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Founder of healthcare startup here too: This sounds like a great project. I love the idea of building technology for healthcare in a small, controlled, active

by mikekij 10y ago

Founder of healthcare startup here too: This sounds like a great project. I love the idea of building technology for healthcare in a small, controlled, active care environment, and then scaling those tools to a larger audience. The bigger issue in healthcare IMHO is that the American healthcare model, while hugely inefficient, seems to be the system that best incentivizes innovation. We pay 10x what Sweden pays for medical devices, but the US market is the only reason those device companies can be profitable. If we move to a single-payer system in the US, the economic incentives for innovation go way down. If someone can figure out how to lower costs, while still providing a profitable market in which drug and device companies can innovate, we'll all benefit.

dflock 10y ago
There are 9.5 million people in Sweden and 320 million in the US - the huge market size in the US would still be a big incentive, whatever else you did.
- mikekij 10y ago
  Not if your margins are negative.
  - lkbm 10y ago
    Negative margins are a result of starting_cost/n + unit_costn > unit_pricen. If unit_cost > unit_price, then increasing n hurts, but in cases where unit_cost > unit_price, increasing n moves your margins to the positive, unless marginal costs increase--which is admittedly sometimes the case, but in many cases they go down.
dikdik 10y ago
> We pay 10x what Sweden pays for medical devices, but the US market is the only reason those device companies can be profitable. Lies, lies, lies, and more lies. This is always quoted, especially in the context of pharma. It's wrong. Americans pay for advertising (which is illegal in most first world countries) and for the yachts and islands of the big healthcare execs. I work at the intersection of biotech and healthcare. Currently working on a healthcare product that will be rolled out in the EU before the US and will be profitable from day 1 without being "subsidized" by Americans.
- mikekij 10y ago
  Being intimately familiar with the COGS and Average Selling Prices of more than a few devices in various geographies, I respectfully disagree. That's not to say you can't have a profitable EU-first product. It's just easier to be profitable with US-first at the moment.
  - dikdik 10y ago
    Disagree with rolling out a product EU first or disagree that companies need the American healthcare industry to become profitable? I can't go too much into the product, but there is a solid strategy behind the rollout. And of course it's easier to be profitable in the US, there is a gravy train of money in healthcare here. While great for healthcare companies, it is AWFUL for consumers. With respect to the initial comment I replied to, everyone (ie government officials and business owners) claims that changing the US healthcare industry will decimate innovation and every pharma/medical device/etc company will utterly fail! I've been in this industry less than a decade and have experienced this rhetoric often whenever certain bills come up at the federal and state levels. Everyone freaks out! And then the bill passes....and everything is fine. We just have to innovate a little more, which is a great thing for the consumer!
jartelt 10y ago
With a single payer system, the insurer can choose prices that will still leave incentive for innovation and not bankrupt all the medical device companies. It is just a matter of choosing the correct pricing, which I am sure is not trivial, but is possible. That said, our health outcomes are not great in US, so maybe we need to balance things out a bit and spend less on new medical devices that help a small number of people and spend more on low tech preventative care measures that help everyone.
jly 10y ago
You may be right about medical innovation being partly driven by the profit and cost-heavy US healthcare system. We need to get comfortable with the idea that economic, profit-driven interest is less important than using our considerable resources to rebalance the care for everyone in a more equitable process. I am willing to slow down the pace of innovation for this goal, and I hope others are, too. This directly parallels environmental concerns, where we as a species are destroying habitat, driving species extinct, and negatively impacting the climate, so we can enjoy many unnatural conveniences. We have to take a step back and realize that fixing these fundamental issues is more important than innovation and technological progress.

by mikekij 10y ago

dflock 10y ago

There are 9.5 million people in Sweden and 320 million in the US - the huge market size in the US would still be a big incentive, whatever else you did.

mikekij 10y ago
Not if your margins are negative.
- lkbm 10y ago
  Negative margins are a result of starting_cost/n + unit_costn > unit_pricen. If unit_cost > unit_price, then increasing n hurts, but in cases where unit_cost > unit_price, increasing n moves your margins to the positive, unless marginal costs increase--which is admittedly sometimes the case, but in many cases they go down.

dikdik 10y ago

> We pay 10x what Sweden pays for medical devices, but the US market is the only reason those device companies can be profitable. Lies, lies, lies, and more lies. This is always quoted, especially in the context of pharma. It's wrong. Americans pay for advertising (which is illegal in most first world countries) and for the yachts and islands of the big healthcare execs. I work at the intersection of biotech and healthcare. Currently working on a healthcare product that will be rolled out in the EU before the US and will be profitable from day 1 without being "subsidized" by Americans.

mikekij 10y ago
Being intimately familiar with the COGS and Average Selling Prices of more than a few devices in various geographies, I respectfully disagree. That's not to say you can't have a profitable EU-first product. It's just easier to be profitable with US-first at the moment.
- dikdik 10y ago
  Disagree with rolling out a product EU first or disagree that companies need the American healthcare industry to become profitable? I can't go too much into the product, but there is a solid strategy behind the rollout. And of course it's easier to be profitable in the US, there is a gravy train of money in healthcare here. While great for healthcare companies, it is AWFUL for consumers. With respect to the initial comment I replied to, everyone (ie government officials and business owners) claims that changing the US healthcare industry will decimate innovation and every pharma/medical device/etc company will utterly fail! I've been in this industry less than a decade and have experienced this rhetoric often whenever certain bills come up at the federal and state levels. Everyone freaks out! And then the bill passes....and everything is fine. We just have to innovate a little more, which is a great thing for the consumer!

jartelt 10y ago

With a single payer system, the insurer can choose prices that will still leave incentive for innovation and not bankrupt all the medical device companies. It is just a matter of choosing the correct pricing, which I am sure is not trivial, but is possible. That said, our health outcomes are not great in US, so maybe we need to balance things out a bit and spend less on new medical devices that help a small number of people and spend more on low tech preventative care measures that help everyone.

jly 10y ago

You may be right about medical innovation being partly driven by the profit and cost-heavy US healthcare system. We need to get comfortable with the idea that economic, profit-driven interest is less important than using our considerable resources to rebalance the care for everyone in a more equitable process. I am willing to slow down the pace of innovation for this goal, and I hope others are, too. This directly parallels environmental concerns, where we as a species are destroying habitat, driving species extinct, and negatively impacting the climate, so we can enjoy many unnatural conveniences. We have to take a step back and realize that fixing these fundamental issues is more important than innovation and technological progress.