ViVE post-script: VC panel opines in midst of digital health’s new reality (depression?), and extra ViVE from an attendee

March 31, 2023 | by

Not everything at ViVE this week was fun and music. The organizers included a timely panel discussion with four VCs exploring the crash of digital health funding, enterprises, and whither the fall of the VCs’ favorite bank, Silicon Valley Bank (SVB). It was moderated by MedCityNews‘ editor-in-chief Arundhati Parmar, who published an interview with Zane Burke, late of Livongo and now CEO of Quantum Health, pointedly asking whether Livongo’s sale to Teladoc was a smart one given the troubling post-script [TTA 3 Feb]. The participants — Lee Shapiro, managing partner at 7wireVentures, Emily Melton, managing partner at Threshold Ventures, Richard Mulry, president and CEO of Northwell Holdings, and Ambar Bhattacharyya, managing partner of Maverick Ventures–evidently weren’t given a diet of softballs, either. 

Parmar started with a quote from a recent article in another publication: “The run on SVB was a textbook result of the myopia and egoism that has swallowed the venture capital industry whole.” This refers to the advice that many VCs gave their invested companies–get your money out now. That was the same invested money that the VCs insisted be in SVB, in accounts such as payables and receivables. At least these VCs seemed to realize that now, somewhat obliquely. Shapiro called it a ‘tragedy of the commons’, B-school terminology that refers to too many people using a common resource ruining it because no one is responsible for it. More to the point, he pointed to some in the VC ‘community’ advising their companies to move their money out of SVB, creating the self-fulfilling prophecy of a run on the bank killing it. Melton pointed to social media and everyone rushing to take care of themselves without reflecting on the consequences of their actions.

The next quote and chart that Parmar presented had to do with that Old Devil Profitability in companies that IPO’d. Only two of 17 are profitable and they’ll be a surprise–Privia Health (VBC models for providers), and Progyny (riding the fertility and benefits bubble). Rather abashedly, the panel admitted to valuation frothiness leading to over-valuation, and a new sobriety and realism leading to (drum roll) an emphasis on profitability. Bhattacharyya noted that VCs were pushing growth up until last year. Now, it’s value, ruled by the “Rule of 40” –combined growth rate and profit margin that exceeds 40%, even better cash flow positive, which are tough bars to achieve for all but the most well-positioned (and fortunate) companies. “That’s now the playbook. So we’ve all transitioned to that.” A defensive playbook, in Shapiro’s view. (A close to impossible one that may stifle innovation, in this Editor’s view, though bootstrapped companies have always earned her admiration.)

To that point, Melton, noted that now more than ever, banking institutions like SVB and similar institutions need to work with founders and VCs to bring innovations to market. “One of the things I’m very fearful of is that we get into an environment where people are risked off and retreat right when we need people to be actually leaning in more now than ever.” Larger banks will be happy to take the money–according to Kruze Consulting, an accounting firm that focuses on startups, about half of its clients that recently changed banks moved to JPMorgan Chase–but will a JPM take up ongoing startup risk? 

Does this begin to feel like Catch-22? (Apologies to Joseph Heller) Or health tech back around 2006-2010?  

One comment towards the end hit home for this Editor, having seen it way up close. Too many founders 1) have an idealistic view of the business they started and can’t separate from it, and 2) there’s a time to exit stage left and do something else with your life. One company that may pull it off in its changeover of CEOs is Oscar Health. I’d add that no CEO should be in that seat for more than 5 years, even in well-established, doing-well companies–much less coming close to dying in place as CEO after 25 years as happened recently at one large, publicly traded payer. Very important: every company should have a succession/coverage plan operative from Day 1, because Stuff Happens. The full article in MedCityNews here. Another shorter take, same panel, in Mobihealthnews.

The next chapter for SVB is that after a Federal bailout (and the realization that the SF Federal Reserve was wearing blinders when it came to watchdogging the bank’s health and solvency), it was mostly sold this past week to First Citizens Bank & Trust Company, a regional bank from Raleigh, North Carolina. SVB’s UK holdings were bought much earlier by HSBC. Also up for sale: Leerink Partners, an investment banker for health care and life sciences companies, that was rebranded as SVB Securities. Jeff Leerink, the founder who still heads it, is trying to get it back through a management buyout. WBUR

A more ViVEcious view of the meeting is over at HISTalk, The most substantive sessions this attendee heard were the opening Tuesday by Micky Tripathi, the National Coordinator for HIT at the Office of the National Coordinator (ONC) for Health Information Technology, and a presentation by Shiv Rao (Abridge) and Joon Lee (UPMC) on generative AI. The downside was that most of the Tuesday presentations came off like walking ads, the CHIME track was separate with some members-only, and that exhibitors got little value by staying over Wednesday as the crowd vanished to 20%. Money quote: “ViVE shoots for a vibe of youth, energy, innovation, and fun in its branding, themes, opening remarks, and evening entertainment. Sounds great until you remember that your ticket cost nearly $3,000.” Ouch! That stings! Well, nobody’s perfect. A successful 2023 means that ViVE will be landing in Los Angeles 25-28 February 2024. For many, it’s on to HIMSS23 in a couple of weeks.

Conference report: MedCityNews CONVERGE

September 18, 2015 | by

Guest columnist Sarianne Gruber (@subtleimpact) attended Breaking Media’s annual MedCityNews CONVERGE two-day conference at Philadelphia’s Hyatt at Bellevue earlier this month, and has a few observations on the surface contradiction of innovation and health insurance.

Breaking Media rightly titled this year’s MedCity News conference “Converge”. Listening to the speakers, meeting the founders of new startups and talking to presenters, it became clear that today’s healthcare ecosystem is interdependent on the all the players to move the needle for better quality health. It was fascinating to learn was how innovation is breaking down the old silos of engagement, and is emerging from all the industry players, as well as joining at new intersections. The proliferation of better products, methodologies and engagement is closing the gap with more data, technology and ideas.

When you think of your health insurance company, usually two words comes to mind, cost and coverage. Keynote Speaker, Daniel Hilferty, President and CEO of Independence Blue Cross, wants to change the focus to consumer and care. Hilferty paralleled the new ventures at Independence to the work of the great innovator, Thomas Edison. Not only did Edison invent the light bulb, but his work is evidenced in the scalability of electricity that changed the world and how we now live.

In what directions is Independence Blue Cross converging? (more…)

Pharma company ‘breaks the Internet’ with Kim K, gets FDA testy

August 14, 2015 | by

But it may break them…well, give them a fracture. Or a good hard marketing lesson. Specialty pharma Duchesnay thought it had hit the jackpot with negotiating a promotional spokeswoman endorsement from pregnant celebrity Kim Kardashian of its morning sickness drug Diclegis. The Kardashian Marketing Machine cranked up. Kim (and mom Kris Jenner) took to Instagram, Facebook and Twitter in late July with (scripted) singing of Diclegis’ praises to their tens of millions of followers. The Instagram posts linked to an ‘important safety page’ a/k/a The Disclaimers. That wasn’t near enough for the Federal Drug Administration (FDA) which governs the acceptable marketing of all drugs in the US. On August 7th a tartly worded letter arrived at Duchesnay’s Pennsylvania HQ cited multiple violations of marketing regulations, notably risk information, and told Duchesnay to cease these communications immediately or withdraw the drug, which would be highly unlikely as it is successful. They also were require to provide “corrective messages” to the “violative materials”.

Our takeaway:

* Duchesnay reaped a bounty of free media (see below), on top of the (undoubtedly expensive) Kardashian endorsement. Yes, they did pay the cost of a FDA nastygram and a legal response, and the warning will live on in their file. However, a lot of target-age women now know Diclegis and others know about the relatively obscure Duchesnay.

* This was a calculated marketing risk that tested the boundaries of social media and celebrity endorsement. (more…)

Do startups truly threaten the ‘healthcare establishment’?

May 19, 2015 | by

Or are successful startups fitting into their game? Chris Seper in MedCityNews paints the picture of one side of a quandary. The ‘healthcare establishment’ fundamentally and to its detriment does not understand and is threatened by the startup and innovation process. A startup may begin with an idea which is, in his words, ‘almost always flawed, sometimes deeply’. If the founders are smart, they will test their ideas, validate them and change them appropriately. If not, they will fail. But it is easier for the Establishment to point at the most egregious of the bad ideas and use them to rationalize the status quo.

But being congenital contrarians, we paint the house on the other side of the street. Has the Establishment caught up with–or in some cases, co-opted startups, making them and their funders ‘do their diligence’ and be more cautious before emerging? This Editor would argue yes, and largely for the better.

**The ‘Wild West’ days are over. A few years ago, a truly bad or deeply flawed health tech idea or could easily find funding, because it was all blank slate, new and ‘transformative’.The sexiest hooks were Quantified Self, sleep, employer health incentives, interactive coaching, genomics, app prescribing and (last) wearables. A lot of founders imagined themselves as the Steve Jobs of Healthcare, down to the black turtleneck. Now there is a history of success and failure. The railroads reached the dusty frontier towns.

**There’s now a ‘Startup Establishment’. National accelerators (more…)

ATA 2015: Day 1 news

May 5, 2015 | by
[grow_thumb image=”https://telecareaware.com/wp-content/uploads/2015/05/ATA-15-show-floor.jpg” thumb_width=”250″ /] HealthSpot/Xerox, Sentrian/Scripps, American Well, Honeywell, vitaphone, more

HealthSpot unveiled the first results of its partnership with (and investment by) Xerox, leveraging their HIT cloud infrastructure and back-end for the HealthSpot Station. The telehealth/virtual consult walk-in kiosk has targeted over 30,000 retail pharmacies with a newly developed consumer retail pharmacy personal health record (PHR). Upgraded patient and portal interfaces process insurance claims through a payment data feed and integrates with EMRs. Release….The US/UK predictive data/remote patient intelligence company Sentrian, winner of this year’s ATA Innovation in Remote Care award, is a part of a year-long 1,000-patient COPD remote patient monitoring study by the Scripps Translational Science Institute (STSI) with members of Anthem’s CareMore health plan. The goal is to use the Sentrian platform data to accurately detect COPD patient decompensation in advance to reduce avoidable hospital readmissions, which on average in the US is 1 out of 11 within 30 days of discharge. Release….American Well launched a platform for individual physicians to connect with current patients (more…)

Another Xerox healthcare move: reducing readmissions

January 25, 2015 | by

About two months ago [TTA 13 Nov 14], we noted Xerox’s interesting investment in telehealth/virtual consult kiosk HealthSpot Station. We thought at that time that Xerox was not active in healthcare services and thus found the HealthSpot Station investment unusual. Right on the diagnostics, wrong on the data crunching. Notably, their Midas+ subsidiary concentrates on healthcare quality management, analytics and benchmarking solutions. Midas+ has entered into the readmissions fray by combining its proprietary database, compiled over 1,900 Xerox hospital clients, with five years of Medicare and claims data to help hospitals better predict 30-day same-cause readmissions. The Midas+ Readmission Penalty Forecaster uses the data to project in “near real-time” both patient patterns and reimbursement rates. Commenting to MedCityNews, Justin Lanning, SVP and managing director of Xerox Healthcare Provider Solutions, said the Forecaster has a 1.5 percent margin of error within the predictive model, with quarterly updates provided to participating hospitals. Midas+ also offers, beyond the model, onsite consulting. HealthSpot Station theoretically could throw off a lot of data on outpatient disease and treatment. Midas+ Forecaster white paper, eWeek.

We also note that MedCityNews, one of the livelier publications that covers a wide swath of the US healthcare scene,  is being acquired by Breaking Media, a New York City-based digital publisher. CEO Chris Seper will remain with the publication. Article.

Unhappy endings: where even innovation cannot make a difference

August 14, 2014 | by | 2 Comments

This week’s sad news of the death of comedian/film star Robin Williams and his ongoing battles with addiction and depression are the center of this thoughtful article by EIC Veronica Combs in MedCityNews. Even with access to the best care and innovations such as virtual visits, Mr Williams committed suicide. The larger point made is that access and healthcare innovation don’t mean automatic adoption or a positive outcome. Some of those with chronic physical or mental illnesses choose not to change their behaviors, comply with a regimen or even to seek help, much less seek out technology or be a QSer. And some are simply beaten down and depressed by the perpetual Battle of Stalingrad that is chronic disease–ask any diabetic [TTA 5 Apr 2013]. Her conclusion is that though innovation may not help everyone, it doesn’t mean we should not pursue it. And, this Editor would add, for developers to realize that they must make technologies simple and affordable enough–‘tear down that wall’–so that those who won’t access help become fewer. (And, yes, there is a spiritual aspect of care that must be addressed–see VOX Telehealth’s work with HealthCare Chaplaincy Network TTA 25 July.)

Update:  Other factors may have tipped Mr Williams’ depression flare-up. The first (more…)