivered for under $2,000, far under other handhelds or carts (VScan is above $12,000, Lumify about $6,000), with delivery this year (pre-order notification at present) in the US only. Butterfly is also working on problems such as the volume of blood a heart is pumping or detecting problems like aortic aneurysms.

The IQ has a brace of impressive testimonials from doctors at Yale, UC Irvine, Denver Health, Rocky Vista University, Mass General, St. Elizabeth’s (Boston), and Metrowest Medical Center. According to vascular surgeon and company chief medical officer Dr. John Martin, he used it on himself to diagnose a mass in his neck last year that turned out to be Stage 4 cancer, for which he is under treatment. Daily Mail, 9to5 Mac, MIT Technology Review  Hat tip to Editor Emeritus Steve Hards

GE’s change at the top puts a healthcare head first

This Monday morning’s Big News was the stepping down, after 16 years, of GE‘s CEO Jeff Immelt effective August 1, and the rise of GE Healthcare’s head, John Flannery. The focus of most articles naturally was the fate of GE. Mr. Immelt may have steered the company through a severe recession starting in 2008, but he managed to lose about a third of the company’s value in the process. Expect some changes to be made in Boston. “I’m going to do a fast but deliberate, methodical review of the whole company,” Flannery told Reuters in an interview. “The board has encouraged me to come in and look at it afresh.” In an earlier call with investors, he said the review would have “no constraint.”

Mr. Flannery is a 30-year GE veteran, head of Healthcare since 2014, and previously head of GE India, its equity business in Latin America and GE Capital in Argentina and Chile. According to Fortune, GEHC is 15 percent of GE’s total business and in recent years has been smartly up in revenue. They have partnered recently with UCSF on predictive analytics, Boston Children’s Hospital on a pediatric brain scan database, and Johns Hopkins of a more efficient hospital bed allocation process. Also is an example of telemedicine remote diagnosis using a GE Health portable ECG device connected to the Tricog smartphone app to take a reading in India which was diagnosed in San Diego.

Usually healthcare CEOs become CEOs of other healthcare companies–witness the rise of one of Mr. Flannery’s predecessors, GE veteran Omar Ishrak, as CEO of Medtronic.  Fortune’s healthcare reporter interviewed Mr. Flannery two weeks ago–more of this interview will be published according to the author. (But hasn’t as of June 21!)

Care Innovations’ ‘record growth in 2015’; replaces CEO; GE departs partnership

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2013/02/gimlet-eye.jpg” thumb_width=”150″ /]Care Innovations‘ recent (undated) press release (discovered as a LinkedIn update), if read without a Gimlet Eye, could be read as another one of those ‘good news’ releases that build company awareness and get it picked up on websites such as TTA. Certainly there’s a nice spin of positive news for remote monitoring technologies, particularly more complex ones in vital signs monitoring and broadening out their applicability. (More on those below.) But the observant eye will pick out a couple of ‘aha!’ moments at this company that got slipped in, but not slipped by, the Eye.

The first is that GE has departed the building. Always the junior partner except for the very beginning in 2009, GE apparently exited sometime after December based on the last press release with Intel-GE identification issued 1 Dec 2015. The boilerplate company description is no longer ‘Intel-GE Care Innovations’ but now ‘Care Innovations, a wholly-owned subsidiary of Intel Corporation’. Lift your eyes to the company logo at the top left of the web page, and there it is, ‘An Intel Company’. GE is not fully cleansed, still to be found on product pages such as Health Harmony and QuietCare, as well as the copyright line at the bottom of each web page. (More work to be done)

The second is the appearance of CI’s new CEO, Randy Swanson, in the executive quote and on the ‘team’ website page. His bio notes that he’s a 17-year Intel finance/business development veteran, at one point with responsibilities in the Digital Health Group. Tea leaf readers might well surmise that Intel will now emphasize profitability at CI after the major repositioning and partner expansion during the 2.5 years of Sean Slovenski’s tenure (a non-Intel’er departed in January to Healthways, TTA 13 Jan).

The release also has a few more interesting moments. (more…)

Ten years on from the WSD: is the future brighter for telehealth? Can wind farms help?

As Prof Mike Short pointed out recently, 2016 is the tenth anniversary of the start of the Whole System Demonstrator (WSD) programme that in retrospect, because of poor trial design, probably slowed the uptake of digital health in the UK more than any other single action. It seems appropriate therefore to look at how telehealth* has fared over that period, and perhaps even more importantly, is poised for the next ten years.

The mistakes of the WSD are well documented (eg here, here & here) – suffice it to say that it proved beyond all reasonable doubt, at least to this editor, that unlike medicine-based interventions, which seem less sensitive to their care pathway, digital health delivers most of its benefit through enabling a different, patient-centred care delivery, so every digital health intervention needs to be evaluated holistically, and in its own care pathway. Sadly over the ten years, much of the academic work looking at the benefits of telehealth has continued to evaluate the technology in the time-honoured way that medicines have been evaluated, with predictably largely equivocal results.

Those of us who have delivered telehealth projects though have a sense of disconnect as, time and again, a focused implementation – not a pilot – in which the staff delivering the service understand that it will be a permanent change for which they need radically to change the way they deliver care, yields huge returns on investments through savings typically in the 50-90% region. (more…)

Care Innovations partners with caregiver mental health app Happify

Intel-GE Care Innovations announced yesterday a partnership with NYC-based Happify to integrate their mental health for caregivers app into Health Harmony by 1st Quarter 2016. Happify is a game-based app targeted to caregivers of the chronically ill to support their mental health and wellbeing through cognitive behavioral therapy, ‘positive psychology’ and conquering negative thinking. Currently it is marketed to healthcare providers and corporate wellness programs. According to the release, “By adding on access to Happify’s innovative mobile app, Care Innovations will be able to leverage state-of-the-art programs to improve the well-being of family caregivers and offer additional programs to its clients.” This is certainly an interesting integration to the typical vital signs and qualitative information gathering of patient data in thinking about the caregiver. However, we note that a previously announced partnership, with UK’s buddi announced last December, is not to be found on the CI website. Release (Business Wire)

Care Innovations goes East–down home to Kentucky

Intel and GE’s joint venture, Care Innovations, is opening an IT and product development center in Louisville KY’s Norton Commons live/work community. According to reports, the 10-person office was opened to develop “software for medical monitoring systems that allow people to measure their vital signs in own homes and that will analyze the data for health care providers”, which sounds like a description of Health Harmony as mentioned further in the article. Also cited by CEO Sean Slovenski was the recent acquisition of several major clients in Mississippi, Louisiana, Kentucky and Tennessee. Headquarters will remain in Roseville, California, northeast of Sacramento and far east of Silicon Valley. Why Louisville? It’s the headquarters of Humana, currently in the early stages of a merger with Aetna. Mr Slovenski is an alumnus of Humana who undoubtedly recognizes that there’s always talent which shakes loose with any merger, often proactively. He has reorganized the company top to bottom since the days in the doldrums under Louis Burns, and added initiatives such as the Validation Institute plus academic relationships with the Jefferson School of Population Health, Xavier University and the University of Mississippi. Louisville is also a lot closer to Washington DC (1.5 hour flight time) and all those wonderful Federal programs with lots and lots of funding.  Louisville Business First, release.

Speaking of the Aetna-Humana merger, it now has a strong boss man to make sure it works–Rick Jelinek, CEO for a year of OptumHealth, 19 years at predecessor now unit UnitedHealthcare including leading the Medicare Advantage and Medicaid businesses. The stakes are high in that the merger will create the second-largest managed care company in the US. Mr Jelinek also will lead Aetna’s enterprise strategy division, and will report directly to Aetna’s CEO. The timeline, unless the Feds put on the brakes, is to close in second half 2016. The combined operating revenue is projected at about $115 billion, with about 56 percent from government-sponsored programs, such as Medicare and Medicaid. The plan, according to Louisville Business First, is to headquarter the combined Medicare, Medicaid and Tricare businesses in Louisville. But, as they say, the meal is still being prepared, and assuredly not everyone at either company will find a seat at this table, or one they want to sit in.

Bayer AG enters the healthcare accelerator game (DE)

Bayer HealthCare AG’s Grants4Apps program announced its support of five startups that, in their words, will support improved outcomes or pharmaceutical processes. Unlike companies like GE or Pfizer, Bayer is outright granting a substantial amount of cash to each–€ 50,000–and offering space plus 3 1/2 months of mentoring in their Berlin HQ in return for the usual small equity stake. Of 70 applications, five were granted to European companies which will have their Demo Day on 1 December:

  • Cortrium:  their C3 device is a state-of-the-art wearable tech sensor for clinical-quality hospital wireless monitoring of health data including electrocardiogram (ECG), body surface temperature, respiratory rate, and body posture/physical activity. Blood oxygen and blood pressure to come in 2015. (Denmark, spun off from Nokia R&D)
  • PharmAssistantself-management tool for chronic disease patients, consisting of a smart pill container and a remote cloud-based monitoring service (Portugal) (more…)

Philips, Salesforce dive into health data integration

Philips Healthcare and Salesforce announced last week their partnership to construct a connected, multi-point and collaborative data platform to benefit providers, payers and patients. The initial step is the launch later this summer of the Philips eCare Coordinator app for healthcare providers and a patient-centered Philips eCare Companion app, which will uptake data from Philips Healthcare medical devices into a variation on the Salesforce1 cloud platform. What’s emphasized in the releases and information from media sources is that it will be designed as an open platform for other device and software providers. (Data security problems down the line are anyone’s guess.) While Philips’ global CEO was part of the announcement and it’s expected that Philips will be lead dog for this, the only two customers mentioned were US and Salesforce’s. There were also few details on how clinical staff would access and use the data.

Cui bono from this? Philips of course, which of late has been lagging (more…)

Suicide-alert sensor for prisons – no wearables needed!

GE_prison-suicide_sensor

GE Global Research has developed a non-contact monitoring system for prisons that aims to alert staff of a suicide attempt in progress. It works by tracking inmate’s movements and vital signs – but without the need for a wearable monitoring device! To achieve this the research team modified standard radar equipment to pick up the delicate movements of the chest caused by breathing and heartbeat.

The system which is designed to be mounted inside a prison cell could be an effective way to monitor at-risk individuals, without resorting to more expensive or more intrusive surveillance solutions. The US Department of Justice funded study proved to be 86 per cent accurate at determining whether someone required assistance.

The final technical report of the three part study is available in full at the National Criminal Justice Reference Service (NCJRS). GE is now exploring ways to commercialise the system in prisons and other settings. Read more: New ScientistNational Institute of Justice

Why GE is getting imaginative about startups

The latest permutation of GE Healthymagination, beyond an ad slogan, is a $250 million Silicon Valley-based fund, complete with a brace of imported VCs. According to new CEO Sue Siegel, the partnerships with StartUpHealth (along with a slice of its companies; TA 10 Jan) and Rock Health are only the start. Their rounds begin at a thrifty $250,000 and they are targeting five areas: personalized (precision) medicine, clinical decision support, life sciences and cellular therapeutics, minimally invasive guidance and patient monitoring. Ms. Siegel notes GE’s current presence but that it needs to go ‘more mobile.’ (Is Care Innovations still in their thoughts, or plunged off the edge of their world?) For a GE, like pharmaceuticals a while ago, it’s evidently easier to buy than to instill innovation, but the investment cash is welcomed in starving health tech. A happily not-firewalled article in the Wall Street Journal’s Venture Capital Dispatch.