Although AI is thought to be in its infancy, it is already changing the way we think about health care. Expectations are high about AI and at the speed that it is moving it brings hope in many areas of health care. The Seattle Health Innovation Meetup group’s next event is Thursday September 13 at 4pm at the Cambia Grove and will focus on how AI might – or might not- change how healthcare is delivered. Please pre-register at this link.
Join these speakers from the Allen Institute Artificial Intelligence Incubator, KenSci, and CuraCloud as we explore the possibilities with those who are using this technology for patients, providers, payors, and researchers.
This is the kickoff to our 2018-19 season of events. We will give you, the audience, an opportunity to announce your projects in progress or services that could be helpful to others.
Can’t attend in person? Join our livestream at:
Lauren Krainski is a Partner at the Allen Institute for Artificial Intelligence (AI2) start-up Incubator. The AI2 incubator helps early stage start-ups, entrepreneurs, and corporate partners build large, AI-first companies that solve high-impact problems. Prior to AI2, she advised start-ups and enterprises in M&A, business development, technology commercialization, and other C-level engagements through multiple management consulting and investment banking roles.
Ankur M. Teredesai, Ph.D., is the co-founder and Chief Technology Officer of KenSci. He also holds a Professorship in Computer Science & Systems at the University of Washington. His research spans data science with its applications for societal impact in healthcare. Teredesai has significant industry experience, having held various positions at C-DAC Pune, Microsoft Research, IBM T.J. Watson Labs, and a variety of technology startups. He has published over 75 papers on machine learning, has managed large teams of data scientists and engineers, and deployed data science solutions in healthcare. His recent applied research contributions include cost and risk prediction for readmission due to chronic conditions such as congestive heart failure.
Ed Butler is Vice President, Marketing and Corporate Development, CuraCloud Corporation, a Seattle startup that provides AI-enabled medical imaging analytics and genomic testing protocols to healthcare providers and researchers. Ed has been a senior advisor to hospitals, health plans, and government agencies including IDX Systems and GE Healthcare in the US and the NHS in England.
4-4:30: Happy (half) hour, check-in, light refreshments
4:30-4:45: Spontaneous Participation: We will have an opportunity for you to share what you are working on or ask others to join you in moving your innovation forward. Any topic, not just AI! The purpose of this informal super-quick stand-up is to connect people who have ideas to those who can help them. Any idea is welcome, however far along it is!
4:45-5:45: Panel discussion
5:45-6:00: Adjourn and networking
Hope to see you there for great conversation, snacks, and action!
Please RSVP but you can always come last minute & pay at the door too!
**Parking in the 1800 9th building garage is now only $10 after 3pm! **
Evidence of the increasing maturity of Seattle’s health innovation community was on full display at the Annual Health Innovation NW Awards Night held at the Cambia Grove on December 14, 2017. This was the third year of the annual health innovation awards program. This program is designed to celebrate the heroes among us who exemplify exceptional performance in traits necessary for successful innovation: Imagination, Customer-centered, Collaboration, and Perseverance. Separate awards were made ito individuals Startups, Institutions, and Community Non-Profit sectors. Over 100 people came out to celebrate the accomplishments of 2017 and to prepare for another great year.
The awardees in the Imagination category:
Institutional sector: Tonya Palermo, PhD, from Seattle Children’s Research Institute
Community Non-profit sector: Suzanne Gwynn, Ladybug House
Startup sector: Mike Van Snellenberg, Wellpepper
The awardees in the Customer-centered category:
Institutional sector: Vince Barrailler, Washington Health Benefit Exchange
Startup Sector: Cassie Wallender
Awardees in the Collaboration category:
Institutional sector: Michael McClain, MD, First Hill Surgery Center
Public Health sector: Hanna Oltean
Startup sector: Avadhut Joshi, Translational Software
Awardees in the perseverance category:
Institutional sector: Tony Blau MD, UW Principal Investigator ITOMIC trial and All4Cure
Community Non-profit sector: Dellann Elliott Mydland, The EndBrainCancer Initiative
Startup Sector: Chris Wood, Clario Medical Imaging
2017 Seattle Health Innovators President’s Awards
This year in addition to the annual Health Innovator of the Year awards for exemplary traits shown above, the Board also designated four President’s Awards for innovation in four areas of great interest in the coming year:
Regulatory Science Innovation
Shawn Swanson, MedsForAll
Pain Management Innovation
Zachary Fisk MD, Anesthesiologist
Patient-Centered Care Innovation
Tony Quang, MD, JD Associate Professor of Radiation Oncology, UW, VA
Regulatory Science Innovation
Dema Poppa, Invio
For more information about these awardees and the 2017 Health Innovator of the Year Awards Program please see the agenda from the event: Health Innovator Awards 2017 presentation 20171214 2000 pdf
Health Innovation NW
Health Innovation NW is a Washington State non-profit corporation dedicated to building a supportive community of individuals interested in transforming health and healthcare. We grew from the Seattle Health Innovation Forum meetup group, founded in 2013, that has over 1,700 members.
Dear Health Innovation Colleague,
Nominate the 3rd Annual Health Innovator of the Year for 2017 here (Google form).
Nomination should only take approx 20 minutes of your time and can be completed on a computer, tablet or phone.
This award is for your peers, your teammates, your collaborators, your staff!
The Seattle Health Innovator of the Year Awards are intended to recognize and encourage individuals who engage in the hard work of driving progress in health and health care. We recognize that progress comes from both innovative ideas and exceptional execution by individuals. These awards are for our colleagues whose efforts we respect and whose examples we want to see more of. We want to encourage innovation in healthcare delivery, life sciences, population health, and new ways of financing health services.
Who has changed your way of thinking, over the past year?
2017 Awards will be made in each of the following categories:
Imagination: This category is to recognize individual achievement in conceiving new ways of solving problems in the health sector via new methods, ideas, products, services, or business models.
Perseverance: This category is to recognize individual achievement in demonstrating tenacity over time in the face of adversity and in transforming health innovation challenges into opportunities.
Customer-focus: This category is to recognize an individual member of an innovation team who maintains focus on the customer and builds deep, long-term relationships by better understanding, anticipating, and fulfilling stated and latent customer needs.
External collaboration: This category is to recognize an individual who has put aside organizational boundaries and has established effective relationships with innovators in other companies.
Nominees must be individuals with a genuine connection to the Greater Seattle Area (broadly construed as Western Washington) involved in health innovation. Nominees may be from care delivery, health and wellness, health IT, life sciences, payers/purchasers etc.
Now’s your chance! Nominate the next Innovator of the Year here.
Nominations are due by Wednesday, November 22. Winners will be announced at the Seattle Health Innovators Holiday Gathering on Thursday Dec 14.
You are invited: register for the 2017 Health Innovation NW Holiday Party at this link.
Health Innovation NW
Health Innovation NW is a Washington non-profit corporation. Our mission is to empower individual change agents in health and life sciences to connect, to educate the community, and to directly advance health innovation.
The Seattle Health Innovators Forum held its Holiday Party and Awards Night December 9, 2015 at the SURF Incubator in the Wells Fargo Center, attended by about 70 participants. This event brought a festive conclusion to an eventful year in the health innovation community in Western Washington. The community of innovators here is local but the innovations we are working on are often global in scale.
The Seattle Health Innovators Forum began in May of 2013, growing from a hotbed of health startups in and around Seattle. Its leadership consists of committees of volunteers who organize an average of 6 forums a year and other projects. Our 2015 forums included topics such as telehealth, the health regulatory climate, population health, precision medicine, measuring the impact of Seattle’s health innovation economy, and the Health Innovators Awards Night. Our membership of nearly 1000 people includes healthcare professionals, entrepreneurs, investors, product developers, freelancers, and others interested in the transformation of health and health care.
The 2015 Health Innovator of the Year Awards Program
2015 is the first year for this program. We announced a “Call for Nominations” in November aimed at grass-roots innovators, individuals who are active within startups, non-profits, payers, and health institutions. We identified 4 attributes of successful innovation: Imagination, Customer-centeredness, Perseverance, and Collaboration.
We received a strong response to the call, with over 35 nomination forms received in less than 4 weeks for a panel of high-quality nominees. We convened an team of respected health innovation professionals to review the nomination forms and select two awardees for each category.
Awardees for the Imagination Category
The Health Innovators of the Year for the Imagination category were awarded to Jeremy Stone, MD and Swatee Surve.
Jeremy Stone MD, MBA
Dr. Jeremy Stone is a Seattle-based physician entrepreneur with deep experience in the financial sector. He is pioneering a new approach to financing healthcare improvements, such as processes to improve post-operative wound care. He has applied a financial instrument, a performance based bond, to the healthcare sector. These “Health Innovation Bonds” can be used to securitize health outcomes. He has assembled a unique team and global advisors for this innovation. Dr. Stone was in London during the Awards ceremony and was represented by Mark Gardiner to receive the award.
Swatee Surve, MBA
Swatee Surve is the Founder and CEO of Litesprite. This is an innovative approach to mental health using games to kindly teach people skills that they can use to deal with stress, depression, and anxiety. Swatee also organized the recent Healthcare track of the Seattle Startup Week, the first time such a track has been part of this annual tradition. Swatee is a frequent panelist on such topics as behavioral health and women in technology leadership, and holds several patents on the disposition of electric currents on fibers and other materials.
Awardees for the Customer-centered Category
Our emphasis in the Customer-Centered category was for people who develop deep relationships with their customers so that they can understand their problems and develop predictive insights as to what their needs are. The Health Innovators of the Year for the Customer Centered category were awarded to Houda Hashad and J.W. Beard MD.
Houda Hachad, PharmD
Houda Hachad is the Chief Science Officer at Translational Software, whose customers are clinical labs who do pharmacogenomic ((PGx) testing. One of her nominators is a customer who said this of her: “Her deep knowledge of not only the clinical aspects of PGx testing, but also the molecular underpinnings of the assays was paramount in guiding our efforts. It is very rare in our business that one can find an individual who has mastered both aspects pertaining to molecular medicine. Furthermore, her understanding of which molecular markers were on the horizon in terms of clinical utility allowed us to shape our existing menu and plan for future tests. Houda’s expertise in pharmacogenetics and pharmacology is complimented by her ability to clearly communicate the important issues pertaining to these complex fields and eloquently answer difficult questions. From a customer support perspective, she has always made herself available at critical moments, to the point where we consider her as an extended team member.”
J.W. Beard, MD
JW Beard MD is a practicing Anesthesiologist and is the Founder and CEO of Monitor Mask Inc. As an anesthesiologist he knows first-hand about frustrations of others in his field when having to jerry-rig 20M basic oxygen face masks to provide a means for sampling the patients’ exhaled CO2 during sedation anesthesia. This vital measurement is mandated by the Standards of Care in the USA, Canada and UK but the market has simply not provided a suitable solution. He designed, tested, patented, and has successfully brought to market a new face mask for this important measurement, It is currently marketed as the CapnoVue M1 face mask.
Awardees for the Collaboration Category
Our emphasis for the Collaboration category this year was inter-organizational collaboration. One of the reasons health innovation is so difficult is that it takes innovators working within established organizations to reach out across organizational boundaries to solve important health problems. The 2015 Health Innovators of the Year for the Collaboration category were awarded to Col. David McCune MD and to Steven Friend, MD PhD.
Col David McCune, MD
Col. David McCune MD is a research consultant with the Western Region Medical Command (WRMC) with the US Army. He has been an effective spokesperson to increase public awareness of the Army’s clinical research program. He is focused on the quantity and quality of clinical trials which advance the health of US soldiers, spouses, dependents, and retirees. In 2015 Dr. McCune has appeared at multiple forums by the Washington Biotechnical and Biomedical Association and the Cambia Grove to inform the health innovation community of the research needs of these populations. He then followed up to help connect selected innovative Seattle area health startups with related research opportunities.
Steven Friend, MD PhD
Steven Friend MD PhD the founder of Sage Bionetworks, a Seattle-based non-profit organization founded in 2009, that provides the tools and environment to conduct dynamic, large-scale biomedical research transparently and collaboratively. In 2015 he led an effort to create an open ecosystem for health data acquired via mobile apps. Working jointly with Apple and Sage, Stephen led efforts that resulted in the open-source Research Kit (Apple) and Bridge / Synapse (Sage) technology platforms, and in the launch of an initial set of 5 Research Kit apps in Parkinson Disease (Sage), Breast Cancer (Sage), Asthma (Mt Sinai School of Medicine), Diabetes (Mass General Hospital), and Cardiovascular Disease (Stanford). As part of this effort, Stephen worked to coordinate a diverse set of collaborators across a variety of organizations, often putting the interests of other organizations ahead of his own. Dr. Friend was unable to attend the Awards night due to illness and was represented by Mike Kellen PhD, from Sage Bionetworks.
Awardees for the Perseverance Category
Innovating in the health industry is not for the impatient. It takes years to develop a solution and bring it to market. Entrepreneurs and other innovators in this sector must learn to deal with both successes and failures, technical and financial hardships, and the ups and downs from working through complex organizations. Some manage to do this with grace and as a result produce high quality output over time.The Health Innovators of the Year for the Perseverance category were awarded to Brandon Masterson and Mary Fenske.
Brandon Masterson is the Founder and CEO of 2Morrow Inc, a mobile health company offering behavior change programs for such conditions as smoking cessation and the creation of healthy habits. Founded in 2011, Brandon and his co-founder Jo Masterson mortgaged their home to self-fund this project for several years while they developed initial customers, won the Surgeon Generals design competition, and collaborated on the smoking cessation program with scientists at the Fred Hutchinson Institute. Brandon has the ability to take on complex problems that seem too hard, and break them into small chunks. This skill has been extremely useful during the startup phase of 2Morrow when challenges are common and resources are limited. It is easy to get discouraged. This makes Brandon an effective startup leader in the mHealth space, where the fast-moving tech industry meets the slower moving, more conservative healthcare industry. His general advice to others, and his company’s credo, is to have “big ears, thick skin and an open mind.”
Mary Fenske is the Founder of Posture Wings, a garment designed to place the body in good posture position with freedom of movement. This changes the biomechanics that can result in neck and shoulder pain. She designed, tested, patented this innovative garment and has persevered for 8 years to bring it to market. In 2006 she started work on this, was awarded a utility patent in 2011, She’s had lots of near-wins with licensing agreements and has continued to move forward despite these setbacks. She believes there remains a void in today’s market, even with the boom in wearable technology and continues to work towards a distribution deal through large scale retail and marketing organizations.
Special Recognition for “Up-and-Comers”
The Evaluation Committee for this year’s Health Innovators of the Year Awards worked through the weekend and into Tuesday evening to finalize the selection process. In the course of reviewing individual nomination forms a consensus grew around two nominees whose work in health innovation deserved an honorable mention for their fresh and creative approaches as, for lack of a better term, “Up-and-Comers”. These individuals are Corinne Pascale Stroum and Melissa DeCapua.
Corinne Pascale Stroum
Corinne is a Senior Program Manager at Caradigm on the Health Care Analytics Team. She is also the Founder of Oy, My Genes!, an innovative way for people to learn of disease risks discoverable through the 23andMe genetic test. When the FDA shut down 23andMe’s service to provide this information to consumers back in November 2013, Corinne developed and brought to market a website that allowed consumers with 23andMe credentials to submit them through her service so that consumers could still learn their risk factors for certain conditions relevant to Ashkenazi Jews. She is an active inventor and we expect to hear more from her in the coming years.
Melissa DeCapua, DNP, PMHNP
Dr. Melissa DeCapua is a board-certified psychiatric nurse practitioner. Her background includes child and adolescent psychiatry as well as psychosomatic medicine. Her nominator said of her “In February, she published a prophetic article describing seven novel ways that the Microsoft Hololens will transform healthcare from nursing education to disaster training. The article quickly caught fire on social media, pushing people to rethink the role of both patient and clinician in a future world where holographic technology more seamlessly bridges the gap to recovery. In March, she joined Seattle-based startup MedBridge as Healthcare Strategist and has since led a new product vision that combines patient data visualizations and educational interventions to improve patient outcomes. Melissa has served as Advisor for yet another fast-growing startup, Point Nurse. Melissa has done all of this and more while earning her Doctor of Nursing Practice in June and is continuing to be an active voice for healthcare reform through her Modern Nurse blog and guest posts on high-profile platforms like Microsoft in Health“.
The Making of “Seattle Health Innovators Holiday Party and Awards Night”
The event was made possible by a team of volunteers who have been working steadily to build a more supportive health innovation community in the Seattle area for the past few years.
A weekend strategy session in September 2015 was held with about 10 members of the program and research committees to plan future events and set goals for 2016.
Among the ideas to emerge from this session was to launch a Health Innovation Awards night. It would be based on a call for nominations from the community. Key themes were the need to broaden our scope to include projects connecting consumers, investors, and building partnerships. The Awards Program was conceived as a way to stimulate our audience beyond the forums, and to serve as a catalyst for developing deeper connections among the community members, Volunteering to head the effort to organize a Holiday Party and Awards Night was Chelsea Steinborn.
Chelsea served as the project manager for the event and as the master of ceremonies. Chelsea is a biomedical engineer, a recent UW Masters in Health Administration graduate, and is now a project manager with the Virginia Mason Research Institute. She played a leadership role in organizing three of our Health Innovation Forums in 2015. Joining Chelsea on the planning team for the Holiday Party were Grace Agustin, Ed Butler, and Kathryn Brown.
Grace Agustin is a Laboratory Information System manager at UW Medicine/Northwest Hospital and is active in Women in Bio and other community groups as well as the Seattle Health Innovators. She has provided support to many of our events. She was invited to join the Health Innovators program committee in 2015.
The 2015 Awards Evaluation Team
A team of experienced and impartial evaluators was formed to review the 2015 nominations. The following profiles provide a glimpse into the background of those who made the difficult evaluations leading to the 2015 awards. Each of the individuals on this team abstained from nominator and nominee roles for this year’s these awards.
Kathryn Brown, PharmD
Kathy Brown was an early and consistent member of the Seattle Health Innovators leadership group. She is a former VP of Pharmacy at Group Health, and is currently a Director of Pharmacy and Integrated Health at Premera and is a Clinical Assistant Professor at the University of Washington. She, along with Scott Kennedy organized the successful Population Health Management Forum in June 1015.
Ed Butler is the co-founder and CEO of Videris Health, a company focused on the needs of cancer patients. He is also is the founder of Agate Point. Ed, along with Jessica Chao, organized the Seattle Heatlh Innovation Forum meetup group in May 2013. Ed was formerly a senior product strategy manager at GE Healthcare, product strategy director and principal engineer at IDX Systems, and a former CIO for the Virginia Medicaid Program.
Brady Ryan is a Commercialization Manager for the Washington Biotechnology and Biomedical Association. Formerly he was a project manager for the WINGS angel investment group that focuses on the health and life sciences sector. Brady has been active in the Seattle Health Innovators since the summer of 2013 and has helped build bridges across the life sciences and health IT communities.
Scott Kennedy, CPA, CHFP
Scott Kennedy is a founding member of the Seattle Health Innovators and has been a consistent participant and member of the leadership team. Formerly an associate director of Finance with Group Health for 19 years, Scott now serves as Controller at the Polyclinic. Scott is also active in the Healthcare Financial Management Association. Scott and Kathy Brown organized the Seattle Health Innovators Population Health Management Forum last June.
Kristin Helps, RN
Kristin Helps is an active post anesthesia care nurse and regularly works shifts at several of Seattle’s hospitals while she completes her MS in Clinical Informatics from the UW. There she is doing research for user adoption of a mobile post surgery wound evaluation app. She is a clinical consultant with Wellpepper, a Seattle-based digital health startup. Kristin was elected to the UW graduate school student government representing 15,000 students in 2014.
John Foy, MD, PhD
John Foy is an independent senior level medical informatics consultant. His career in Medicine and Computer Science reaches back to the 1970s at NIH in the early days of electronic medical records. Dr. Foy has had an active role in the development of medical informatics over several decades especially as it pertains to electronic medical record systems. He was a director at IDX Systems (formerly PHAMIS) and continued as a senior product strategy manager upon the acquisition of IDX by GE in 2006 in such areas as critical care, clinical documentation, computerized physician order entry, and others. He was a founding member of the Seattle Health Innovation Forum in 2013 and has been a consistent participant and advisor ever since.
Also assisting in the Holiday Party event logistics were Eric Jain, Jo Masterson, Brian Crouch, and other volunteers. Thanks to Seaton and Candace Gras for their flexible terms in making the SURF venue available to this community. SURF has been a continuing supporter of this community since 2013.
More pictures from the Holiday Party and Awards Night
Mary Fenske accepting the Health Innovator of the Year Award for Perseverance.
Houda Hachad and JW Beard receive awards for the Customer Closeness category from Chelsea Steinborn.
Col. David McCune MD receives the Health Innovator of the Year Award for the Collaboration category, followed by Mike Kellen, PhD, nominator and representative of Steven Friend MD PhD.
Swatee Surve accepts Health Innovator of the Year Award for Imagination.
Brandon Masterson, explains how it’s done.
John Foy, on behalf of the evaluation team, surprises Ed Butler with a certificate recognizing his contributions to the Seattle Health Innovation Forum.
Pictured above, from left, are Mark Gardiner, accepting on behalf of Jeremy Stone MD, Brandon Masterson, Col David McCune MD, Mary Fenske, Swatee Surve, Houda Hachad PharmD, JW Beard MD, Mike Kellen PhD, on behalf of Steven Friend MD PhD, and Ed Butler, recognized for contributions to the growth of this forum.
This is the 4th in a series of posts comparing Seattle with other health innovation clusters. We are comparing several cities on a set of criteria of interest to healthcare startups. Katie Smolnycki is a life sciences market consultant who relocated to Seattle in early 2015 and has been a member of the Health Innovator research team. Her post below examines the institutions that can contribute to a vibrant ecosystem for health innovation companies.
By Katie Smolnycki
Continuing on our journey of exploring healthcare innovation hubs, we will examine the various healthcare institutions in Boston, Chicago, New York City, San Francisco, and Seattle. The comparison criteria in this series include the following:
- Cost of doing business – Seattle ranks in the middle.
- Financial capital – Seattle is lowest of the comparison cities in the amount invested in healthcare; 30% of angels are specifically associated with healthcare.
- Human capital –Highest ranked city in our study with the largest share of college grads[i]; hub for technology and sciences.
- Health Institutions- this post.
- Regional culture – to be posted in September.
To explore the institutions in each of these centers of interest, we decided to focus on hospitals, payers, NIH funding, and research institutions.
A competitive healthcare delivery market is favorable for innovators because these systems need to find ways to gain market share. How competitive is Seattle’s healthcare delivery market? To explore this we looked at the American Hospital Directory, which provides statistics for non-federal, short-term, and acute care hospitals in each state with data collected from each hospital’s most recent Medicare cost report[ii]. Compared with the other health innovation hubs, Seattle has the fewest hospitals and the lowest ratio of staffed beds. San Francisco and Boston have approximately the same number of hospitals and the most staffed beds per their population, with around 300 people per one staffed bed.
This suggests that the competitive pressures on Seattle’s hospital systems may be less intense than those cities with higher per capita beds. Concentration of ownership using the Herfindahl-Hirschman Index (HHI) is another method of assessing market competitiveness. The analysis below by David Cutler and Fiona Morton published in the Journal of the American Medical Association in 2013 compares the HHI across the US for hospital referral regions.
Seattle’s hospital referral region is moderately concentrated. This is similar to the markets in Boston, San Francisco, Chicago, and New York City. This suggests that the healthcare delivery market in Seattle is no more competitive, and is perhaps less competitive than the other hubs in our comparison set.
According to a study published by National Association of Insurance Commissioners (NAIC), the top large group insurance companies by market share (ranked largest to smallest) are: United Health Group, Wellpoint Inc. Group, Kaiser Foundation Group, Humana Group, Aetna Group, HCSC Group, Cigna Health Group, Highmark Group, Coventry Corp. Group, and HIP Insurance Group. At least one of top three large group insurers of NY, CA and IL all are represented in the NAIC Top Health Insurance Company report; whereas a main insurer for MA (BCBS of Mass) comes in at 23 and Cambia Health Solutions (the holding company for Regence BlueShield in WA, OR, UT, ID), comes in at 25. Seattle is not the headquarters of a single large national health insurance carrier. Our two Blue carriers, Premera, and Cambia Health Solutions, serve several western states but are not national entities. Group Health Cooperative is Washington-only.
Of the top 10 health insurance companies in the US, one is is headquartered in Chicago, two are in the Bay Area, and three are within commuting distance of the New York Metro area. This suggests that Seattle’s payer community may not have had the resources to provide a launchpad for startups, at least until recently.
Cambia Health Solutions is becoming an important player in the health innovation community in Seattle. Cambia Grove opened in the spring of 2015 providing a community space to bring innovators and entrepreneurs together with stakeholders to find innovative solutions from challenges in health care. They offer a variety of programming geared to helping entrepreneurs connect with the other players in the industry. One program hosted by Cambia Grove in July was a Reverse Pitch event which Evergreen Hospital pitched their problems to innovators in the digital health community.[iii].
NIH Research Funding
Funding of research grants by the NIH is an important part to furthering research in higher education centers, hospitals, and non-profits and for-profits research institutions. In FY2015, the NIH invested nearly $30.3 billion in medical research which allows investigators to come up with new ideas that can help change the world. This was $211 million above FY2014 budget, a 0.7% increase in funding, while FY2016 funding is expected to be $31.3 billion. The NIH main themes for driving discovery and innovation in FY 2015 funding were: today’s basic science for tomorrow’s breakthroughs, precision medicine, big opportunities in big data, and nurturing talent and innovation.
Boston received the most NIH research funding in both FY 2014 and 2015. Boston hospitals receive the most funding from the NIH for hospital research having five out of the top six top NIH funded hospitals[iv]. Hospital funding in Boston makes up almost 50% of the NIH funding received in the area. In the other regions, hospital based NIH funding makes up to 5% of the region’s NIH funds. For medical school NIH funding, NYC area schools (12 schools) receive $1.1 billion in research with Boston and Chicago medical schools (5 and 6 schools respectively) receiving over $400 million of medical school funding. Seattle only has one medical school but receives over $300 million in funding putting the University of Washington in the top five for funding in both FY 2014 and FY 2015.
Of the NIH funding that came to Washington in 2014, the University of Washington received $437 million, followed by Fred Hutch at $222 million, representing 75% of the total. This highlights the crucial importance of the UW and the Hutch in Seattle’s health innovation ecosystem. This ratio is similar to each of the other cities, looking at the top 50 organizations receiving NIH funding.
For more information on financial capital in these regions, please see our financial capital blog post
Life Science and Biotech Institutions
Washington State is home to 567 life science companies and research organizations with a majority of those located in the Greater Seattle area. There are 274 medical device companies, 182 biopharma companies and 92 nonprofit research organizations or academic research centers[v]. These companies combined add $11.4 billion to Washington’s GDP and represent the 5th largest employment sector, with a 12% growth in jobs from 2007 – 2013.
Out of the top 15 pharma companies by 2014 revenue[vi], Seattle is only has ties to three: Sanofi (some manufacturing), Gilead (inflammation/respiratory and hematology/oncology therapeutic areas and clinical research), and Bristol Myers Squibb (Zymogenetics ). In June 2015, Bristol Myers Squibb announced the relocation of the 40 Seattle based research and development jobs to San Francisco, leaving their early manufacturing group (approximately 120 employees) in Seattle[vii]. Amgen had a presence is Seattle until this past year when they closed down their facilities to cut costs. Seattle’s biotech sector is predominately small, early stage companies and some large nonprofit research institutions. For example Juno Therapeutics, an immunotherapeutics company, went public in December 2014 with $265 million IPO and a valuation of more than $3 billion. Juno recently announced a partnership with Celgene for $1 billion to work on the development and commercialization for immunotherapies[viii]. Presage Biosciences, an oncology start-up in Seattle that works to use human efficacy data earlier in drug development, announced August 20, 2015 that they received a strategic undisclosed investment from the venture capital arm of Takeda Pharmaceutical[ix]. About half of Washington’s life science companies are medical device companies, with Philips Healthcare being the largest medical device company located in the Greater Seattle area. Despite Seattle’s lack of large biopharma and medical device companies, there is still potential for collaboration with larger companies.
Seattle’s strong technology industry can help foster growth in the digital health space, as well as innovation in medical devices. In 2014, there was $1.1 billion in transactions across Washington State including IPOs, M&A activity, and venture equity and as of August 2015, there have been $2.5 billion in life science transactions, which is expected to reach $3 billion by the end of 2015. Transactions are approximately 38% medical technology, 31% pharmaceuticals, 23% health IT and 8% other[xi].
Boston, New York City, and San Francisco are home to many of the top biopharma and medical device companies (Johnson and Johnson, Novartis, Roche, Merck, GlaxoSmithKline, AstraZeneca, Bayer, Amgen, and Eli Lilly) and smaller startup companies as well. Chicago is home to fewer top healthcare companies than Boston, NYC, and the Bay Area but is headquarters for few larger companies, such as Abbott Laboratories (AbbVie), Baxter, Takeda (US headquarters), Walgreens, and Allscripts.
The presence of institutions with both the resources and the business drivers to innovate are favorable to health startups. Seattle’s position relative to the comparison cities is not as strong as it could be but still offers ample opportunities for health startups:
1. The healthcare delivery system market in Seattle is similarly concentrated as other cities but the per capita staffed bed ratio suggests that hospital systems here may still lack the existential competitiveness of other cities and may not yet be ready to look outside to the startup community for innovative approaches.
2. The health insurance industry in the Northwest has not been a national launchpad for startups.The recent activities of Cambia Health Solutions is a positive development.
3. NIH funding in Seattle lags Boston, New York, and San Francisco but is still respectable. This provides a critical funding stream and keeps Seattle in the running as an attractive location for health startups. This is mostly due to the influence of the UW and Fred Hutch in attracting federal research funds and spinning off new companies.
4. Seattle has a vibrant community of life sciences organizations that are not as large as those found in Boston and other life sciences hubs. The economic impact of this sector has been strong, with 12% job growth 2007-2013, as the 5th largest employment sector in the state.
According to a study from the University of Washington, “Humans get smart by being around other smart people.” The study describes this trait as the way in which Seattle is currently transforming itself into a hub of human capital, as educated individuals with talent and creativity have been moving into the city for decades. This influx of knowledgeable and skilled individuals is an absolute plus for those interested in achieving innovation and change.
This is the third in a series of blog posts in which we are contrasting Seattle’s health startup environment with other leading hubs for health and life science innovation. Each of these posts focuses on a different location evaluation criterion, including the cost of doing business, the availability of investment, and this week it’s about the availability of talent- the human capital of startups.
The purpose of this series is personal, rather than to create yet one more “top 5” lists. We’re both working on our digital health startups and we are open to locating anywhere in the world that helps us be more successful. While we’re fond of Seattle, our mission is not to promote Seattle. It’s about succeeding in our startups, both of which have co-founders in other major health hubs.
(Pictured: Sean Bell of Arrivale discusses scientific wellness at the Seattle Health Innovation Forum on Precision Medicine, July 2015)
Innovation Happens at the Edges
Just as sparks fly between positive and negatively charged bodies, the juxtaposition of disciplines and industries can produce new insights leading to innovative breakthroughs. The Pacific Northwest in the past 20 years has attracted talent to fuel its need for highly skilled, creative people in these sectors:
- Life sciences
- Software development
- eCommerce and Cloud services
Seattle is listed as one of the top 10 life sciences clusters in the United States, according to the 2014 survey by JLL’s Life Sciences group. According to the Washington Biotechnical and Biomedical Association, 567 life science companies and over 34,000 individuals are directly employed in this segment averaging over $83,000 in salaries (compared with an average $53k in WA).
While that is good news for Seattle, it is worth observing that Boston is #1, San Francisco is #2, and San Diego is #3, Raleigh/Durahm 4th, and the New York/NewJersey megalopolis 5th in that same list of life science clusters. Seattle ranks only 10th on that list. The industrial diversity in Seattle is competitive with these cities, but is not unique. Seattle has unique qualities that we’ll get to in subsequent posts, and is competitive, if not leading, in accessibility of world-class human talent.
Washington state has 90,000 software developers, which are some of the highest paid jobs in the state. Tech employees have a median salary between $100,000 and $140,000 per year, according to the a recent study by the Washington Technology Industry Association.
The Seattle tech knowledge-base has been growing via significant hiring by such new economy leaders as Amazon, Facebook, Google, Tableau, Expedia, Juno Therapeutics, and others. The major players in the rapidly growing cloud computing industry are concentrated in the Pacific Northwest, with Microsoft, Google, and Amazon’s cloud technologists all located in the metro Seattle area, and with low-cost, clean hydro-electric powered data centers in Eastern Washington. Greg Gottesman, of the Madrona Venture Group was quoted in Geekwire as saying “the Pacific Northwest has had an incredible influx of engineers, some to startups and many to bolster the engineering offices of companies that aren’t headquartered here like Google and Facebook,” said Gottesman. “If you believe as I do that top technical talent is the lifeblood of successful startups, I think the trends are very favorable for our region over the next decade.”
The Aerospace industry is a long-time anchor of Pacific Northwest industry. While Boeing has moved its headquarters to Chicago and many of its manufacturing and engineering functions to other parts of the world, others are stepping in, such as Esterline Technologies, Crane Aerospace, Aerojet, Electropact, and others. While the relevance of these industries to health innovation may at first appear remote, the presence of such advanced high-tech companies creates a population of well-insured and educated patients. Healthcare delivery systems in most metro areas must compete to improve quality and reduce costs for self-insured employers.In Seattle this results in fierce competition among delivery systems to maintain an edge. Greg Marchand, Director of Benefits Policy and Strategy for the Boeing Company at a Health Collaborative forum in December 2014. He described their efforts to better manage their $2 billion in annual employee healthcare expenses. The Boeing Accountable Care Organization has created a more competitive model and Boeing has also invested in their own health analytics group to measure improvements.
Health Meetups Compared
We’re seeing this cross-industry innovation interest in the membership growth of the Seattle Health Innovation Meetup, founded two years ago. The group has experienced net growth of 63% in the last 7 months, currently around 850 members, with event attendance between 80-100.
The membership growth in the Seattle Health Innovators can be a useful proxy for the engagement of the community supporting health innovation. While larger than the Boston Health 2.0 chapter, we are still smaller than similar groups in other cities in absolute numbers. The San Francisco-based Health Technology Forum is 2 years older and has 3,439 members, of whom around 150 attend the meetings. The New York City Health 2.0 chapter, founded 7 years ago, has 4,542 members (events draw 73-150).
High in Education Capital
Seattle is also one of the top ten US cities with the largest population of college graduates, making it a destination for educated individuals who are more likely to produce new ideas in every field (CityLab). The city also has a considerable community of individuals going to school in health-related fields The University of Washington’s Seattle campus had an enrollment of 44,158 in 2014, with 240 new students admitted to its reputable medical program every year, and “the Department of Medicine is comprised of 14 Divisions” for hundreds of students working to receive degrees in the field (University of Washington). We also have Seattle University (7,560 students), Seattle Pacific University (3,891) and a variety of community colleges offering health and technology related training.
City-wide Analysis: Seattle and Health Care
Seattle may not yet be at the level of some the other major cities that have become innovation centers for health and medical care, but it is on its way. Advisors and educated individuals inhabit the city while a large population of young, health-conscious people also flock there. It is beneficial to remember Seattle’s potential and for those who are hoping to create and invent new possibilities in the field to consider making Seattle their creative nucleus. More than anything else, the city’s human capital is especially well suited for this type of work, making it a perfect place for innovators, dreamers, and hard workers to create the next big change in healthcare.
Density matters. Seattle is compressed between Lake Washington on the east and Puget Sound, making it a walkable downtown, similar in that respect to San Francisco and New York City, only smaller. The high technology companies east-of-Lake-Washington in the communities of Bellevue, Kirkland and Redmond are within a 30-40 minute bus ride from downtown Seattle of the U District.
Considering Making a Move to a Health Innovation Capital?
Seattle’s health startup community has access to world-class human talent in one of the major hubs of technology and health innovation. If you are looking for a way to share new and big ideas with other like-minded individuals, consider the Emerald City. Our next blog posts in this series will compare the health institutions in the area with other cities, and the culture of innovation.
Angela Hong, CEO Healthy Beeps
Ed Butler, CEO, Videris Health