How Startups Fit into Healthcare's Transformation

Healthcare and life sciences giants might be eager to emulate practices that let startups move fast, but some impediments to going digital can get in the way. Much like other incumbent industries, healthcare organizations continue to explore ways to both evolve their IT infrastructure and see a positive return on investment. A collaboration with a startup can sound like a quick way to tap into entrepreneurial ingenuity. Such relationships, however, can be a delicate balancing between institutional regimentation and disruptive ideas.

Pfizer, for example, wants to adopt startup-style tech strategies for digital transformation but such efforts can be constrained by the clash of conflicting environments, said Sandeep Burugupalli, senior director of global medical epidemiology at Pfizer’s Data Center of Excellence. He spoke last week in New York in a discussion on “How Startups Drive Digital Transformation in Healthcare and Life Sciences.” Technology consultancy Campana & Schott organized the panel that included Bayer and startup Surgical Theater.

“I’ve been very interested in transformation; exciting, sexy startups; and great solutions,” Burugupalli said. “Trying do this in the corporate environment, it’s a very difficult process.” Part of the challenge, he said, is getting startups to integrate with the organization’s existing workflows and processes. Burugupalli warned about becoming blinded by the “sexy” prospects of innovation and said companies have to resolve the “unsexy” aspects of such collaborations in order to make them work.

“We tried working with startups in the AI and machine learning space,” he said. “Data sharing was a nightmare. It would take six to 12 months to even get the legal agreements done.” Even with those agreements addressed, the organizations still had to establish environments for the startups to use internal data from his company. Over time, the collaboration process became easier, Burugupalli said.

One measure Pfizer implements, he said, is a sign-or-walk agreement that stipulates the startup will not use the data it gained access to for questionable purposes. “Healthcare is a big machine,” Burugupalli said. “It’s a complex web of stakeholders and they’re all interlinked.” Startups and technologists must be shown that in order to influence one piece of healthcare, they must fit into the many moving parts of that machine, he said.

“Being the little guy, we’re looking for validation of our technology and seeing how we can make an impact,” said Sukhpal Singh, vice president of VR and AR programs for Surgical Theater, which develops augmented and virtual reality technology for the healthcare industry. For example, he said Surgical Theater’s technology was used in the treatment of a tumor that was close to a patient’s optic nerves. When the surgeon reviewed the planned standard procedure in advance through VR, it revealed there was a hidden piece of tumor that required a change to their approach.

Sukhpal Singh, Surgical TheaterImage: Joao-Pierre S. Ruth

Getting healthcare companies to embrace digital transformation and collaboration with startups can take a fair amount of campaigning in-house, according to Priscilla Beal, who performs technology prospecting for the Bayer emerging technology solutions team. She said there is a need to evangelize and empower individuals within organizations that have a lot of external partners to engage with and be inspired by startups and transformation.

Bayer, Beal said, has been innovating for some 157 years within its niche. While it is proficient on its home turf, the organization might appreciate assistance in other arenas. “One of the things we’re not especially good at from a resource perspective is [how] this technology that’s changing every minute of every day,” Beal said. She explained that Bayer wants to capitalize on emerging technology through digital transformation and wants its employees from system administrators to clinicians on board with the nuances of what such innovation can do for them individually.

Priscilla Beal, BayerImage: Joao-Pierre S. Ruth

Guiding Bayer through this journey is a digital transformation board that serves to discover ideas while also applying governance, Beal said. It is important, she said, for an organization that operates in more than 100 countries and has more than 108,000 employees to not lose focus while pursuing transformation. “Can we leverage these exciting new technologies like 5G and quantum computing and maintain enterprise infrastructure?” Beal asked.

Moving at a measured pace and a bit of handholding may be unavoidable to ease healthcare organizations into digital transformation because of the regulatory and security rigors they must adhere to.

Singh said Surgical Theater can offer an enterprise solution on servers at hospitals, feeding multiple departments, but it can take up to one year just to move through the bureaucratic process and security approvals. Surgical Theater is exploring a mobile solution for hospitals for the future, he said, but moving forward on such an option it will face considerable security scrutiny. “Very few hospitals are comfortable with data being wireless,” Singh said.

Despite some bureaucratic, institutional logjams, healthcare seems to be coming around to the long-term benefits of digital transformation and collaboration with startups. “I’ve seen the ways machine learning is automating so much of our processes and the ability for us to make things more efficient,” Burugupalli said. That can come into play especially with alleviating workloads for the armies of data managers he said Pfizer employs to examine every single datapoint from clinical trials, and to flag inconsistencies. “We have 30 years of historical data that we use to train an algorithm to identify discrepant datapoints,” he said. “I see this transforming healthcare pretty significantly over the next couple years.”