Founded in 2014, Babylon enables users to obtain virtual consultations with doctors and healthcare professionals via text and video messaging through a mobile app. It operates the GP at Hand service in the U.K., which gives users access to an NHS GP. Investors include Hoxton Ventures, Kinnevik AB, and the creators of Google DeepMind.

Founder Ali Parsa claims that Babylon is the beginning of the end for the old fashioned way the world uses healthcare. Since 2016, Babylon has provided consultations via its Babel app to Rwandans. It partners with Rwanda’s regionally managed health insurance schemes, the Mutuelles de Santé. Users pay FRw500, which is about 58¢, per consultation.

They simply call a number to book an appointment, undergo the assessment over the phone, first by a nurse and then if necessary with a doctor, and are treated digitally or referred to specialist. The app generates unique codes which patients use to pick up prescription drugs or to request lab tests at a Babel partner lab center.

Babel’s business model remediates to some extent the lack of access to doctors, especially in rural areas, and could save countless lives through earlier access to treatment. Additionally, it prevents patients from clogging up specialist centers not intended to treat simple ailments — injecting some efficiency into the system overall. However, with Rwanda’s per capita income at just $1,760 on a purchasing-power-parity (PPP) basis, it could be a while before Babylon makes a profit.

The post How Babylon Health is Improving Rwandan Health appeared first on Karma Impact.

Perspectives: Opinions from our network of advisors, investors, operators and analysts on the risks and opportunities they see.

The web of regulatory and individual privacy requirements in the U.S. makes it extremely difficult to be innovative in the healthcare sector.

Even so, digital pharmacies are trying to challenge brick-and-mortar competitors in the almost $300 billion pharmacy market by promising cost savings, convenience and greater access for consumers for whom a trip to the drugstore is a difficult thing.

Nicole DiMaria, a member of New Jersey-based Chiesa Shahinian & Giantomasi PC, provides healthcare corporate and regulatory counseling as part of the firm’s Healthcare and Hospitals Group. She spoke with Karma Network’s Contributing Editor Michael Moran about the regulatory and consumer trust issues facing digital pharmacies and what factors might influence whether impact investors jump in.

Michael Moran: What regulatory issues will be the biggest drivers for digital pharmacies and what will be the blockers?

Nicole DiMaria: The regulatory issue that appears to be one of the biggest drivers for the digital pharmacy industry is the move from fee-for-service to value-based purchasing and healthcare. Drug prices and consumer out-of-pocket costs are rapidly increasing, which heightens the demand for price transparency and consumer-driven healthcare.

First, digital pharmacies have the opportunity to offer their customers a software platform that allows customers to easily compare drug prices and find alternatives, ultimately making them better consumers of healthcare, increasing competition, and lowering costs.

Second, digital pharmacies can also offer personalized medication management tools, which can increase medication adherence, improve patient outcomes and, again, ultimately lower healthcare costs.

Third, digital pharmacies that have strong connections with their customers will have greater leverage in purchasing drugs directly from pharmaceutical companies where discounts can be passed on directly to the consumer.

There are a multitude of regulatory obstacles from state retail pharmacy laws, fraud and abuse laws, federal and state privacy and security laws to interstate pharmacist licensing regulations. And these laws are constantly in flux. It is difficult to succeed in this space without having a very strong understanding of the depth and nuance of the regulatory environment.

Michael Moran: How will digital pharmacies build and maintain trust among patients in this time of data mistrust?

DiMaria: First, they must demonstrate the value of data to improve customer experience. The level of convenience and value customers perceive — for instance the ease of refilling prescriptions and communicating with a pharmacist to address any concerns — can outweigh any distrust.

Second, strong privacy and security controls should be emphasized to customers. It is crucial for digital pharmacies to invest in a data infrastructure that is well vetted for security and to document their compliance with laws such as HIPAA and High Tech. Obtaining independent third-party privacy and security certifications, for example HiTrust Certification, would likely go a long way in establishing greater trust.

Michael Moran: Is there an impact investment play in digital pharma, for instance, greater patient access?

DiMaria: Impact investors would likely be intrigued by a digital pharmacy’s ability to improve patient outcomes and reduce healthcare costs, both of which are noble social endeavors.

A driving force for backing a digital pharmacy is likely the trend toward increased convenience where customers can make purchases with a few taps and find it on the smartphone, and the digital pharmacy’s ability to be seen as a vehicle for improving patient outcomes and reducing healthcare costs.

A digital pharmacy that provides the combination of convenience, reliability, and personal interaction and emphasizes its role in improving the healthcare system and leveraging valuable healthcare data would appear to be well-positioned to attract investors.

The likely deterring force in backing these companies would be the challenge in ensuring that a digital pharmacy has the right software to achieve this combination, and the challenge in navigating (an) extremely complex regulatory environment.

The post Nicole DiMaria: “Out-of-pocket costs are rapidly increasing, which heightens the demand for price transparency and consumer-driven healthcare.” appeared first on Karma Impact.

On Our Radar: Deals we are paying attention to for their impact on industry.

CMS Medical Venture Investment has bought a quarter of Midatech Pharma Plc’s stock outstanding, reported Bloomberg on April 8.

Both are specialty pharmaceutical companies, with CMS owned by a holding company. The venture capital held 104 million shares, according to Midatech Pharma’s April 2, 2019, public-share registry filing.

The U.K.-based Midatech, founded in 2000, focuses on developing and selling products in oncology and immunotherapy in the U.S. and on its home turf. Among its products are Zuplenz, Gelclair, Oravig and Soltamox — all treatments for cancer. Midatech collaborates with universities and pharmaceutical companies to develop its platform technologies into products.

The China-based CMS Medical is a wholly owned subsidiary of China Medical System Holdings Limited, which is an investment holding company that deals with the manufacturing marketing, promotion and sales of prescription drugs and other medicinal products to hospitals. Its products are used in the treatment of gastropathy, cardiopathy, traumatic infection, hepatopathy, eye diseases and others.

As CMS has done with its stake in Midatech, it builds up its portfolio through asset acquisition, equity investment, licensing and distribution, and R&D. Its purchase of Midatech shares now gives it a bigger presence in cancer-treating drugs.

CMS was listed on the Hong Kong Stock Exchange with a market capitalization of some HK$19.89 billion as of Monday.

Michelle Lodge is a New York-based writer whose work has appeared in Time, Fortune, Barron’s, the Miami Herald, the British Medical Journal as well as on CNBC.com.

The post CMS Medical Buys 25% of Midatech’s Outstanding Stock appeared first on Karma Impact.

Pharmaceutical distribution usually faces three common problems in sub-Saharan Africa.

Firstly, the retail market is highly fragmented, consisting of mom-and-pop pharmacies and other informal outlets. Secondly, the supply chain is also highly fragmented with intermediaries creaming off significant margins. And thirdly, non-counterfeit drugs are not affordable for vast swathes of African consumers.

Take Nigeria, for example, where informal retail accounts for more than three quarters of the value of the pharma market. Counterfeit and medicines are widely distributed and are difficult to distinguish from the genuine article. Therefore, competition is fierce, and customer acquisition is very difficult.

In Kenya, intermediaries control the highest margins, accounting for an excessively high 50% of a pharma product’s final price. Compare this with the OECD countries, where distributors account for between 2-24% of the final price.

With distributor and retail margins pushing up the price of drugs, it is not surprising that patients are often forced to seek cheaper but potentially unsafe counterfeit drugs. There is a great need for solutions which improve both market access from the manufacturer’s standpoint and affordability of drugs from the patient’s standpoint.

mPharma, a Ghanaian venture-backed startup, is attempting to provide such a solution. It streamlines the drug supply chain by using data to understand what drugs are in demand and through which channels they can be best delivered. By aggregating demand and consolidating distribution, mPharma creates sizable efficiencies throughout the value chain, allowing it to half the final retail price of drugs and thereby increase accessibility to patients.

The post Fragmented Supply Chains & Counterfeit Drugs Hinder African Pharma Growth appeared first on Karma Impact.

The lack of healthcare professionals and health facilities is one of the biggest challenges facing African healthcare, and the problem is especially acute in rural areas, since 90% of healthcare workers live in cities on average.

Since African governments are not appreciably increasing healthcare spend, healthcare resources will be strained to meet the demand in the foreseeable future.

An unwelcome knock-on effect of inadequate primary care is that the few specialist hospitals that do exist are often full of patients with simple ailments, instead of the complex conditions for which those facilities were intended. [readmore]
There is a need for solutions that allow health systems to provide more primary care within the constraints of limited resources while directing patients away from hospitals.

Digital health and portable devices have the potential to do just this. The first way is through diagnosis. In Nigeria, GE has sold portable flip-phone style ultrasound scanners and trained carers in remote villages on how to identify the biggest pregnancy complication risks. They use less power than standard devices and are cheaper and more resilient.

The second way is with digital devices that can enable remote consultations. U.K. startup Babylon created the Babel app in Rwanda, which provides personalized treatment advice and access to doctors to more than 2 million patients.

In South Africa, the mobile messaging platform MomConnect, which has half a million subscribers, provides targeted health promotion messages to pregnant women to improve their health and that of their infants.

Not only can such solutions improve accessibility, they also augment community-based primary care, which as we have already seen, is the best way to improve outcomes at a lower cost. Babel uses village ambassadors to spread the service, so it is an excellent example of this.

The post Portability is Crucial for a Healthier African Population appeared first on Karma Impact.

1Mg, a platform offering an online pharmacy and health application that tells users about their medicines, their substitutes, and side effects, raised an undisclosed amount of venture funding on April 27, 2018, valuing the company at $75 million. Previously, the company raised $15 million of Series C venture funding in a deal led by HBM Healthcare Investments on July 27, 2017. In addition to keeping patients knowledgeable about their medication, the platform also provides regular health tips, online medication orders, and booking services for health tests and packages at local certified labs.

CVS struck a deal with the U.S. Postal Service to pick up prescriptions at CVS stores and bring them to customers’ homes in 1-2 days. Customers will be charged $4.99 per delivery, which could include over-the-counter products such as aspirin as well.

Zipdrug, a provider of an online application that provides medication delivery to homes and offices, raised $600,000 of seed funding from Notation Capital, Collaborative Fund, and Red Sea Ventures on July 14, 2017.

Hims, a provider of wellness products intended to offer hair loss prevention medicines for men, raised $50 million [readmore]of Series B2 venture funding in a deal led by IVP on June 28, 2018, putting the company’s pre-money valuation at $450 million. Thrive Capital, Forerunner Ventures, SV Angel, Redpoint Ventures, Founders Fund, and CAVU Venture Partners also participated in the round.

Apotea, an online full-scale pharmacy store. Stampen Media Partner, Sjätte AP-fonden, and Ernströmgruppen sold a 4.9% stake in the company to Creades for $13.5 million on April 28, 2017. The post-deal valuation of the firm was $274.09 million.

MDSave, an operator of an online healthcare transactional platform, raised $4.82 million of venture funding from undisclosed investors on June 1, 2018. Previously, the company received an undisclosed amount of debt financing from Comerica Bank on September 18, 2017. MDSave works to lower healthcare cost by offering patients clear upfront pricing from quality physicians.

Kakehashi, a provider of an electronic medication history system connecting medical treatment and patients, raised $8 million of Series A venture funding from ITOCHU Technology Ventures, GE Ventures, and Salesforce Ventures on May 14, 2018. The company’s SaaS-based system stores all information related to a health insurance claim and a patient’s drug history management.

The post Are Consumers Ready for Digital Pharmacies? appeared first on Karma Impact.

Key Market Movements

1Mg, a platform offering an online pharmacy and health application that tells users about their medicines, their substitutes, and side effects, raised an undisclosed amount of venture funding on April 27, 2018, valuing the company at $75 million. Previously, the company raised $15 million of Series C venture funding in a deal led by HBM Healthcare Investments on July 27, 2017. In addition to keeping patients knowledgeable about their medication, the platform also provides regular health tips, online medication orders, and booking services for health tests and packages at local certified labs.

CVS struck a deal with the U.S. Postal Service to pick up prescriptions at CVS stores and bring them to customers’ homes in 1-2 days. Customers will be charged $4.99 per delivery, which could include over-the-counter products such as aspirin as well.

Zipdrug, a provider of an online application[readmore] that provides medication delivery to homes and offices, raised $600,000 of seed funding from Notation Capital, Collaborative Fund, and Red Sea Ventures on July 14, 2017.

Hims, a provider of wellness products intended to offer hair loss prevention medicines for men, raised $50 million of Series B2 venture funding in a deal led by IVP on June 28, 2018, putting the company’s pre-money valuation at $450 million. Thrive Capital, Forerunner Ventures, SV Angel, Redpoint Ventures, Founders Fund, and CAVU Venture Partners also participated in the round.

Apotea, an online full-scale pharmacy store. Stampen Media Partner, Sjätte AP-fonden, and Ernströmgruppen sold a 4.9% stake in the company to Creades for $13.5 million on April 28, 2017. The post-deal valuation of the firm was $274.09 million.

MDSave, an operator of an online healthcare transactional platform, raised $4.82 million of venture funding from undisclosed investors on June 1, 2018. Previously, the company received an undisclosed amount of debt financing from Comerica Bank on September 18, 2017. MDSave works to lower healthcare cost by offering patients clear upfront pricing from quality physicians.

Kakehashi, a provider of an electronic medication history system connecting medical treatment and patients, raised $8 million of Series A venture funding from ITOCHU Technology Ventures, GE Ventures, and Salesforce Ventures on May 14, 2018. The company’s SaaS-based system stores all information related to a health insurance claim and a patient’s drug history management.

The post How Digital Startups Are Besting Brick-and-Mortar Pharmacies appeared first on Karma Impact.

Key Market Movements

1Mg, a platform offering an online pharmacy and health application that tells users about their medicines, their substitutes, and side effects, raised an undisclosed amount of venture funding on April 27, 2018, valuing the company at $75 million. Previously, the company raised $15 million of Series C venture funding in a deal led by HBM Healthcare Investments on July 27, 2017. In addition to keeping patients knowledgeable about their medication, the platform also provides regular health tips, online medication orders, and booking services for health tests and packages at local certified labs.

CVS struck a deal with the U.S. Postal Service to pick up prescriptions at CVS stores and bring them to customers’ homes in 1-2 days. Customers will be charged $4.99 per delivery, which could include over-the-counter products such as aspirin as well.

Zipdrug, a provider of an online application that provides medication delivery to homes and offices, raised $600,000 of seed funding from Notation Capital, Collaborative Fund, and Red Sea Ventures on July 14, 2017.

Hims, a provider of wellness products intended to offer hair loss prevention medicines for men, raised $50 million of Series B2 venture funding in a deal led by IVP on June 28, 2018, putting the company’s pre-money valuation at $450 million. Thrive Capital, Forerunner Ventures, SV Angel, Redpoint Ventures, Founders Fund, and CAVU Venture Partners also participated in the round.

Apotea, an online full-scale pharmacy store. Stampen Media Partner, Sjätte AP-fonden, and Ernströmgruppen sold a 4.9% stake in the company to Creades for $13.5 million on April 28, 2017. The post-deal valuation of the firm was $274.09 million.

MDSave, an operator of an online healthcare transactional platform, raised $4.82 million of venture funding from undisclosed investors on June 1, 2018. Previously, the company received an undisclosed amount of debt financing from Comerica Bank on September 18, 2017. MDSave works to lower healthcare cost by offering patients clear upfront pricing from quality physicians.

Kakehashi, a provider of an electronic medication history system connecting medical treatment and patients, raised $8 million of Series A venture funding from ITOCHU Technology Ventures, GE Ventures, and Salesforce Ventures on May 14, 2018. The company’s SaaS-based system stores all information related to a health insurance claim and a patient’s drug history management.

The post Regulation Is Still a Hurdle for Pharmaceutical Innovation appeared first on Karma Impact.

Just as in banking and finance, millennials are demanding new, more client-centered approaches across a range of healthcare services, giving rise to offerings that are more patient-centric, flexible, adaptive, transparent, and cost-effective. Because they gravitate towards optimal customer experiences, millennials represent inroads for innovative healthtech companies to seize market share in a market long dominated by national health services and large-scale providers.

As healthtech innovators decentralize the marketplace, patients’ control of their healthcare is growing. This includes more direct control of an estimated 1,000 exabytes of global healthcare data, which is expected to double by 2020. A path to making our personal data safely available for far-reaching R&D is possible for the first time. Blockchain technology will allow research AI to curate and parse our health data even as it remains our private property. Powerful research algorithms will access vast stores of global health data, accelerating research, drug development, and treatment.

The curation and sifting of healthcare data is where companies like Tempus are planning to radically improve patient outcomes. Tempus has created a clinical and molecular data library designed to accelerate cancer research. The goal is to personalize and optimize treatments through data analytics and machine learning algorithms. Genomic tests will analyze cancer tumors, DNA, RNA, and proteomic data, creating treatment options tailored to each and every patient.

In health insurance, wearable tech designed to harvest and upload our vital health statistics in real time to health data analytics in the cloud is driving new and powerful models of preventative care. Annual checkups, which take place every one or two years, if at all, will become a thing of the past. By predicting potential health crises like strokes or cancer and consequently alerting physician intervention much earlier, companies like United Health Care are reshaping patient care. These companies are incentivizing savings in healthcare markets and creating revenue for companies working to reduce hospital stays or eliminate them altogether.

All of this can look very threatening to doctors and hospitals as the traditional gatekeepers of our data, exams, diagnosis, and treatment. A successful preventative healthcare model will be vastly more cost-effective, meaning that doctors and hospitals alike may face significant revenue losses.

And the questions don’t end there. What is the role of insurance companies in the management of personal health data? Where will regulatory entities seek to locate the exabyte-churning algorithms that will hold the most personal health data of billions?

Companies like Clover Health who help hospitals and providers reduce costs will do well during what promises to be a challenging realignment. Incumbents will create or acquire preventative care arms in a bid to stay relevant.

The challenges this realignment creates cannot be underestimated. Until major health providers design and then commit fully to a profitable preventative healthcare business model, true decentralization will be elusive. Major players may seek to impede implementation of preventative care infrastructure and policy and maintain their existing crisis care business models, but they will do so at their peril.

Robots vs. Doctors
Human doctors remain central to major treatments and surgery, but even that is changing quickly. The Smart Tissue Autonomous Robot, or STAR, is able to successfully conduct surgeries start to finish and has already proven itself better at cutting and stitching up soft tissues than experienced surgeons, who tended to cause more char and deviated more from the optimal cut line.

While successful STAR surgeries are only being conducted on live pigs, the da Vinci robot has been allowing doctors to do remote surgery on humans for years. In China, an autonomous dental surgery robot has successfully 3D printed and fitted dental implants in a volunteer’s mouth.

The short-term result is a growing partnership between human surgeons and automated surgical systems, but the developers of STAR are intent on making autonomous robotic surgery a reality. Ultimately, it will come down to costs, errors, and efficiency — a contest that all too many human surgeons will lose.

Healthcare innovation, driven by potent new technologies, represents a major threat to incumbent healthcare providers. The coming contest between human and robotic surgeons, as well as the tensions between crisis versus preventative care models, ultimately become moot, leapfrogged by a revolution in AI-assisted research, design, surgery, and treatment.

The Flow of Capital
The flow of capital into healthtech has grown dramatically. Global private equity investments in the healthcare sector breached historic highs in 2017 reaching $43B, a roughly 20 percent increase over the $36B deal volume registered in 2016. While investments from the U.S. and North America declined from $28.4B in 2016 to $22.1B in 2017, advancements were offset by robust investment growth in Europe and Asia. EU private equity investments in 2017 almost tripled to $12.8B relative to the $4.6B registered in 2016. Similarly, Asian private equity investments more than doubled in 2017 to $7.2B from $3.2B in 2016.

While there was significant pullback in U.S. and North American private equity investments in 2017 in terms of total disclosed deal value, the interest in PE deals appears to be fairly robust. In 2017, 130 PE dealswere struck in the region — the highest level since 2010. The decline in deal volume appears to be owed to a combination of factors including persistent uncertainty surrounding the legislative process, robust competition in a relatively well-developed PE market, and historically high valuations as a result of the extended bull market run in U.S. financial markets.

PE investors in the U.S. appear to bet big on the synergies created by the consolidation of medical practices in regional markets and a marked shift of the sector towards providing lower-cost non-hospital-based care. Another key sector that captured the imagination of North American PE investors was pharmaceuticals, which accounted for 38 percent of the total PE deal volume. The largest deal of 2017 was the acquisition of Parexel International by Pamplona Capital Management for $5B. Paraxel International is a contract research organization that focuses on the biopharma sector.

Healthtech Opportunities
Artificial intelligence is the buzzword in the entrepreneurial healthtech space. AI and machine learning are particularly well-suited to curating and interpreting massive, previously incompatible pools of research data — and doing so quickly.

AI-driven drug discovery platforms like Innoplexus, an end-to-end platform for life sciences research, use artificial intelligence to generate smart data and insights to assist in the discovery, clinical development, and regulatory compliance of pharmaceutical medicine.

AI-based diagnostics as a first-tier of clinical diagnostics are already entering the marketplace. How good are healthcare diagnostics? In July of 2018, Babylon Health announced its AI had demonstrated diagnostic ability on par with human doctors, after scoring 81 percent in a Membership of the Royal College of General Practitioners (MRCGP) exam in its first sitting. Although the results of Babylon Health’s AI test await a more strenuous peer-reviewed process, the promise of diagnostic AIs is already clear.

Big players partnering with agile startups represent a significant growth driver. Far from resisting innovation and decentralization, Johnson & Johnson is investing in an incubator platform to lure healthtech innovators into partnerships. In July 2018, the U.K.’s highly successful Medopadopened a base in New York City as part of Johnson & Johnson’s incubator platform JLABS.

Conclusions
The scale of realignment required by the healthtech revolution is unparalleled. The transition from a crisis care model to a truly dynamic preventative model will challenge the revenue models of doctors and hospitals alike. Incumbents, with the most invested in legacy crisis care models, aging infrastructure, and outdated IT, will seek to realign their business model by aggressively acquiring or partnering with healthtech innovators.

However, until the industry aligns with a data-driven model of preventative care, power will not fully shift to patients, but instead remain fragmented among insurers, incumbent healthcare providers, and legacy segments of the industry that will continue to treat patients under the waning crisis care model.

The post Cutting Costs and Wait Times with Digital Medical Care Services appeared first on Karma Impact.

Just as in banking and finance, millennials are demanding new, more client-centered approaches across a range of healthcare services, giving rise to offerings that are more patient-centric, flexible, adaptive, transparent, and cost-effective. Because they gravitate towards optimal customer experiences, millennials represent inroads for innovative healthtech companies to seize market share in a market long dominated by national health services and large-scale providers.

As healthtech innovators decentralize the marketplace, patients’ control of their healthcare is growing. This includes more direct control of an estimated 1,000 exabytes of global healthcare data, which is expected to double by 2020. A path to making our personal data safely available for far-reaching R&D is possible for the first time. Blockchain technology will allow research AI to curate and parse our health data even as it remains our private property. Powerful research algorithms will access vast stores of global health data, accelerating research, drug development, and treatment.

The curation and sifting of healthcare data is where companies like Tempus are planning to radically improve patient outcomes. Tempus has created a clinical and molecular data library designed to accelerate cancer research. The goal is to personalize and optimize treatments through data analytics and machine learning algorithms. Genomic tests will analyze cancer tumors, DNA, RNA, and proteomic data, creating treatment options tailored to each and every patient.

In health insurance, wearable tech designed to harvest and upload our vital health statistics in real time to health data analytics in the cloud is driving new and powerful models of preventative care. Annual checkups, which take place every one or two years, if at all, will become a thing of the past. By predicting potential health crises like strokes or cancer and consequently alerting physician intervention much earlier, companies like United Health Care are reshaping patient care. These companies are incentivizing savings in healthcare markets and creating revenue for companies working to reduce hospital stays or eliminate them altogether.

All of this can look very threatening to doctors and hospitals as the traditional gatekeepers of our data, exams, diagnosis, and treatment. A successful preventative healthcare model will be vastly more cost-effective, meaning that doctors and hospitals alike may face significant revenue losses.

And the questions don’t end there. What is the role of insurance companies in the management of personal health data? Where will regulatory entities seek to locate the exabyte-churning algorithms that will hold the most personal health data of billions?

Companies like Clover Health who help hospitals and providers reduce costs will do well during what promises to be a challenging realignment. Incumbents will create or acquire preventative care arms in a bid to stay relevant.

The challenges this realignment creates cannot be underestimated. Until major health providers design and then commit fully to a profitable preventative healthcare business model, true decentralization will be elusive. Major players may seek to impede implementation of preventative care infrastructure and policy and maintain their existing crisis care business models, but they will do so at their peril.

Robots vs. Doctors
Human doctors remain central to major treatments and surgery, but even that is changing quickly. The Smart Tissue Autonomous Robot, or STAR, is able to successfully conduct surgeries start to finish and has already proven itself better at cutting and stitching up soft tissues than experienced surgeons, who tended to cause more char and deviated more from the optimal cut line.

While successful STAR surgeries are only being conducted on live pigs, the da Vinci robot has been allowing doctors to do remote surgery on humans for years. In China, an autonomous dental surgery robot has successfully 3D printed and fitted dental implants in a volunteer’s mouth.

The short-term result is a growing partnership between human surgeons and automated surgical systems, but the developers of STAR are intent on making autonomous robotic surgery a reality. Ultimately, it will come down to costs, errors, and efficiency — a contest that all too many human surgeons will lose.

Healthcare innovation, driven by potent new technologies, represents a major threat to incumbent healthcare providers. The coming contest between human and robotic surgeons, as well as the tensions between crisis versus preventative care models, ultimately become moot, leapfrogged by a revolution in AI-assisted research, design, surgery, and treatment.

The Flow of Capital
The flow of capital into healthtech has grown dramatically. Global private equity investments in the healthcare sector breached historic highs in 2017 reaching $43B, a roughly 20 percent increase over the $36B deal volume registered in 2016. While investments from the U.S. and North America declined from $28.4B in 2016 to $22.1B in 2017, advancements were offset by robust investment growth in Europe and Asia. EU private equity investments in 2017 almost tripled to $12.8B relative to the $4.6B registered in 2016. Similarly, Asian private equity investments more than doubled in 2017 to $7.2B from $3.2B in 2016.

While there was significant pullback in U.S. and North American private equity investments in 2017 in terms of total disclosed deal value, the interest in PE deals appears to be fairly robust. In 2017, 130 PE dealswere struck in the region — the highest level since 2010. The decline in deal volume appears to be owed to a combination of factors including persistent uncertainty surrounding the legislative process, robust competition in a relatively well-developed PE market, and historically high valuations as a result of the extended bull market run in U.S. financial markets.

PE investors in the U.S. appear to bet big on the synergies created by the consolidation of medical practices in regional markets and a marked shift of the sector towards providing lower-cost non-hospital-based care. Another key sector that captured the imagination of North American PE investors was pharmaceuticals, which accounted for 38 percent of the total PE deal volume. The largest deal of 2017 was the acquisition of Parexel International by Pamplona Capital Management for $5B. Paraxel International is a contract research organization that focuses on the biopharma sector.

Healthtech Opportunities
Artificial intelligence is the buzzword in the entrepreneurial healthtech space. AI and machine learning are particularly well-suited to curating and interpreting massive, previously incompatible pools of research data — and doing so quickly.

AI-driven drug discovery platforms like Innoplexus, an end-to-end platform for life sciences research, use artificial intelligence to generate smart data and insights to assist in the discovery, clinical development, and regulatory compliance of pharmaceutical medicine.

AI-based diagnostics as a first-tier of clinical diagnostics are already entering the marketplace. How good are healthcare diagnostics? In July of 2018, Babylon Health announced its AI had demonstrated diagnostic ability on par with human doctors, after scoring 81 percent in a Membership of the Royal College of General Practitioners (MRCGP) exam in its first sitting. Although the results of Babylon Health’s AI test await a more strenuous peer-reviewed process, the promise of diagnostic AIs is already clear.

Big players partnering with agile startups represent a significant growth driver. Far from resisting innovation and decentralization, Johnson & Johnson is investing in an incubator platform to lure healthtech innovators into partnerships. In July 2018, the U.K.’s highly successful Medopadopened a base in New York City as part of Johnson & Johnson’s incubator platform JLABS.

Conclusions
The scale of realignment required by the healthtech revolution is unparalleled. The transition from a crisis care model to a truly dynamic preventative model will challenge the revenue models of doctors and hospitals alike. Incumbents, with the most invested in legacy crisis care models, aging infrastructure, and outdated IT, will seek to realign their business model by aggressively acquiring or partnering with healthtech innovators.

However, until the industry aligns with a data-driven model of preventative care, power will not fully shift to patients, but instead remain fragmented among insurers, incumbent healthcare providers, and legacy segments of the industry that will continue to treat patients under the waning crisis care model.

The post Is It Ethical to Personalize Consumer Products Using DNA? appeared first on Karma Impact.