Building a Safer Digital Health Landscape

Our lives have been going digital since the invention of computers. But even as we enjoy the conveniences that can come with these advances, we are opening doors to threats that never existed before. While hackers might not be interested in your smart refrigerator, they are absolutely interested in breaching the digital systems that we use in every aspect of our lives.


As you’ve no doubt seen, healthcare is especially susceptible to issues related to security. While there are regulations and technology in place to protect this digital infrastructure, hackers are always adapting. It’s therefore critical that the companies in charge of protecting and providing this data stay ahead of their nefarious competition.

Modern Threats

The latest large-scale attack on the healthcare industry occurred when a virus, masked as ransomware, found its way from Eastern Europe all the way to the United States. On the surface, this new virus appeared like the ransomware named “Petya” from 2016 which locked users out of their systems unless they paid a “ransom” to the hacker. Instead, the new virus nicknamed “NotPetya” infiltrated and destroyed files and functionalities.


Companies like Nuance Communications, which stores and transmits both patient and insurance data, were deeply affected by the virus. Rather than helping providers via its Dragon Medical Advisor and Radiology Critical Test Results products, Nuance instead found sensitive information destroyed.

The First Step to Safer Data

Although legislation like HIPAA and HITRUST serve to provide standards for data security, it’s clear by the Nuance attack that legislation alone can only go so far. Practitioners, and the companies that serve them, must also do their part.


The biggest and easiest step to take right now is cooperation, which involves two parts:
The sharing of threat indicators and sound practices will help ensure that the industry can merge its efforts to keep data secure. The National Health Information Sharing and Analysis Center (NH-ISAC) is an example of a forum that already exists for this exact purpose. The more companies that join the forum, the more information and brain-power there is to prevent or mitigate cyberattacks in the future.


The second part of cooperation involves outsourcing. It can be hard for CEOs to let a third party control part of their operation, but when it comes to things as complex as cybersecurity, often times someone else can do it better. There are numerous companies that specialize in cloud-based healthcare data management and security. Their commitment to security allows them to focus their efforts on protecting against threats.

Outsourcing: Galen Data

Many companies have joined in on the movement toward a secure medical world including angelMD startup Galen Data. Galen provides custom, compliant, and affordable cloud storage for small to medium sized companies. Galen is able to make storage systems faster than competitors while upholding safety compliance because the infrastructure is existing and tested. After customizing the system, Galen can focus efforts on maintaining, monitoring, and updating it for the customer.


According to Galen Data’s CEO Alex Condon, the healthcare data security field has two major issues that can lead to breaches. The first issue is that smaller companies simply don’t know the best practices, which is why it is beneficial to outsource. The other issue is that data is shared a lot in healthcare, which makes it subject to phishing or ransomware attacks on the individual level. Alex claims that, to minimize this potential threat, companies have to limit the amount of people who have access to certain data.

The Future of Data Security

While many companies like Galen Data are taking the right steps, the industry must always be looking for new ways to stay ahead of the curve. Right now, we can do what Abbott’s Executive VP of Medical Devices Robert Ford calls for: create an industry standard that protects data while still leaving room for innovation. Ford acknowledges the fact that this will not get done by government, so it will fall on the healthcare industry to make and follow its own standards. Abbott released what they are doing in this report to help guide the conversation.


In the long term, there are more complex solutions for data security that need to be kept in mind. Healthcare IT News ran an interview with Robert LaMagna-Reiter, Senior Director of Information Security at First National Technology Solutions, where he discusses the possible use of AI and machine learning in data security. AI systems could self-monitor, self-heal, and with the ability to predict threats, could prevent attacks from ever happening.


It is important to understand that cyber threats are real today, and working together is the best way to create a safer digital health field. This includes forums like the NH-ISAC and in bringing innovations to the field like AI, machine learning, and quantum computing. The more minds that we have working together, the safer healthcare data will be in the years to come.

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Science behind the Startup: Pro-Arc Diagnostics

As Michelle Faits discussed earlier in an angelMD #StartupSpotlight, Pro-Arc Diagnostics makes a blood test to detect mutated forms of the JC virus (JCV) which may increase one’s risk of developing Progressive Multifocal Leukoencephalopathy (PML), an often fatal disease.

What is PML?

Approximately 75-80% of humans are infected by the JC virus, a polyomavirus which is asymptomatic following primary infection and often occurs during early childhood. [1],[2] Although a definitive route of transmission is not known, it is likely that JCV spreads via a respiratory route or a urine or fecal to oral route as 20-40% of the population can periodically excrete JCV in their urine and JCV can be found in untreated wastewater. [1,2,3,4]


In healthy individuals, JCV infects kidney epithelial cells and bone marrow-derived cells where it likely establishes either low-level persistent infections or latent infections due to inefficient viral replication in those cell types. [2],[3]


In immunosuppressed individuals, certain strains of JCV can migrate to the central nervous system (CNS) and infect oligodendrocytes and astrocytes where the virus can robustly replicate. [2],[3] Changes to the noncoding control region (NCCR) and to the sequence encoding capsid protein VP1 of the JCV genome can allow JCV to become neurovirulent. [5] However, these mutations’ exact roles in developing PML is not completely understood, [3] and while DNA mutations in JCV may be a necessary feature of PML, they may not be sufficient to induce PML. [5]


In the CNS, JCV targets oligodendrocytes, the glial cells primarily responsible for myelinating axons in the white matter, for lytic infection leading to the progressive, often fatal demyelinating disease PML.[1] In addition to demyelination in the white matter, PML can also comprise demyelination of other CNS regions including the brainstem and cerebellum. Between 35-45% of PML patients will exhibit a visual deficit, approximately 33% of patients will exhibit a mental deficit, and 25-33% of patients will experience motor weakness.[1]

PML Incidence

The incidence of PML was considered low (0.07%) prior to the AIDS epidemic, but affected 7-10% of HIV-1+ patients before the introduction of highly active antiretroviral therapies (HAART). After HAART was introduced, the incidence decreased to between 3-5%, and combined antiretroviral therapy (cART) decreased the incidence even further to approximately 0.13-0.33% in HIV-1+ patients. [1],[4]


Patients with autoimmune diseases such as multiple sclerosis and Crohn’s disease who were treated with certain monoclonal antibodies have also developed PML. In known cases in which PML was caused by immunosuppressive therapies, the incidence of the diseases is less than 0.13%, [5] although reported incidence rates can reach 1.0% depending on the length of immunosuppressive treatment. [2]


As Michelle Faits shared in the Pro-Arc Startup Spotlight, “patients with diseases like MS kept telling us they would take better medications if only there was a way to know if they’d be safe from the PML side effect.” For this reason, Pro-Arc is developing blood tests to identify not simply whether or not a patient is infected with JCV, but whether they are infected with a mutated form of JCV that is associated with PML.




  1. Saribas, A. S., Ozdemir, A., Lam, C. & Safak, M. JC virus-induced Progressive Multifocal Leukoencephalopathy. Future Virol. (2010).
  2. Ferenczy, M. W. et al. Molecular biology, epidemiology, and pathogenesis of progressive multifocal leukoencephalopathy, the JC virus-induced demyelinating disease of the human brain. Clin. Microbiol. Rev. (2012).
  3. Maginnis, M. S. et al. Progressive multifocal leukoencephalopathy-associated mutations in the JC polyomavirus capsid disrupt lactoseries tetrasaccharide c binding. MBio (2013).
  4. Beltrami, S. & Gordon, J. Immune surveillance and response to JC virus infection and PML. J. Neurovirol. (2014).
  5. Johnson, E. M., Wortman, M. J., Dagdanova, A. V, Lundberg, P. S. & Daniel, D. C. Polyomavirus JC in the context of immunosuppression: a series of adaptive, DNA replication-driven recombination events in the development of progressive multifocal leukoencephalopathy. Clin. Dev. Immunol. (2013).
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The Orthopedic Surgeon’s Hammer

“The internist has the stethoscope, but the orthopedist has the hammer.” This is a medical mantra heard throughout many medical training institutions.

As funny as it may sound, it is true, within an orthopedic surgeon’s DNA lies the ability to build things or put things back together. It should come as no surprise that when something is broken, we want to fix it. This may be why we see a large number of orthopedic surgeon entrepreneurs and developers in the innovation space.

A Decade of Orthopedic Innovation

There have been many reasons for orthopedic innovation over the past 10 years, but none has driven the orthopedic surgeon more than the desire to be less invasive with a quicker return to function. This has led to dramatic improvements in technique and pain control allowing same day partial and total joint arthroplasty which is likely to become the norm within the next five years.


The incorporation of adductor nerve blocks combined with pericapsular anesthetic infiltration has allowed faster mobility and better pain control after total knee arthroplasty, permitting many patients to go home that same day. This particular advancement has saved hospitals and payers countless dollars and produces better patient outcomes, decreasing a 7 to 10-day hospital stay to a same-day discharge or at most a 23-hour stay.


The drive towards minimally invasive procedures has also heralded the movement towards minimally invasive diagnostics. In-office ultrasound for diagnostic and interventional purposes has increased dramatically over the past 10 years.


During that period of time, ultrasound technology has improved so much that a cordless office device that connects to an iPad now costs half of what a larger fixed unit would cost and provides a clearer picture that can actually show blood flow or a healing response at a tissue repair site or a broken bone.


These portable devices can be used in the office, on the sidelines, or in the emergency room making it very convenient for orthopedic surgeons to make a quick diagnosis without an MRI (essentially saving the patient and the payers money and time). Many surgeons now implement the use of ultrasound in addition to the use of biologics for tissue healing and regeneration.


Another big advancement came in the field of biologics. In 2012, Drs. Grudon and Yamanaka won the Nobel Prize in Physiology/Medicine for demonstrating that mature adult cells can be reprogrammed into immature pluripotent stem cells.


It is only a matter of time before these cells can be manipulated into progenitor cells of the central nervous system or articular cartilage possibly reversing or improving the effects of spinal cord injury and osteoarthritis. These progenitor cells could be used to augment tissue repair sites in ACL and rotator cuff surgery or used to create a biologic scaffold for tissue ingrowth in meniscus repair or cartilage growth.


The Future of Orthopedics

3D printing is another technology that is being tested in orthopedic surgery for its potential in custom joint replacement surgery, custom patient specific fracture fixation, or cartilage and bone transplant. 3D printing in conjunction with biologic scaffolding will eventually lead to a revolutionary biologic joint replacement option in the near future.


There has also been a great interest in the use of robotics in orthopedic surgery, creating more accurate implant placement by customizing the configured bone cuts that are made during surgery. Like many of these other technologies, we are still in the data-collection phase regarding this specific technology regarding the economics. However, early results have shown favorable outcomes and more accurate implant placement.


The flurry of new technologies are exciting and very promising, however the biggest challenge we currently face is the adoption of many of these technologies by the payers. Innovation and insurance coverage almost have an inverse relationship so even though there may be a cost savings and better outcomes in the long run, many payers will not likely cover these treatment options for another 10-15 years.


The future of orthopedic surgery and innovation is promising but patient demand and physician involvement/entrepreneurship will be needed to drive many of these products to market therefore it is key that physicians get involved and continue to advance innovation on behalf of their patients.

Find out about companies making exciting innovations at angelMD.

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By the Numbers: Generics and the Drug Market

Following the FDA’s announcement that it will expedite the review of generic drug applications in order to increase competition, we take a look at recent trends in generic drug markets, the need to manage cost, and some of the FDA regulations surrounding our generic drug market.

Why it matters: Stats at a glance

“Too many patients are being priced out of the medicines they need. While [the FDA] doesn’t have a direct role in drug pricing, we can take steps to help address this problem by facilitating increased competition in the market for prescription drugs through the approval of lower-cost, generic medicines,” FDA Commissioner Scott Gottlieb, M.D. wrote in a blog post.

  • 62% of U.S. adults are concerned about their ability to pay for medical treatment if they get sick or injured [1].
  • 27% of patients avoided filling a prescription and 18% skipped a dose of their medication in the year prior to the survey due in part to the cost [1].
  • 20.5% of brand-name prescriptions are approved and ordered but never collected from the pharmacy (an action known as prescription abandonment), while only 7.7% of generics are abandoned. Abandonment is thought to be primarily due to the cost of copays [2].
  • In 2015, prescription drug spending totaled $324.6 billion, rising 9.0% from 2014 and making up a 10% share of the total U.S. healthcare spending of $3.2 trillion ($9,990 per person) [3].
  • In 2016, generic drugs saved an estimated $253 billion in healthcare spending, bringing the total in savings due to generics to about $1.67 trillion over the last decade [2].
  • Of the $253 billion in savings from generics drugs in 2016, Medicare savings totaled $77 billion while Medicaid savings totaled $37.9 billion [2].

[1] 2016 national patient survey commissioned by the Physicians Foundation and administered by Nielsen’s The Harris Poll (1,511 total respondents, ages 27-75 who had two visits with the same doctor in the previous year).
[2] 2017 Generic Drug Access and Savings Report from the Association for Accessible Medicines (AAM).
[3] Centers for Medicare and Medicaid Services’ National Health Expenditure 2015 Highlights.

Managing Cost

Prescription drug spending accounts for approximately 10% of total healthcare spending, and has been rising for the past four decades. According to the National Health Expenditures 2015 Highlights from the Centers for Medicare & Medicaid Services, prescription drug spending totaled $324.6 billion in 2015, rising 9% from 2014. Although the increase was a deceleration in spending as compared to the 12.4% increase in 2014, spending on prescription drugs still had the largest percent growth compared to other services (e.g., hospital care, clinical services, dental services, home health care, and durable medical equipment).

Generics are a recognized avenue for decreasing prescription drug spending and represent the majority of dispensed prescriptions. In 2016, 89% of dispensed prescriptions were for generics, but they accounted for only 26% of prescription spending. The remaining 74% of prescription spending went towards brand-name drugs which made up just 11% of dispensed prescriptions (2017 Generic Drug Access and Savings Report, AAM).


Retail prescription drug spending from 1970-2015.  Data pulled from the National Health Expenditure Accounts data tables.

The Express Scripts 2016 Drug Trend Report found that the average price of common brand-name drugs has increased since 2008, while generic drug prices have declined. Their Prescription Price Index tracks a 208% increase in the price of common brand-name drugs between 2008 and 2016, whereas common generic drugs have decreased by 73% (from a $100 base price in January 2008, that brings the 2016 prices in at $307.86 and $26.27 in 2008 dollars for brand-name and generic drugs, respectively). A 2016 report from the U.S. Government Accountability Office (GAO) similarly found that under Medicare Part D, which went into effect in January 2006, the price of generic drugs fell 59% from 2010 to 2015.

Savings due to the generic drug market

According to the 2017 Generic Drug Access and Savings Report from the Association for Accessible Medicines (AAM), generic drugs saved $253 billion in healthcare spending in 2016. The top ten generic drugs alone (based on 2016 savings) saved $75.8 billion. When broken down by treatment area, mental health, hypertension, cholesterol, and anti-ulcers treatments had the largest savings.


The top 10 generic drugs ranked by their 2016 annual savings. All values are for 2016. Table adapted from the Top 10 Generic Drugs Ranked by Savings table in the 2017 Generic Drug Access and Savings Report from the AAM.


2016 savings by treatment area from generic drug useage. Adapted from the 2017 Generic Drug Access and Savings Report from the AAM with data from QuintilesIMS.

Major players

According to a FiercePharma report which ranked the top 15 generic drug manufacturers based on 2016 revenue, the top 5 were Teva, Mylan, Novartis (Sandoz is Novartis’s generic division), Pfizer, and Allergan with generics revenues between $4.5-9.85 billion for 2016. Coming in at 15th on the list is Apotex, with a 2016 generics revenue of $1.6 billion.

Drug manufacturers, including Teva, Mylan, and Sandoz, interviewed by GAO reported that competition in the generic marketplace is the primary driver of generic drug prices, leading us to the FDA’s interest in increasing competition.

FDA regulations

The FDA announced on June 27th that it will begin to expedite the review of abbreviated new drug applications (ANDAs), the generic drug application, until there are three approved generics for a given drug. Previous policies prioritized only the first generic product’s review.

The FDA’s new push for three generic drugs is based on an analysis of retail sales data from IMS Health. The study found that the first generic manufacturer drops the average relative price per dose (ratio of average generic price to corresponding brand-drug price) to 94% of the brand-drug price, while two generic manufacturers brings the cost to 52%, and three generic manufacturers brings the cost to 44%. Subsequent generic manufacturers can continue to cut prices, but more slowly.

To gain FDA approval, drug manufacturers must submit an ANDA and demonstrate that the generic version can be substituted for a safe and effective brand-name drug (an innovator drug). Generic drug manufacturers generally do not have to conduct costly preclinical and clinical trials to establish safety and effectiveness, but rather can conduct smaller studies to demonstrate bioequivalence between the generic drug and the innovator drug.

This savings from reduced clinical trials, along with decreased spending on advertising and marketing generics compared to brand-name counterparts, can cut the cost of developing and marketing generic drugs. The Tufts Center for the Study of Drug Development estimated that it costs approximately $2.6 billion to bring a new prescription medicine to market; generic drug costs are significantly less.

The FDA approved 630 ANDAs and tentatively approved another 183 during the 2016 calendar year, the highest annual ANDA approvals to date. The number of yearly ANDA approvals has shown an increasing trend in the past 15 years (Figure X) in part due to the Generic Drug User Fee Amendments (GDUFA) of 2012 which allocated additional funds and approved program fees for the FDA to review generic drug applications.

2017 data runs through May 2017. Adapted from a 2016 Office of Generic Drugs Director’s Update and the FDA annual Activities Report of the Generic Drug Program (FY 2017)

In addition to the FDA’s new policy which will expedite the review of generic drug applications, the FDA also released a list of off-patent, off-exclusivity drugs without approved generics (see below for a review of patents versus exclusivity).

Patents vs. exclusivity

Patents are issued by the U.S. Patent and Trademark Office (USPTO) and are a property right allowing patent holders to exclude other manufactures from making, using, and selling the invention within the U.S.

Exclusivity is granted by the FDA and refers to the exclusive marketing rights and the FDA’s promise to postpone approving competitor drugs. Both new drug applications (NDAs) and ANDAs can be eligible for exclusivity.

Source: FDA, Frequently Asked Questions on Patents and Exclusivity, FDA/CDER SBIA Chronicles, and Five Types of Exclusivities.


The FDA’s announcement to expedite the review of some generic drugs came shortly after they announced the development of a Drug Competition Action Plan. The Action Plan will include a public hearing on July 18th to solicit comment on generics and FDA standards and regulations that may be limiting competition.

As FDA Commissioner Scott Gottlieb, M.D. said, “Getting safe and effective generic products to market in an efficient way, being risk-based in our own work and making sure our rules aren’t used to create obstacles to new competition can all help make sure that patients have access to more lower-cost options.”

Addressing generic drug policies and facilitating review of generic drug applications was listed as one possible strategy to limit the effects of high drug prices in a 2016 article from JAMA. Kesselheim, et al. also outline other federal, state, and health care organization strategies to limit high drug prices, including limiting secondary patents which may extend patent protection and reduce competition, policing anticompetitive business practices, and increasing opportunities for price negotiation by governmental payers.

Although there are instances of high generic drug costs even with three generic manufacturers for a drug product (e.g., the cheapest generic for Gleevec, a cancer treatment, is still $150/pill and $57,000 per year per patient), and more than 300 of the 1,441 generic drugs analyzed by GAO between 2010 and 2015 experienced price increases of 100% or more, evidence still suggests that increased competition can decrease drug costs.

An article published in the Annals of Internal Medicine concluded that, “generic drug prices [are] strongly associated with market competition levels.”

Researchers from the University of Florida, University of Utah, and Brigham and Women’s Hospital in Boston used data on 1.08 billion prescription drug claims between 2008 and 2013 and the Herfindahl–Hirschman Index (HHI), a measure of market concentration, to estimate competition levels for 1120 generic drugs. They grouped drugs based on their competition level and found that drugs in the low-competition group had the largest increases in average price (63.8%), whereas medium-competition, and high-competition groups had smaller price increases (43.8% and 9.7%, respectively). Their results also imply that drug prices do not immediately adjust after a change in market competition. Given this, and the drug development timeline, we can expect to wait some time to see how the changes to the FDA’s policies will affect the cost of prescription drugs.

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Friday Roundup – July 7, 2017

The Friday Roundup is a collection of five stories that you need to know about each week. From policy, to innovations, look to us to keep you up to date on what’s happening in the healthcare industry.

Google Violated UK Patient Privacy

The Royal Free NHS Foundation Trust did not comply with British data protection law when it shared patient data with Google’s artificial intelligence software DeepMind according to the Information Commissioner’s Office.

Announced in November 2016, the partnership immediately drew criticism due to lack of transparency about what the data from 1.6 million patients would be used for. In a blog post, Information Commissioner Elizabeth Denham wrote about what the healthcare industry can learn from the violation, including balancing the value of privacy and innovation and advocating for increased law knowledge.

Surgeon General Nominee Announced

Current Indiana Health Commissioner Dr. Jerome Adams has been nominated by the President to assume the position of Surgeon General. The nomination has been met with a response that has become somewhat rare: bipartisan approval.

Adams, an anesthesiologist, is known as a public health leader for his work on the opioid crisis in Indiana. Most notably, Adams had to address an HIV outbreak in Indiana, which largely spread through needle use. He is recognized by the Indiana Health Department for convincing his appointer and then-Indiana Gov. Mike Pence to allow syringe exchanges in certain counties to limit the spread of HIV. If confirmed, Adams would serve a four-year term.

Aging Out Exacerbates Physician Shortage

There has long been concern around the lack of appropriate healthcare professionals and research from the Janis Orlowski, chief healthcare officer for the Association of American Medical Colleges, indicates it could get worse. Orlowski’s finding is something common in other industry and likely due to the Baby Boomer generation nearing retirement.

Orlowki indicates a shortage of 45,000-105,000 physicians within the next couple years, but the findings aren’t all bad. Her research shows the number of students attending U.S. medical schools has actually increased by 28 percent, but the lack of residency spots keeps them from becoming the professionals that are desperately needed.

Healthcare leaders have already taken Orlowki’s research and used it to form concrete policy suggestions that facilitate the utilization of young talent, like states implementing provisional medical licenses.

More Scrutiny Needed When it Comes to Antibiotic Trials

With issues like antibiotic resistance, prescribing the correct antibiotic to a patient has become increasingly difficult for physicians and is now being compounded by discrepancies between lab results and clinical trials.

New research indicates that initial testing needs to be in an environment more similar to the human body to reduce error. The researchers also note that this could be contributing to antibiotic resistance as “ineffective antibiotics [are] being prescribed as a result of these erroneous tests.”

Chasing the Fountain of Youth

One doctor’s pursuit of a drug to minimize the effects of aging has led him to metaformin, a drug typically used to treat type 2 diabetes that keeps blood sugar levels in check. Dr. Nir Barzilai is currently working to get the FDA to approve the pill for antiaging purposes.

The pill uses a compound from the French Lilac plant and when approved by the FDA in 1994, the drug was shown to improve health in a variety of ways. The FDA 25 to 40 percent less of metaformin users were diagnosed with cancer than diabetics under other treatment.

Barzilai is now leading a clinical study with metaformin with the goal of receiving FDA approval of it as an antiaging drug.

New at angelMD

  • We’ve launched a new syndicate with Noninvasix, a company building a monitoring systems to help reduce brain injury during childbirth. Sign up for the webinar to find out more or read their Startup Spotlight.
  • Lab Sensor Solutions, PatientFinder, and Tivic are just three of the many startups to join the angelMD community. Check out their profiles to see how they’re changing the face of healthcare.

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