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#TUBiol5227: Biomarkers & Biotargets: Genetic Testing and Bioethics

Curator: Stephen J. Williams, Ph.D.

The advent of direct to consumer (DTC) genetic testing and the resultant rapid increase in its popularity as well as companies offering such services has created some urgent and unique bioethical challenges surrounding this niche in the marketplace. At first, most DTC companies like 23andMe and Ancestry.com offered non-clinical or non-FDA approved genetic testing as a way for consumers to draw casual inferences from their DNA sequence and existence of known genes that are linked to disease risk, or to get a glimpse of their familial background. However, many issues arose, including legal, privacy, medical, and bioethical issues. Below are some articles which will explain and discuss many of these problems associated with the DTC genetic testing market as well as some alternatives which may exist.

‘Direct-to-Consumer (DTC) Genetic Testing Market to hit USD 2.5 Bn by 2024’ by Global Market Insights

This post has the following link to the market analysis of the DTC market (https://www.gminsights.com/pressrelease/direct-to-consumer-dtc-genetic-testing-market). Below is the highlights of the report.

As you can see,this market segment appears to want to expand into the nutritional consulting business as well as targeted biomarkers for specific diseases.

Rising incidence of genetic disorders across the globe will augment the market growth

Increasing prevalence of genetic disorders will propel the demand for direct-to-consumer genetic testing and will augment industry growth over the projected timeline. Increasing cases of genetic diseases such as breast cancer, achondroplasia, colorectal cancer and other diseases have elevated the need for cost-effective and efficient genetic testing avenues in the healthcare market.
 

For instance, according to the World Cancer Research Fund (WCRF), in 2018, over 2 million new cases of cancer were diagnosed across the globe. Also, breast cancer is stated as the second most commonly occurring cancer. Availability of superior quality and advanced direct-to-consumer genetic testing has drastically reduced the mortality rates in people suffering from cancer by providing vigilant surveillance data even before the onset of the disease. Hence, the aforementioned factors will propel the direct-to-consumer genetic testing market overt the forecast timeline.
 

DTC Genetic Testing Market By Technology

Get more details on this report – Request Free Sample PDF
 

Nutrigenomic Testing will provide robust market growth

The nutrigenomic testing segment was valued over USD 220 million market value in 2019 and its market will witness a tremendous growth over 2020-2028. The growth of the market segment is attributed to increasing research activities related to nutritional aspects. Moreover, obesity is another major factor that will boost the demand for direct-to-consumer genetic testing market.
 

Nutrigenomics testing enables professionals to recommend nutritional guidance and personalized diet to obese people and help them to keep their weight under control while maintaining a healthy lifestyle. Hence, above mentioned factors are anticipated to augment the demand and adoption rate of direct-to-consumer genetic testing through 2028.
 

Browse key industry insights spread across 161 pages with 126 market data tables & 10 figures & charts from the report, “Direct-To-Consumer Genetic Testing Market Size By Test Type (Carrier Testing, Predictive Testing, Ancestry & Relationship Testing, Nutrigenomics Testing), By Distribution Channel (Online Platforms, Over-the-Counter), By Technology (Targeted Analysis, Single Nucleotide Polymorphism (SNP) Chips, Whole Genome Sequencing (WGS)), Industry Analysis Report, Regional Outlook, Application Potential, Price Trends, Competitive Market Share & Forecast, 2020 – 2028” in detail along with the table of contents:
https://www.gminsights.com/industry-analysis/direct-to-consumer-dtc-genetic-testing-market
 

Targeted analysis techniques will drive the market growth over the foreseeable future

Based on technology, the DTC genetic testing market is segmented into whole genome sequencing (WGS), targeted analysis, and single nucleotide polymorphism (SNP) chips. The targeted analysis market segment is projected to witness around 12% CAGR over the forecast period. The segmental growth is attributed to the recent advancements in genetic testing methods that has revolutionized the detection and characterization of genetic codes.
 

Targeted analysis is mainly utilized to determine any defects in genes that are responsible for a disorder or a disease. Also, growing demand for personalized medicine amongst the population suffering from genetic diseases will boost the demand for targeted analysis technology. As the technology is relatively cheaper, it is highly preferred method used in direct-to-consumer genetic testing procedures. These advantages of targeted analysis are expected to enhance the market growth over the foreseeable future.
 

Over-the-counter segment will experience a notable growth over the forecast period

The over-the-counter distribution channel is projected to witness around 11% CAGR through 2028. The segmental growth is attributed to the ease in purchasing a test kit for the consumers living in rural areas of developing countries. Consumers prefer over-the-counter distribution channel as they are directly examined by regulatory agencies making it safer to use, thereby driving the market growth over the forecast timeline.
 

Favorable regulations provide lucrative growth opportunities for direct-to-consumer genetic testing

Europe direct-to-consumer genetic testing market held around 26% share in 2019 and was valued at around USD 290 million. The regional growth is due to elevated government spending on healthcare to provide easy access to genetic testing avenues. Furthermore, European regulatory bodies are working on improving the regulations set on the direct-to-consumer genetic testing methods. Hence, the above-mentioned factors will play significant role in the market growth.
 

Focus of market players on introducing innovative direct-to-consumer genetic testing devices will offer several growth opportunities

Few of the eminent players operating in direct-to-consumer genetic testing market share include Ancestry, Color Genomics, Living DNA, Mapmygenome, Easy DNA, FamilytreeDNA (Gene By Gene), Full Genome Corporation, Helix OpCo LLC, Identigene, Karmagenes, MyHeritage, Pathway genomics, Genesis Healthcare, and 23andMe. These market players have undertaken various business strategies to enhance their financial stability and help them evolve as leading companies in the direct-to-consumer genetic testing industry.
 

For example, in November 2018, Helix launched a new genetic testing product, DNA discovery kit, that allows customer to delve into their ancestry. This development expanded the firm’s product portfolio, thereby propelling industry growth in the market.

The following posts discuss bioethical issues related to genetic testing and personalized medicine from a clinicians and scientisit’s perspective

Question: Each of these articles discusses certain bioethical issues although focuses on personalized medicine and treatment. Given your understanding of the robust process involved in validating clinical biomarkers and the current state of the DTC market, how could DTC testing results misinform patients and create mistrust in the physician-patient relationship?

Personalized Medicine, Omics, and Health Disparities in Cancer:  Can Personalized Medicine Help Reduce the Disparity Problem?

Diversity and Health Disparity Issues Need to be Addressed for GWAS and Precision Medicine Studies

Genomics & Ethics: DNA Fragments are Products of Nature or Patentable Genes?

The following posts discuss the bioethical concerns of genetic testing from a patient’s perspective:

Ethics Behind Genetic Testing in Breast Cancer: A Webinar by Laura Carfang of survivingbreastcancer.org

Ethical Concerns in Personalized Medicine: BRCA1/2 Testing in Minors and Communication of Breast Cancer Risk

23andMe Product can be obtained for Free from a new app called Genes for Good: UMich’s Facebook-based Genomics Project

Question: If you are developing a targeted treatment with a companion diagnostic, what bioethical concerns would you address during the drug development process to ensure fair, equitable and ethical treatment of all patients, in trials as well as post market?

Articles on Genetic Testing, Companion Diagnostics and Regulatory Mechanisms

Centers for Medicare & Medicaid Services announced that the federal healthcare program will cover the costs of cancer gene tests that have been approved by the Food and Drug Administration

Real Time Coverage @BIOConvention #BIO2019: Genome Editing and Regulatory Harmonization: Progress and Challenges

New York Times vs. Personalized Medicine? PMC President: Times’ Critique of Streamlined Regulatory Approval for Personalized Treatments ‘Ignores Promising Implications’ of Field

Live Conference Coverage @Medcitynews Converge 2018 Philadelphia: Early Diagnosis Through Predictive Biomarkers, NonInvasive Testing

Protecting Your Biotech IP and Market Strategy: Notes from Life Sciences Collaborative 2015 Meeting

Question: What type of regulatory concerns should one have during the drug development process in regards to use of biomarker testing? From the last article on Protecting Your IP how important is it, as a drug developer, to involve all payers during the drug development process?

Read Full Post »

New resource for finding FDA-approved medical devices that incorporate AI

Reporter: Satwik Sunnam, Research Assistant 3, One year Internship in Medical Text Analysis with Deep Learning NLP

This article reports List of FDA approved medical devices that are employing Artificial Intelligence and Machine Learning (AI/ML)

The FDA is providing this initial list of AI/ML-enabled medical devices marketed in the United States as a resource to the public about these devices and the FDA’s work in this area.

Contents of this list: This initial list contains publicly available information on AI/ML-enabled devices. The FDA assembled this list by searching FDA’s publicly-facing information, as well as by reviewing information in the publicly available resources cited below (*) and in other publicly available materials published by the specific manufacturers.

This list is not meant to be an exhaustive or comprehensive resource of AI/ML-enabled medical devices. Rather, it is a list of AI/ML-enabled devices across medical disciplines, based on publicly available information.

Updates to this list: The FDA plans to update this list on a periodic basis based on publicly available information. Send questions or feedback on this list to digitalhealth@fda.hhs.gov.

AI/ML-Enabled Medical Devices

Devices are listed in reverse chronological order by Date of Final Decision. To change the sort order, click the arrows in the column headings.

Use the Submission Number link to display the approval, authorization, or clearance information for the device in the appropriate FDA database. The database page will include a link to the FDA’s publicly available information.

Devices are listed in reverse chronological order by Date of Final Decision. To change the sort order, click the arrows in the column headings.

Use the Submission Number link to display the approval, authorization, or clearance information for the device in the appropriate FDA database. The database page will include a link to the FDA’s publicly available information.

FDA Final Decision in 2021:

List of AI/ML-enabled medical devices marketed in the United States

Date of Final Decision Submission NumberDeviceCompanyPanel (Lead)
06/17/2021K203514Precise PositionPhilips Healthcare (Suzhou) Co., Ltd.Radiology
06/16/2021K202718Qmenta Care Platform FamilyMint Labs, Inc., D/B/A. QMENTARadiology
06/11/2021K210484LINQ II Insertable Cardiac Monitor, Zelda AI ECG Classification SystemMedtronic, Inc.Cardiovascular
06/10/2021K203629IDx-DRDigital Diagnostics Inc.Ophthalmic
06/02/2021DEN200069Cognoa Asd Diagnosis AidCognoa, Inc.Neurology
05/19/2021K210237CINA CHESTAvicenna.AIRadiology
04/30/2021K210001HYPER AiRShanghai United Imaging Healthcare Co.,Ltd.Radiology
04/23/2021K203314Cartesion Prime (PCD-1000A/3) V10.8Canon Medical Systems CorporationRadiology
04/23/2021K203502MEDO-ThyroidMEDO DX Pte. Ltd.Radiology
04/21/2021K210556Preview ShoulderGenesis Software InnovationsRadiology
04/20/2021K203610Automatic Anatomy Recognition (AAR)Quantitative Radiology Solutions, LLCRadiology
04/19/2021K203469AI SegmentationVarian Medical SystemsRadiology
04/16/2021K203517Saige-QDeepHealth, Inc.Radiology
04/14/2021K202992BriefCase, RIB Fractures Triage (RibFx)Aidoc Medical, Ltd.Radiology
04/09/2021DEN200055GI GeniusCosmo Artificial Intelligence – AI, Ltd.Gastroenterology-Urology
04/02/2021K202441Eclipse II with Smart Noise CancellationCarestream Health, Inc.Radiology
04/01/2021DEN200038Gili Pro Biosensor (Also Known as Gili Biosensor System)Continuse Biometrics Ltd.Cardiovascular
03/31/2021K203258syngo.CT Lung CAD (Version VD20)Siemens Healthcare GmbHRadiology
03/31/2021K203443MAGNETOM Vida, MAGNETOM Sola, MAGNETOM Lumina, MAGNETOM Altea with syngo MR XA31ASiemens Medical Solutions USA, Inc.Radiology
03/31/2021K210071SIS System (Version 5.1.0)Surgical Information Sciences, Inc.Radiology
03/26/2021DEN200019Oxehealth Vital SignsOxehealth LimitedCardiovascular
03/24/2021K203225Aquilion ONE (TSX‐306A/3) V10.4 with Spectral Imaging SystemCanon Medical Systems CorporationRadiology
03/23/2021K210209Viz ICHViz.Ai, Inc.Radiology
03/19/2021K203235VBrainVysioneer Inc.Radiology
03/09/2021K203256Imbio RV/LV SoftwareImbio, LLCRadiology
03/05/2021K202300Optellum Virtual Nodule Clinic, Optellum Software, Optellum PlatformOptellum LtdRadiology
03/01/2021DEN200022Analytic for Hemodynamic Instability (AHI)Fifth Eye Inc.Cardiovascular
02/25/2021K202990NinesMeasureNines, Inc.Radiology
02/25/2021K203578OTIS 2.1 Optical Coherence Tomography System, THiA Optical Coherence Tomography SystemPerimeter Medical Imaging AI, Inc.General And Plastic Surgery
02/19/2021K202212TruplanCircle Cardiovascular Imaging Inc.Radiology
02/09/2021K203103Synapse 3D, Synapse 3D Base Tools v6.1Fujifilm CorporationRadiology
02/05/2021K210053LVivo Software ApplicationDiA Imaging Analysis Ltd.Radiology
01/29/2021K201411Visage Breast DensityVisage Imaging GmbHRadiology
01/15/2021K193271UAI Easytriage-RibShanghai United Imaging Intelligence Co., Ltd.Radiology
01/14/2021K202700ART-PlanTheraPanaceaRadiology
01/12/2021K201836Aquilion Lightning (TSX-036A/7) V10.2 With AiCE-ICanon Medical Systems CorporationRadiology
01/09/2021K200717CLEWICU System (ClewICUserver and ClewICUnitor)Clew Medical Ltd.Cardiovascular
01/07/2021K202414BrainInsightHyperfine Research, Inc.Radiology

SOURCE

https://www.fda.gov/medical-devices/software-medical-device-samd/artificial-intelligence-and-machine-learning-aiml-enabled-medical-devices?utm_medium=email

Other related articles Published in this Open Access Online Scientific Journal include the following:

Cardiac MRI Imaging Breakthrough: The First AI-assisted Cardiac MRI Scan Solution, HeartVista Receives FDA 510(k) Clearance for One Click™ Cardiac MRI Package

Reporter: Aviva Lev-Ari, PhD, RN

Al is on the way to lead critical ED decisions on CT

Curator and Reporter: Dr. Premalata Pati, Ph.D., Postdoc

Applying AI to Improve Interpretation of Medical Imaging

Author and Curator: Dror Nir, PhD

Developing Deep Learning Models (DL) for the Instant Prediction of Patients with Epilepsy

Reporter: Srinivas Sriram, Research Assistant I

Science Policy Forum: Should we trust healthcare explanations from AI predictive systems – Some in industry voice their concerns

Curator: Stephen J. Williams, PhD

Al System Used to Detect Lung Cancer

Reporter: Irina Robu, Ph.D.

The Future of Speech-Based Human-Computer Interaction
Reporter: Ethan Coomber

Deep Medicine: How Artificial Intelligence Can Make Health Care Human Again
Reporter: Aviva Lev-Ari, PhD, RN

Supporting the elderly: A caring robot with ‘emotions’ and memory
Reporter: Aviva Lev-Ari, PhD, RN

Developing Deep Learning Models (DL) for Classifying Emotions through Brainwaves
Reporter: Abhisar Anand, Research Assistant I

Read Full Post »

Can the Public Benefit Company Structure Save US Healthcare?

Curator: Stephen J. Williams, Ph.D.

According to Centers for Medicare and Medicare Services (CMS.gov) healthcare spending per capita has reached 17.7 percent of GDP with, according to CMS data:

From 1960 through 2013, health spending rose from $147 per person to $9,255 per person, an average annual increase of 8.1 percent.

the National Health Expenditure Accounts (NHEA) are the official estimates of total health care spending in the United States. Dating back to 1960, the NHEA measures annual U.S. expenditures for health care goods and services, public health activities, government administration, the net cost of health insurance, and investment related to health care. The data are presented by type of service, sources of funding, and type of sponsor.

Graph: US National Healthcare Expenditures as a percent of Gross Domestic Product from 1960 to current. Recession periods are shown in bars. Note that the general trend has been increasing healthcare expenditures with only small times of decrease for example 2020 in year of COVID19 pandemic. In addition most of the years have been inflationary with almost no deflationary periods, either according to CPI or healthcare costs, specifically.

U.S. health care spending grew 4.6 percent in 2019, reaching $3.8 trillion or $11,582 per person.  As a share of the nation’s Gross Domestic Product, health spending accounted for 17.7 percent.

And as this spending grew (demand for health care services) associated costs also rose but as the statistical analyses shows there was little improvement in many health outcome metrics during the same time. 

Graph of the Growth of National Health Expenditures (NHE) versus the growth of GDP. Note most years from 1960 growth rate of NHE has always been higher than GDP, resulting in a seemingly hyperinflationary effect of healthcare. Also note how there are years when this disconnect is even greater, as there were years when NHE grew while there were recessionary periods in the general economy.

It appears that US healthcare may be on the precipice of a transformational shift, but what will this shift look like? The following post examines if the corporate structure of US healthcare needs to be changed and what role does a Public Benefit Company have in this much needed transformation.

Hippocratic Oath

I swear by Apollo the physician, and Asclepius, and Hygieia and Panacea and all the gods and goddesses as my witnesses, that, according to my ability and judgement, I will keep this Oath and this contract:

To hold him who taught me this art equally dear to me as my parents, to be a partner in life with him, and to fulfill his needs when required; to look upon his offspring as equals to my own siblings, and to teach them this art, if they shall wish to learn it, without fee or contract; and that by the set rules, lectures, and every other mode of instruction, I will impart a knowledge of the art to my own sons, and those of my teachers, and to students bound by this contract and having sworn this Oath to the law of medicine, but to no others.

I will use those dietary regimens which will benefit my patients according to my greatest ability and judgement, and I will do no harm or injustice to them.

I will not give a lethal drug to anyone if I am asked, nor will I advise such a plan; and similarly I will not give a woman a pessary to cause an abortion.

In purity and according to divine law will I carry out my life and my art.

I will not use the knife, even upon those suffering from stones, but I will leave this to those who are trained in this craft.

Into whatever homes I go, I will enter them for the benefit of the sick, avoiding any voluntary act of impropriety or corruption, including the seduction of women or men, whether they are free men or slaves.

Whatever I see or hear in the lives of my patients, whether in connection with my professional practice or not, which ought not to be spoken of outside, I will keep secret, as considering all such things to be private.

So long as I maintain this Oath faithfully and without corruption, may it be granted to me to partake of life fully and the practice of my art, gaining the respect of all men for all time. However, should I transgress this Oath and violate it, may the opposite be my fate.

Translated by Michael North, National Library of Medicine, 2002.

Much of the following information can be found on the Health Affairs Blog in a post entitled

Public Benefit Corporations: A Third Option For Health Care Delivery?

By Soleil Shah, Jimmy J. Qian, Amol S. Navathe, Nirav R. Shah

Limitations of For Profit and Non-Profit Hospitals

For profit represent ~ 25% of US hospitals and are owned and governed by shareholders, and can raise equity through stock and bond markets.

According to most annual reports, the CEOs incorrectly assume they are legally bound as fiduciaries to maximize shareholder value.  This was a paradigm shift in priorities of companies which started around the mid 1980s, a phenomenon discussed below.  

A by-product of this business goal, to maximize shareholder value, is that CEO pay and compensation is naturally tied to equity markets.  A means for this is promoting cost efficiencies, even in the midst of financial hardships.

A clear example of the failure of this system can be seen during the 2020- current COVID19 pandemic in the US. According to the Medicare Payment Advisory Commission, four large US hospitals were able to decrease their operating expenses by $2.3 billion just in Q2 2020.  This amounted to 65% of their revenue; in comparison three large NONPROFIT hospitals reduced their operating expense by an aggregate $13 million (only 1% of their revenue), evident that in lean times for-profit will resort to drastic cost cutting at expense of service, even in times of critical demands for healthcare.

Because of their tax structure and perceived fiduciary responsibilities, for-profit organizations (unlike non-profit and public benefit corporations) are not legally required to conduct community health need assessments, establish financial assistance policies, nor limit hospital charges for those eligible for financial assistance.  In addition to the difference in tax liability, for-profit, unlike their non-profit counterparts, at least with hospitals, are not funded in part by state or local government.  As we will see, a large part of operating revenue for non-profit university based hospitals is state and city funding.

Therefore risk for financial responsibility is usually assumed by the patient, and in worst case, by the marginalized patient populations on to the public sector.

Tax Structure Considerations of for-profit healthcare

Financials of major for-profit healthcare entities (2020 annual)

Non-profit Healthcare systems

Nonprofits represent about half of all hospitals in the US.  Most of these exist as a university structure, so retain the benefits of being private health systems and retaining the funding and tax benefits attributed to most systems of higher education. And these nonprofits can be very profitable.  After taking in consideration the state, local, and federal tax exemptions these nonprofits enjoy, as well as tax-free donations from contributors (including large personal trust funds), a nonprofit can accumulate a large amount of revenue after expenses.  In fact 82 nonprofit hospitals had $33 billion of net asset increase year-over-year (20% increase) from 2016 to 2017.  The caveat is that this revenue over expenses is usually spent on research or increased patient services (this may mean expanding the physical infrastructure of the hospital or disseminating internal grant money to clinical investigators, expanding the hospital/university research assets which could result in securing even larger amount of external funding from government sources.

And although this model may work well for intercity university/healthcare systems, it is usually a struggle for the rural nonprofit hospitals.  In 2020, ten out of 17 rural hospitals that went under were nonprofits.  And this is not just true in the tough pandemic year.  Over the past two decades multitude of nonprofit rural hospitals had to sell and be taken over by larger for-profit entities. 

Hospital consolidation has led to a worse patient experience and no real significant changes in readmission or mortality data.  (The article below is how over 130 rural hospitals have closed since 2010, creating a medical emergency in rural US healthcare)

https://www.nationalgeographic.com/history/article/appalachian-hospitals-are-disappearing

And according to the article below it is only to get worse

The authors of the Health Affairs blog feel a major disadvantage of both the for-profit and non-profit healthcare systems is “that both face limited accountability with respect to anticompettive mergers and acquisitions.”

More hospital consolidation is expected post-pandemic

Aug 10, 2020

By Rich Daly, HFMA Senior Writer and Editor

News | Coronavirus

More hospital consolidation is expected post-pandemic

  • Hospital deal volume is likely to accelerate due to the financial damage inflicted by the coronavirus pandemic.
  • The anticipated increase in volume did not show up in the latest quarter, when deals were sharply down.
  • The pandemic may have given hospitals leverage in coming policy fights over billing and the creation of “public option” health plans.

Hospital consolidation is likely to increase after the COVID-19 pandemic, say both critics and supporters of the merger-and-acquisition (M&A) trend.

The financial effects of the coronavirus pandemic are expected to drive more consolidation between and among hospitals and physician practices, a group of policy professionals told a recent Washington, D.C.-based web briefing sponsored by the Alliance for Health Policy.

“There is a real danger that this could lead to more consolidation, which if we’re not careful could lead to higher prices,” said Karyn Schwartz, a senior fellow at the Kaiser Family Foundation (KFF).

Schwartz cited a recent KFF analysis of available research that concluded “provider consolidation leads to higher health care prices for private insurance; this is true for both horizontal and vertical consolidation.”

Kenneth Kaufman, managing director and chair of Kaufman Hall, noted that crises tend to push financially struggling organizations “further behind.”

“I wouldn’t be surprised at all if that happens,” Kaufman said. “That will lead to further consolidation in the provider market.”

The initial rounds of federal assistance from the CARES Act, which were based first on Medicare revenue and then on net patient revenue, may fuel consolidation, said Mark Miller, PhD, executive vice president of healthcare for Arnold Ventures. That’s because the funding formulas favored organizations that already had higher revenues, he said, and provided less assistance to low-revenue organizations.

HHS has distributed $116.2 billion from the $175 billion in provider funding available through the CARES Act and the Paycheck Protection Program and Health Care Enhancement Act. The largest distributions used the two revenue formulas cited by Miller.

No surge in M&A yet

The expected burst in hospital M&A activity has yet to occur. Kaufman Hall identified 14 transactions in the second quarter of 2020, far fewer than in the same quarter in any of the four preceding years, when second-quarter transactions totaled between 19 and 31. The latest deals were not focused on small hospitals, with average seller revenue of more than $800 million — far larger than the previous second-quarter high of $409 million in 2018.

Six of the 14 announced transactions were divestitures by major for-profit health systems, including Community Health Systems, Quorum and HCA.

Kaufman Hall’s analysis of the recent deals identified another pandemic-related factor that may fuel hospital M&A: closer ties between hospitals. The analysis cited the example of  Lifespan and Care New England, which had suspended merger talks in 2019. More recently, in a joint announcement, the CEOs of the two systems noted that because of the COVID-19 crisis, the two systems “have been working together in unprecedented ways” and “have agreed to enter into an exploration process to understand the pros and cons of what a formal continuation of this collaboration could look like in the future.”

The M&A outlook for rural hospitals

The pandemic has had less of a negative effect on the finances of rural hospitals that previously joined larger health systems, said Suzie Desai, senior director of not-for-profit healthcare for S&P Global.

A CEO of a health system with a large rural network told Kaufman the federal grants that the system received for its rural hospitals were much larger than the grants paid through the general provider fund.

“If that was true across the board, then the federal government recognized that many rural hospitals could be at risk of not being able to make payroll; actually running out of money,” Kaufman said. “And they seem to have bent over backwards to make sure that didn’t happen.”  

Other CARES Act funding distributed to providers included:

  • $12.8 billion for 959 safety net hospitals
  • $11 billion to almost 4,000 rural healthcare providers and hospitals in urban areas that have certain special rural designations in Medicare

Telehealth has helped rural hospitals but has not been sufficient to address the financial losses inflicted by the pandemic, Desai said.

Other coming trends include a sharper cost focus

Desai expects an increasing focus “over the next couple years” on hospital costs because of the rising share of revenue received from Medicare and Medicaid. She expects increased efforts to use technology and data to lower costs.

Billy Wynne, JD, chairman of Wynne Health Group, expects telehealth restrictions to remain relaxed after the pandemic.

Also, the perceptions of the public and politicians about the financial health of hospitals are likely to give those organizations leverage in coming policy fights over changes such as banning surprise billing and creating so-called public-option health plans, Wynne said. As an example, he cited the Colorado legislature’s suspension of the launch of a public option “in part because of sensitivities around hospital finances in the COVID pandemic.”

“Once the dust settles, it’ll be interesting to see if their leverage has increased or decreased due to what we’ve been through,” Wynne said.

About the Author

Rich Daly, HFMA Senior Writer and Editor,

is based in the Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

Source: https://www.hfma.org/topics/news/2020/08/more-hospital-consolidation-is-expected-post-pandemic.html

From Harvard Medical School

Hospital Mergers and Quality of Care

A new study looks at the quality of care at hospitals acquired in a recent wave of consolidations

By JAKE MILLER January 16, 2020 Research

Two train tracks merge in a blurry sunset.

Image: NirutiStock / iStock / Getty Images Plus       

The quality of care at hospitals acquired during a recent wave of consolidations has gotten worse or stayed the same, according to a study led by Harvard Medical School scientists published Jan. 2 in NEJM.

The findings deal a blow to the often-cited arguments that hospital consolidation would improve care. A flurry of earlier studies showed that mergers increase prices. Now after analyzing patient outcomes after hundreds of hospital mergers, the new research also dashes the hopes that this more expensive care might be of higher quality.

Get more HMS news here

“Our findings call into question claims that hospital mergers are good for patients—and beg the question of what we are getting from higher hospital prices,” said study senior author J. Michael McWilliams, the Warren Alpert Foundation Professor of Health Care Policy in the Blavatnik Institute at HMS and an HMS professor of medicine and a practicing general internist at Brigham and Women’s Hospital.

McWilliams noted that rising hospital prices have been one of the leading drivers of unsustainable growth in U.S. health spending.   

To examine the impact of hospital mergers on quality of care, researchers from HMS and Harvard Business School examined patient outcomes from nearly 250 hospital mergers that took place between 2009 and 2013. Using data collected by the Centers for Medicare and Medicaid Services, they analyzed variables such as 30-day readmission and mortality rates among patients discharged from a hospital, as well as clinical measures such as timely antibiotic treatment of patients with bacterial pneumonia. The researchers also factored in patient experiences, such as whether those who received care at a given hospital would recommend it to others. For their analysis, the team compared trends in these indicators between 246 hospitals acquired in merger transactions and unaffected hospitals.

The verdict? Consolidation did not improve hospital performance, and patient-experience scores deteriorated somewhat after the mergers.

The study was not designed to examine the reasons behind the worsening in patient experience. Weakening of competition due to hospital mergers could have contributed, the researchers said, but deeper exploration suggested other potential mechanisms. Notably, the analysis found the decline in patient-experience scores occurred mainly in hospitals acquired by hospitals that already had a poor patient-experience score—a finding that suggests acquisitions facilitate the spread of low quality care but not of high quality care.

The researchers caution that isolated, individual mergers may have still yielded positive results—something that an aggregate analysis is not powered to capture. And the researchers could only examine measurable aspects of quality. The trend in hospital performance on these standard measures, however, appears to point to a net effect of overall decline, the team said.

“Since our study estimated the average effects of mergers, we can’t rule out the possibility that some mergers are good for patient care,” said first author Nancy Beaulieu, research associate in health care policy at HMS. “But this evidence should give us pause when considering arguments for hospitals mergers.”

The work was supported by the Agency for Healthcare Research and Quality (grant no. U19HS024072).

Co-investigators included Bruce Landon and Jesse Dalton from HMS, Ifedayo Kuye, from the University of California, San Francisco, and Leemore Dafny from Harvard Business School and the National Bureau of Economic Research.

Source: https://hms.harvard.edu/news/hospital-mergers-quality-care

Public Benefit Corporations (PBC)

     Public benefit corporations (versus Benefit Corporate status, which is more of a pledge) are separate legal entities which exist as a hybrid, for-profit/nonprofit company but is mandated to 

  1. Pursue a general or specific public benefit
  2. Consider the non-financial interests of its shareholders and other STAKEHOLDERS when making decision
  3. report how well it is achieving its overall public benefit objectives
  4. Have limited fiduciary responsibility to investors that remains IN SCOPE of public benefit goal

In essence, the public benefit corporations executives are mandated to run the company for the benefit of STAKEHOLDERS first, if those STAKEHOLDERS are the public beneficiary of the company’s goals.  This in essence moves the needle away from the traditional C-Corp overvaluing the needs of shareholders and brings back the mission of the company and in the case of healthcare, the needs of its stakeholders, the consumers of healthcare.

     PBCs are legal entities recognized by states rather than by the federal government.  So far, in 2020 about 37 states allow companies to incorporate as a PBC.  Stipulations of the charter include semiannual reporting of the public benefits bestowed by the company and how well it is achieving its public benefit mandate.  There are about 3,000 US PBCs. Some companies have felt it was in their company mission and financial interest to change incorporation as a PBC.

Some well known PBCs include

  1. Ben and Jerry’s Ice Cream
  2. American Red Cross
  3. Susan B. Komen Foundation
  4. Allbirds (a shoe startup valued at $1.7 billion when made switch)
  5. Bombas (the sock company that donates extra socks when you buy a pair)
  6. Lemonade (a publicly traded insurance PBC that has beneficiaries select a nonprofit that the company will donate to)

Although the number of PBCs in the healthcare arena is increasing

  1. Not many PBCs are in the area of healthcare delivery 
  2. Noone is quite sure what the economic model would look like for a healthcare delivery PBC

Some example of hospital PBC include NYC Health + Hospitals and Community First Medical Center in Chicago.

Benefits of moving a hospital to PBC Status

  1. PBCs are held legally accountable to a predefined public benefit.  For hospitals this could be delivering cost-effective quality of care and affordable to a local citizenry or an economically disadvantaged population.  PBCs must produce at least an annual report on the public benefits it has achieved contrasted against a third party standard.  For example a hospital could include data of Medicaid related mortality risks, data neither the C-corp nor the nonprofit 501c would have to report on.  Most nonprofits and charities report their taxes on a schedule H or Form 990, which only has to report the officer’s compensation as well as monies given to charitable organizations, or other 501 organizations.  The nonprofit would show a balance of zero as the donated money for that year would be allocated out for various purposes. Hospitals, even as nonprofits, are not required to submit all this data.  Right now in US the ACA just requires any hospital that receives government or ACA insurance payments to report certain outcome statistics.  Although varying state by state, a PBC should have a “benefit officer” to make sure the mandate is being met.  In some cases a PBC benefit officer could sue the board for putting shareholder interest over the public benefit mandate.
  2. A PBC can include community stakeholders in the articles of incorporation thus giving a voice to local community members.  This would be especially beneficial for a hospital serving, say, a rural community.
  3. PBCs do have advantages of the for-profit companies as they are not limited to non-equity forms of investment.  A PBC can raise money in the equity markets or take on debt and finance it.  These financial instruments are unavailable to the non-profit.  Yet one interesting aspect is that PBCs require a HIGHER voting threshold by shareholders than a traditional for profit company in the ability to change their public benefit or convert their PBC back to a for-profit.

Limitations of the PBC

  1. Little incentive financially for current and future hospitals to incorporate as a PBC.  Herein lies a huge roadblock given the state of our reimbursement structure in this country.  Although there may be an incentive with regard to hiring and retention of staff drawn to the organization’s social purpose.  There have been, in the past, suggestions to allow hospitals that incorporate at PBC to receive some tax benefit, but this legislation has not gone through either at state or federal level. (put link to tax article).  
  2. In order for there to be value to constituents (patients) there must be strong accountability measures.  This will require the utmost in ethical behavior by a board and executives.  We have witnessed, through M&A by large health groups, anticompetitive and near monopoly behavior.
  3. There are no federal guidelines but varying guidelines from state to state.  There must be some federal recognition of the PBC status when it comes to healthcare, such as that the government is one of the biggest payers of US healthcare.

This is a great interview with ArcHealth, a PBC healthcare system.

Source: https://www.archealthjustice.com/arc-health-as-public-benefit-company-and-social-enterprise-what-is-the-difference/

Arc Health as a Public Benefit Company and Social Enterprise – What is the difference?

Mar 3, 2021 | Healthcare

Arc Health PBC is a public benefit corporation, a mission-driven for-profit company that utilizes a market-driven approach to achieving our short and long-term social goals. As a public benefit corporation, Arc Health is also a social enterprise working to further our mission of providing healthcare to rural, underserved, and indigenous communities through business practices that improve the recruitment and retention of quality healthcare providers.

What is a Social Enterprise?

While there is no one exact definition, according to the Social Enterprise Alliance, a social enterprise is an “organization that addresses a basic unmet need or solves a social or environmental problem through a market-driven approach.” A social enterprise is not a distinct legal entity, but instead, an “ideological spectrum marrying commercial approaches with social good.” Social enterprises foster a dual-bottom-line – simultaneously seeking profits and social impact. Arc Health, like many social enterprises, seeks to be self–sustainable. 

Two primary structures fall under the social enterprise umbrella: nonprofits and for-profit organizations. There are also related entities within both structures that could be considered social enterprises. Any of these listed structures can be regarded as a social enterprise depending on if and how involved they are with socially beneficial programs.

What is a Public Benefit Corporation?

Public Benefit Corporations (PBCs), also known as benefit corporations, are “for-profit companies that balance maximizing value to stakeholders with a legally binding commitment to a social or environmental mission.” PBCs operate as for-profit entities with no tax advantages or exemptions. Still, they must have a “purpose of creating general public benefit,” such as promoting the arts or science, preserving the environment, or providing benefits to underserved communities. PBCs must attain a higher degree of corporate purpose, expanded accountability, and expected transparency. 

There are now  over 3,000 registered PBCs, comprising approximately 0.1% of American businesses.

 As a PBC, Arc Health expects to access capital through individual investors who seek financial returns, rather than through donations. Arc Health’s investors make investments with a clear understanding of the balance the company must strike between financial returns (I.e., profitability) and social purpose. Therefore, investors expect the company to be operationally profitable to ensure a financial return on their investments, while also making clear to all stakeholders and the public that generating social impact is the priority. 

What is the difference between a Social Enterprise and PBC?

Social enterprises and PBCs emulate similar ideals that value the importance and need to invoke social change vis-a-vis working in a market-driven industry. Public benefit corporations fall under the social enterprise umbrella. An organization may choose to use a social enterprise model and incorporate itself as either a not-for-profit, C-Corp, PBC, or other corporate structure.  

How did Arc Health Become a Public Benefit Corporation?

Arc Health was initially formed as a C-Corp. In 2019, Arc Health’s CEO and Co-Founder, Dave Shaffer, guided the conversion from a C-Corp to a PBC, incorporated in Delaware. Today, Arc Health follows guidelines and expectations for PBCs, including adhering to the State of Delaware’s requirements for PBCs. 

Why is Arc Health a Social Enterprise and Public Benefit Corporation?

Arc Health believes it is essential to commit ourselves to our mission and demonstrate our dedication through our actions. We work to adhere to the core values of accountability, transparency, and purpose. As a registered public benefit company and a social enterprise, we execute our drive to achieve health equity in tangible and effective ways that the communities we work with, our stakeholders, and our providers expect of us.  

90% of Americans say that companies must not only say a product or service is beneficial, but they also need to prove its benefit.

When we partner with health clinics and hospitals, we aim to provide services that enact lasting change. For example, we work with healthcare providers who desire to contribute both clinical and non-clinical skills. In 2020, Arc Health clinicians developed COVID-19 response protocols and educational materials about the vaccines. They participated in pain management working groups. They identified and followed up with kids in the community who were overdue for a well-child check. Arc Health providers should be driven by a desire to develop a long-term relationship with a healthcare service provider and participate in its successes and challenges.   

Paradigm Shift in the 1980’s: Companies Start to Emphasize Shareholders Over Stakeholders

So earlier in this post we had mentioned about a shift in philosophy at the corporate boardroom that affected how comparate thought, value, and responsibility: Companies in the 1980s started to shift their focus and value only the needs of corporate ShAREHOLDERS at the expense of their  traditional STAKEHOLDERS (customers, clients).  Many movies and books have been written on this and debatable if deliberate or a by-product of M&A, hostile takeovers, and the stock market in general but the effect was that the consumer was relegated as having less value, even though marketing budgets are very high.  The fiduciary responsibility of the executive was now defined in terms of satisfying shareholders, who were now  big huge and powerful brokerage houses, private equity, and hedge funds.  A good explanation by Medium.com Tyler Lasicki is given below.

From the Medium.com

Source: https://medium.com/swlh/the-shareholder-v-stakeholder-contrast-a-brief-history-c5a6cfcaa111

The Shareholder V. Stakeholder Contrast, a Brief History

Tyler Lasicki

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May 26, 2020 · 14 min read

Introduction

In a famous 1970 New York Times Article, Milton Friedman postulated that the CEO, as an employee of the shareholder, must strive to provide the highest possible return for all shareholders. Since that article, the United States has embraced this idea as the fundamental philosophy supporting the ultimate purpose of businesses — The Shareholders Come First.

In August of 2019, the Business Roundtable, a group made up of the most influential U.S CEOs, published a letter shifting their stance on the purpose of a corporation. Regardless of whether this piece of paper will actually result in any systematic changes has yet to be seen, however this newly stated purpose of business is a dramatic shift from the position Milton Friedman took in 1970. According to the statement, these corporations will no longer prioritize maximizing profits for shareholders, but instead turn their focus to benefiting all stakeholders — including citizens, customers, suppliers, employees, on par with shareholders. 

Now the social responsibility of a company and the CEO was to maxiimize the profits even at the expense of any previous social responsibility they once had.

Small sample of the 181 Signatures attached to the Business Roundtable’s letter

What has happened over the past 50 years that has led to such a fundamental change in ideology? What has happened to make the CEO’s of America’s largest corporations suddenly change their stance on such a foundational principle of what it means to be an American business?

Since diving into this subject, I have come to find that the “American fundamental principle” of putting shareholders first is one that is actually not all that fundamental. In fact, for a large portion of our nation’s history this ideology was actually seen as the unpopular position.

Key ideological shifts in U.S. history

This post dives into a brief history of these two contrasting ideological viewpoints in an attempt to contextualize the forces behind both sides — specifically, the most recent shift (1970–2019). This basic idea of what is most important; the stakeholder or the shareholder, is the underlying reason as to why many things are the way they are today. A corporation’s priority of shareholder or stakeholder ultimately impacts employee salaries, benefits, quality of life within communities, environmental conditions, even the access to education children can receive. It affects our lives in a breadth and depth of ways and now that corporations may be changing positions (yet again) to focus on a model that prioritizes the stakeholder, it is important to understand why.

Looking forward, if stakeholder priority ends up being the popular position among American businesses, how long will it last for? What could lead to its downfall? And what will managers do to ensure a long term stakeholder-friendly business model?

It is clear to me the reasons that have led to these shifts in ideology are rather nuanced, however I want to highlight a few trends that have had a major impact on businesses changing their priorities while also providing context as to why things have shifted.

The Ascendancy of Shareholder Value

Following the 1929 stock market crash and the Great Depression, stakeholder primacy became the popular perspective within corporate America. Stakeholder primacy is the idea that corporations are to consider a wider group of interested parties (not just shareholders) whose positions need to be taken into consideration by corporate governance. According to this point of view, rather than solely being an agent for shareholders, management’s responsibilities were to be dispersed among all of its constituencies, even if it meant a reduction in shareholder value. This ideology lasted as the dominant position for roughly 40 years, in part due to public opinion and strong views on corporate responsibility, but also through state adoption of stakeholder laws.

By the mid-1970s, falling corporate profitability and stagnant share prices had been the norm for a decade. This poor economic performance influenced a growing concern in the U.S. regarding the perceived divergence between manager and shareholder interest. Many held the position that profits and share prices were suffering as a result of corporation’s increased attention on stakeholder groups.

This noticeable divergence in interests sparked many academics to focus their research on corporate management’s motivations in decision making regarding their allocation of resources. This branch of research would later be known as agency theory, which focused on the relationship between principals (shareholders) and their agents (management). Research at the time outlined how over the previous decades corporate management had pursued strategies that were not likely to optimize resources from a shareholder’s perspective. These findings were part of a seismic shift of corporate philosophy, changing priority from the stakeholders of a business to the shareholders.

By 1982, the U.S. economy started to recover from a prolonged period of high inflation and low economic growth. This recovery acted as a catalyst for change in many industries, leaving many corporate management teams to struggle in response to these changes. Their business performance suffered as a result. These distressed businesses became targets for a group of new investors…private equity firms.

Now the paradigm shift had its biggest backer…. private equity!  And private equity care about ONE thing….. THEIR OWN SHARE VALUE and subsequently meaning corporate profit, which became the most important directive for the CEO.

So it is all hopeless now? Can there be a shift back to the good ‘ol days?  

Well some changes are taking place at top corporate levels which may help the stakeholders to have a voice at the table, as the following IRMagazine article states.

And once again this is being led by the Business Roundtable, the same Business Roundtable that proposed the shift back in the 1970s.

Andrew Holt

Andrew Holt

REPORTER

  •  
  •  

SHAREHOLDER VALUE

CORPORATE GOVERNANCE

Shift from shareholder value to stakeholder-focused model for top US firms

AUG 23, 2019

Business Roundtable reveals corporations to drop idea they function to serve shareholders only

Source: https://www.irmagazine.com/esg/shift-shareholder-value-stakeholder-focused-model-top-us-firms

Andrew Holt

Andrew Holt

REPORTER

n a major corporate shift, shareholder value is no longer the main objective of the US’ top company CEOs, according to the Business Roundtable, which instead emphasizes the ‘purpose of a corporation’ and a stakeholder-focused model.

The influential body – a group of chief executive officers from major US corporations – has stressed the idea of a corporation dropping the age-old notion that corporations function first and foremost to serve their shareholders and maximize profits.

Rather, the focus should be on investing in employees, delivering value to customers, dealing ethically with suppliers and supporting outside communities as the vanguard of American business, according to a Business Roundtable statement.

‘While each of our individual companies serves its own corporate purpose, we share a fundamental commitment to all of our stakeholders,’ reads the statement, signed by 181 CEOs. ‘We commit to deliver value to all of them, for the future success of our companies, our communities and our country.’

Gary LaBranche, president and CEO of NIRI, tells IR Magazine that this is part of a wider trend: ‘The redefinition of purpose from shareholder-focused to stakeholder-focused is not new to NIRI members. For example, a 2014 IR Update article by the late Professor Lynn Stout urges a more inclusive way of thinking about corporate purpose.’ 

NIRI has also addressed this concept at many venues, including the senior roundtable annual meeting and the NIRI Annual Conference, adds LaBranche. This trend was further seen in the NIRI policy statement on ESG disclosure, released in January this year. 

Analyzing the meaning of this change in more detail, LaBranche adds: ‘The statement is a revolutionary break with the Business Roundtable’s previous position that the purpose of the corporation is to create value for shareholders, which was a long-held position championed by Milton Friedman.

‘The challenge is that Friedman’s thought leadership helped to inspire the legal and regulatory regime that places wealth creation for shareholders as the ‘prime directive’ for corporate executives.

‘Thus, commentators like Mike Allen of Axios are quick to point out that some shareholders may actually use the new statement to accuse CEOs of worrying about things beyond increasing the value of their shares, which, Allen reminds us, is the CEOs’ fiduciary responsibility.

‘So while the new Business Roundtable statement reflects a much-needed rebalancing and modernization that speaks to the comprehensive responsibilities of corporate citizens, we can expect that some shareholders will push back on this more inclusive view of who should benefit from corporate efforts and the capital that makes it happen. The new statement may not mark the dawn of a new day, but it perhaps signals the twilight of the Friedman era.’

In a similarly reflective way, Jamie Dimon, chairman and CEO of JPMorgan Chase & Co and chairman of the Business Roundtable, says: ‘The American dream is alive, but fraying. Major employers are investing in their workers and communities because they know it is the only way to be successful over the long term. These modernized principles reflect the business community’s unwavering commitment to continue to push for an economy that serves all Americans.’

Note:  Mr Dimon has been very vocal for many years on corporate social responsibility, especially since the financial troubles of 2009.

Other related articles published on this Open Access Online Scientific Journal on Healthcare Issues include the following:

Opportunity Mapping of the E-Health Sector prior to COVID19 Outbreak
mHealth market growth in America, Europe, & APAC
Ethics Behind Genetic Testing in Breast Cancer: A Webinar by Laura Carfang of survivingbreastcancer.org
The Inequality and Health Disparity seen with the COVID-19 Pandemic Is Similar to Past Pandemics
Live Notes from @HarvardMed Bioethics: Authors Jerome Groopman, MD & Pamela Hartzband, MD, discuss Your Medical Mind
COVID-related financial losses at Mass General Brigham
Personalized Medicine, Omics, and Health Disparities in Cancer:  Can Personalized Medicine Help Reduce the Disparity Problem?

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Science Policy Forum: Should we trust healthcare explanations from AI predictive systems?

Some in industry voice their concerns

Curator: Stephen J. Williams, PhD

Post on AI healthcare and explainable AI

   In a Policy Forum article in ScienceBeware explanations from AI in health care”, Boris Babic, Sara Gerke, Theodoros Evgeniou, and Glenn Cohen discuss the caveats on relying on explainable versus interpretable artificial intelligence (AI) and Machine Learning (ML) algorithms to make complex health decisions.  The FDA has already approved some AI/ML algorithms for analysis of medical images for diagnostic purposes.  These have been discussed in prior posts on this site, as well as issues arising from multi-center trials.  The authors of this perspective article argue that choice of type of algorithm (explainable versus interpretable) algorithms may have far reaching consequences in health care.

Summary

Artificial intelligence and machine learning (AI/ML) algorithms are increasingly developed in health care for diagnosis and treatment of a variety of medical conditions (1). However, despite the technical prowess of such systems, their adoption has been challenging, and whether and how much they will actually improve health care remains to be seen. A central reason for this is that the effectiveness of AI/ML-based medical devices depends largely on the behavioral characteristics of its users, who, for example, are often vulnerable to well-documented biases or algorithmic aversion (2). Many stakeholders increasingly identify the so-called black-box nature of predictive algorithms as the core source of users’ skepticism, lack of trust, and slow uptake (3, 4). As a result, lawmakers have been moving in the direction of requiring the availability of explanations for black-box algorithmic decisions (5). Indeed, a near-consensus is emerging in favor of explainable AI/ML among academics, governments, and civil society groups. Many are drawn to this approach to harness the accuracy benefits of noninterpretable AI/ML such as deep learning or neural nets while also supporting transparency, trust, and adoption. We argue that this consensus, at least as applied to health care, both overstates the benefits and undercounts the drawbacks of requiring black-box algorithms to be explainable.

Source: https://science.sciencemag.org/content/373/6552/284?_ga=2.166262518.995809660.1627762475-1953442883.1627762475

Types of AI/ML Algorithms: Explainable and Interpretable algorithms

  1.  Interpretable AI: A typical AI/ML task requires constructing algorithms from vector inputs and generating an output related to an outcome (like diagnosing a cardiac event from an image).  Generally the algorithm has to be trained on past data with known parameters.  When an algorithm is called interpretable, this means that the algorithm uses a transparent or “white box” function which is easily understandable. Such example might be a linear function to determine relationships where parameters are simple and not complex.  Although they may not be as accurate as the more complex explainable AI/ML algorithms, they are open, transparent, and easily understood by the operators.
  2. Explainable AI/ML:  This type of algorithm depends upon multiple complex parameters and takes a first round of predictions from a “black box” model then uses a second algorithm from an interpretable function to better approximate outputs of the first model.  The first algorithm is trained not with original data but based on predictions resembling multiple iterations of computing.  Therefore this method is more accurate or deemed more reliable in prediction however is very complex and is not easily understandable.  Many medical devices that use an AI/ML algorithm use this type.  An example is deep learning and neural networks.

The purpose of both these methodologies is to deal with problems of opacity, or that AI predictions based from a black box undermines trust in the AI.

For a deeper understanding of these two types of algorithms see here:

https://www.kdnuggets.com/2018/12/machine-learning-explainability-interpretability-ai.html

or https://www.bmc.com/blogs/machine-learning-interpretability-vs-explainability/

(a longer read but great explanation)

From the above blog post of Jonathan Johnson

  • How interpretability is different from explainability
  • Why a model might need to be interpretable and/or explainable
  • Who is working to solve the black box problem—and how

What is interpretability?

Does Chipotle make your stomach hurt? Does loud noise accelerate hearing loss? Are women less aggressive than men? If a machine learning model can create a definition around these relationships, it is interpretable.

All models must start with a hypothesis. Human curiosity propels a being to intuit that one thing relates to another. “Hmm…multiple black people shot by policemen…seemingly out of proportion to other races…something might be systemic?” Explore.

People create internal models to interpret their surroundings. In the field of machine learning, these models can be tested and verified as either accurate or inaccurate representations of the world.

Interpretability means that the cause and effect can be determined.

What is explainability?

ML models are often called black-box models because they allow a pre-set number of empty parameters, or nodes, to be assigned values by the machine learning algorithm. Specifically, the back-propagation step is responsible for updating the weights based on its error function.

To predict when a person might die—the fun gamble one might play when calculating a life insurance premium, and the strange bet a person makes against their own life when purchasing a life insurance package—a model will take in its inputs, and output a percent chance the given person has at living to age 80.

Below is an image of a neural network. The inputs are the yellow; the outputs are the orange. Like a rubric to an overall grade, explainability shows how significant each of the parameters, all the blue nodes, contribute to the final decision.

In this neural network, the hidden layers (the two columns of blue dots) would be the black box.

For example, we have these data inputs:

  • Age
  • BMI score
  • Number of years spent smoking
  • Career category

If this model had high explainability, we’d be able to say, for instance:

  • The career category is about 40% important
  • The number of years spent smoking weighs in at 35% important
  • The age is 15% important
  • The BMI score is 10% important

Explainability: important, not always necessary

Explainability becomes significant in the field of machine learning because, often, it is not apparent. Explainability is often unnecessary. A machine learning engineer can build a model without ever having considered the model’s explainability. It is an extra step in the building process—like wearing a seat belt while driving a car. It is unnecessary for the car to perform, but offers insurance when things crash.

The benefit a deep neural net offers to engineers is it creates a black box of parameters, like fake additional data points, that allow a model to base its decisions against. These fake data points go unknown to the engineer. The black box, or hidden layers, allow a model to make associations among the given data points to predict better results. For example, if we are deciding how long someone might have to live, and we use career data as an input, it is possible the model sorts the careers into high- and low-risk career options all on its own.

Perhaps we inspect a node and see it relates oil rig workers, underwater welders, and boat cooks to each other. It is possible the neural net makes connections between the lifespan of these individuals and puts a placeholder in the deep net to associate these. If we were to examine the individual nodes in the black box, we could note this clustering interprets water careers to be a high-risk job.

In the previous chart, each one of the lines connecting from the yellow dot to the blue dot can represent a signal, weighing the importance of that node in determining the overall score of the output.

  • If that signal is high, that node is significant to the model’s overall performance.
  • If that signal is low, the node is insignificant.

With this understanding, we can define explainability as:

Knowledge of what one node represents and how important it is to the model’s performance.

So how does choice of these two different algorithms make a difference with respect to health care and medical decision making?

The authors argue: 

“Regulators like the FDA should focus on those aspects of the AI/ML system that directly bear on its safety and effectiveness – in particular, how does it perform in the hands of its intended users?”

A suggestion for

  • Enhanced more involved clinical trials
  • Provide individuals added flexibility when interacting with a model, for example inputting their own test data
  • More interaction between user and model generators
  • Determining in which situations call for interpretable AI versus explainable (for instance predicting which patients will require dialysis after kidney damage)

Other articles on AI/ML in medicine and healthcare on this Open Access Journal include

Applying AI to Improve Interpretation of Medical Imaging

Real Time Coverage @BIOConvention #BIO2019: Machine Learning and Artificial Intelligence #AI: Realizing Precision Medicine One Patient at a Time

LIVE Day Three – World Medical Innovation Forum ARTIFICIAL INTELLIGENCE, Boston, MA USA, Monday, April 10, 2019

Cardiac MRI Imaging Breakthrough: The First AI-assisted Cardiac MRI Scan Solution, HeartVista Receives FDA 510(k) Clearance for One Click™ Cardiac MRI Package

 

Read Full Post »

This AI Just Evolved From Companion Robot To Home-Based Physician Helper

Reporter: Ethan Coomber, Research Assistant III, Data Science and Podcast Library Development 

Article Author: Gil Press Senior Contributor Enterprise & Cloud @Forbes 

Twitter: @GilPress I write about technology, entrepreneurs and innovation.

Intuition Robotics announced today that it is expanding its mission of improving the lives of older adults to include enhancing their interactions with their physicians. The Israeli startup has developed the AI-based, award-winning proactive social robot ElliQ which has spent over 30,000 days in older adults’ homes over the past two years. Now ElliQ will help increase patient engagement while offering primary care providers continuous actionable data and insights for early detection and intervention.

The very big challenge Intuition Robotics set up to solve was to “understand how to create a relationship between a human and a machine,” says co-founder and CEO Dor Skuler. Unlike a number of unsuccessful high-profile social robots (e.g., Pepper) that tried to perform multiple functions in multiple settings, ElliQ has focused exclusively on older adults living alone. Understanding empathy and how to grow a trusting relationship were the key objectives of Intuition Robotics’ research project, as well as how to continuously learn the specific (and changing) behavioral characteristics, habits, and preferences of the older adults participating in the experiment.

The results are impressive: 90% of users engage with ElliQ every day, without deterioration in engagement over time. When ElliQ proactively initiates deep conversational interactions with its users, there’s 70% response rate. Most important, the participants share something personal with ElliQ almost every day. “She has picked up my attitude… she’s figured me out,” says Deanna Dezern, an ElliQ user who describes her robot companion as “my sister from another mother.”

The very big challenge Intuition Robotics set up to solve was to “understand how to create a relationship between a human and a machine,” says co-founder and CEO Dor Skuler. Unlike a number of unsuccessful high-profile social robots (e.g., Pepper) that tried to perform multiple functions in multiple settings, ElliQ has focused exclusively on older adults living alone. Understanding empathy and how to grow a trusting relationship were the key objectives of Intuition Robotics’ research project, as well as how to continuously learn the specific (and changing) behavioral characteristics, habits, and preferences of the older adults participating in the experiment.

The results are impressive: 90% of users engage with ElliQ every day, without deterioration in engagement over time. When ElliQ proactively initiates deep conversational interactions with its users, there’s 70% response rate. Most important, the participants share something personal with ElliQ almost every day. “She has picked up my attitude… she’s figured me out,” says Deanna Dezern, an ElliQ user who describes her robot companion as “my sister from another mother.”

Higher patient engagement leads to lower costs of delivering care and the quality of the physician-patient relationship is positively associated with improved functional health, studies have found. Typically, however, primary care physicians see their patients anywhere from once a month to once a year, even though about 85% of seniors in the U.S. have at least one chronic health condition. ElliQ, with the consent of its users, can provide data on the status of patients in between office visits and facilitate timely and consistent communications between physicians and their patients.

Supporting the notion of a home-based physician assistant robot is the transformation of healthcare delivery in the U.S. More and more primary care physicians are moving from a fee-for-service business model, where doctors are paid according to the procedures used to treat a patient, to “capitation,” where doctors are paid a set amount for each patient they see. This shift in how doctors are compensated is gaining momentum as a key solution for reducing the skyrocketing costs of healthcare: “…inadequate, unnecessary, uncoordinated, and inefficient care and suboptimal business processes eat up at least 35%—and maybe over 50%—of the more than $3 trillion that the country spends annually on health care. That suggests more than $1 trillion is being squandered,” states “The Case for Capitation,” a Harvard Business Review article.

Under this new business model, physicians have a strong incentive to reduce or eliminate visits to the ER and hospitalization, so ElliQ’s assistance in early intervention and support of proactive and preventative healthcare is highly valuable. ElliQ’s “new capabilities provide physicians with visibility into the patient’s condition at home while allowing seamless communication… can assist me and my team in early detection and mitigation of health issues, and it increases patients’ involvement in their care through more frequent engagement and communication,” says in a statement Dr. Peter Barker of Family Doctors, a Mass General Brigham-affiliated practice in Swampscott, MA, that is working with Intuition Robotics.

With the new stage in its evolution, ElliQ becomes “a conversational agent for self-reported data on how people are doing based on what the doctor is telling us to look for and, at the same time, a super-simple communication channel between the physician and the patient,” says Skuler. As only 20% of the individual’s health has to do with the administration of healthcare, Skuler says the balance is already taken care of by ElliQ—encouraging exercise, watching nutrition, keeping mentally active, connecting to the outside world, and promoting a sense of purpose.

A recent article in The Communication of the ACM pointed out that “usability concerns have for too long overshadowed questions about the usefulness and acceptability of digital technologies for older adults.” Specifically, the authors challenge the long-held assumption that accessibility and aging research “fall under the same umbrella despite the fact that aging is neither an illness nor a disability.”

For Skuler, a “pyramid of value” is represented in Intuition Robotics offering. At the foundation is the physical product, easy to use and operate and doing what it is expected to do. Then there is the layer of “building relationships based on trust and empathy,” with a lot of humor and social interaction and activities for the users. On top are specific areas of value to older adults, and the first one is healthcare. There will be more in the future, anything that could help older adults live better lives, such as direct connections to the local community. ”Healthcare is an interesting experiment and I’m very much looking forward to see what else the future holds for ElliQ,” says Skuler.

Original. Reposted with permission, 7/7/2021.

Other related articles published in this Open Access Online Scientific Journal include the Following:

The Future of Speech-Based Human-Computer Interaction
Reporter: Ethan Coomber
https://pharmaceuticalintelligence.com/2021/06/23/the-future-of-speech-based-human-computer-interaction/

Deep Medicine: How Artificial Intelligence Can Make Health Care Human Again
Reporter: Aviva Lev-Ari, PhD, RN
https://pharmaceuticalintelligence.com/2020/11/11/deep-medicine-how-artificial-intelligence-can-make-health-care-human-again/

Supporting the elderly: A caring robot with ‘emotions’ and memory
Reporter: Aviva Lev-Ari, PhD, RN
https://pharmaceuticalintelligence.com/2015/02/10/supporting-the-elderly-a-caring-robot-with-emotions-and-memory/

Developing Deep Learning Models (DL) for Classifying Emotions through Brainwaves
Reporter: Abhisar Anand, Research Assistant I
https://pharmaceuticalintelligence.com/2021/06/22/developing-deep-learning-models-dl-for-classifying-emotions-through-brainwaves/

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How is the 3D Printing Community Responding to COVID-19?

Reporter: Irina Robu, PhD

 

As the new pandemic COVID-19 takes over the globe, several countries are implementing travel restrictions, social distancing and work from home policies. Healthcare systems are overloaded and fatigued by this new coronavirus (COVID-19). Since COVID-19 is a respiratory illness, patients require specialist respirators to take over the role of the lungs. These respirators are in short supply, however, along with medical personnel, hospital space and other personal safety equipment required to treat patients.

Professional AM providers, makers and designers in the 3D printing community have started to answer to the global crisis by volunteering their respective skills to ease the pressure on supply chains and governments. The additive manufacturing and 3D printing community has numerous members keen to support during the COVID-19 pandemic.

A hospital in Brescia, Italy with 250 Coronavirus patients lacking breathing machines has recently run out of the respiratory valves needed to connect the patients to the machines. In response to the situation, the CEO of Isinnova, Cristian Fracassi used 3D bioprinting to produce 100 respirator valves in 24 hours, which are currently being put to use in the Brescian hospital.

At the same time, Materialise, has released files for a 3D printed hands-free door handle attachment to lessen Coronavirus transmission via one of the most common mediums. Door handles are exposed to a lot of physical contact over the course of a day, especially in public spaces such as offices and hospitals. The 3D printable add-on allows users to carry out the lever action required to pop open most modern doors using their elbows.

Protolabs, a leading on-demand manufacturer with 3D Printing is using rapid production methods to good use during the current Coronavirus outbreak by producing components for #COVID19 test kits and ventilators. California-based Airwolf3D volunteered their own fleet of 3D printers for the manufacturing of respirator valves and custom medical components. The company is also offering remote technical support for medical staff that would like to know more about 3D printing.

Volkswagen has started a task force that will adapt its car-making capacity and manufacturing facilities to the production of hospital ventilators and medical devices. Using their own 125 industrial 3D printers to tackle the COVID-19 pandemic. At the same time, Volkswagen is donating face masks to healthcare providers and local authorities as part of an agreement made with German Health Minister.

Stratasys has organized its global 3D printing resources to respond to the COVID-19 pandemic by printing full-face shields to provide protection to healthcare workers. The company showed that the strength of 3D bioprinting can be adapted on the fly to address shortages of parts related to shields, masks, and ventilators, among other things.
Doctors, hospital technicians and 3D-printing specialists are also using Google Docs, WhatsApp groups and online databases to trade tips for building, fixing and modifying machines like ventilators to help treat the rising number of patients with COVID-19, the disease caused by the coronavirus.

The efforts come as supply shortages loom in one of the biggest challenges for health care systems around the world.

SOURCE

3D Printing Community responds to COVID-19 and Coronavirus resources

 

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Real Time Coverage @BIOConvention #BIO2019: Understanding the Voices of Patients: Unique Perspectives on Healthcare; June 4 11:00 AM

Reporter: Stephen J. Williams, PhD @StephenJWillia2

 

Description

The role of the patient has evolved dramatically over the past decade. Not only are patients increasingly more involved in their healthcare decision making, they are also passionate advocates who work tirelessly to advance drug development research and development and secure a public policy environment that is patient-centric. Join a discussion with patient advocates as they discuss their journeys to diagnosis and their viewpoints on our healthcare system. They will share their perspectives on what it means to be a patient and how they are advocating in their own unique ways to achieve a common goal: bringing new treatments to patients.

Speakers
Christopher Anselmo: affected by MS but did not understand why he should be involved in a study at the time or share your story but he saw others who benefited from both of these and now is fervent patient advocate. Each patient is worth their weight in gold as needed for other patient support.  The why needs to be asked of oneself before go out to other patients or into new trials. Might not see through to end if don’t have that discussion of why doing this.
Eve Bukowski:  she had stomach aches, went to hospital, and diagnosed with constipation, but had stage III colon cancer.  She was campaigning for Hillary Clinton but then started to campaign for her life.  She wound up having multiple therapies and even many I/O trials.  Fighting cancer is a mental challenge.   She has been fighting for eleven years but has an amazing strength and will.
Emily Kramer: cystic fibrosis patient.  Advocates for research as she has a mutant allele (nonsense mut) that is not targeted by the current new therapy against known mutants of CFTR.  So started Emily’s Entourage for this orphan of an orphan disease.  Funded $4 million in grants and helped develop a new startup and get early seed funding.  Noticed that the infrastructure to get these drugs to market was broken and also is investing to shore up these breaks in drug pipeline infrastructure for orphan diseases. For progressive diseases she would like drug developers to shift the timelines or speed with which they get to take a chance and try that new possibility. As a patient advocacy org, they want to partner every step of the way with biotech/pharma, they understand co’s and stakeholders can only do so much but let’s break out of convention.
Julie: many patient advocacy groups go person to person and make a support network.

Please follow LIVE on TWITTER using the following @ handles and # hashtags:

@Handles

@pharma_BI

@AVIVA1950

@BIOConvention

# Hashtags

#BIO2019 (official meeting hashtag)

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Reporter: Gail S. Thornton

 

From The Wall Street Journal (www.wsj.com)

Published January 9, 2019

Health-Care CEOs Outline Strategies at J.P. Morgan Conference

Chiefs at Johnson & Johnson, CVS discuss what’s next on a range of industry issues

One of the biggest health conferences of the year for investors, the J.P. Morgan Health-Care Conference, is taking place this week in San Francisco. Here are some of the hot topics covered at the four-day event, which wraps up Thursday.

BioMarin Mulls Payment Plans

BioMarin Pharmaceutical Inc. CEO Jean-Jacques Bienaimé said he would consider pursuing installment payment arrangements for the biotech’s experimental gene therapy for hemophilia. At the conference, Mr. Bienaimé told the Wall Street Journal that the one-time infusion, Valrox, is likely to cost in the millions because studies have shown it can eliminate bleeding episodes in patients, and current hemophilia treatments taken chronically can cost millions over several years. “We’re not trying to charge more than existing therapies,” he said. “We want to offer a better treatment at the same or lower cost.”

Johnson & Johnson Warns on Pricing

As politicians hammer drug prices, Johnson & Johnson CEO Alex Gorsky suggested companies need to police themselves. At the conference, Mr. Gorsky told investors that drug companies should price drugs reasonably and be transparent. “If we don’t do this as an industry, I think there will be other alternatives that will be more onerous for us,” Mr. Gorsky says. Some drugmakers pulled back from price increases in mid-2018 amid heightened political scrutiny, but prices went up for many drugs at the start of 2019.

Marijuana-Derived Drugs Show Promise

 

CVS Discusses New Stores

CVS Health Corp. Chief Executive Larry Merlo began showing initial concepts the company will be testing as it begins piloting new models of its drugstores that incorporate its Aetna combination. The first new test store will open next month in Houston, he told investors, and it will include expanded health-care services including a new concierge who will help patients with questions. 

Aetna Savings On the Way

Mr. Merlo also spelled out when the company will achieve the initial $750 million in synergies it has promised from the CVS-Aetna deal. In the first quarter, he said the company will see benefits from consolidating corporate functions. Savings from procurement and aligning lists of covered drugs should be seen in the first half, he says. Medical-cost savings will start affecting results toward the end of the year, he noted. 

Lilly Cuts Price

Drugmaker Eli Lilly & Co. expects average net US pricing for its drugs–after rebates and discounts–to decline in the low- to mid-single digits on a percentage basis this year, Chief Financial Officer Josh Smiley told the Journal. Lilly’s net prices had risen during the first half of 2018, but dropped in the third quarter as the company took a “restrained approach,” Mr. Smiley said. Lilly, which hasn’t yet reported fourth-quarter results, took some list price increases for cancer drugs in late December but hasn’t raised prices in the new year, he said.

Peter Loftus at peter.loftus@wsj.com and Anna Wilde Mathews at anna.mathews@wsj.com

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37th Annual J.P. Morgan HEALTHCARE CONFERENCE: News at #JPM2019 for Jan. 10, 2019: Deals and Announcements

Reporter: Stephen J. Williams, Ph.D.

From Biospace.com

 

JP Morgan Healthcare Conference Update: Sage, Mersana, Shutdown Woes and Babies

Speaker presenting to audience at a conference

With the J.P. Morgan Healthcare Conference winding down, companies remain busy striking deals and informing investors about pipeline advances. BioSpace snagged some of the interesting news bits to come out of the conference from Wednesday.

SAGE Therapeutics – Following a positive Phase III report that its postpartum depression treatment candidate SAGE-217 hit the mark in its late-stage clinical trial, Sage Therapeutics is eying the potential to have multiple treatment options available for patients. At the start of J.P. Morgan, Sage said that patients treated with SAGE-217 had a statistically significant improvement of 17.8 points in the Hamilton Rating Scale for Depression, compared to 13.6 for placebo. The company plans to seek approval for SAGE-2017, but before that, the FDA is expected to make a decision on Zulresso in March. Zulresso already passed muster from advisory committees in November, and if approved, would be the first drug specifically for postpartum depression. In an interview with the Business Journal, Chief Business Officer Mike Cloonan said the company believes there is room in the market for both medications, particularly since the medications address different patient populations.

 

Mersana Therapeutics – After a breakup with Takeda Pharmaceutical and the shelving of its lead product, Cambridge, Mass.-based Mersana is making a new path. Even though a partial clinical hold was lifted following the death of a patient the company opted to shelve development of XMT-1522. During a presentation at JPM, CEO Anna Protopapas noted that many other companies are developing therapies that target the HER2 protein, which led to the decision, according to the Boston Business Journal. Protopapas said the HER2 space is highly competitive and now the company will focus on its other asset, XMT-1536, an ADC targeting NaPi2b, an antigen highly expressed in the majority of non-squamous NSCLC and epithelial ovarian cancer. XMT-1536 is currently in Phase 1 clinical trials for NaPi2b-expressing cancers, including ovarian cancer, non-small cell lung cancer and other cancers. Data on XMT-1536 is expected in the first half of 2019.

Novavax – During a JPM presentation, Stan Erck, CEO of Novavax, pointed to the company’s RSV vaccine, which is in late-stage development. The vaccine is being developed for the mother, in order to protect an infant. The mother transfers the antibodies to the infant, which will provide the baby with protection from RSV in its first six months. Erck called the program historic. He said the Phase III program is in its fourth year and the company has vaccinated 4,636 women. He said they are tracking the women and the babies. Researchers call the mothers every week through the first six months of the baby’s life to acquire data. Erck said the company anticipates announcing trial data this quarter. If approved, Erck said the market for the vaccine could be a significant revenue driver.

“You have 3.9 million birth cohorts and we expect 80 percent to 90 percent of those mothers to be vaccinated as a pediatric vaccine and in the U.S. the market rate is somewhere between $750 million and a $1 billion and then double that for worldwide market. So it’s a large market and we will be first to market in this,” Erck said, according to a transcript of the presentation.

Denali Therapeutics – Denali forged a collaboration with Germany-based SIRION Biotech to develop gene therapies for central nervous disorders. The two companies plan to develop adeno-associated virus (AAV) vectors to enable therapeutics to cross the blood-brain barrier for clinical applications in neurodegenerative diseases including Parkinson’s, Alzheimer’s disease, ALS and certain other diseases of the CNS.

AstraZeneca – Pharma giant AstraZeneca reported that in 2019 net prices on average across the portfolio will decrease versus 2018. With a backdrop of intense public and government scrutiny over pricing, Market Access head Rick Suarez said the company is increasing its pricing transparency. Additionally, he said the company is looking at new ways to price drugs, such as value-based reimbursement agreements with payers, Pink Sheet reported.

Amarin Corporation – As the company eyes a potential label expansion approval for its cardiovascular disease treatment Vascepa, Amarin Corporation has been proactively hiring hundreds of sales reps. In the fourth quarter, the company hired 265 new sales reps, giving the company a sales team of more than 400, CEO John Thero said. Thero noted that is a label expansion is granted by the FDA, “revenues will increase at least 50 percent over what we did in the prior year, which would give us revenues of approximate $350 million in 2019.”

Government Woes – As the partial government shutdown in the United States continues into its third week, biotech leaders at JPM raised concern as the FDA’s carryover funds are dwindling. With no new funding coming in, reviews of New Drug Applications won’t be able to continue past February, Pink Sheet said. While reviews are currently ongoing, no New Drug Applications are being accepted by the FDA at this time. With the halt of NDA applications, that has also caused some companies to delay plans for an initial public offering. It’s hard to raise potential investor excitement without the regulatory support of a potential drug approval. During a panel discussion, Jonathan Leff, a partner at Deerfield Management, noted that the ongoing government shutdown is a reminder of how “overwhelmingly dependent the whole industry of biotech and drug development is on government,” Pink Sheet said.

Other posts on the JP Morgan 2019 Healthcare Conference on this Open Access Journal include:

#JPM19 Conference: Lilly Announces Agreement To Acquire Loxo Oncology

36th Annual J.P. Morgan HEALTHCARE CONFERENCE January 8 – 11, 2018

37th Annual J.P. Morgan HEALTHCARE CONFERENCE: #JPM2019 for Jan. 8, 2019; Opening Videos, Novartis expands Cell Therapies, January 7 – 10, 2019, Westin St. Francis Hotel | San Francisco, California

37th Annual J.P. Morgan HEALTHCARE CONFERENCE: News at #JPM2019 for Jan. 8, 2019: Deals and Announcements

 

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37th Annual J.P. Morgan HEALTHCARE CONFERENCE: #JPM2019 for Jan. 8, 2019; Opening Videos, Novartis expands Cell Therapies, January 7 – 10, 2019, Westin St. Francis Hotel | San Francisco, California, Volume 2 (Volume Two: Latest in Genomics Methodologies for Therapeutics: Gene Editing, NGS and BioInformatics, Simulations and the Genome Ontology), Part 1: Next Generation Sequencing (NGS)

37th Annual J.P. Morgan HEALTHCARE CONFERENCE: #JPM2019 for Jan. 8, 2019; Opening Videos, Novartis expands Cell Therapies, January 7 – 10, 2019, Westin St. Francis Hotel | San Francisco, California

Reporter: Stephen J. Williams, PhD

The annual J.P. Morgan Healthcare Conference is the largest and most informative healthcare investment symposium in the industry, bringing together industry leaders, emerging fast-growth companies, innovative technology creators, and members of the investment community.

 

Joe Biden

Joe Biden on the Fight Against Cancer

Former Vice President of the United States joined the J.P. Morgan Healthcare Conference to discuss cancer initiatives.

Watch Video

Bill Gates

Bill Gates on the Current State of Global Health

In his keynote address at the annual J.P. Morgan Healthcare Conference, Bill Gates spoke about the state of healthcare around the world.

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CEO Anne

Anne Wojcicki on Disrupting the Healthcare Industry

The CEO of 23andMe discusses at the J.P. Morgan Healthcare Conference how her genomics company is activating the power of the consumer.

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  1. Another packed house as panel including Saurabh Saha, & Alexis Borisy discuss the rewiring of R&D for the digital age at Exec Bfast

Novartis Talks Move to Cell and Gene Therapies at JPM

Novartis logo on outdoor wall

Denis Linine / Shutterstock

Following a strong post-hoc analysis of mid-stage data in the fall of 2018, Novartis announced this morning the company’s experimental humanized anti-P-selectin monoclonal antibody was crizanlizumab granted Breakthrough Therapy Status by the U.S.Food and Drug Administration (FDA).

Crizanlizumab received the designation as a treatment for the prevention of vaso-occlusive crises (VOCs) in patients of all genotypes with sickle cell disease (SCD). VOCs, which can be extremely painful for patients, happen when multiple blood cells stick to each other and to blood vessels, causing blockages.

The designation was awarded following results from the Phase II SUSTAIN trial, which showed that crizanlizumab reduced the median annual rate of VOCs leading to health care visits by 45.3 percent compared to placebo. The SUSTAIN study also showed that crizanlizumab significantly increased the percentage of patients who did not experience any VOCs vs placebo, 35.8 percent vs. 16.9 percent.

The FDA designation came one day after the Swiss pharma giant laid out its map for a future of success, sustainability and, if things work out, respect from consumers. In an interview with CNBC Monday, Novartis Chief Executive Officer Vas Narasimhan noted that the company is looking to become an entity that doesn’t draw its profits from treating disease, but will make money by providing cures. He pointed to the moves Novartis has made toward gene and cellular therapies that have the potential to cure patients of various diseases in what many researchers hope could be a “one-and-done” treatment. Narasimhan told CNBC that cures are what society wants and that is something they will value. The challenge will be determining the payment system.

As an example, the company is eying potential approval of a gene therapy for spinal muscular atrophy (SMA), a fatal genetic disease marked by progressive, debilitating muscle weakness in infants and toddlers. Novartis’ gene therapy Zolgensma is expected to be approved by the FDA this year and could have a price tag of between $4 and $5 million. While significantly high, non-profit SMA groups have already suggested that the gene therapy treatment could be more cost-effective than Spinraza, the only approved SMA treatment on the market.

During its presentation at J.P. Morgan, Novartis pointed to the moves it has made as the company pivots to this future of gene and cell therapies. The presentation noted that over the course of 2018, the company made several deals to sell off non-essential businesses, such as the $13 billion sale of its share of a consumer health business to partner GlaxoSmithKline. Not only that, but Novartis also made significant acquisitions to reshape its portfolio, including the $8.7 billion acquisition of AveXis for the SMA gene therapy. The deal for AveXis wasn’t the only gene therapy deal the company struck. Novartis began 2018 with a deal for Spark Therapeutics’ gene therapy Luxturna, a one-time gene therapy to restore functional vision in children and adult patients with biallelic mutations of the RPE65 (retinal pigment epithelial 65 kDa protein) gene.

In his interview with CNBC, Narasimhan said the company is about “platforms,” which also includes radio-ligand therapy. The company forged ahead in that area with two acquisitions, Advanced Accelerator Applications and Endocyte. Radiopharmaceuticals like Endocyte’s Lu-PSMA-617 are innovative medicinal formulations containing radioisotopes used clinically for both diagnosis and therapy. When the Endocyte deal was announced, Novartis noted the field is expected to become an increasingly important treatment option for patients, as well as a key growth driver for the company’s oncology business.

Other posts on the JP Morgan 2019 Healthcare Conference on this Open Access Journal include:

#JPM19 Conference: Lilly Announces Agreement To Acquire Loxo Oncology

36th Annual J.P. Morgan HEALTHCARE CONFERENCE January 8 – 11, 2018

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