VC To PCORI: Partner With Private Sector To Maximize Research Investment, Impact

As the Patient-Centered Outcomes Research Institute develops its data infrastructure, it should also be looking at partnerships with the private sector to help maximize the value of dollars invested in research and help bring in points of view that can help extract the most value from the data collected, a venture capitalist tells the institute.

The Patient-Centered Outcomes Research Institute should be looking to partnerships with the private sector as a means of extending the limited budget it is operating under, Bob Kocher, partner at venture capital firm Venrock, recently said during an institute-sponsored event.

Speaking July 2 at the “National Workshop to Advance the Use of Electronic Data,” Kocher advised PCORI to think beyond just spending its funds on research grants and use some of its money to build partnerships with the private sector, an action that could generate more research bang for the buck. His recommendation comes as PCORI is preparing to fund research in the development of data infrastructure (Also see "PCORI Plans Detailed Funding Announcement For One Area Of Research Agenda" - Pink Sheet, 19 Mar, 2012.).

“I’d encourage you to look beyond the traditional grant recipients for who to partner with and also who to help co-fund your work,” Kocher said. “I would submit that you can get 10 times your budget by partnering with the private sector to actually jointly invest in projects together, so think about how to do that.” Kocher is a former member of the Obama administration who served as special assistant to the president for health care and economic policy. He helped shape the Affordable Care Act, including working on the language that formed PCORI. “While we gave [PCORI] as much money as we could in the legislation, it’s nowhere near enough to answer all the questions that we’d all like to answer. And there’s nobody faster at translating it than the private sector.”

PCORI held the workshop July 2-3 at Stanford University in Palo Alto, Calif., to solicit ideas about the creation of a data infrastructure to facilitate the gathering of patient-centered research as well as disseminate research findings (Also see "Building Data Infrastructure For PCORI Research Should Start Now, NIH’s Collins Says" - Pink Sheet, 16 Jul, 2012.). Kocher’s comments focused on what to do with the research once it is gathered and the importance of reaching out to the private sector as partners.

“I would submit that [PCORI] can get 10 times your budget by partnering with the private sector to actually jointly invest in projects together.” – Bob Kocher of Venrock

Kocher put his recommendations in the context of the current health care environment, noting that in the U.S., there is more spent on health care services, but the outcomes fall short in relation to the money spent, with a key driver being the variation among U.S. patients.

“PCORI was created in part to help people know what to do and to help that variation be necessary variation, not the unnecessary type that leads to medical errors, complications and patients not getting the treatment they would otherwise choose if they have the data or their clinicians have the data in front of them,” Kocher said.

That being said, Kocher identified three things he thinks will shift the health care landscape, regardless of the outcome of the coming election: that there will be a bending of the cost curve because the current environment simply cannot sustain the growth in health care spending; that productivity within health care will improve; and new payment models will emerge that reward outcomes rather than simply pay for services.

“These things are happening regardless of the political, cultural [and] emotional factors,” Kocher said. And it’s because of these factors that the venture capital community is seeing opportunity in health care.”

Data Liberation

What Kocher believes will make a partnership successful between PCORI and private sector players is what he called “data liberation.” He pointed to a partnership between HHS, the Institute of Medicine and the Robert Woods Johnson Foundation that is doing that.

“The basic idea was HHS is a treasure trove of great data that when you are at HHS or in government, you can access it to answer questions that we’d all like to answer,” Kocher said. “Why not make it publicly available? … If you liberate the data, people will do things that you didn’t think of [and do it] faster, cheaper and combine it with other things that you can’t combine it with, whether it’s other data sets or other technologies, to create value for consumers, to create jobs and improve the health system.”

Drawing a parallel to the data HHS has, Kocher said the patient-centered outcomes research generated by PCORI will have the same kinds of characteristics. There is “a primed ecosystem of people ready to consume the data that you create and liberate and translate it into patient care, into risk-adjusted outcomes, into decision-support tools, into [electronic health records] that aren’t so painful to use, into community-created research projects, into faster-enrolled and conducted clinical trials, into better payment systems that actually have the right outcomes in mind, into much better analytic tools to support rudimentary decision-support in order sets that are being uptaken by hospitals today.”

And if PCORI does look to private sector partnerships to co-fund research, “I’m optimistic that more money will flow as more data is liberated and you will be awestruck by the scale and the speed that you can change medicine,” Kocher predicted.

He offered four basic guidelines for PCORI when entering into private sector partnerships. The first relates to privacy and security of the data. “Absolutely, you need to have draconian penalties for people that violate privacy rules or don’t take seriously how to do risk-adjustment right or how to make sure they translate it correctly,” Kocher said.

Second is placing an emphasis on the personalization of the research data. “Population health is really important, but when you are a patient with a doctor, the question is always ‘what should I do?’” Kocher noted. “The more you can support personalization, the risk-adjusting, the helping to figure out am I like the patient studied or not at the point of care, the better. Allow people to see the risk trade-offs and what outcomes they should go for,” such as seeking a cure, getting back to work or slowing the decline in overall health, for example.

Third is to seek out non-traditional partners, and fourth is to understand not only study treatment options, but also systems of care. “As important as what treatment do you choose is … what system should you [choose] to deliver it,” Kocher stated. “What are the more productive systems? What’s the right mixture of people and technologies? I’d encourage you to think about large populations, large data sets, timely and liberal release of data and allowing people to ask questions that build up the priorities that you’ve set and bring leverage to the money that you bring to bear.”

Overall, Kocher said the venture capital community is “excited about the work that [PCORI is] doing. We are seeing more funding in the last quarter than we saw in all of last year.”

He noted that there have been thousands of start-ups that have been created in the wake of the health care reform law. “I urge you to tap into the innovation that surrounds you to make this data useful and change care faster than we do when we publish in the New England Journal [of Medicine] without any other ways to spread it.”