Saturday, March 10, 2012

Health Care Venture Capital Shift

Thus times do shift, each thing his turn does hold; New things succeed, as former things grow old.

Robert Herrick (1591-1674), Ceremonies for Candlemass Eve

March 10, 2012 - From my perch as a health reform and innovation watcher, the shift is palpable. As health costs grow, as technologies increase rather than decrease costs, and as government, private payers, and patients look at new ways to save money, venture capitalists are shifting attention and investments to cost-reducing services and technologies.

Here are a few examples, drawn from my own experience and other sources.

• Shape Medical Systems, St. Paul, Minnesota – Markets a low cost, small, portable, no risk device that serves as substitute and supplement to bulky high coronary treadmills, differentiates between dyspnea from coronary and pulmonary causes of dyspnea, and predicts outcomes and responses to drugs.

• InstantMedicalHistory. com, Raleigh, North Carolina, has developed and marketed clinical algorithm system that allows patients to enter online their complaints, histories, and symptoms from home and reception areas, and generate a narrative history before seeing the doctor, thereby saving patients and physicians time and money.

• Practice Fusion, Inc., San Francisco, California, markets a highly-rated “free” electronic health record for physicians that qualifies for “meaningful use” financial incentives at no cost to physicians and requires no in-office installation because computing is done in the “cloud” by Internet browsers.

• Castlight Health, Inc., San Francisco, California is a technology company that allows patients to choose cheapest health care.

• Catheter Connections, Inc, Salt Lake City, Utah, has developed an infection-free catheter that decreases costs for hospitals.

• Edwards Lifesciences, Inc, Irving, California, has developed sapien valve for patients too sick to undergo open heart surgery.

• ZocDoc, Inc, New York City and elsewhere, a free service that allows patients to find and book doctor appointments.

• Essence Group Holding Company, Inc., St. Louis, Missouri, a laboratory for invests in software and services that helps develop data and services that save money.

• Advo-Caring, Inc., Warwick, Rhode Island and Boston, helps high-end individuals and company executives, find care and counseling for elderly parents and employees.


1) Medinnovation blog – type in "venture capital" in search box and previous blogs on venture capital will appear.

2) “Forget The Robots: Venture Capitalists Change Their Health Care Investments,” KQED, March 9, 2012

3) “Health Investors' New Calculus: Save Money to Make Money,” Kaiser Health News, March 9, 2012

Tweet: Venture capitalists shift strategy by investing in firms that save money rather than make money for patients, doctors, and health system.

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