mc dougall
DESCRIPTION
TRANSCRIPT
Ohio State – 4th Annual Personalized Health Care National Conference
Private and Confidential
October 7th, 2011PwC Health Industries Advisory
Gerry McDougallPartner, U.S. Personalized Medicine & Health Sciences Leader
Ohio State – 4th Annual Personalized Health Care National Conference
2PricewaterhouseCoopers LLP
PricewaterhouseCoopers (PwC) is a global firm that draws upon the talents of more than 165,000 people in 150 countries.
• Established in July 1998 with the merger of Price Waterhouse and Coopers & Lybrand, PwC is the world’s largest professional services firm.
• Globally, PwC’s revenue is over 30 billion dollars, of which close to 10 billion is consultancy.
• PwC provides a full range of business services, which include audit, accounting and tax advice; management, health care, information technology and human resource consulting; and financial advisory services including mergers & acquisitions and project finance.
6/7/2011
PwC and our Personalized Medicine Practice
Ohio State – 4th Annual Personalized Health Care National Conference
3PricewaterhouseCoopers LLP
PwC's Healthcare Strategy is predicated on our ability to understand and help clients respond to key trends and to serve all sectors on the healthcare continuum
10/7/2011
PwC and our Personalized Medicine Practice
Ohio State – 4th Annual Personalized Health Care National Conference
4PricewaterhouseCoopers LLP
Personalized Medicine has many different definitions, and is broader than just molecular genomics
PwC’s Definition:
A holistic, individualized model of care that examines each individual’s unique makeup and designs appropriate strategies for
maintaining wellness and treating illness.
“The right treatment for the right person at the right time”
“A form of medicine that uses information about a person’s genes, proteins, and environment to prevent, diagnose, and treat disease”
(US National Cancer Institute)
“The application of genomic and molecular data to better target the delivery of healthcare, facilitate the discovery and clinical testing of new products, and help determines a person’s predisposition to a particular disease or condition”
(Senate bill sponsored by Senator Obama, 2007)
10/7/2011
PwC and our Personalized Medicine Practice
Ohio State – 4th Annual Personalized Health Care National Conference
5PricewaterhouseCoopers LLP
TGen: Translational Genomics Research Institute: Development of a Research Institute, creation of a partnership
10/7/2011
• PwC was engaged – first by the State of Arizona and then by Jeff Trent and Dan Von Hoff- to design and implement, from the ground up, a genome research and technology institute for the advancement of bioscience and biomedicine in Arizona.
• Key PwC efforts included:• Feasibility study and assessment• Affiliation agreements with academic and
clinical partners• Business and financial planning• Strategic, operational, facilities planning• Overall operational implementation• Board development
PwC has been and continues to be involved in many TGen initiatives -
PwC and our Personalized Medicine Practice
Ohio State – 4th Annual Personalized Health Care National Conference
6PricewaterhouseCoopers LLP
PwC was engaged by the government of Luxembourg to assist them in diversifying their economy into the biosciences. Partner Gerry McDougall was interviewed by the news agency about PwC’s’ leadership of this initiative - Highlights include:
• PwC became involved through a series of discussions in creating strategic partnerships with TGen and other leading US Institutions in the biosciences. TGen has served as the spark that has catalyzed Arizona’s life sciences effort over roughly the past decade and was used as the case study by the Government of Luxembourg in developing their conceptual model for a bio economy.
• Luxembourg will complement what has been done in Europe by focusing initially on molecular diagnostics, and becoming a center of excellence around molecular diagnostics, in order to enable the early detection of diseases. Their aim is to not compete in established areas already, but to create a niche where they can take advantage of their geographic location.
• PwC goal with Luxembourg was to deliver knowledge transfer over the next three to five years, so that Luxembourg has the world-class sophistication to do the research — proteomics and systems biology. PwC helped facilitate the training of Luxembourg scientists in the US and then re-establish themselves back in Luxembourg once the infrastructure is in place.
• Luxembourg aimed to develop its center of excellence’ for bioscience by establishing a trans-Atlantic series of collaborations with three US-based institutions: The Partnership for Personalized Medicine, the Institute for Systems Biology, and TGen.
• PwC was the initial facilitator of these partnerships which drove over $250M into these US research organizations, and developed the plans for each of the new ventures.
PwC was the subject of an in-depth news article detailing its work with Luxembourg, partnering them with TGen to bring an integrated Biobank Center to Luxembourg
10/7/2011
PwC and our Personalized Medicine Practice
Ohio State – 4th Annual Personalized Health Care National Conference
7PricewaterhouseCoopers LLP
Through International Project Work and Global Research, we have Developed a Deep Knowledge Base Regarding International Initiatives
One example – the development of our HealthCast 2010 report:
The PricewaterhouseCoopers (PwC) Health Research Institute developed this report. It identifies and discusses significant trends reshaping health systems around the world, specifically the creation of a new, more efficient primary health system -- one that is patient centered and takes into account the evolving power of individuals.
To complete this report, PwC:
• Surveyed more than 590 health leaders in over 20 countries, including the UK, Germany, the Netherlands, the US (50), Canada, South Africa, Australia, New Zealand, Argentina, Brazil, China and India, central Europe, Scandinavia, the Middle East and Asia.
• Conducted over 200 in-depth interviews globally (55 in the US) of top executives in government, hospital systems, insurance companies, physician groups, pharma and life science companies and technology firms in 25+ countries.
• Surveyed 3,500 consumers (500 per country) in over 20+ countries including the UK, Germany, the Netherlands, Norway, the US, Canada, and Australia.
HealthCast report: The Customization of Diagnosis, Care and Cure
10/7/2011
PwC and our Personalized Medicine Practice
Ohio State – 4th Annual Personalized Health Care National Conference
8PricewaterhouseCoopers LLP
The Market Potential is Huge
PwC Health Industries Advisory •
Targeted Therapeutics:$21bn
Esoteric Lab Services:
$11bn
CORE P4 Total: $42bn
Esoteric Test Sales:$10bn
Nutrition & Wellness Total: $292bn
RPM/ Telemedicine:
$0-109bn
EMR: $6bn
DM: $3bn
Personalized Medical Care Total: $9-118bn
Nutrition/ Organic
care:$181bn
Complementary & Alternative Medicine:
$41bn
Medical Retail:$10bn
Health Clubs & Spa:$61bn
2015Total Market: $344-452bn
Molecular Diagnostics: $7bn
CAGR’08-’15
Nutrition & Wellness
Personalized Medical Care
CORE P4
Health Clubs & Spa
Nutrition/Organic
Comp & Alt Medic.
Medical Retail
RPM/Telemedicine
EMR
Disease Mgmt
Esoteric Lab Serv.
Esoteric Test Sales
Targ. Therapeutics
10%
2%
7%
22%
7%
15%
23%-92%
6%
44%
13%
10%
9%
10%
1 Reflects upper range of RPM/TelemedicineNote: Totals may differ due to rounding
Figures Not Drawn to Scale
2008Total Market: $210-215bn
Targeted Therapeutics:$12bn
Molecular Diagnostics: $3bn
Esoteric Lab Services:
$5bn
CORE P4 Total: $21bn
Esoteric Test Sales:$4bn
Nutrition & Wellness Total: $185bn
RPM/ Telemedicine
:$0-5bn
EMR: $2bn
DM: $2bn
Personalized Medical Care Total: $4-9bn
Nutrition/ Organic
care:$112bn
Complementary & Alternative
Medicine:$35bn
Medical Retail:$3bn
Health Clubs &
Spa:$35bn
“One of the innovation areas with the highest impact will be the whole field of early and correct diagnoses.”
- Mars di Bartolomeo, Luxembourg Minister of Health
10/7/2011
The Personalized Medicine Market
Ohio State – 4th Annual Personalized Health Care National Conference
9PricewaterhouseCoopers LLP
A New Emerging Paradigm
CDC Definition of Wellness – covers all phases of patient well being
PatientDiagnosis
Preventative
Hospital
ASC/Outpatient
center
Physician office/Clini
c
PhysicianDiagnosis
NurseDiagnosis
AlternativeDiagnosis
Preventative
& Chronic
Chronic
Chronic & Clinical
Preventative
ClinicalPreventati
ve
ConsumerProblem
DiagnosisTreatment
PlanTreatmentDelivery
Resort/Spa
Home/Gym
Group/Community
Emotional
(Social / Spiritual
)
Mental
Physical
Expanded view of Health & Wellness
PhysicalDiscomfo
rtPhysician
Physician/nurse
HospitalSurgery
ClinicSurgery
Physician officeExam
Traditional view of Health & Wellness
PatientProblem
DiagnosisTreatment
PlanTreatmentDelivery
Healthy Vulnerable Affected Sick
The Personalized Medicine Market
10/7/2011
Ohio State – 4th Annual Personalized Health Care National Conference
10PricewaterhouseCoopers LLP
The Broad Health and Wellness Perspective of a Large Global Consumer Products Company Demonstrates the Wealth of Potential Strategic Partners
10/7/2011
Key players: Molecular Diagnostics
Digital Coaching Programs
Health-Based Social Media
Wellness Mobile Applications
PersonalMonitoring
Employer Initiatives to Decrease Health Costs
Personalized Medicine / Genetic Testing
Community Based Awareness Initiatives
Government Initiatives to Decrease Health Costs
Health Data Aggregation
Personalized Health and Lifestyle Coaching
Functional Foodsand Drinks
Exergame Equipmentand Fitness Centers
Personalized Skincare & Cosmetics
Sports Nutrition Programs
Home Health Monitoring
HealthE-Games
Sports Nutrition Programs
Activity Managementand Wellness Programs
PersonalizedFitness
Wellness Market
Weight Management Centered Media
The Personalized Medicine Market
Ohio State – 4th Annual Personalized Health Care National Conference
11PricewaterhouseCoopers LLP
The Trends We Are Seeing…
10/7/2011
Watch Video
Ohio State – 4th Annual Personalized Health Care National Conference
12PricewaterhouseCoopers LLP
Research Priorities Can Be Altered By Social Media
10/7/2011
An MS theory coined in 2008 about how MS was not an autoimmune disease but rather a vascular disease caused by blockages in the brain received a lot of internet attention in Canada
more than 500 Facebook pages, groups or events devoted to the theory
tens of thousands of followers A poll shows more than half of Canadians
are familiar with the theory
Social Media puts pressure on scientists, politicians and funders to alter research priorities despite absence of credible scientific evidence
Resulted in demands for clinical trials for controversial treatment
Reports have sparked a national debate about whether publicly funded trials should be conducted and whether MS patients should have immediate, publicly funded access to the vein-widening treatment known as venoplasty
Ohio State – 4th Annual Personalized Health Care National Conference
13PricewaterhouseCoopers LLP
Spending on Diagnostics is the Most Efficient Use of Health Dollars
• Countless patients will benefit from molecular diagnostics which informs their clinical treatment based on their individual genotype
• 1,800 diagnostic tests available now• 5-10 new diagnostics tests per week
• Diagnostics provide value at every stage of clinical care
Supports the decision to
treat
Predicts likelihood of an adverse
reaction
Prevents warnings
and recalls
Better outcomes
Lower treatment
costs
U.S. Healthcare
≈ $2 T
U.S. LabBillings$55 B
U.S. IVD Revenu
e$14B
<.7% of total spend
<3% of total spend
*Over 72% of all medical decisions are made based on the $14B IVD
Source: Noel Doheny
A Closer Look at Diagnostics
10/7/2011
Ohio State – 4th Annual Personalized Health Care National Conference
14PricewaterhouseCoopers LLP
Diagnostics are the Foundation of Personalized Medicine
10/7/2011
Susceptibility• Monogenetic• Complex
Risk Analysis(modeling)
PredictionRisk MitigationPreventionRisk monitoring
Early Detection
PrognosisIntervention• Stratification • Target ID/Validation • Rx algorithms • PGX• Therapeutic monitoringCompanion Dr
Source: Dr. Franklyn G. Prendergast, Mayo Clinic
A Closer Look at Diagnostics
Ohio State – 4th Annual Personalized Health Care National Conference
15PricewaterhouseCoopers LLP
Clinical research optimization
Clinical,financial & operational
data
Provider
Health plan
Consumer
Health plan
Provider
Life Sciences
Public sector
Offerings
Channels
Chronic care management
Safety surveillance
Disease/ bio-surveillance
Health & wellness management
Medicationtherapy
management
Personal health records(Shared decision making)
Quality & efficiency management
Health outcomes & economics
Decisionsupport
Employer
Public sector
Health managementHealth intelligence
Health informatics
Health informatics
Electronic Patient Information Network
De
ma
nd
fo
r in
form
atio
n-e
na
ble
d h
ea
lth s
erv
ice
s D
ata
ne
two
rk
Healthsystem
Researchnetwork
National association
Regional health
information exchange
Nationallab
Dataaggregator
Payor
Information Systems will Serve as the Foundation for Personalized Medicine
10/7/2011
The Importance of HIT
Ohio State – 4th Annual Personalized Health Care National Conference
16PricewaterhouseCoopers LLP
Health management(Systemic management of outcomes)
Personalized medicine
Integrated patient records
Health managementalgorithms and tools
Advanceddecision support
Analytical competencies and tools
Required capabilities
Richness and timeliness of information
Evolution of evidence-based medicine knowledge base
Healthcare measurement(Quality, safety, Outcomes and cost)
FoundationalBuilding blocks to success
AdvancedMarketadvantage
DistinctiveCompetitive advantage
Op
port
un
itie
s Organizations grow their informatics competency, which increases the availability and portability of secure and protected clinical information
HIT Systems fall on an Evolutionary Continuum that Supports Personalized Medicine
10/7/2011
The Importance of HIT
Ohio State – 4th Annual Personalized Health Care National Conference
17PricewaterhouseCoopers LLP
Integration of the Personalized Medicine Value Chain – Biology to Cure – will be Critical to Curing Multiple Myeloma
Innovative Clinical Trials
Longitudinal Study
LS Tissue Bank
LS Data Bank
Patient Focused
Outcomes
TARGETS
BIOMARKERS
DIAGNOSTICS
Cure for Multiple Myeloma
GenomicsInitiative
Bio-Infomatics and Data Analytics
SEGMENTATION
TARGET ID
Drug Pool
Novel & Existing Drugs
MMRC Tissue Bank
10/7/2011
The Multiple Myeloma Example
Ohio State – 4th Annual Personalized Health Care National Conference
18PricewaterhouseCoopers LLP
The MMRF/C must Balance its Focus on Accelerating Drug Development with Identifying the Right Drug(s) for the Right Patient(s)
Speed Next Generation Treatments
Personalized Medicine
Innovative Trials
Longitudinal Study
Next gen’omics
Pipeline/Portfolio
Correlative Studies
Current Trials/Metrics
WISERFASTER
MMRFResources
10/7/2011
The Multiple Myeloma Example
Ohio State – 4th Annual Personalized Health Care National Conference
19PricewaterhouseCoopers LLP
Healthcare Reform Landscape
10/7/2011
The Changing Healthcare Landscape
Ohio State – 4th Annual Personalized Health Care National Conference
20PricewaterhouseCoopers LLP
Advances in PM will Influence the Full Healthcare Continuum
• Diagnostic tests to complement traditional risk factors
• Risk assessment based on genomic and proteomic profiles and information
• Used for definitive diagnosis and disease typing
• Better accuracy in diagnosis through tests with improved specificity
Accountability? Clearer risk, accountability, cost
Prevention and Wellness
Monitoring and Management of
Condition(s)
Risk Assessment
Diagnosis Prognosis
Clinical Decision
Making for Treatment
Fee for Service(APR-DRG)
Capitation or Global Payment
APC and EAPG RBRVSPay for
Performance
Episode or Bundled
Payments
Acute Care Management
ACOChronic Care Management
Medical HomesSpecialty
Medical HomesEpisodes of
Care
Financial Reimbursement
Healthcare Continuum
Healthcare Delivery Models Accountability for care, cost, and outcomes is shifting during the US era of reform
Volume based Value based, quality, outcomesPayment
Care Venue
Records / Info.
Treatment
Paper, Fragmented Electronic / Usable / Transparent
One size fits all Personalized
Hospital based / Acute Integrated, outpatient, patient centered
• Focus on late-stage detection and intervention (High cost, variable quality and outcomes)
• Multiple reimbursements for fragmented (siloed) care versus integrated management of patient needs
• Medical professionals paid for illness versus wellness• Inadequate social and economic incentives for wellness• Inadequate medical training/understanding of
genetics/genomics/proteomics
Risk Share
Benefit Challenges• Actuarial calculations disruption and
redefinition• Services need to be defined as covered
versus excluded category.• States may require specific test benefits.• Medicare statute excludes “screening”
services unless previously enumerated, but the border between screening & diagnostic services is sometimes problematic.
Coding Challenges• Lengthy process for new code
development• CPT: uncertain granularity of Tier 1
codes, and lack of granularity of Tier 2 codes
• Multiple methodology-based or misc. (NOC) CPT codes (incl. molecular diagnostics “stacking” codes
• Laboratory test CPT coding is not well suited to coding for information services
Coverage and Evidence Standards Challenges• Coverage determination that has few
standards, varies widely from test to test,
• CMS’s coverage determination process lacks sufficient predictability in its evidence requirements
• Human factors confound coverage review, especially gaps in technical expertise and ability to determine true value
Payment and Diagnostics Reimbursement Challenges• Characteristics of the CLFS and PFS
make their application to payment problematic
• Payment system anchored in the costs of tests developed and performed decades ago, and applied inconsistently
• Payment-setting process fails to recognize their clinical utility and economic value
• Focus on prevention and prediction of disease rather than reaction to it
• Probabilistic health history through DNA sequence
• Early warning about predisposition could promote healthier lifestyles
• Recurrence monitoring
• Monitoring for treatment efficacy
• Leverage population based therapeutic research
• More targeted treatment for mgmt. and late stage
• Used to predict efficacy or safety response for specific treatments
• Right treatments at right time for right patients
• Genomic and information based clinical decisions
• Less variability
• Assess severity and/or risk of recurrence
• Informed decisions on clinical decisions and pathway
• Know what is true stage of disease progression
• Reduced possibliity of side effects
10/7/2011
The Changing Healthcare Landscape
Ohio State – 4th Annual Personalized Health Care National Conference
21PricewaterhouseCoopers LLP
Payer Landscape Continuum
10/7/2011
Financial Reimburseme
nt
Full capitation
Fee-for-service
Health Management
EpisodicPreventive
Care Delivery
ChronicWellness
The Changing Healthcare Landscape
Ohio State – 4th Annual Personalized Health Care National Conference
22PricewaterhouseCoopers LLP
Towards Accountable Care Organizations
10/7/2011
Payment
Venue
Records
Treatment
Volume based
Hospital based
Paper
One size fits all
Performance based
Integrated, outpatient
Electronic
Personalized
1990 2000 2010 2020
Accountable Care Organizations: Patient Centric Model
The Changing Healthcare Landscape
Ohio State – 4th Annual Personalized Health Care National Conference
23PricewaterhouseCoopers LLP
National Initiatives: The Forum on Personalized Health Care Announces Launch of The Roadmap for Personalized Health Care
10/7/2011
PwC will be a key contributor to the initiative intended to:
• Foster and apply disruptive innovation to effect transformative, systemic change in health care
• It is designed to provide stakeholders in the health care with an actionable plan
• Led by Harvard Business School professor Clayton Christensen, creator of the theory of disruptive innovation.
• The Roadmap will draw from and build upon Christensen’s analysis of how disruptive forces can be put to work to help effect systemic change in diagnosis and patient care.
Ohio State – 4th Annual Personalized Health Care National Conference
24PricewaterhouseCoopers LLP
Personalized Medicine has Momentum
10/7/2011
Several articles yesterday as follow up to the ASCO Conference in Chicago, applaud the new wave of personalized cancer treatments in development
Ohio State – 4th Annual Personalized Health Care National Conference
25PricewaterhouseCoopers LLP 10/7/2011
For additional insight, see our publications:
Gerry McDougallPersonalized Medicine [email protected](617) 530-4471