Exponential Medicine and Pharma's Unfulfilled Promise

At the 2016 Exponential Medicine (#xMed) conference that recently convened in San Diego, here are some of the things I learned:

• In Haiti, technology is enabling medical professionals to use 3D printing to make umbilical cord clamps for newborns, saving lives in impoverished circumstances.

• Retinal scans may soon be used to detect Alzheimer’s Disease before symptoms even present themselves.

• Around the world, non-invasive techniques - such as focused ultrasound - are replacing surgery, completely eliminating tumors while causing much less trauma to the body.

And I also heard this:

- “A new app or intelligent medical device may have more impact on healthcare than a new blockbuster drug.”

- “In pharma, there is no sharing of learnings from R&D, no open source. Data scientists are considered ‘Research Parasites’.”

- “The only pharma CEOs we recognize are outlaws.”

The big questions for me became: Is there a relationship between the first set of observations and the second? In other words, is the general lack of innovation from pharma companies in the digital health arena related to the industry’s structural limitations and ethical behavior? 

Noodling over the answers to these questions would occupy my thoughts for the four days of Exponential Medicine (xMed) at the majestic Hotel Coronado.

How I got here

This was my first time attending Exponential Medicine; after a few tastes of TEDMED, South by Southwest (SXSW), Health 2.0, the Consumer Electronics Show’s Health track, I thought I should sample what many were calling the hottest ‘new’ healthcare conference. In its sixth year, and still relatively small at about 500 attendees, Exponential Medicine (the healthcare expression of Singularity University) takes a decidedly different tack than its more famous competitors. While TEDMED projects a humanistic and wide-eyed view of health possibilities, and SXSW emits a younger, culture-forward vibe, xMed exudes high medical geekiness. 

It seemed as though virtually everyone at xMed (except me) was an M.D. Or a Ph.D. Or both. And while there were some nods to new age-y culture (yes, there was a swami) and greater issues facing humanity (Dave Chase’s (@chasedave) noble film, The Big Heist, about the healthcare cost explosion and its damage to the American middle class), the predominant tone was one of earnest, techno-optimism, shared among an extraordinarily exclusive group. If the content presented is any guide, the attendees cared mostly about how medical technology could improve individual health, assuming you had unlimited access to information and money. X-Prize founder Peter Diamandis (@PeterDiamandis) urged attendees, tellingly, to be “the CEO of your own health” while encouraging them to pay $25,000so that his company, Human Longevity Inc. with its “Health Nucleus” center, can scan their DNA and provide extensive testing to predict (and thereby perhaps prevent) cancer, heart disease, and other illnesses. xMed registrants were offered a 10% discount -if they signed up now! 

Another reason I came to San Diego was the lure of swimming in the roiling intellectual sea of “Exponential Thinking.” One of the founders of Singularity University is Ray Kurzweil (@raykurzweil), and it’s no exaggeration to say that reading Kurzweil (and other futurists like George Gilder) in the 1990s changed my life. When in 1998 I started my company – a marketing solutions firm that would come to be known as the healthcare agency Heartbeat, the foundational idea was to apply the power of exponential technology to marketing and, in so doing, transform the way organizations identified, influenced, and ultimately persuaded customers. So it was particularly tempting to meet others attracted to the ideas of Singularity University in a healthcare context. 

Looking back to earlier days, it’s revealing to see what surprises you in life. Sometimes it’s not what has happened, but what hasn’t.

The rise of e-commerce and the collapse of the newspaper and magazine industries? Saw that coming. 

The creative destruction of the music, TV and movie businesses? It all seemed inevitable if you understood exponential principles. 

But eighteen years after starting my company, what has surprised me most is the glacial pace of what I saw as the inevitable, ‘transformation of healthcare’.  In virtually every other sector, exponential technology has led to greater innovation, and higher value at lower cost – that’s practically the definition of exponential economics. So why not healthcare?

Go Uber yourself

Early on at xMed, Founder and Executive Director, Dr. Daniel Kraft (‪@daniel_kraft‪‪) threw out a phrase he hoped would become a meme: “Uber yourself before you get Kodak’d”. Judging by the number of re-tweets, his meme is off to a good start. But while there are crevices throughout the industry in which we see innovators displacing establishment players, in pharma the barricades have proven remarkably well-entrenched. The ‘Kodaks’ are still selling Kodachrome and digital cameras have somehow not reached the market. 

Among the xMed audience of doctor-preneurs (another neologism), I heard volleys of passion and inventiveness firing at the parapets of the pharma and medical device industries: Robots displacing standard surgical practice (Israeli surgeon Amir Szold: “Robots with brains of their own can be more effective and efficient”); ‘fetal fitbits’ for monitoring the vitals of premature infants; post-partum depression revealed through the examination of Facebook posts. Yet relatively few rounds landed near the walls of our industry with the potential to rattle the ways commercial pharma and med device companies conduct their businesses. 

Why should it be that the pharma industry in particular (less so than med devices) appears protected from the waves of change disrupting everything else in the modern economy, and increasingly, the rest of the healthcare sector itself?

It’s certainly not because disruptive potential doesn’t exist. At xMed, I saw many manifestations of innovation that would be immediately relevant to pharma.

Virtually convincing

Virtual Reality and Augmented Reality are technologies that have offered teasing potential for many years. In healthcare, these technologies have been explored to create exceptional experiences, especially for doctors curious to look inside a new molecular mechanism or disease pathway. While such attempts are not exactly new (my company created its first VR experience for a pharma client in 2012), the technology has advanced to the point where much richer, more immersive experiences are now possible. 

At xMed, a Los Angeles start-up called Blue Vishnu demonstrated startling ultra-high fidelity VR experiences, wherein the user “steps into” the body of another person to enter a reality he could have previously barely imagined. In the “Healthcare Innovation Lab”, which, at a less self-important conference might be called the “Trade Show Floor”, I tried a Blue Vishnu experience in which, once equipped with goggles and headset, I ‘entered’ a painting, passed into the bodies of sculpted characters and looked out at the other characters in the artwork from the perspective of the person I stepped into. (I could even look down at “my” own hand, except it was that of a tattooed woman.)

A stunning kind of theater, to be sure.  But as Blue Vishnu CEO Alexx Henry (@alexxhenry) later explained from the stage, such extreme avatars “can change your life.” He spoke of applications in dermatology and healthcare in general:  Imagine “seeing” a version of your future self, based on your precise anatomy, and witnessing the effect of different nutritional and behavioral choices on your aging.  “Would that be motivating?” Alexx asked. Well, duh.

Beyond motivating us to take better care of our corporal selves, perhaps the larger value of such experiential tricks is their potential to increase empathy for other people, whether to help a doctor better understand a mental disorder, or to enable a caregiver to more deeply appreciate (and better alleviate) a loved one’s suffering.

Also in the realm of generating a deeper, more subtle compassion for people with illness, a film shown by Genentech’s Senior Director of Commercial Strategy, Kevin Noble (@teamrampantlion) caught my attention. The film, with the surprisingly bland title “Feeling the Impact”, is actually a delicately-inspired portrait of a breast cancer patient, Katy, and the ways in which having the disease changed her conception of herself, her family and her understanding of the meaning of life and time. It’s a rare example of a pharmaceutical company making a much ‘nobler’ connection with patients and the larger community, without insisting upon obvious promotional returns.  “If one wouldn’t have to die from it, cancer would be a great disease,” said Katy. “Because it sweetens life.”  (Watch the remarkable video yourself, here:  https://www.youtube.com/watch?v=fNume0FGNWk)

Of course, Exponential Medicine is all about thinking larger – exponentially so. And for those of us who consider it essential to broaden the value proposition of the pharma industry, from focusing on discovering and selling medicines, to concentrating on preserving and enhancing health and wellness, a prerequisite for exponential thinking is a grand redefinition of purpose. “We have to change our mindset from ‘sickcare’ to ‘healthcare’”, as Daniel Kraft put it when kicking off the conference.

Could a new health app or digitally-enabled device have the same impact as a blockbuster drug? Dr. Kraft thinks it might. 

Bringing the sort of exponential thinking that would be required for pharma companies to reinvent themselves with such a broader definition of their role has not - and will not - come easily. 

But a promising model could be seen at Xmed from an unlikely source - Britain’s National Health Service (NHS). With 1.3 million employees, NHS is the fifth largest employer in the world and the single largest provider of healthcare services on the planet. Dr. Tony Young (@DrTonyYoung) serves as NHS’ Director for Innovation (imagine taking on that job?). Could such a ginormous organization possibly spur innovation in healthcare? But Dr. Young’s perspective might surprise you: “If you want to innovate at scale, NHS is a great place to do it.” Dr. Young explained that NHS had a goal to achieve savings of 30 billion pounds sterling, and much of those savings needed to come through efficiency-driving innovation.  How would they accomplish that? “The hardest thing to do,” said Dr. Young, was to “stop doing the old things.”

Dr. Young’s team took on the ambitious challenge of turning the doctor’s bag into a “digital patients’ kit” and his Innovation Lab’s team of 103 young NHS doctors were charged with re-inventing the delivery of medical care in the field. One result from his doctor-preneurs:  the invention of Cordio (http://www.cordio-med.com/index.html), a mobile app that listens to changes in voice tone and can predict advanced heart failure 10 days before it occurs. Anticipating heart failure may help to prevent it, and in so doing, help reduce the enormous costs of extended hospital stays, not to mention saving lives. 

Reflecting on his team’s accomplishments, Dr. Young offered a trenchant summary: “You can be big and innovate, if you give people permission and support.”

So if a bureaucracy as byzantine as NHS can find a way to seed innovations that improve medical outcomes, the same should be possible, in theory at least, for the pharma industry. And yet, very little of this kind of inventiveness has come from our industry to date. What are the obstacles? It’s all well and good for the NHS to find better ways to improve care and reduce costs, but if you’re a capitalist entity looking to generate profit from healthcare, is there a realistic path forward? An exponential thinker would say ‘there must be, if we think in an exponential way.’

Turning pharma exponential

But Dr. Amir Kalali (@akalali), Global Head of the Neuroscience Center of Excellence at IMS/Quintiles, questioned whether the industry, as currently structured, can answer the innovative challenge. “The industry is now run by financial engineers, not medical people.” And, perhaps partially as a result of this, "in healthcare, we get LESS for MORE money.”  In other words, the inverse of the exponential promise.  Moreover, Dr. Kalali noted, pharma is notoriously risk averse, and without the embrace of risk-taking, true innovation will be still-born.

Dr. Kalali’s unromantic assessment of the industry perhaps understates the potential for the disruptions that may be set off by exponential thinkers.  But at least two very big things will need to happen if that promise is to be fulfilled, one structural, the other ethical.

Sheltered islands

Structurally, pharma companies must create protected islands for innovation (as the NHS did) that support experimentation without concern for immediate financial gain. No start-up is expected to return a profit in a quarter, or even a year. Yet, for the most part, pharma companies have shown little tolerance for investing with a long-term vision for anything other than discovering (or in-licensing) new molecules. 

To achieve success beyond the medicine (where the potential of digital health mostly lies), time horizons have to be extended out at least five years. And in that time, the innovators from outside and inside the current company structure must be nurtured and given protection from ‘normal’ financial demands. As legendary Silicon Valley investor Vinod Khosla (@vkhosla) put it, “Change always happens slower than you think in the beginning, but is much bigger than expected in the long-term.” Pharma companies need to demonstrate faith in the long game.

Ethical inhibition

Another one of Dr. Kalali’s comments hit home for me: “The only pharma CEO faces we recognize today are outlaws…” So, while the Martin Shkrelis and Michael Pearsons of the world may not be representative of the ethics of the industry as a whole, to the public, they are the industry. Is there a connection between the dynamic of the pharma industry that enabled the bad actors, and the inability to-date to trigger transformative, exponential change? Indirectly, I think the answer is yes. The fact that the industry’s unique pricing structure (which enabled Turing and Valeant and Mylan to take those exorbitant price increases) is part of the root dynamic that undermines the industry’s urgency to make fundamental changes. If you can increase drug prices without relation to improved outcomes or to providing other added value for patients or doctors, you are insulated from the need to take digital innovation seriously. Exorbitant price increases are thus not only an ethical problem, they are, in the end, an enormous inhibitor of innovation as well.

Awakening your exponential self

On the last day of xMed, we were greeted (sort of) by my erstwhile hero, Ray Kurzweil. He ‘showed up’ in the form of a robot projecting his image to the crowd, really not much more than a video chat on wheels. I mentioned at the start that Kurzweil’s writing, particularly his seminal book, The Age of Spiritual Machines, was one of the inspirations for my company and my career. He wrote of technology being “evolution by other means.” Now, nearly two decades later, we ought to be getting close to much grander possibilities in healthcare. And Mr. Kurzweil believes this to be so: “We are approaching what I call ‘Bridge 3’ to radical life extension,” his digitized image proclaimed.

But in order to realize this dream, we must “avoid the trap of falling into the linear fallacy,” Kurzweil cautions. Which means we must not use our old, incrementally-oriented ways of thinking to conjure the possibilities of an exponential world. 

So, in the end, when, and whether, pharma joins the exponential future is really up to each of our exponential selves.
 

Bill Drummy is Founder & CEO, Heartbeat, and a member of Pharmaceutical Executive's Editorial Advisory Board.