• The drug shortage problem in the US is getting worse, and has extended to include a type of epidural used for pregnant women during childbirth.
• Hospitals have had to get crafty with rationing drug dosage in order to compensate for the shortage. 
• The American Society of Health-System Pharmacists lists hundreds of compounds that are currently facing shortages, placing the healthcare system on the brink of a public health emergency. 
• Not enough companies are making drugs at a rate to keep up with demand. 

The US has had a long-standing problem with drug shortages, but now, the situation is reaching a tipping point.

In the past year, the healthcare industry dealt with the aftermath of Hurricane Maria, which shut down many facilities that manufactured commonly used healthcare products such as saline and other intravenous (IV) fluids. 

Now, new additions to the growing list of shortages include a medication commonly administered as epidurals to women giving birth.

"There really is no alternative that provides the same safety, reliability, and comfort that we all have using it," Ruth Landau, an obstetric anesthesiologist at Columbia University Medical Center told Fortune. 

In February, Columbia was due to run out of bupivacaine, a local anesthetic used frequently as an epidural for women in labor. Injected into the base of the spine to block pain, the numbing drug also has applications in other surgical and medical procedures. 

As a result, Columbia now reserves bupivacaine prepared with dextrose for "the most risk and complicated emergency deliveries." Hospitals across the nation who also use the drug are using conservation guidance Landau helped develop to ration supply by coaxing multiple doses of the drug from a vial that would normally serve only one patient. 

'The brink of a healthcare emergency'

And it's not just medication for epidurals. The American Society of Health-System Pharmacists lists hundreds of compounds that are currently facing shortages.

"The ongoing shortages of these vital lifesaving medications are overwhelming the resources of our nation’s hospitals, placing our healthcare system on the brink of a public health emergency," ASHP CEO Paul W. Abramowitz said in a press release Wednesday. 

The supply shortage has expanded to include a few types of IV fluids, including bags of saline and nutritional solutions as well as injectable opioids. American Hospital Association has advised hospitals to use alternative versions of the drug and to prioritize which patients receive certain medications. 

When drug supply runs short in some ERs, healthcare professionals have had to substitute in other medications that sometimes may cause unpleasant side effects or may not be safe for certain patients.

According to the ASHP, there are a number of reasons for the shortages. Some are related to manufacturing problems and recalls, other involve a discrepancy in supply and demand. The companies which make large portions of a certain drug can stop making it, or a drug is produced by only a single manufacturer.

The problem is that there are simply not enough companies making the drug at a rate that can keep up with demand, and part of that problem is the consolidation of the manufacturers who produce generic drugs.

US generic companies competing with foreign companies that are able to make the same drugs at a cheaper cost have trouble turning profits. That's caused manufacturers to focus on certain generic drugs and discontinue others that don't make as much money. If one generic manufacturer has a shortage, it can't be readily fixed. Other generic companies might not make the same drug, and getting specific approval to make the drug can take longer than the shortage even lasts. 

SEE ALSO: We're running out of commonly used drugs — and hospitals say it's 'quickly becoming a crisis'

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• Fitbit is making a big move into health, starting with features that it says will allow it to better track heart rate and align with other medical devices like blood-sugar trackers for diabetics.
  
• It's also developing tools to detect common but serious conditions such as sleep apnea and atrial fibrillation.
  
• Shelten Yuen, Fitbit's vice president of research and development, told Business Insider that the company hopes its clinical trials and a new partnership with the Food and Drug Administration will enable it to make several fresh products available soon.
  

The company behind the simple fitness band aimed at getting people moving now has its sites set higher: playing doctor.

In recent months, wearable-device company Fitbit has made a big push toward healthcare. From an in-app feature for tracking women's menstrual cycles to a redesigned ecosystem that makes it more compatible with diabetic glucose monitors, the company is working to keep its device relevant alongside heavy competition from players like Apple.

As part of the health pivot, the company is also developing apps designed to detect two common but dangerous health conditions: sleep apnea, which affects 22 million Americans but goes undiagnosed in some 80% of them, and atrial fibrillation, a tough-to-spot heart disorder that's on the rise in the US.

It's all part of a strategic move to transform its products from casual, single-purpose fitness bands to comprehensive devices that do everything from tracking your steps to detecting and even treating illnesses, Shelten Yuen, Fitbit's vice president of research and development, told Business Insider. In the process, the company will be working closely with the Food and Drug Administration and running a series of clinical trials.

"We're consumer-centric and health-centric at same time," Yuen said. "We're moving into a new direction where those lines will become blurred and, I think, Fitbit will play a huge role in giving individuals insight there, and healthcare providers too."

From fitness trackers to far-reaching health tools

One-use devices such as wristbands that exist just to help count steps have fallen by the wayside as all-in-one gadgets like smartphones and smartwatches have taken their place.

Fitbit's share price, in turn, has taken a tumble. When the company went public in 2015, it did so at a $4 billion valuation; now its market cap stands at just over $1 billion.

So Fitbit is looking at broadening out its product to have a more comprehensive role as a health tool. And the company is starting by focusing on populations other wearable-device makers may have overlooked.

In February, the company put $6 million behind a tiny San Francisco startup that's working on a needle-free way to track blood-glucose levels, a key metric that people with diabetes rely on to make decisions about what to eat and when. Around the same time, Fitbit announced a number of new partnerships with diabetes-device companies designed to help better integrate the devices into the Fitbit ecosystem.

In May, Fitbit became the first major wearables company to introduce period tracking. The feature includes an in-app dashboard that allows users to log their periods, record symptoms, and opt into getting push notifications two days before and on the day of their predicted period start date. Eventually, Fitbit wants to use the data it gathers from the initiative to help women take steps to address painful period-related symptoms such as cramps and fatigue, Yuen told Business Insider.

"To take something most women have in their pocket or purse and use that to help give key health information not only to themselves but also to medical providers, that is such a powerful, and still relatively untapped, resource,"Katherine White, a professor of obstetrics and gynecology at Boston University who advised Fitbit on its female-health tracking initiative, said.

Diagnosing heart conditions, sleep apnea, and more

Next, Fitbit plans to roll out a host of more advanced medical features geared at detecting widespread but often unaddressed health conditions.

First on Fitbit's radar are sleep apnea and atrial fibrillation, or A-fib, two disorders that frequently go undetected but can have dramatic consequences without treatment.

While sleep apnea is characterized by breathing that repeatedly stops and starts during sleep, atrial fibrillation is an irregular, often quick heart rate that can cause poor circulation.

In 2017, Fitbit enrolled in a new precertification program with the FDA designed to help speed the approval process for new digital health products.

As part of that work, Fitbit is conducting clinical trials on both sleep apnea and A-fib, to see if their devices could one day replace existing tests for the conditions, which are often invasive and expensive. Right now, diagnosing sleep apnea requires physicians to collect information on everything from your heart rate and blood-oxygen level to your airflow and breathing patterns.

For some people, that can mean spending the night in a sleep lab and spending up to $5,000 a night; others may be able to do so using home sleep-apnea tests that cost between $350 and $500. By comparison, Fitbit's most expensive smartwatch costs $300.

As with its female-health-tracking initiative, the new apps would give Fitbit access to a trove of data — in many cases where little or none existed before.

That data could be used as it is now — with researchers who are studying cancer and heart conditions drawing from it for scientific studies — or it could be sold. For instance, genetics-testing company 23andMe has sold anonymized genetic data from millions of customers to drug companies.

Fitbit's data could be more attractive than that of its competitors because it's all stored one place, no matter what device the consumer is wearing.

"We know people like to change their devices," Yuen said. "Regardless of which device you use, Fitbit is able to maintain a big database of this, and we think that's exceptionally powerful over the long term."

If the company can pull from that mass of data and capitalize on conditions that other wearable-device makers aren't addressing, that could be enough to keep customers — and researchers — coming back for more.

"The market is very large for these kinds of tools, but right now they're all behind this regulatory fence, and so we hope there will be some exciting commercial opportunities in the near future," he added.

SEE ALSO: A little-known technology that Fitbit and Apple are exploring could be the answer to healthy eating and peak performance

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• Pharmaceutical companies are starting to embrace technology and data science into their new healthcare strategies.
• A Novartis executive says the company has used technology to conduct better research and monitor clinical trials.
• And a Johnson & Johnson executive said she believes technology allows companies to better connect with their consumers. 

Pharmaceutical companies are starting to pick up cues from Silicon Valley.

A number of senior executives from Lilly, Roche, Johnson & Johnson and Novartis spoke about the emerging trend of incorporating technology and data science into how they approach healthcare this week at the UBS Global Healthcare conference in New York.

Novartis executive James Bradner, president of the Novartis Institutes for BioMedical Research, said the company is using technology to conduct better research. Through the adoption and integration of new digital technologies into its business, Novartis hopes to increase efficiency and productivity with its research and development.

For example, it's using artificial intelligence to analyze images of cells and to see how potential drugs interact with their protein targets.

Besides Novartis, other pharma companies are using artificial intelligence to analyze past data and make predictions to potentially expedite the discovery of new drugs. For example, XtalPi Inc, which offers digital drug development solutions, partnered with Pfizer in May in a strategic research collaboration to develop AI software to identify new drugs.

The healthcare artificial intelligence market is projected to grow exponentially in the coming decade, according to market research data firm Global Markets Insight. At least 18 pharmaceutical companies and more than 75 startups have been working on integrating machine learning into the drug discovery process. Adapting AI-based analysis can reduce costs, shorten the time it takes to come up with and test a new drug, and lead to potentially more effective drugs.

Novartis' Bradner believes data science can accelerate the rate of new discoveries and innovation in the field. Algorithms about consumers behaviors, characteristics and preferences can better help drug companies analyze priorities in research and development, he said.

Incorporating AI into clinical trial management and monitoring can offer insights for protocol design based on past treatment patterns and access ideal candidates for a certain trial. Additionally, the technology can instantly gather real-time and real-world patient data and feedback and provide support or adjustments when necessary.

Other pharma executives including Sandi Peterson, group worldwide chairman at Johnson and Johnson, also spoke to this trend at the UBS conference. J&J has rebuilt its technology infrastructure, Peterson said, and has pursued strategic partnerships with tech providers and has invested in developing AI machine learning capabilities.

Becoming a more tech-forward pharma company will help J&J to attract a younger consumer.

"It's how consumers want to engage with brands today," Peterson said.

SEE ALSO: An executive at $12 billion biotech startup Samumed just gave a potential timeline for the company to go public

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• With the explosion of new cancer treatments, global spending on these medications in 2017 rose 18% to $133 billion and is expected to reach $200 billion by 2022, according to a new report. 
• The median annual cost of a cancer drug launched in 2017 exceeded $150,000.

There are more than 700 cancer drugs in late-stage development— that's more than a 60% increase from a decade ago.

But while the number of new cancer treatments has risen, so too has spending on the disease. 

Spending on cancer therapies rose to $133 billion in 2017, an increase of 18% over the year prior, according to a new study on Thursday.

In the US alone, spending on cancer medicine doubled over the last five years from $25 billion to $50 billion, according to the study, which was published by the IQVIA Institute for Human Data Science. The global market for cancer is expected to reach a staggering $200 billion by 2022 

New treatments are allowing patients to survive longer with their cancer, but there's a price to pay for innovation. The median annual cost of a cancer drug launched in 2017 exceeded $150,000 — almost twice the cost of new treatments that were launched 10 years ago. 

"We've still got a long ways to go, and we are spending a lot of money on cancer therapies. But again, these are bringing new treatment options to a disease that once was definitely a death sentence" Murray Aitkens, executive director of IQVIA Institute told Business Insider. "Now we're seeing real, almost-cures, significantly longer remissions for patients and definitely better outcomes. It's a very exciting time." 

SEE ALSO: The US is running out of commonly used drugs including ones used in epidurals, and it’s put us on ‘the brink of a public health emergency’

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• Republicans repealed Obamacare's individual mandate in their tax reform law, which President Donald Trump said was effectively a repeal of Obamacare.
• A new Congressional Budget Office report shows that fewer people will leave the Obamacare market due to the mandate repeal than previously thought.
• Part of the reason, the CBO said, was because people value health coverage more than before Obamacare was passed.

Even after sustaining a major blow from Republicans, Americans may not ditch Obamacare as quickly as previously thought.

The new GOP tax reform law contained a provision that virtually eliminated Obamacare's individual mandate, which requires all Americans to purchase health coverage or face a penalty. After Congress passed the tax law, Trump claimed that getting rid of the mandate amounted to a "repeal" of the landmark healthcare law.

Trump's language was a bit strong — the mandate is only one element of Obamacare — but the Congressional Budget Office estimated in November that 13 million more Americans would end up uninsured by 2027 than under the current baseline. 

Six months later, a CBO update found that the mandate repeal would only cause about 5 million more people to go uninsured in that timeframe. There are several reasons for the adjustment, including insurance market changes and methodology tweaks.

While those changes were more technical in nature, the CBO also mentioned an interesting shift that helped cause the drop: people like having health insurance.

"The mandate has been in place for an additional year (five years in total), and people’s expectations about whether one should have coverage are more established and, in CBO’s current judgment, less sensitive to repealing the legal mandate," the report said.

Put another way, Obamacare prompted millions of American to get health coverage for the first time — and a good portion don't want to give up what they've bought.

Recent polling also appears to confirm that many Americans plan to stick with their coverage despite the mandate repeal.

The Kaiser Family Foundation, a nonpartisan health policy think tank, found in a March poll that 90% of people currently enrolled in a plan purchased on the Obamacare marketplace planned to keep their coverage even when the penalty disappears in 2019. Just 7% of people who had these plans told Kaiser they planned to drop the coverage.

The Kaiser also poll found that most people didn't consider the mandate to be a big reason for their insurance purchase. Just 34% of those surveyed said the law's requirement to buy coverage was a "major reason" they decided to sign up.

This could, of course, change over time based on factors like the cost of coverage.

In the report, the CBO also estimated that premiums on the Obamacare individual insurance market would increase by 15% in 2019 and 7% each year afterward through 2027.

SEE ALSO: The GOP just dealt another blow in their steady unraveling of Obama's legacy

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Theranos' star was shining bright going into 2015. 

The darling blood-testing startup had racked up a $9 billion valuation with its big vision to test for a number of conditions off just a small sample of blood, and its CEO Elizabeth Holmes was featured on the cover of business magazines and lists of top executives. But then questions started being raised about how the company's technology worked. 

As Wall Street Journal reporter John Carreyrou details in his new book, "Bad Blood: Secrets and Lies in a Silicon Valley Startup," the events leading up to the imminent downfall of the company started unraveling even years earlier. The book gives a behind the scenes look into the events propelled the biotech startup, Theranos, into chaos and deceit.

Here are the events that contributed to the rise, the fall, the pivot, and now potential criminal charges of the once promising company founded by Holmes. 

SEE ALSO: The reporter who broke the Theranos saga wide open pinpoints the moment he knew he had a big story on his hands

DON'T MISS: The rise and fall of Elizabeth Holmes, who started Theranos when she was 19 and became the world's youngest female billionaire before it all came crashing down

Elizabeth Holmes dropped out of Stanford University in 2003 at the age of 19 to start Theranos, which was then called Real-Time Cures. She was inspired both by her grandfather's medical career, and her summer 2003 internship at the Genome Institute of Singapore. Briefly after the internship she wrote up a patent application for an arm patch that had the ability to diagnose and treat medical conditions.

Shaunak Roy, a PhD student Holmes was assisting in Professor Channing Robertson's lab, joined her at Theranos in May 2004 as its first employee. Robertson joined the company's board as an adviser.

In order to raise initial funding, Holmes leveraged several family connections. The first two investors in Theranos were Tim Draper, the father of her childhood friend and former neighbor, and Victor Palmieri, one of her father's long-time friends. By the end of 2004, Holmes had raised nearly $6 million.

• Allergan just recalled one lot of birth-control pills because the first four pills of the pack are inactive.
• With birth control, messing up the order of hormone to placebo or missing a few days of hormones could lead to unintended pregnancy. 
• Allergan's stock was down 2% on Tuesday. 

Allergan is recalling one lot of birth-control pills because the first four pills in a 28-pill pack are inactive, placing women at risk of pregnancy.

One lot of Taytulla physician sample packs (marked lot #5620706 Exp. May 2019) contained the out-of-order pills, the company said. It learned about the error from a doctor who reported it.

The blister packs should have contained pink capsules with oral contraceptive hormones for the first 24 days, followed by four days of maroon capsules without hormones. Reversing the order of the pills could have gone unnoticed by women taking them. Missing even a few days of the hormones could lead to unintended pregnancy if taken at the wrong time over 28 days.

In a statement, Allergan said it is notifying customers by recall letter. It also encouraged patients to contact their doctors. A call to Allergan seeking more information about how many pill packs were recalled was not immediately answered.

Allergan’s stock fell 2 percent Monday morning. The company has been buffeted for months by bad publicity related to its unsuccessful deal with an Native American tribe to shield itself from a patent challenge.

In January it cut 1,400 jobs to prepare for generic competition to its best-selling product, Restasis eye drops.

SEE ALSO: David Tepper now has the go-ahead to go full activist on Allergan if he wants to

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• A New York Times investigation found after uncovering a chain of confidential internal communications that Purdue Pharma knew that its opioid drugs were being abused in 1996 shortly after they came on the market.
• In 2007, Purdue Pharma pleaded guilty to "misbranding" its drug as less addictive than shorter-lasting painkillers. 
• Earlier in 2018, Purdue said it would cut down its sales force and enforce measures to both reduce the amount of excess drugs in circulation and make drugs with more "abuse-deterrent" properties. 

The US is currently in the throes of an opioid crisis. 

There were more than 42,000 deaths attributed to opioids in 2016, and 40% of all opioid overdose deaths involve prescription opioids. 

One of those prescription opioids, OxyContin, was first introduced to the market in 1996. In the few years following its launch, OxyContin-maker Purdue Pharma received numerous reports and tips that the drug had been circulating in the underground scene and was being widely abused, according to a New York Times investigation.

Purdue Pharma denied knowing anything about the abuse until the early 2000s, but a confidential Justice Department report showed that the drugmaker was notified by several researchers and knew about the abuse shortly after OxyContin hit the market, the Times story said. 

Despite the warnings and complaints, the company concealed such knowledge and continued to market the drug as less appealing to drug abusers and less addictive than normal opioids, according to the Times story. 

"Suggesting activities that last occurred more than 16 years ago, for which the company accepted responsibility, helped contribute to today’s complex and multi-faceted opioid crisis is deeply flawed," said Purdue representative Robert Josephson in an email statement to Business Insider. "The bulk of opioid prescriptions are not, and have never been for OxyContin, which represents less than 2% of current opioid prescriptions. As government reports state, today’s increase of fatal opioid-related overdoses is being driven by abuse of heroin and illicit fentanyl." 

According to the Centers for Disease Control and Prevention, the "economic burden" of prescription opioid misuse alone in the United States is $78.5 billion a year. The National Institute on Drug Abuse says that the value accounts for costs of healthcare, lost productivity, addiction treatment, and criminal justice involvement. 

The prescription drug abuse had its roots in the late 1990s, according to NIDA, when drug companies told the medical community that patients would not become addicted to prescription opioid pain relievers. This caused healthcare providers to prescribe these drugs at a higher rate. Later though, it became evident that opioids like OxyContin were in fact highly addictive and were becoming widely misused. 

The Times uncovered a series of internal communication spanning all the way back to 1996 that found Purdue was complicit in overlooking the dangers OxyContin posed. In May 1996, a study was sent to both Purdue's owner and general counsel alerting them about how drug abusers were extracting morphine from the MS Contin tablets. By 1997, Purdue was aware that OxyContin had become a hotly searched topic online and was especially popular in the underground drug scene. At that time, the company also started receiving numerous reports about abuse, addiction and crimes related to the drug. Examples included local newspaper articles about doctors refusing to prescribe more drugs because of high demand, as well as arrests tied to those purchasing the drug illegally.

Without conducting clinical trials, the FDA permitted Purdue in late 1995 to make the claim that its drug "was believed to have" less appeal to abusers based on a theory that drug abusers preferred the "quicker hit" of shorter-lasting painkillers. Purdue proceeded to center its marketing campaign around that statement. 

In 2007, Purdue Pharma pleaded guilty to "misbranding" the drug and settled after top Justice Department officials  decided not to move forward with felony charges. Purdue admitted that it had "trained sales representative to tell doctors that OxyContin was less addictive and prone to abuse than competing opioids," The Times reported. 

In February 2018, the drugmaker said it would cut its sales force in half and cease promotion of opioids to physicians. In a statement posted on Purdue's website, as part of its "multifaceted approach to address the prescription opioid abuse crisis," Purdue said it would take action to reduce opioid abuse by limiting the length of first opioid prescriptions and thinking of ways to make opioids with abuse-deterrent properties, such as making them harder to crush.

SEE ALSO: Explosive '60 Minutes' investigation finds Congress and drug companies worked to cripple DEA's ability to fight opioid abuse

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• Piraye Yurttas Beim founded a New York-based startup called Celmatix that brings data science and genetics to fertility.
• Her company is the only successful startup of its kind.
• Beim explained that in order to succeed where others failed, Celmatix did a few things that are considered unconventional in the startup world.

When Piraye Yurttas Beim considers the fact that her data-driven fertility startup doesn't have a single competitor, she doesn't feel light and free. 

"It's a huge burden," Beim, whose genetics and reproduction startup Celmatix is the only company of its kind, told Business Insider.

There are plenty of Silicon Valley-style approaches to fertility — bracelets can track your fertile window using data on your temperature and menstrual cycles, and some healthcare benefit providers help cover the cost of procedures like egg freezing and in-vitro fertilization. But no other company looks at the role genetics plays in your chances of conceiving.

Celmatix does this with a spit-in-a-tube genetics testing kit called Fertilome, which looks at the traits that impact your chances of getting pregnant. The company also offers a complementary data analytics platform called Polaris, which is designed to help clinicians track your reproduction journey.

Since being founded nearly nine years ago, Celmatix has managed to raise $60 million in startup funding and interact with more than 90,000 patients through its data platform.

Not only are there no other companies doing what Beim is doing; there are nearly no leading startups of any kind led by women. Last year, all-female startup teams got just 2% of all venture capital investment dollars. At the same time, teams that were men-only got roughly 80%.

But Beim believes Celmatix followed some fundamental protocols that allowed her company to succeed. 

Prioritizing basic science and leaning into government regulation

To emerge as a leader in the field, Celmatix did two things that might be considered unconventional in the startup universe.

First, they emphasized the traditional scientific process, publishing dozens of peer-reviewed papers in recognized scientific journals.

The company maintains a large scientific advisory board of what Beim calls "heavy hitters"— people with decades of experience in the field that lend insight into which new technologies or research the company should consider in its approach.

That nine-member board is key to all of Celmatix's efforts. The advisors keep an eye out for the lastest technological advancements, help evaluate the company's existing efforts, and oversee the peer-reviewed research that informs those approaches.

"And the end of the day, it's about moving the knowledge base forward," Beim said.

Second, Celmatix has embraced government regulation, which many existing scientific startups have instead encountered as a major road block. The team rolled out their laboratory-grade genetics-testing facility in a state with some of the most stringent oversight in the country: New York.

"We started in the hardest state we could have," Beim said.

New York is characterized by rigorous lab-approval criteria, but Celmatix elected to begin its genetics-testing efforts in the state as a means of validating their test's methodology. As a clinical-grade lab, the facility where Celmatix's tests are processed is posed to offer doctors and patients medically verified insight into their health and their chances of conceiving.

And unlike most startups on either the East or West Coast, women make up the majority of Celmatix's team of staff and leadership. Beim said all of those women share the belief that "if we're not doing this, no one else will."

SEE ALSO: A Silicon Valley biotech hub that offers startups $250,000 in funding explains the 'secret sauce' to success

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• Honor, a senior home care startup that wants to use technology to better care for seniors in their homes, has changed the way it's doing business. 
• Honor switched up its business model in late 2017 to start working with home care agencies to staff their practices — rather than compete with them for clients. "They’re really good at being deep in communities," CEO Seth Sternberg told Business Insider.
• To date, Honor has raised $115 million from backers including Andreessen Horowitz and Thrive Capital. 

Home care startup Honor is no longer looking to disrupt the healthcare world in the same way that Uber redefined the taxi industry.

After learning that upending the existing home care world would be more difficult than it had imagined, Honor is crafting a new strategy. The company is now working with established home care agencies by supplying them with technology and employees to take care of their senior clients. It'd be like if a rideshare startup were to supply existing taxi companies with drivers and an app for customers to use.

Honor is part of the multi-billion-dollar home care industry, one that's growing as the elderly population booms in the US. The idea is that having an extra hand at home could help otherwise healthy elderly people stay independent for longer, and hopefully out of the hospital. 

Honor helps out on the non-medical end of things, supplying care professionals that can assist elderly clients with daily chores, transport to a doctor's appointment, grocery shopping, or other activities that are part of daily life, while streamlining the process using technology. 

As Honor got its start, it went head-to-head in competition with the established senior care agencies that were in each of the cities Honor branched into. 

"There's no customer we don't compete for. We compete for every single customer," Honor CEO Seth Sternberg told Business Insider in August 2016. The system of agencies, Sternberg said at the time, was historically "fragmented." 

But late last year, Honor started working with the agencies it once sought to be in competition with.

Instead of competing to recruit elderly clients to use Honor instead of another local agency, agencies have started to use Honor's technology and staffing capabilities to send out care professionals to the clients they manage. 

"They’re really good at being deep in communities," Sternberg told Business Insider. Healthcare — from the pharmacy to the doctor's office to the hospital — is a local experience, and that extends to home care as well. Because home care agencies are already embedded into local communities, Honor doesn't have to replicate that work or compete against them. Now, the company can just plug itself in, handling a lot of the logistics that are similar from agency to agency. 

In May, Honor raised an additional $50 million in a round led by South African tech firm Naspers Ventures to build out its "Care Network," the group of home care agencies that use Honor. To date, Honor's raised $115 million.

How home care agencies use Honor

Working with the home care agency and through Honor's technology (housed in an app and online), Honor lines clients up with a "Care Pro" (the home care professional) who's a good fit and has the right expertise to help out that elderly client. Through the app, family members can schedule times when they need a Care Pro to stop by, add details, and monitor to make sure the visit actually happened.

That way, the Care Pros, the seniors receiving care, the agency that linked the seniors to the Care Pros, and their loved ones are all connected through Honor's app. 

Now that it's working with agencies, most of that process stays the same, but the agencies set up the clients. Honor takes on a lot of the administrative tasks, which has been a big help to Laurie Miller, who runs Apple Care and Companion in Dallas, Texas and started working with Honor at the end of 2017. Miller started her agency with her mother in 2006. Over the last decade, she's seen the home care industry go through some big changes.

"It's like night and day," she said. Recruiting care professionals has gotten more competitive as her small business goes up against not just other home care clinics but nursing homes and other professions.

Because of that competition, Miller would often quadruple shift interview appointments, hoping even one candidate would show. Now, Honor employs the Care Pros that work with Miller's clients. 

Not having to recruit gives Miller more time to grow the business, she said, especially because she can bring on additional care professionals as needed. 

Miller also used to rely on an on-call cell phone that clients could ring if they needed care. Miller and other Apple employees would take turns bringing the phone home overnight and would grapple with finding someone available at an odd hour of the night. 

Now that she's using Honor, clients can call the startup instead. 

Honor has set up shop in San Francisco, Los Angeles, and the Dallas-Fort Worth area. It has also expanded to Albuquerque, New Mexico, to see how the company could fare in a less densely populated area. So far, it's been easier than other places, Sternberg said, in part because there's less traffic for Care Pros to get caught in on the way to a visit. 

Shaking up the senior home care industry has had some growing pains beyond Honor. In February 2017 Homehero, a startup with $20 million in funding, shut down its home care business and pivoted to a healthcare venture. Hometeam, a New York-based home healthcare startup, in May hired a new CEO as part of its push to work more closely with health plans including Medicare and Medicaid.

SEE ALSO: Hometeam, a startup that wants to keep seniors out of the hospital, has hired a new chief executive as part of a management shake-up

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• Pharmaceutical companies have a strategy to block out competition to their prescription drugs.
• According to a new study, about 7% of all pharma mergers and acquisitions from 1989 to 2011 are so-called "killer acquisitions," meaning they're used strategically by big pharma to eliminate competition from smaller companies. 
• The practice could drive up prices on existing therapies, says Florian Ederer, an author of the study. 

Big pharmaceutical companies may have developed a strategy to block out competition to their prescription drugs.

A recent study by researchers at the Yale School of Management and London Business School noted a trend of mergers and acquisitions made by big pharma to strategically eliminate competitors. The researchers dubbed these deals "killer acquisitions."  

For example, a large pharmaceutical company with a successful drug brand might acquire a new, smaller company  making a drug to treat the same disease. This way, the large pharma company can terminate the new drug's development and it can continue to control market share as well as raise prices. The researchers estimated that 7% of pharma deals were so-called killer acquisitions. The practice could drive up prices on existing therapies, says Florian Ederer, an author of the study. 

In a recent example of this, Mallinckrodt Pharmaceuticals settled with the Federal Trade Commission in 2017 after it was charged with violating anti-trust laws over its specialty drug Achtar. Several years earlier, Questcor (a company that Mallinckrodt later acquired) bought a competitor to Acthar called Synacthen. The FTC alleged that this kept other companies from selling the competing drug at a lower price. 

The study suggested that large drug companies sometimes buy up smaller companies only to shut down their production and ongoing development. An analysis of more than 35,000 drugs in development in the U.S. market from 1989 to 2011 gave insight into how these types of deals are reshaping the R&D process at companies. 

Drugs acquired by other large pharma companies were more likely to be terminated than non-acquired drugs, particularly when the parent company already had a similar product, the study found. If these deals hadn't taken place, the number of drugs continuing development each year would increase by 5%. This means killer acquisitions may be preventing a large number of medical treatments from being developed, the study said. 

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• Food and Drug Administration officials say the next wave of drug abuse could involve opioid substitutes.
• These substitutes include gabapentinoids, loperamide, benzodiazepines, and kratom.
• "We must be aware that any decisive actions taken to reduce prescription opioid abuse and stem the tide of overdose and death can have unintended consequences, including prompting people to turn to alternative, potentially dangerous substances," the officials wrote in a recent letter published in The New England Journal of Medicine. 

New addiction trends seem to materialize overnight. For the Food and Drug Administration, every drug is a potential suspect.

In a letter published Wednesday in The New England Journal of Medicine, the FDA officials Douglas C. Throckmorton, Scott Gottlieb, and Janet Woodcock warned that non-opioid painkillers could be at the forefront of the next wave of drug abuse.

"We must be aware that any decisive actions taken to reduce prescription opioid abuse and stem the tide of overdose and death can have unintended consequences, including prompting people to turn to alternative, potentially dangerous substances," the officials wrote in the letter.

There were more than 42,000 deaths in the US attributed to opioids in 2016, and 40% of all opioid-overdose deaths involve prescription opioids, according to the Centers for Disease Control and Prevention.

The FDA says it is reducing excess amounts of opioids in circulation, encouraging doctors to prescribe drugs other than opioids when possible, and developing new therapeutics to help people dealing with pain.

But efforts to curb prescription-opioid abuse by the FDA could effectively shift use to opioid substitutes instead.

Substances that the agency is closely watching are gabapentinoids, which are used to treat seizures and neuropathic pain; loperamide, an over-the-counter treatment for diarrhea; benzodiazepines, which are used to treat anxiety; and kratom, a plant-based supplement with psychoactive effects that can enhance mood and offer pain relief.

The FDA says it is able to get at the forefront of the latest trends in drug addiction by sifting through internet forums and online mentions to detect concerning patterns. While opioid substitutes are safe when used appropriately, instances of misuse have attracted the agency's attention.

SEE ALSO: A bombshell New York Times report says that Purdue Pharma knew OxyContin was being abused within the first few years after it launched

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• Healthcare costs in the US continue to soar, yet the conversation typically focuses on the high costs of treating diseases, rather than the potential benefit of greater efforts for prevention.
• The fastest way to lower costs is to reduce the number of Americans who are overweight, smoke, or drink too much alcohol.
• Americans should make changes in their lifestyles, and the food industry needs to change the way food is prepared and marketed.
• Doing so could prevent many of the chronic diseases driving up the nation’s health care costs, and reduce the need for expensive treatments.
• Finland decreased its rate of deaths from coronary heart disease by 63% by persuading its farmers and food processors to produce healthier products.

The discussion of the soaring costs of health care in the US often focuses on the high costs of treating diseases, rather than on the potential economic benefits of preventing them. Changes in lifestyle and diet could prevent many of the chronic diseases driving up the nation’s health care costs, improve health, and reduce the need for expensive treatments.

As we write in a new Milken Institute report, US health care costs for chronic diseases such as heart disease, cancer, diabetes, and Alzheimer’s disease totaled $1.1 trillion in 2016. When lost economic productivity is included, the total economic impact was $3.7 trillion. This is equivalent to nearly 20% of the US gross domestic product.

In terms of risk factors, being overweight or obese accounted for $1.7 trillion, or 47% of the total cost. Approximately 8.7% of health-care spending in the US is attributable to cigarette smoking; 60% of that is paid by public sources — Medicare, Medicaid, and other US federal and state health programs. Health problems caused by excessive drinking cost $27.4 billion in 2010, or 1% of the total cost of chronic diseases and 11% of the total costs of alcohol abuse.

The fastest way to lower costs, or at least to slow the upward spiral, is to reduce the number of Americans who carry excess weight, smoke, or drink too much alcohol. The share of American adults classified as obese increased from 13% in 1960 to almost 40% in 2016. Another 33% are overweight. Epidemiologic research has established a strong link between obesity and chronic diseases such as heart disease, kidney disease, and several types of cancers.

Unless Americans make changes in their lifestyles and the food industry changes the way food is prepared and marketed, the number of people with chronic diseases — and the cost of treating them — will continue to rise. The aging of the US population compounds these challenges, as both the prevalence and severity of chronic diseases increase with age. The Partnership to Fight Chronic Disease estimates that by 2030, 83 million people in the US will have three or more chronic health conditions, up from 31 million in 2015.

That trend highlights America’s health care dilemma. We spend over $10,000 per person every year on health care, more than any other country, yet our life expectancy is below the average of other high-income countries. Behavioral factors — unhealthful eating, a lack of exercise, smoking, and excessive use of alcohol — are among the reasons.

We need to address these cost drivers.

The Chronic Disease Management Act now before Congress is a step in the right direction. The legislation would enable more patients to receive preventive services by permitting high-deductible insurance plans to cover prevention before the deductible is met.

Other promising approaches include public awareness and health education campaigns, as well as financial incentives for weight loss, exercise, and smoking cessation. Infrastructure improvements can encourage more people to walk, jog, and bike. Whether through regulation or self-policing, food companies need to reduce the amount of salt, fat, sugar, and other unhealthy additives in their products. The use of taxes and regulation to limit consumption of unhealthy foods, tobacco, and alcohol also merits consideration.

Finland offers an example of how to do this. In the early 1970s, the province of North Karelia had the highest heart attack rate in the world. What came to be known as the North Karelia project led to a 63% decline in deaths from coronary heart disease for men between the ages of 30 and 64. The proportion of men who smoked regularly declined from 52% to 36%.

The project, which continued for more than two decades, went beyond educating consumers about healthier diets, getting more exercise, and the hazards of smoking. It persuaded farmers to produce less red meat and dairy products in favor of the vegetables and berries that grow well in Finland’s cold climate, and lobbied food processors to reduce potentially harmful ingredients in packaged food.

A project like this for the US could include similar measures, including a reexamination of agricultural subsidies that indirectly lower the cost of many processed food products and sugar-sweetened beverages.

Prevention is far cheaper than treatment — but changing health-related behaviors is difficult. The federal government has been fighting obesity since at least 1956 when President Dwight Eisenhower created the President’s Council on Youth Fitness. Yet obesity rates have soared.

We’ve had better success with smoking. Beginning with the landmark 1964 surgeon general’s report on smoking and health, concerted public health, regulatory, and economic efforts have lowered the smoking rate from nearly 45% in 1965 to about 15% today.

There are hopeful signs on the horizon in the fight against chronic diseases: increased awareness of their growing economic burden along with pressure from employers and public and private insurers has reinvigorated the call to focus on prevention. Combatting chronic diseases before they occur may prove to be an effective way forward.

Advances in medical technology and science are enabling medical treatments scarcely imagined only a few years ago. “Targeted” therapies attack cancer at the molecular and cellular level and can be customized to fit a person’s genetic makeup; bionic limbs give amputees more active lives.

We need similar “targeted” therapies aimed at human behaviors. Finland’s success reducing heart attacks in North Karelia and the effectiveness of anti-smoking campaigns in the US show that the right combination of education, policy, and incentives can work. It is time apply these lessons widely to fight the drivers of our chronic disease epidemic.

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• Parachute Health, a startup that's trying to digitize the process of prescribing medical equipment, just raised $9.5 million.
• Durable medical equipment such as oxygen tanks or wheelchairs often have to be ordered using a fax machine. Parachute is trying to change that by creating a platform hospitals, medical suppliers, and insurers can all communicate on.
• "The only loser here is the fax machine," Parachute CEO David Gelbard told Business Insider.

Parachute Health CEO David Gelbard sees his main competitor as an unlikely one: the fax machine. 

While the machines are considered inefficient and outdated in most offices, they're actually still used in many hospitals to order durable medical equipment, like oxygen tanks or wheelchairs. 

In response, the New York-based startup is trying to digitize the process of getting this type of equipment to make it easier for hospitals to prescribe it, insurers to pay for it, and suppliers to ship it out to patients who need it as soon as they leave the hospital. That way, the hospital doesn't have to send a fax to communicate the order, and the patients can get it quicker than they might have otherwise.

Gelbard sees it as a win for everyone involved in the process. 

"The only loser here is the fax machine," Gelbard told Business Insider. 

According to the National Health Expenditures report, durable medical equipment only made up about 2% — or $51 billion — of the $3.3 trillion spent on healthcare in the US in 2016. Prescription drugs, for comparison, made up about 10% of the healthcare spend. Even so, Gelbard said, he feels it's an important part to fix. 

"It's such a critical piece to solve, just because of the disproportionate impact on a patient," he said. 

Parachute on Monday announced a $9.5 million funding in a series A round led by Insight Venture Partners to help the company get its technology into more health systems. In total, the company has raised $15 million. 

How Parachute works

Elsewhere in the hospital, information about a particular patient can travel from one place to another electronically. For example, your doctor might send out a prescription, and it goes to your pharmacy seamlessly through electronic prescribing. The same goes for ordering blood tests.

The problem is when you leave the hospital. Everything that happens within the four walls of the medical facility is bound by electronic medical record, which digitizes everything that happens within the facility. At the point of discharge, the EMR stops and patients have to deal with an antiquated world of paper order forms and fax. That's where Parachute wants to step in. 

Here's how it works: Before the patient leaves the hospital, a care manager or physical therapist will access needs of the patient outside of the treatment center.

For example, if they need a wheelchair or oxygen tank, they can go into an electronic health record such as Epic, open up Parachute, and order the equipment needed. The form can be signed and processed electronically before being rerouted to the supplier that can take the order. 

Parachute charges the supplier side of the market for the technology, and then works to link them up to nursing homes, home care agencies and hospitals digitally. 

"We're just replacing the fax-day workflow that exists today to connect this dot in the healthcare system," Gelbard told Business Insider. 

SEE ALSO: A startup that’s raised $115 million once wanted to disrupt the multi-billion home care industry — now it’s working with it

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• A study found that around 70,000 early-stage breast cancer patients a year could safely skip chemotherapy without hurting their chances of beating the disease.
• The study used a genetic test called Oncotype DX to measures each patient's cancer risk.
• Women who had scored at an intermediate risk of cancer had the same outcomes with surgery and hormone therapy with or without the chemotherapy. 

CHICAGO (AP) — Most women with the most common form of early-stage breast cancer can safely skip chemotherapy without hurting their chances of beating the disease, doctors are reporting from a landmark study that used genetic testing to gauge each patient's risk.

The study is the largest ever done of breast cancer treatment, and the results are expected to spare up to 70,000 patients a year in the United States and many more elsewhere the ordeal and expense of these drugs.

"The impact is tremendous," said the study leader, Dr. Joseph Sparano of Montefiore Medical Center in New York. Most women in this situation don't need treatment beyond surgery and hormone therapy, and "the rest of them are receiving chemotherapy unnecessarily."

The study was funded by the National Cancer Institute, some foundations and proceeds from the U.S. breast cancer postage stamp. Results were discussed Sunday at an American Society of Clinical Oncology conference in Chicago and published by the New England Journal of Medicine. Some study leaders consult for breast cancer drugmakers or for the company that makes the gene test.

Moving away from Chemo

Cancer care has been evolving away from chemotherapy — older drugs with harsh side effects — in favor of gene-targeting therapies, hormone blockers and immune system treatments. When chemo is used now, it's sometimes for shorter periods or lower doses than it once was.

For example, another study at the conference found that Merck's immunotherapy drug Keytruda worked better than chemo as initial treatment for most people with the most common type of lung cancer, and with far fewer side effects.

The breast cancer study focused on cases where chemo's value increasingly is in doubt: women with early-stage disease that has not spread to lymph nodes, is hormone-positive (meaning its growth is fueled by estrogen or progesterone) and is not the type that the drug Herceptin targets.

The usual treatment is surgery followed by years of a hormone-blocking drug. But many women also are urged to have chemo to help kill any stray cancer cells. Doctors know that most don't need it, but evidence is thin on who can forgo it.

The study gave 10,273 patients a test called Oncotype DX, which uses a biopsy sample to measure the activity of genes involved in cell growth and response to hormone therapy, to estimate the risk that a cancer will recur.

What the study found

About 17 percent of women had high-risk scores and were advised to have chemo. The 16 percent with low-risk scores now know they can skip chemo, based on earlier results from this study.

The new results are on the 67 percent of women at intermediate risk. All had surgery and hormone therapy, and half also got chemo.

After nine years, 94 percent of both groups were still alive, and about 84 percent were alive without signs of cancer, so adding chemo made no difference.

Certain women 50 or younger did benefit from chemo; slightly fewer cases of cancer spreading far beyond the breast occurred among some of them given chemo, depending on their risk scores on the gene test.

Will people trust the results?

All women like those in the study should get gene testing to guide their care, said Dr. Richard Schilsky, chief medical officer of the oncology society. Oncotype DX costs around $4,000, which Medicare and many insurers cover. Similar tests including one called MammaPrint also are widely used.

Testing solved a big problem of figuring out who needs chemo, said Dr. Harold Burstein of the Dana-Farber Cancer Institute in Boston. Many women think "if I don't get chemotherapy I'm going to die, and if I get chemo I'm going to be cured," but the results show there's a sliding scale of benefit and sometimes none, he said.

Dr. Lisa Carey, a breast specialist at the University of North Carolina's Lineberger Comprehensive Cancer Center, said she would be very comfortable advising patients to skip chemo if they were like those in the study who did not benefit from it.

Dr. Jennifer Litton at MD Anderson Cancer Center in Houston, agreed, but said, "Risk to one person is not the same thing as risk to another. There are some people who say, 'I don't care what you say, I'm never going to do chemo,'" and won't even have the gene test, she said. Others want chemo for even the smallest chance of benefit.

Adine Usher, 78, who lives in Hartsdale, New York, joined the study 10 years ago at Montefiore and was randomly assigned to the group given chemo.

"I was a little relieved. I sort of viewed chemo as extra insurance," she said. The treatments "weren't pleasant," she concedes. Her hair fell out, she developed an infection and was hospitalized for a low white blood count, "but it was over fairly quickly and I'm really glad I had it."

If doctors had recommended she skip chemo based on the gene test, "I would have accepted that," she said. "I'm a firm believer in medical research."

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Marilynn Marchione can be followed at @MMarchioneAP .

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The Associated Press Health & Science Department receives support from the Howard Hughes Medical Institute's Department of Science Education. The AP is solely responsible for all content.

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• Over the weekend at the American Society of Clinical Oncologists meeting, a lot of updates and new data were presented. 
• It sent stocks all over the place Monday with the biggest movers being Bristol-Myers Squibb, Nektar, Loxo and Bluebird bio. 

Investors had mixed reactions to some of the data coming out of an annual cancer conference this weekend.

The American Society of Clinical Oncologists held their annual meeting in Chicago this past weekend with many pharma and biotech companies presenting updates to their trials and new data. Although there were no huge breakthroughs or discoveries, many data showed promising results for future treatments.

Here's how some major movers measured up:

• Celgene and Bluebird bio presented updated results from the ongoing phase I clinical study for an investigational CAR-T cell therapy for multiple myeloma, a form of blood cancer. While not a cure, it is one of the more promising data seen in myeloma, analysts said. Celegene's stock was flat and Bluebird's stock was up 3.4% as of Monday afternoon. 
• Nektar Therapeutics and Bristol-Myers Squibb presented preliminary data based on a trial that combined Nektar's immunotherapy NKTR-214 with BMS's Opdivo. The trial's results didn't impress investors and sent both companies' stocks down as of Monday afternoon, with Nektar down 43.2% and BMS down 3.3%. 
• Loxo Oncology presented positive data in its early stage trial looking at the effect of a new drug, LOXO-292 on tumor reduction for three types of cancer. Loxo's stock was up 12.5% to a record high after the abstract presentation over the weekend, but dropped 1.9% Monday. 
• Merck, which was dubbed the "winner" after the data it presented at another cancer conference in April, remains a leader in the field presenting positive results for Keytruda in treating non-small cell lung cancer. Its stock was up 2.3% Monday afternoon.  

SEE ALSO: We're getting new treatments for 'a disease that once was definitely a death sentence' — but it comes with a big price tag

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• Women dominate jobs in healthcare, education, administration, and other industries. Nursing and teaching are especially popular. 
• These 43 jobs are held by more women than men.
• The best-paid career is nurse midwife, which has a median income among women of $101,552.

Some jobs are dominated by women.

According to data from the US Census Bureau's 2016 American Community Survey, women comprise at least 80% of the workforce in these 43 jobs. Business Insider pulled the salary information from ACS and descriptions of each of these jobs from the Bureau of Labor Statistics. 

Many of these jobs are in healthcare, education, and administration. Nursing and teaching are especially popular for women, and the best-paid job on the list is nurse midwife.

Read on for the full list:

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Eligibility interviewer, government programs

Median pay for women: $41,024

Percent women employed: 80.3%

What they do: Determine eligibility of persons applying to receive assistance from government programs and agency resources, such as welfare, unemployment benefits, social security, and public housing.

Library technician

Median pay for women: $28,397

Percent women employed: 80.4%

What they do: Assist librarians by helping readers in the use of library catalogs, databases, and indexes to locate books and other materials; and by answering questions that require only brief consultation of standard reference.

Audiologist

Median pay for women: $72,123

Percent women employed: 80.5%

What they do: Assess and treat persons with hearing and related disorders.

• Axovant, a biotech company founded by Vivek Ramaswamy, is pivoting to gene therapy after its Alzheimer's drug tanked last year.
• The therapy comes from Oxford BioMedica and it uses a harmless virus to deliver three genes key to production of dopamine and hopefully relieve neurodegeneration from Parkinson's.
• The company plans to start its first clinical trial this year.

If you bet $100 on Axovant Sciences nine months ago, you’re down 93 bucks.

But the biotech company best known for a blowup rivaling bitcoin wants a second chance, and on Wednesday is unveiling new management and a new drug it believes can win investors back over.

Axovant, founded by biotech entrepreneur Vivek Ramaswamy, is pivoting to gene therapy. The company paid $30 million up front for a one-time treatment Axovant believes could change the lives of patients with Parkinson’s disease.

The therapy comes from Oxford BioMedica, a U.K. firm that helped Novartis bring about the first CAR-T therapy to win FDA approval. Called AXO-Lenti-PD, Axovant’s new project uses a harmless virus to deliver three genes key to the production of dopamine and thereby relieve the neurodegeneration that characterizes Parkinson’s. The company plans to start its first clinical trial this year.

It’s a sharp pivot for Axovant, whose first act depended on outfoxing larger firms with repossessed drugs. Gene therapy is considerably more ambitious — and considerably riskier — than the company’s foundational strategy.

The question now is how investors will react. They’ve heard a version of this story before.

Three years ago, Axovant pulled off an industry-record initial public offering on the idea that it could succeed where GlaxoSmithKline failed with an investigational drug for Alzheimer’s disease. The drug, acquired for just $5 million up front, turned Axovant into a darling of Wall Street with a multibillion-dollar valuation. Ramaswamy, then 30, landed on the cover of Forbes, where he pledged to create the “Berkshire Hathaway of drug development.”

It hasn’t worked out that way so far. In September, Axovant revealed that GSK was right to sideline that Alzheimer’s drug, which failed in a large clinical trial. In January, a second clinical failure led Axovant to cut ties with the drug altogether, sending its once-soaring stock price below $3 a share.

A month later, Dr. David Hung, the biotech luminary Ramaswamy recruited to run Axovant, resigned and deleted the whole experience from his LinkedIn profile.

In biotech circles, the Axovant debacle became a referendum on Ramaswamy, who left a career as a hedge fund manager to build a constellation of biotech companies at work on drugs licensed from other firms.

The saga has turned Ramaswamy into a uniquely divisive figure in an industry more prone to circling wagons than ostracizing pariahs. To his admirers, he’s a clever operator with a novel approach and enough humility to recruit people who know things he doesn’t. To skeptics, he’s a Wall Street profiteer responsible for a Rube Goldberg machine of sketchy biotech companies that turns investor cash into short-term returns for his friends.

The pivot to gene therapy is a chance for Ramaswamy, Axovant’s chairman, to write a second act for his neuroscience company.

Cheruvu said the Oxford BioMedica deal represents “a strategic shift” for the company, an effort “to push Axovant in the direction of transformational therapy, not just incremental advances.” The company recruited Fraser Wright, a founder of the gene therapy company Spark Therapeutics, to serve as its chief technology officer. He joins Michael Hayden, a scientist behind the first gene therapy approved in the West, who joined Axovant as an adviser last month.

AXO-Lenti-PD is step one is Axovant’s transformation, Cheruvu said. The company plans to bring in more gene therapies and treatments for Parkinson’s.

“This is just the beginning,” he said. “If I do my job right, my hope is that we’ll hear many more announcements like this in the coming months.”

Now we’ll see what Wall Street thinks. Axovant closed at $1.75 per share on Tuesday. There’s plenty room to grow.

SEE ALSO: A biotech founded by a 32-year-old just failed a key Alzheimer's drug trial

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• A recent study found that generic drug companies with more competition had a higher number of recalls due to manufacturing problems.
• Higher competition was also found to be associated with lower FDA plant inspection scores.
• The study recommends that the FDA more closely regulate how generic drugs are made and the manufacturing quality of the plants that produce them. 

There's a caveat to the availability of cheaper drugs: There's no guarantee on consistent quality. 

These days, generic drugmakers can't seem to win. Consolidation of generic drug companies result in shortages, which negatively impacts patients. But competition has its own consequences as well. 

Generic drug price competition in the market is associated with higher number of product recalls due to manufacturing-related issues, according to a new study. These findings were published last week in the Journal of Operations Management by researchers from Indiana University's Kelley School of Business, University of Minnesota's Carlson School of Management, and University of Notre Dame's Mendoza College of Business 

"When we push companies to be more cost competitive, that money has to come out of somewhere," George Ball, one of the study's authors, told Business Insider. And it's very likely that the firms are cutting costs on manufacturing, which could have implications on drug quality.

The researchers cross-referenced two datasets: product recall data across a 12-year period and data from the Food and Drug Administration's Orange Book, which contains approved drug products with therapeutic equivalence evaluations to measure product competition in the pharmaceutical industry. 

Generic drugs continue to populate the marketplace, and that's thanks to the Drug Price Competition and Patent Term Restoration Act, also known as the Hatch-Waxman Act, which passed in 1984. The act sought to increase competition and lower prices by speeding up the generic drug approval process.

However, upon closer examination of 939 recalls over a 12-year period, the researchers noticed that greater competition was linked with more reports of severe manufacturing recalls that could potentially cause death or medical harm to the customer. 

High competition was also found to predict poorer FDA plant inspection scores, which in turn predicts the recalls, Ball said. These inspections are geared toward measuring how well the plant is managing their product quality. 

The researchers suggest that these problems could be solved by more aggressive inspection of the manufacturing and production of high volume generic drugs. "Consider not just what's in the drug, but how the drug is being made," said Ball. 

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• On Thursday, the US Justice Department proclaimed that the part of the Affordable Care Act requiring people to have health insurance was unconstitutional.
• This also extends to two major provisions of the ACA, also known as Obamacare, including one that protects people with preexisting conditions from being denied coverage.
• A coalition of 20 states led by attorneys from Texas and Wisconsin sued the government in February for the repeal of the Obamacare provisions.
• Attorney General Jeff Sessions said the Justice Department would not defend the preexisting-conditions provision or the provision allowing insurance companies to impose discriminatory pricing.

WASHINGTON — The US Justice Department on Thursday said the part of Affordable Care Act requiring people to have health insurance is unconstitutional, an unusual move that could lead to stripping away some of the most significant and popular parts of the law, better known as Obamacare.

In a brief filed in a federal court in Texas, the department said a tax law signed last year by President Donald Trump that eliminated penalties for not having health insurance rendered the so-called individual mandate under Obamacare unconstitutional.

The Justice Department said that also nullified two other major provisions of Obamacare linked to the individual mandate, including one barring insurance companies from denying coverage to people with preexisting conditions.

Attorney General Jeff Sessions, in a letter to House Speaker Paul Ryan, said he had determined the individual mandate would be unconstitutional when the tax law takes effective in 2019.

The mandate in Obamacare was meant to ensure a viable health-insurance market by forcing younger, healthier Americans to buy coverage.

The Justice Department rarely declines to argue in favor of existing law in court, and this decision will put pressure on the Affordable Care Act, which was President Barack Obama's signature domestic achievement.

A coalition of 20 US states sued the federal government in February, claiming the law was no longer constitutional after last year's repeal of the penalty that individuals had to pay for not having insurance.

Led by Texas Attorney General Ken Paxton and Wisconsin Attorney General Brad Schimel, the lawsuit said that without the individual mandate, Obamacare in its entirety was unlawful.

Sessions said in his letter that the Justice Department was not arguing that the entire law did not pass constitutional muster. He said the department refused to defend only the preexisting-conditions provision as well as one forbidding insurers from charging people in the same community different rates based on gender, age, health status, or other factors.

Trump and fellow Republicans in Congress have sought to dismantle Obamacare, which sought to expand insurance coverage to more Americans.

(Reporting by Eric Beech and Lisa Lambert; Editing by Leslie Adler)

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