136 – How the MAHA Movement Is Rewiring U.S. Healthcare Policy

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Vic: Okay. Welcome to Health Further. We have a guest host today. Marcus is outta town, enjoying himself. Rick Abramson, thanks for doing this. Really appreciate it.

Oh man. Thank you so much 

Rick Abramson: for having me, Vic. I'm thrilled to be here. I cannot tell you how excited I am. This is, this is great. What a great opportunity. Um, gotta say a little intimidating, you know, sitting in the Marcus Whitney chair, 

Vic: it is hard to, uh, step into the Marcus Whitney chair. But, but, uh, you have been a friend of ours, a friend of the pod, and then, uh, previously you've been on the show already, so this is old hat to you.

Yeah, we did for, uh, new listeners. We'd episode 73 about a year ago Oh wow. About AI in healthcare. Um. AI feels like changes every day. So a lot has changed since last July. So we'll dig into it for sure. Um, how's the week been? How you been, uh, following the news and getting ready? There is, uh, it is like too much, man.

I feel like buried by all [00:01:00] this stuff going on, you 

Rick Abramson: know? Yeah. It's been, uh, it's been nuts. Yeah. Um, but it's, but we're super happy to be here. I gotta say I'm a little, a little disappointed. I was hoping that there'd be like, kind of like. In the Marcus Whitney chair, like a little setup, like the matrix where I can like plug something in the back of my head.

Yes. Yeah. Download and just immediately get all the knowledge. Much the knowledge. Yeah, exactly. We 

Vic: don't have, you know, any fans. Eventually we'll get a live studio hoping I'd walk out here like a Juujitsu master or something like that. Yes, yes. So, um, next Simon, give the audience a little bit of your background.

So, um, you've, you're, you're a physician. Yeah. And then you left. Everyday practice and moved into the business side. But, but how, how would you describe it? 

Rick Abramson: Yeah. Well, so 

Vic: man, 

Rick Abramson: former, what kind of 

Vic: physician? Maybe just give a little bit more of your background. 

Rick Abramson: Yeah. Uh, so former, former McKinsey consultant before I mm-hmm.

Before I even went to medicine. Um, former Vanderbilt doc. I'm a radiologist, uh, former HCA for a couple years, former Chief Medical officer for a couple of AI startups. So, uh, a lot of formers in there. Yeah. You know? Yeah. Um, Hey man, I just, I'm, I'm just healthcare [00:02:00] curious, you know? Yeah. Like, like you guys, and, uh, yeah, man, there's so much interesting stuff going on.

You know, the intersection between the, the policy world, the tech world, um, and how it, how it impacts on the whole venture ecosystem. Mm-hmm. It's a great time to be doing the stuff, man. Yeah. And it's just, it's so interesting. And then 

Vic: you, um, you left the US regulatory, um. Area mm-hmm. To pursue AI outside of the us.

Talk about that decision and what it's like outside, um, of the FDA kind of purview. 

Rick Abramson: Yeah. Well, so I was, uh, working with a startup, uh, based in Sydney, Australia. Yeah. Uh, that did AI for medical imaging and, um, you know, it was a lot easier outside the US Yeah. And, uh, you know, than it is here. Um, it was actually, when I was there, it was really a tale of two businesses.

You know, you have the. Outside the US business and the inside the US business. Mm-hmm. Um, and so now, you know, new administration, you know, maybe things change, maybe they don't. I'm sure we'll get into it. Yeah. Um, but uh, you know, regulatory is definitely a huge barrier for people doing ai, especially clinical ai, right?

Mm-hmm. And we, we talked about that [00:03:00] last time. Yeah, right. Clinical versus non-clinical ai. Um, but, uh, a huge learning, learning opportunity and, um, a lot of good stuff going on all over the globe. 

Vic: Yeah. Excellent. Okay, well, let's dig in a lot of stories this week. Let's do it.

Okay. We are gonna start with the economy. You're a listener. So, you know, we start with the kind of economic backdrop for healthcare and the non-farm payroll. The BLS came out with their jobs report for April on Friday, and Marcus and I talked about, um, the preview. A DP had a, had a preview that was disappointing, but, but the actual report came out very strong.

177,000 jobs ahead of expectations, which were 1 33. Yep. Um, what's your sense of the payroll market? 

Rick Abramson: Yeah. Well, first thank you for starting here and reminding us that there are still traditional macroeconomic indicators that are important, right? I mean, it seems like the market is [00:04:00] just moved by, you know, the latest PostIt truth, social, but, um, yeah.

Uh, jobs numbers are still important and, um, yeah. I mean, these came in, these were, these were good. They, they beat expectations, but they didn't crush expectations. Yeah. They were not too hot, not too cold, you know, dare I say Goldilocks? Yeah. Numbers maybe. Um, so, um, yeah, but the big asterisk there, right, is that these, you know, these are probably a little too soon to reflect any changes in hiring from the, from the tariff announcements, right?

So, 

Vic: right. Yeah. And so then we had the fed meeting. Yesterday, well, Tuesday and Wednesday, but the, uh, Powell came out yesterday and gave his discussion and he, he kind of had a similar reaction to yours. Um, he's in a wait and see. He's not gonna be preemptive and, and think he can guess where the economy's going, but more kind of ready watching pricing, inflation watching the jobs.

Yeah. Right now he is sort of following the data and watching things come in. Uh, what are your thoughts about that? Is that where you think you should be? Or what, what are your thoughts [00:05:00] about that? Yeah. 

Rick Abramson: Well, you know, it's, it says so often now, it's, it's become cliche, but I'll just say it again. I wouldn't be wanna be Jerome Powell, you know?

I mean, you can't, you can't lower rates because of inflation. You can't raise rates because, you know, GDP numbers are starting to get a little soft, you know? Mm-hmm. One day he is getting. Fired the next day. He is not right. And we're like, yeah, what's the fed chair to do? Right. Um, so, you know, here he's kind of kicking the can down the road, which is very, I think, appropriate because, um, you know, we don't know, like the impact of trade negotiations is it would, would be, would be huge.

So it's wait and see, I think for, for, for the Fed. 

Vic: Yeah. Yeah. That, that's certainly where he is. I have been, and I still think, um, because policy takes three, six, maybe nine months to really take effect, I think that the tariffs are gonna have much more of a drag on the economy than they'll have an inflationary effect.

So I would've liked to see him take a small step into, uh, accommodating. But I'm a VC too, so maybe all Of course. Yeah. And maybe short-term [00:06:00] inflation followed by 

Rick Abramson: long-term drag. Yeah, yeah. Um, in this case, oh, no question. Short-term inflation, but, and then, uh, and then it's hard to hit the, the timing, right?

Yes. Yeah. Right, 

Vic: right. Okay. Moving on to the next story. So, um, Trump in the US signed their first trade deal with the UK today, and so good to see some progress. What were your thoughts about this first deal? Yeah, I 

Rick Abramson: mean, markets seem to like it. I think they're looking for any kind of good news. Mm-hmm. Um, I haven't seen the details of the trade deal.

I don't know, I don't know what, how much changed and that's what I'm gonna be looking to see. Yeah. I don't, I haven't seen, I think that's because 

Vic: there weren't many details. Yeah. Um, there was sort of combinations for a UK steel and automotive, um. But I think it's positive that we got a deal signed.

Mm-hmm. I don't think it's that surprising that the UK and US can strike a deal. Yeah. Um, we had a trade surplus with the UK last year. Yeah, exactly. So this is not like the, the most important [00:07:00] one, but it, but it's good to get some momentum maybe and get the first one. Right. Right. 

Rick Abramson: And if your, if your, if your metric is the trade is the trade deficit, then this is an easy one for you.

Right, right. 

Vic: Yeah. Us and China officials are meeting, uh, really for the first time to have trade talks in Switzerland. Kind of a neutral party. Yeah. I don't think it's high level Trump and, and gee, you're not gonna be there. Um, but what are your thoughts about this? Uh, from what I 

Rick Abramson: understand, the way this happened was that, you know, UK and China, I mean, sorry, US and China just not talking to each other at all, uh, refusing to engage.

And then, you know, maybe like a week or two ago, China sent some kind of like signal kind of basically saying like, and it was about Fentanyl, right? Yeah. And it was kind of like, um, so, you know, do you think I could do, you know, what, what do you think I could do about fentanyl? Yeah. And us is like, oh, I've got, I've got some suggestions for you.

Yeah. And that kind of opened up the pathway to this, uh, uh, to everyone talking. Yeah. Like to them talking. So, um, you know, it's good news, but they've got a long way to go. 

Vic: Yeah, 

Rick Abramson: yeah. 

Vic: Yeah. I mean, unlike the uk, which was relatively easy, uh, with a lot of work [00:08:00] to do with China. Yeah. But, but positive that they have started or they're about to start.

Rick Abramson: Right. And lots of, a lot of pressure on both sides to, to engage in these talks. 

Vic: Yeah, that's right. Okay. Moving into the venture, sort of roll up. So, TSO life raised $43 million in a Series B, uh, led by peaks span capital. Uh, so they produce a product that helps, uh, senior living, assisted living, um, bring better experiences for their residents.

What do you, do, you know about, what do you think about this deal? All right, 

Rick Abramson: so I gotta tell you, I looked, I looked at this and my first thought was that, remember that Saturday Night Live sketch a couple years ago, it was the Amazon for seniors, like the Amazon Alexa device for seniors. Hilarious. You know, like Keenan Thompson can't pronounce Alexa, he gives going Clarissa Odessa.

And you got like the Kate McKinnon character who's like turning it, telling it to turn up the heat in the room. Um, so this is not AI for seniors, but it's AI for operators of senior living facilities, right? Yes. And so [00:09:00] from what I understand, you do kind of do an interview with the, with the nursing home resident or the senior living resident coming in, and then based on that interview.

Uh, it's gonna generate some insights to help personalize the experience mm-hmm. For the resident, like suggesting customized activities and, you know, friends that they can make. Um, the, the example I saw was like, somebody comes up to a facility director, they want a bridge partner and they dashboard will suggest a, a bridge partner.

Yeah. They, 

Vic: Vic also likes bridge. Yes. And exactly. That's right. 

Rick Abramson: Um, I, I don't know, I mean, sounds nice. I don't know if not really a must have or maybe I'm doing too, being too harsh. I don't know. 

Vic: I, I think I agree. I mean, I'm hopeful. I think our seniors deserve to have better experiences so that, that that sounds great.

It's a good vision. Yeah. And at the same time, for the past 20 years, I have invested in and lost money in various technologies to make the senior resident experience better [00:10:00] and just adoption is hard. Yeah. It's, it's not, um, there's not a lot of motivation to bring new things like this in. Um, but I'd love to see it get adoption.

Yeah, for sure. Next one is Food Health Company. Uh, raised seven and a half million dollars in a series A as they pivoted their business model. So this was a food as medicine startup in San Francisco maybe five years ago or so when food as medicine started being really, um, hot and your, your insurance company would subsidize healthy food for you.

Yeah. And now they're pivoting bite well before, right? Yes. Bite. Well, um, mm-hmm. Guess a little bit. Not quite that long ago. 2023 is when they raise their seed round. Yeah. Um, and they're now pivoting because food as medicine and subsidizing food for members is kind of outta favor or not as common anymore.

Mm-hmm. That's right. Yeah. Uh, Medicaid maybe won't subsidize that [00:11:00] for very much longer. Um, so they're moving more to. Um, work with grocery stores about advising people on what is healthy and what's not healthy. 

Rick Abramson: Yeah, I saw that They're, um, yeah, they have a deal with Kroger. Yeah. Um, so across the, that, that portfolio that includes like Harris Teeter and Ralph's.

Right. And, uh, yeah, I haven't been to Kroger in a while. I want to, I wanna go in and see if I can look for this. So this is a, it basically gives you a score, right? Like a score rating from one to 100 on the food and its nutrient density and the ingredient quality and, um, yeah. Pretty interesting. Um, I think, yeah.

Um, really, I mean, I think the most important thing here is that, how it fits into this whole Yeah. Food is medicine, you know? Yeah. Make America healthy again, you know, kind of movement. Um, which I think we'll, we'll talk about in a little bit, but I mean, this is kind of poster child for that type, that type of stuff.

Vic: Yeah. Yeah. And the chief medical officer at Kroger is a friend of mine from the fellow he's here from Nashville, Mark Watkins. Okay. We were in fellows together. Yeah. He's been trying to bring, uh, food as medicine sort of concepts into the forefront at Kroger for a [00:12:00] long time. Yeah. Um, and so hopefully this will help there.

Okay. Then last one in the Venture Deerfield management, one of the, uh, one of the strongest, largest, um, VC firms in, in healthcare raised a $600 million fund, which is smaller than they have raised in the past, and they called it a constrained market. So good to see them get their fund closed. Um, but if Deerfield was having trouble, uh, the entire market's having trouble 

Rick Abramson: Yeah.

Kind of a, kind of a mixed message a little bit, right? Mm-hmm. I mean, it shows that you can still raise, but I it took 'em a long time, right? I think it took 'em 18 months to complete the raise. Yeah. And so, you know, people are still investing, but there's a lot of hesitancy Yeah. Out there. Yeah, that's right.

And then we haven't had a big biotech IPO in a, in a while. Right, right. 

Vic: Yeah. Exits in general across healthcare have been sparse, let's say. Yeah. Yeah. Okay. Moving into the policy, this is where I think you really have a lot of depth. Um, and so the first story in the Wall Street Journal, Trump picks a Maha moment leader for surgeon, Jared.

Casey [00:13:00] means. Who I've read her book, good Energy, and she's, um, pretty, pretty widely known for her discussions around food and, and, um, and kind of getting the right kind of food, um, is gonna be the Surgeon General, which is controversial. She is a doctor, but she hasn't practiced in a while. That's, yeah. So I, what, what do you She's 

Rick Abramson: nominated for Surgeon General.

Yes. Sorry. So she has not been approved and Yeah, the controversy, there's a lot of controversy around her, um, which we could go into. But, um, you know, this, we, I think you paired this, this article with another article about, um, yes. Yeah. So 

Vic: maybe we'll check both at once. So the next, yeah, the next nomination, is it Venet Prasad?

Venet Prasad, yeah. Yeah. So he is nominated to Succeed Mark's at. Uh, CBER, which is the Research Center for Biologics Evaluation and research. Part of the FDA. 

Rick Abramson: Yeah, exactly. So I think these belong together because to me these are really important because what we have is health and human services now trying, now starting to [00:14:00] fill out their kind of second Right.

Where a lot of the actual work gets done. Yeah, exactly. The, 

Vic: the heads of it then. Nominate these lieutenants that do a lot the day-to-day work. That's right. 

Rick Abramson: Yeah. So we have the head, we have heads for FDAN, nih, C-D-C-C-M-S. Right. Uh, but now these are the deputies who kind of like really, really kind of do a lot of the work.

And, you know, these appointments I think, reflect a lot of where the administration is going in terms of policy priorities, which then of course translate into research funding priorities. Yeah. And device approval pathways. Um, so, you know, where does 

Vic: the surgeon General 

Rick Abramson: sit in the HHS Surgeon General, I believe reports directly to the HHS secretary.

I'd have to check the org chart. Okay. But that's kind of the, technically the Surgeon General is over the public health service. Right. So these are, I think it's like 8,500, you know, public health. You, public health, um, servants basically that report up to him or her. Um, I dunno what the final number's gonna be with Right, right.

But, um, but that's, I'm pretty sure that's right. They're not, [00:15:00] um, within CMS or, or NIH or, or, um, uh, or FDA. Okay. I do know that, um, now these two, um, Casey means and, um, uh, and, um, uh, um, Vene. Pade, right. Yeah. Um, these are important because they, and I don't wanna put them too much together 'cause they're individuals with their own agendas and policies and everything, but like, so not to pay paying with too broad a brushstroke, but like they're both kind of in the vanguard of this Maha Yeah.

Movement. Right. This make America a healthy movement. Yeah. Which I think 

Vic: really starting, almost starting with Trump, but Trump and Kennedy and then all of the appointments, I don't think there's an exception. Mm-hmm. So to fit with this, uh, direction. 

Rick Abramson: Yeah. 

Vic: And it's a pretty different direction for. HHS, which is, um, not find ways to care for our sick population.

That's right. But instead, how can we make Americans healthy? How can we keep them from getting sick [00:16:00] with exercise, going outside food, things like that. Which if successful would be wonderful. Yeah, yeah, yeah. For sure. It's, uh, you know, the question is like, can we get there or how do we get there? 

Rick Abramson: Yeah. And people like, uh, you know, a lot of people ask you like, what is this MAHA thing?

And it's hard to, it's hard to really capture because there's so many different strains is pulling from. But, um, I think you're hitting the nail on my head. I mean, I think at the core it's about this idea that we've. We have, um, we have neglected chronic disease. Yeah. Or that we have kind of, we have not prioritized chronic disease and that we need to look at more prevention, you know, rather than, uh, rather than, you know, downstream, downstream treatment.

And so, you know, this movement is talking about, you know, better food choices and cleaner water and getting more exercise and getting more sleep. Um, and at the same time there's this kind of other strain that's kind of talk, like looking at the downstream treatments and saying like, maybe we do too much.

You know, maybe we do, you know, maybe we push too many pills. Yeah. You know, recommend too many [00:17:00] procedures and maybe there's not good enough evidence for a lot of the stuff that we do. Um, and I think the final strain that you kind of hear this coming out in some of the policy discussions now is that, uh, this idea that, um, that the way we got here is somehow related to the influence of big food and big pharma and big biotech, right.

And their relationship to. To government and that, you know, maybe that relationship's been too cozy and we need to kind of, kind of blow that up, get a little more distance between industry and regulators. And you've already, you already see that in kind of policy proposals coming out. 

Vic: Yeah. So you, you have spent a lot of time thinking about policy, particularly radiology, but across medicine.

And I want your thoughts on a framework that I'm not totally able to articulate, but I'm gonna try and, and try to bat it around just for a minute with you, which is, I think there are kind of three different aspects of health broadly. Mm-hmm. And it kind of reflected in HHS where there's public health, and that was probably the first [00:18:00] place in a historical lens that, that humans really started working.

Infectious disease, clean water. Mm-hmm. Um, let's just try to understand how we can take care of our population. Um, the next was then acute, uh, acute medical treatments. You, you get hurt. On the manufacturing line or on the farm, and we need to patch you up and send you home again. So that acute intervention surgery and, and the doctor is kind of acting on the patient.

And then there are medicines as well, but they're, they're short term in nature. It's a, it's an acute event and then hopefully you recover from it and you're no longer under care. Mm-hmm. And, and then there's chronic disease and the treatments related to chronic disease. And I want your thoughts on the, the idea that you really, it's almost like a hierarchy.

You can't address the [00:19:00] acute disease or chronic disease. If you have hard public health and you have cholera and you have, you know, disease, um, really difficult to, to focus on anything. And then acute is kind of the next that you get in a car accident or you have a broken leg. Um, and it's actually a sign of success.

Like our system has been successful at treating these first kind of two major rungs of, of overall health that now we get to address chronic disease. When people died at 50, 200 years ago, there wasn't a lot of chronic disease, but it's better that they're living much longer. And part of the effect of that though is that we have chronic disease.

So is that a useful way to think about things? Um, or what are your thoughts about that framework? I 

Rick Abramson: a lot, I like that a lot. It's very similar to a framework that I always kind of come back to, which is genetics, environment and behavior. You know? Yeah, yeah. Just kind of [00:20:00] like a triangle and like, like, I mean, we know that there's a contribution for most disease.

Yeah. Of most of 'em is all those three, those three are 

Vic: contributing. Yeah. Yeah. 

Rick Abramson: Exactly. And there's a question how they, and that's just how much, how much is weighted? Mm-hmm. You know, and how much, you know, what's, what's the most important one? Yeah. But we have, you know, branches of government, branches of policy that deal with all three.

And, uh, I think right now we're seeing, you know, we've put a lot of emphasis into genetics re research over the past several years. And, um, you know, you hit comments about, like, you walk around the NIH you can't, you know, you can't take a step without bumping into 12 geneticists, you know? Right. Yeah. Um, and I think that's actually been really helpful and that's given us a lot of amazing, amazing, uh, you know, like, uh, interventions Yeah.

That we can actually use for patient care. Yeah. But 

Vic: that's, but that's not everything. 

Rick Abramson: Yeah. It's not everything. Yeah. And so now, you know, maybe we're going to shift a focus a little bit, maybe towards behavior. Mm-hmm. Um, and then the environment obviously is the, the last piece. And, you know, environment's interesting because that's kind of, you know, that's out of certainly the purview of.

You know, FDA or CC, you know, C-D-C-N-I-H-I mean, you're [00:21:00] talking about EPA, you're talking about clean water. Yeah. Um, and, um, you know, and already we're seeing some, you know, I don't, I wouldn't say tensions, but maybe some, you know, kind of like push and pull within administration. You know, kind of like rolling back some environmental, uh, policies.

Mm-hmm. Environmental regulation. I think there we're gonna see into kind of an interesting, there's a lot of interesting kind of axes of, of potential tension Yeah. Right now, because you, you're pulling together people from so many different, different paradigms and, and, and different themes. Um, yeah. Which is 

Vic: probably good.

I mean, if, if we can make the EPA work in a constructive way with HHS, that it would be positive. Absolutely. Yeah. 

Rick Abramson: Yeah. For sure. For sure. 

Vic: Part of the reason I wanted to frame this sort of a multi-step process of bringing health to a population is, I don't know that big pharma or big food or big anything, um, are bad people.

I, I think, you know, sort of. Pharma has delivered incredible medicines that have really helped both in public health, [00:22:00] in sort of, uh, infectious disease, and then in acute care and in chronic care. But the business model, how we incentivize them. Maybe needs to be rethought for chronic disease where you might be taking this medicine for your, the rest of your life.

That's a different thing than taking it sort of post, post or surgical procedure for 15 days or 30 days. Yeah. 

Rick Abramson: I, I think, yeah, I think that's right. And I think one of the, the criticisms of the Maha movement is that maybe it's too, too much downplaying the importance of these, uh, you know, drugs and, and procedures, you know, that we do use, that we do have good Yeah.

Scientific evidence for, um, and now we're gonna shift the focus all the way up to prevention and maybe kind of leave some of this stuff, you know, kind of neglected. And that's, that's the debate that's going on Yeah. Right now. Right. Um, this, um, you know, one of the, you know, this, uh, Vene Psad is an interesting, uh, yeah.

I don't know him, uh, Dr. Means I've 

Vic: read her book, but 

Rick Abramson: what, 

Vic: what is he, what's his background? He 

Rick Abramson: has made, uh, a big name for [00:23:00] himself, um, as kind of a contrarian. I use the term contrarian, kind of like, I gotta be careful because like now what's, what was con a contrarian is now Oh, now leading the country.

Yeah. Well, and they're in position of power. Well, yeah. Yeah, exactly. Yeah. But he's, he's, he's a, uh, very well-trained, uh, hematologist oncologist. He practice out of the University of San Francisco, uh, California, San Francisco, um, you know, very well, well-trained, very, um, you know, kind of like respected. Um, but his main name made a name for himself as a skeptic of a lot of the cancer, uh, screening procedures that we have, like colonoscopy, mammography.

Yeah. Um, he has a background in epidemiology, trained at the, uh, NCI spent a lot of time there. Mm-hmm. Um, and so he, his basic message is that we need better evidence for a lot of stuff. Mm-hmm. And we need to hold things to higher scrutiny, which again, talking about these kind of potential axes of tension.

Right. Within the, within the, yeah. The policy world. Now we've got an, you know, FDA leadership has come out and said, you know, we are going to. Uh, we're gonna streamline drug approvals. We're going to get [00:24:00] innovative treatments out into market. You know, we have accelerated approvals. Um, you know, we will, um, kind of like we, we, we will make sure that, that, um, you know, promising therapies are delivered to patients, you know, as quickly as possible.

On the other hand, you have another kind of now kind of counter counterweight, basically saying like, you know, Hey, slow down. We're gonna actually, you know, take a step back, increase the level of scrutiny, make sure that we have the required evidence, you know, maybe require more from dev developers and manufacturers Yeah.

Before we approve stuff. Um, and so the biotech, uh, you know, s and p biotech, uh, index, I think that was Yeah. Yeah. This, this, yeah. So the reason why stocks fell so much is because his, you know, his being brought in, I think is seen as, you know, shifting the balance a little bit more toward that higher scrutiny, uh, higher.

Evidence threshold and potentially longer approval times. 

Vic: Yeah. And, and I have seen, I can't quote it. You might be able to, there are studies where cancer screening, um, with all, with all [00:25:00] the false, false positives and then the ongoing, uh, further tests and, and looking into things, um, can be in a population view negative.

Yeah. Where, where you have more of a negative effect than the positive of catching cancer early. Yeah, yeah, yeah. Um, so that balance of actually running the studies and looking at what is best to bring to market or to allow in the market, I think probably is, is a healthy thing to, to think through for the.

For the fda. A what, what are your thoughts about 

Rick Abramson: that? I, I, I think so. You know, and it goes into, I mean, there's a lot of startups in the wellness and longevity space mm-hmm. That I think, um, you know, all these questions kind of, you know, float around them. I think we've talked about, yeah. VO and Ezra and some of these kind of full body scans, um, which, which deal with the exact, those are the exact same, the exact issues that, you know, people are raising, you know, false positives, false negatives, you know, false sense of assurance.

Um, but, you know, we want, we want to let, we want to empower [00:26:00] consumers, let them decide, you know, let the, let free markets reign. Um, but I think at the point you hit is really important, you, you get into this kind of paradoxical situation where what you recommend for a population is not necessarily the what you recommend for an individual.

Yeah. Right. You know, like I have a lot of problems with the idea of like a PVO scan for everybody, you know? Right. Like, that's, that, that to me raises a lot of questions. But I gotta say, I've had a PVO scan. Right. I found it pretty helpful. You know, I got some good information from it. Right. So, and an individual by individual level, you know, like, or.

That you, you may actually like, recommend something. Um, and that's, that's an interesting 

Vic: way to dig into HHS broadly. FDA has a function of safe and effective. Mm-hmm. Is that, is that right? Mm-hmm. Yeah. But then, but then CMS is more like, what should we pay for outta outta Medicare? Yeah. Or, and Medicaid and those things, uh, for a long time were very married together.

Like, once something got approved from the FDA, it was very [00:27:00] quickly approved for reimbursement. Right. That's been separating. Yeah. Yeah. And that's probably how it should be, right? Like this, uh, full body scan is safe and effective at telling you a lot of information, whether that is good for CMS to fund for every Medicare recipient.

Right. I don't know that that would be a. Good for the recipients themselves. For the va. For every va the va, right? Yeah. Right, right, right. Uh, but then you get to this, um, class distinction where then people can pay for it themselves and they get access, which is difficult. It's problematic. Yeah. Right. Yeah.

Rick Abramson: Absolutely. Yeah. And that's, that's what we're all, that's what we're all, all wrestling with. Yeah. Yeah. 

Vic: So, um, you know, some of these people or your one or two degrees separated from them, um, how do you think it's gonna shape up with the next six months, 12 months? Two years? Um, alright, well, 

Rick Abramson: so we talked a little about, about kinda like what defines the [00:28:00] Maha Yeah.

Movement. Yeah. You know, I think in all fairness, we probably should talk a little bit about the pushback, you know, the criticism of it, you know. So, uh, we talked about kind of moving the emphasis to kind of upstream to prevention, right? And we talked about mm-hmm. You know, clean food and water and, you know, uh, exercise and sleep.

Um, you know, a lot of the, these Maha. Influencers are, uh, pushing kind of things beyond that. And they're, you know, we, they're talking about, um, they're talking about supplements and they're talking about infusions. Yeah. And they're talking about, um, you know, wearing, uh, you know, a bunch of devices. Um, and that's, that's raised some eyebrows because the evidence for those things aren't that great.

Mm-hmm. Either. Right. Right. So the exact same, they're accusing the mainstream. Yeah. Legacy media, Sal medical establishment. Yeah. This is kind of the same apply here. Yeah. And then there's some conflicts of interest issues that have been raised. Mm-hmm. And, you know, some of these guys like kind of getting paid to, you know, promote certain products or having a financial interest in, in companies that they, uh, you know, that they, um, yeah.

So that, 

Vic: um, if it is right to [00:29:00] not have pharmaceutical interests on the committees that are approving drugs, it's also you can't have a supplement interest. Right. Or you can't have a, a device that a company you own 10% of is, is marketing. Yeah. That seems pretty straightforward. Is there, is there that conflict, that kind of conflict going on where it's they're pointing fingers at other people, but then they're doing the same thing on their side?

Rick Abramson: Yeah. I mean, I think that, well, that's the criticism. That's, that's the criticism, right? Yeah. That there's, uh, you know, they have a financial interest in companies that they're talking about, or they're getting have consultant agreements. Yeah. Or, or, or they, uh, they're getting paid to promote certain items.

Yeah. Uh, I mean, vin's pictures up here, I'm not saying the vinne is, is Yeah, yeah, yeah. Right, right. But in general, that has been a, yeah. A, a, a criticism of kind of some of the, some of these wellness influencers, let's call them. Yeah. Um, 

Vic: so, um, well, one of the things that, so I don't know the enough details to give an example in that thing, but, uh, last night with my son who's, who's 18, we were talking about Trump's, uh, crypto [00:30:00] coin.

Yeah. And Right. My position is he was very transparent about that. And I mean, it's, it's, I forget what it is, but it's like the Trump coin. It's not behind the scenes and. I think if, if someone wants to purchase the, what is a lottery ticket of the Trump coin? 'cause you think it's going to go up, you're, it's gambling, but I don't see that as bad.

Um, maybe he's using the White House in a way that is not what I think is the best thing to use it for, but, but it's very transparent. And so the, to me, the transparency in the FDA and HHS is the thing. Like either you are allowed to be on these committees that approve things, um, and you have to disclose what you have, um, or you're not.

Um, but a lot of times the disclosures in [00:31:00] the past 40 years have been not widely disseminated, right? It is, yes. It's disclosed somewhere on a website, but it's not very clear. And everyone in the committee has, has various conflicts. Um, what are your thoughts about that, um, sort of line of thinking? Yeah. I 

Rick Abramson: mean, I guess, uh, with the analogy, the Trump coin, I mean, I'd say that, you know, blind speculation is probably okay.

You know, if you don't have any insider information Yeah. You're just like, you, I'm putting, putting a fiber down on Trump coin, yeah's gonna pop tomorrow. You know, that's fine. Uh, but paying for paying for influence, you know, I think that's where you kind start Yes. Right. Crossing the line. Right. And 

Vic: so, yeah, like, Hey, uh.

Rick, you know, Trump, this is not true. Tell me when he is gonna announce something and then I'm gonna buy it in front of that. That's inside information. Yeah. In, in the purest sense of it. 

Rick Abramson: Right? Right. Exactly. Exactly. So if you have a line into what's gonna happen with a certain regulatory decision mm-hmm.

Or if you can influence that regulatory decision Yeah. And you happen to have a financial interest in the decision. Yeah. I think [00:32:00] that that, that, that crosses the line. Right. Right. Um, yeah. And so in the, the whole disclosure thing is interesting because like yeah. Disclosing your involvement with, with a, with an entity, you, and in certain circumstances that might be enough, but in certain others it might not be potentially, you know, um, just 'cause I, I.

Publish a paper and like in fine print at the very, very bottom and like eight point font, you know, and say like, oh, you know, sponsored by a grant from Pfizer or something. Yeah. Um, yeah, it may not, may not necessarily be enough if that's, you know, a market moving paper that that was, you know, clearly influenced by, you know, the, by my funding source.

Vic: Yeah. 

Rick Abramson: Um, I, I think it's case by case basis, but um, I, I, I do agree that this stuff needs to be out in the open when I think transparency is important. 

Vic: Yeah. 

Rick Abramson: Um, and um, and it's stuff we should just be aware of. Yeah. Yeah. 

Vic: Yeah. Okay, good. But anyway, so 

Rick Abramson: like, just wrapping up here, I mean, like you asked kinda like my, my thoughts on just kinda like the whole movement and its effect on the ecosystem.

I mean, I would say that if I'm an entrepreneur and if I'm in that, uh, you know, preventive [00:33:00] health or wellness or food as medicine mm-hmm. Or functional medicine, whatever you call it, um, I think you're getting some tailwinds here. And what about 

Vic: AI in at the FDA, I mean you had to leave the us it's pretty, um.

Unclear to me where, where that's headed right now. I 

Rick Abramson: think too early to say, yeah, they just announced an ai, uh, an AI ZR coming from the private sector. Um, I don't think it's a physician. I think it's, uh, someone coming from the private sector business world don't know much about him. Um, but, um, but this is, this is where this tension between kind of safety on one hand guaranteeing safety and promoting innovation mm-hmm.

That is really gonna come to the forefront. Um, so I, I, I would love to see, I would love personally what I would love to see, um, I, I would love to see some of these software in more innovative software products get out to market quicker. Um, maybe. Lowering the evidentiary burden on developers so they don't have to, you know, they don't have to have like a [00:34:00] $10 million clinical trial in order to get like a piece of software to market.

Yeah. Um, but I think on the tail end, that probably means raising the post market surveillance requirements and gathering data after a product Yeah. Out in market already. Um, I think overall it's, it's a matter of making sure that the, that the benefit and risk are in line with the, the, the, the evidentiary threshold that we're putting in.

Mm-hmm. So if something's super dangerous, you wanna require a lot of data. Um, if it's a tongue pressure, you know, like Yeah. You know, maybe Go ahead. Yeah. Go ahead and do it. Right. 

Vic: Okay. Great. Justice Department brought a lawsuit to Medicare insurers, uh, that they are improperly funding the brokers. They called it alleging kickbacks, where they are paying the brokers to steer customers that are.

More profitable mm-hmm. To their plans. Yeah. What do you think of the story, 

Rick Abramson: his policy backdrop here as well. Right. So Ma [00:35:00] Oz, I think has been very supportive of, of MA for a long time. Yeah. He's a big, kind of big fan, but he also said in his confirmation hearings that he was really gonna go after these kind of questionable payments.

Right. Yeah. Going to to Medicare Advantage plans. Um, you know, this is, it sounds pretty, pretty, pretty bad, right? Yeah. Like paying paying pick packs of, to brokers to steer patients into, into higher cost plans. And, and not only that, but they're paying, or, or at least alleged, uh, to be, um, paying brokers to keep the, you know, sicker patients out of the plans.

Right. You know, 'cause they're more costly. Yeah. Um, you know, that's, that's, 

Vic: that's not great. Right. Right. Exactly. Um, so if they can substantiate this and, and you know, the accusation is not, they have to go through the whole process, but it, a lot of this things in this, in this article looked pretty circumstantially.

Negative. Yeah. Yeah, 

Rick Abramson: exactly. And yeah, this is one of these things like Medicare Advantage is pretty popular, right? Oh yeah. It's, it's more than 50% of enrollees now. Yeah. But I guess it keeps getting more and more controversial among policy [00:36:00] makers. Yeah. And it's just 'cause there's so much opportunity to game, to game the system.

Right? Right. So I mean like, I mean there's a lot of, lot of startups out there that are built around risk adjustment, right? Yeah. And helping these planes risk adjust and you kind of think they're gonna be facing, facing higher compliance headwinds going forward, I would think. Yeah. You know, way, you 

Vic: know, I think definitely.

I think they should. I think they should be. Yeah. For sure. Um, okay, so we've been talking over the last month or maybe even two months about supplemental payments and the New York Times called it the Medicaid loophole used by 49 states to grab federal money. Uh, we've talked about it almost every week on this show because Congress is looking to find savings and there's a ton of money.

I think it's 800 billion or so every year. Yeah. Into this. Particular as the Times said, loophole. And, um, what I liked about is this article, they go through the whole, you know, uh, summary of it, but they have a really good [00:37:00] chart here of how, just like how it works, supplemental payments are super confusing.

The Times did a really good job, uh, describing it. So the way that it works is, you know, the state government will make a payment to a hospital. This is the traditional way, and if they pay a thousand dollars in this diagram, the federal government will reimburse 60% of that, or in this example, 600. And the loophole or, or the, the game that some 49 states have started doing is they charge a tax to the hospital.

Usually an association of hospitals and collect tax money, and then they use that tax money to increase their payments. Mm-hmm. Um, so say they get a $30 tax in this example, they then pay all of that to the back to the hospital. So the hospital has paid a tax but gotten it back a hundred cents of the dollar.

But then the state gets a higher reimbursement, 'cause 60% of [00:38:00] that higher number is of course more money. And they do that over and over and over again. 870 billion annually. I was a little bit off on the amount. So, um, what are your thoughts about this, this whole, it's 

Rick Abramson: super, it's super clever, right? I 

Vic: mean, 

Rick Abramson: it's just kind of genius.

Yes. Um, and so, and you know, and it's hard to 

Vic: stop. I mean, it's difficult to stop. Well, also having. Medicaid 

Rick Abramson: payments exist. Exactly. Well, like one person's loophole is another person's way of making sure they can meet their Medicaid budget. Right. So this is, this is a tough one. I I was surprised by the magnitude of the potential savings here.

Right. So, I mean, right now on the Hill House Ways and Means committee is trying to find a way to save $880 billion. Yeah. And this is eight 70 and Medicaid. And this is, well, so I think that was the, I think that was total. They were sending, oh, Medicaid, I think it's, but I think it was 600 billion over 10 years.

So it gets you pretty, pretty far Yeah. Pretty close to that number. And you know, that would be pretty nice if like the Congress could just like snap [00:39:00] their fingers and have $600 billion. 

Vic: Yeah. It would be up here. Right. It's interesting that it would be nice at the federal level, but then, so now we're showing the states that are, um, most, uh, responsible for that amount of money.

Yeah. And Tennessee, where we're sitting right now is one of the. You know, it's like an bright orange, 30%, um, share of Medicaid funding through taxes. So, um, but it's, it's, I mean, like we said, it's 49 states. It's almost every state. It's, yeah. If, if the federal government saved that money, it would inherently then be incumbent on the states to figure out a way to f to pay for that.

Yeah, exactly. Or cut programming program. Exactly. 

Rick Abramson: Which I think why this has, I mean, they have been trying, apparently to close this. Loophole, if you wanna call it that, since the late eighties. Right? Yeah. Right. And they haven't succeeded. And this is why, I mean, the states really depend on this mechanism.

Yeah. You know? Yeah. To, to meet their budget. And, uh, the only, the other thing that jumps [00:40:00] out about this chart is that it's, it's kind of, it's really disproportionately the red states mm-hmm. That are affected by this. So GOP lawmakers are not gonna be jumping to do this anytime soon, I think. But I mean, it is pretty interesting to think about the magnitude of savings there.

You know, I mean, the problem that the house faces right now, or congress in general is that, you know, I mean, as you, you guys have talked about this, I mean, 880 million, 8,000 80 billion, that's a big chunk of change, you know? That's right. And everybody wants to wave their hands and say like, oh, it's gonna be, we're gonna cut down on fraud and abuse.

Yeah. And that same is gonna appear, but like, that's just, just that that's not gonna happen. Yeah. It's not even to an order of magnitude, you know, close. And so, you know, they're finishing a pretty tough set of options up there, right? Yes. It's like lower the. The, the, the federal matching rate for Medicaid lower the federal, you know, the subsidy, federal subsidy match for aca A.

Right. Yeah. Beneficiaries, you know, do work requirements. I mean, you know, yeah. Block grants, I mean, like these, all these things, whatever. [00:41:00] Nobody wants to do anything someone's 

Vic: not 

Rick Abramson: gonna like. That's right. Exactly. Exactly. So it'd be nice if this could just materialize and have no impact on the state budget, but that's not, that's not gonna happen either.

Right. 

Vic: Moving on, healthcare Dive had a, had a story about Trump ordering the FDA to help speed the building of new drug factories. I, which I think is great. I, I don't know what regu, so the idea was that the FDA should, um, reduce regulations so that factories can be built more quickly. Um, 

Rick Abramson: what are your thoughts about this?

Yeah, I'm not, I mean, I'm not so down in the weeds on this one. Mm-hmm. I, I don't know exactly what regulations would be rolled back. I mean, it just, yeah. This, this makes sense. I think, I mean, it makes sense that the, that this would be happening, right? It's like we're on, we're gonna onshore pharma development, we're going to, you know, kind of be more resilient in terms of supply chains.

We're going to, you know, maybe create jobs, although we were talking about this before the, before the podcast. I mean, how, how quickly can you Yeah. Really spin up those, those jobs, right? 

Vic: Yeah. [00:42:00] Well, part of reducing the regulation, I think, is to try to answer that where, um, I mean, I think the capital is probably ready to go, but when you actually go to try to break ground Yeah.

And stand up the building, it's, it's complex with local, state, and federal regulations. That's right. So, so now NIH is going to ban new funding from US scientists to partners abroad. So I didn't know about this before this story in the New York Times, but. I guess, um, there is a possibility for the NIH funds, a researcher in a us um, academic medical center or research facility, they can then sub out pieces of that to international labs.

Uh, or they used to before this, um, executive order. 

Rick Abramson: Yeah, yeah, yeah. So this is what, uh, we're gonna call it research nationalism maybe? Yeah, I guess so. We, we 

Vic: are pulling in all the research to only be [00:43:00] done in the us, which I guess is okay, but maybe there are, I, I'm torn about this. Maybe there are things that can be researched in other countries, um, that wouldn't be allowed here.

But is, are we exporting then things that we wouldn't want? To happen in our country. 

Rick Abramson: Yeah. I mean, and it probably depends on what we're, what we're looking at. Yeah. But this is, um, you know, it's um, uh, I think, well, I think at the, at the foundation is driven by security concerns, right? Yeah. So security concerns with, with China.

Um, and, uh, and also kind of an effort to, to, to bring, I mean, the gain of research. 

Vic: Is the most obvious one that was, was outsourced. Exactly. Exactly. And caused trouble, obviously that did not work out well. Right, right. 

Rick Abramson: Yeah. Um, yeah, so I mean, this, this could potentially help, um, you know, some, you know, some US based CROs and maybe some US based labs.

Um mm-hmm. It's not great for global scientific collaboration. Yeah. You know, especially coming after, you know, withdrawal from the WHO and, you know, some, you know, [00:44:00] pull 

Vic: back from some other things, but, um, probably negative for biotech, I think. Right. 

Rick Abramson: Well, I mean, especially if you have kind of, you're dependent on a research agreement and you're, you're kind of doing research in, uh, India or Israel or, or China.

Yeah. Um, it's probably not great because it's, it's more expensive to do research here. Yeah. Which is I think the point. Yeah. Right. Um, so we need to attack those costs. Right. And, you know, and maybe that'll kind of spur 

Vic: more domestic research activity. Right. On the other side of that, us, uh, is kind of curbing or pulling back the AI chip export.

Banned. So the industry, Nvidia basically, and the rest of the industry has been lobbying to, um, stop this limitation on their ability to sell to Chi China and other places, the best chips. Um, I understand why that they, they don't want those limitations, but, but I think it is important to limit China's ability to continue to build out [00:45:00] AI towards artificial general intelligence over the next year or two.

Um, what are your thoughts about sort of, um, this really change, the Trump administration was strong on it and now they're changing, sort of coming back to it. Yeah. Well, you just have to take 

Rick Abramson: one look at, uh, Nvidia stock performance after this announcement and know, right? I mean, I think it, it went up by over 3% on this news.

Yeah. Right. And, uh, I mean, look, I mean that the chip industry doesn't like caps on, on exports. Um, but you know, just. You know, this doesn't mean that there won't be caps there, there'll, there will just be a different form of, of export caps. And so, uh, 

Vic: yeah, but it's gonna delay the caps for a while. Yeah.

Meanwhile, NVIDIA's sending chips all over the place right now. Exactly. Exactly. So that is the policy. So moving onto the payer side, we just have two payer stories, CVSB expectations, which was good to see. Uh, but more interesting they withdrawing from the a CA exchanges where they claimed they were losing money, so they would no [00:46:00] longer participate in the a CA exchanges.

And then they also struck a deal with Nova Nortis to sell Wegovy at reduced prices in their store. So, very similar to last week, Nova did a deal with HIMS and hers. Um, they're definitely building up distribution partners in the us. Um, what'd you think about CVS four? 

Rick Abramson: $499 a month? Uh, according to the article.

Yeah, that's right. Out, out pocket. So go, go get your way Govi. Yeah. I, I guess, right? That's right. Um, yeah. No, so this is, uh, this is interesting, I think on a couple levels. I mean, it shows how, how competitive and costly that a CA space has become. And, uh, it's probably CCVS health. I mean, they've been kind of toying with this for a long time Right.

And kind of like, so they're finally pulling outta the marketplaces and they're probably just kind of doubling down on what they do best, right. Which is retail. Yeah. Uh, and, and pharmacy and, uh, the, the, the, the announcement with Novo nor Nordisk, that's, that's great. That's great for 'em. Um, and it's great for Nova Nordisk.

Yeah. Because they're like, you guys talked about this last [00:47:00] week. Um, they're, they're kind of battling the direct Yeah. Consumer catch lilies. Yeah, exactly. Exactly. Yeah. Um, so it's good. This may open the, a CA marketplace a little bit to some smaller players coming in. Um, but it, it also, yeah, hopefully, I think it's, uh, yeah, 

Vic: I hope so.

I think there's, there's not enough. Payers in the, in the marketplaces, but yeah. And in the short term, 

Rick Abramson: you're raising 

Vic: kind 

Rick Abramson: of some coverage access. Right. 

Vic: Right. 

Rick Abramson: Concerns. Right. Yeah. 

Vic: Okay. Then Clover Health, you know, which has been really struggling for years with Medicare Advantage Small, um, kind of tech forward startup, Clover Health, um, they had a successful quarter.

They, um, beat beat earnings and, you know, are growing pretty well. So they seem like they're back on the growth trajectory. They've taken a, you know, significant, they were a high flying, you know, super exciting stock post pandemic, but, but not anymore. Yeah. But now they're coming back. Maybe 

Rick Abramson: these guys have been around for 10 years.

Yeah, I know. I didn't realize that. Yeah. You know, I thought they [00:48:00] were just little babies, but, uh, but yeah, they looked like it. They're, they're turning around. They had struggled for a long time. Yeah, that's right. Um, and so now they're, uh, yeah, they're, they're, they're cutting costs. They're, they're raising their revenues.

Maybe, maybe VC fueled payer models are not, not dead. Um, yeah, maybe. 

Vic: I don't know. I think it's a long way. I mean, they are back to growth, but they've come down quite a bit. Mm-hmm. So, uh, some level when you get the base effects low enough, then you eventually you're gonna start turning up. Yeah. Right. Yeah.

Okay. Switching over to the health system. So here locally, veno Medical Center, we sort of knew this was coming. They, they got hit from the NIH uh, reduction in grants and overhead, and they have done a hiring freeze. And then also they're making layoffs. They didn't announce in this news channel, local news, uh, channel five story, how many layoffs?

I think it's gonna be pretty significant. We both have friends over there. Yeah. Yeah. Um, I've been hearing it's a decent number of [00:49:00] people. Um. So sad to see, but been a surprising. I know, 

Rick Abramson: I know. I hate, I hate to see it. Like, I mean, um, it's, um, it's tragic because like when you're, when you're here locally, you know, and you see it happening, I mean, you really realize the, the personal impact.

Yeah. Right. You know, of these, of these announcements. Um, you know, 

Vic: uh, and if you're a PhD, you research biologists at Vanderbilt. It's not like you can go to another academic medical center. They're all have higher in freezes are cutting back. Sure. So it's countrywide. So I, I'm fearful that I'm not sure where these people are gonna go 

Rick Abramson: next.

Well, there was another article too, I don't think it's in our packet, but there was, it was an article about, um, how, uh, countries abroad are now kind of like shimming up their, their, uh, their, their packages to try to attract Oh yeah. US researchers. So yeah. I mean, I think maybe they go abroad, you know.

Yeah. Um, yeah. Maybe they'll, but, um, but you know, these are not just researchers. These are, you know, kind of frontline employees Right. You know, staff at all levels. Um, and I think like, kind of stepping back from the [00:50:00] personal, you know, kind of like how, how immediate it is. I mean, I think what happens at a lot of these academic medical centers is they, they do have a tendency to get a little bit fat.

You know, they, they mm-hmm. I mean, you know, just kinda just the way, the way they operate. Yeah. And, um, I think every once in a while there's like, every five or 10 years, there's a big shock to the system. Mm-hmm. And that's when the, the A MC kind of takes the opportunity to kind of. You know, trim, trim back.

Mm-hmm. Um, and, um, and so maybe these are, yeah. 

Vic: So in the long term it could be okay. Could be healthy. 

Rick Abramson: Yeah. Yeah, I think so. Yeah. Kind of pruning the tree, but that's, yeah. It's hard to explain to when you're one of the leaves, right? Yeah. Right. Mm-hmm. Yeah. 

Vic: Oregon Health and Science University had a merger they were trying to put together with Legacy Health, which also was out in Oregon.

Uh, and that fell apart. So, um, it was gonna create a pretty big system with over a hundred locations. Um, and it's not clear what happened, but the deal, I don't think it was stopped [00:51:00] by regulation. I think either the two sides couldn't get to a final agreement or something changed. Yeah. But it, but the deal fell apart.

What do you 

Rick Abramson: think about this? So it could have been regulatory, it could have been, I think there was some local pushback. Yeah. Maybe there was a, a culture clash. Um, I think some of the, 

Vic: some of the. I think their union based in Oregon. Some, some of the nurse unions and things were, were sort of asking for in their contract negotiations and they, they hadn't had that figured out.

So yeah, there were aspects like that that could have caused it to go put. Yeah. And there was 

Rick Abramson: some local regulatory body that was trying to put the KB on it Yeah. As well. I guess the question is, is this, is this a one-off or does this have implications for regional consolidation all over the country? I don't know.

What do you, what do you think? I think 

Vic: it is, um, when we just talked about the Vanderbilt story, I think academic medical standard, so Oregon Health and Science University is not as big as Vanderbilt, but they're in the same category mm-hmm. As [00:52:00] Vanderbilt. Yep. And I think there's just a lot of uncertainty about, I mean, maybe it is every 10 years they go through this transition, but when you're going through that and you have a, a merger process in play, I.

I think that was the, the question mark that was un uncertain. Yeah. But I don't have evidence of that. That's just my thought. So, um, academic medical centers I think are under stress right now. And, and yeah. 

Rick Abramson: And a lot of them grew pretty rapidly and took on a lot of, you know, acquired community hospitals, you know, trying to build out their referral networks and who knows, maybe a legacy took a, a look at the financials and saw stuff they didn't like.

Right. That's total speculation. No, no idea if that's what happened. 

Vic: Okay. This was a interesting and hard story in, in Fierce Healthcare. It really is a news story covering the McKinsey report, which we will add the McKinsey report, um, to the show notes as well. But the title is Helping nurse managers tend to their frontline workers, cuts down [00:53:00] turnover, um, which seems, you know, fairly straightforward.

Um, but there was a lot of really interesting and difficult, um. It kind of updates from how the nurse workers in our healthcare system are doing broadly. And I was disappointed 'cause I thought we were doing better. I mean, this was, you know, sort of top of mind in the pandemic and right after. And it seemed like we were getting a little bit better, but Yeah.

Hasn't really gone away, but it hasn't really, hasn't really gone away. So we're just looking at the McKinsey report now, and like all McKinsey reports, they have a, they had a couple graphics in here, so of course you have to have that, right, right. McKinsey report. Yeah. Um, and so this chart is sort of maybe 10 or 12 of the reasons that they're nurses are not feel factors that nurse contribute to a nurse's decisions to leave a position or how they're not feeling valued.

And the number one is that they're leaving for another better job, but [00:54:00] that's not that useful. Uh, but then they don't feel valued by leadership and they don't feel valued by the organization or, or. Two and three, and then it goes to compensation and advancement. Mm-hmm. I dunno, what are your thoughts about the nurse 

Rick Abramson: community?

Yeah, so the report, it is a really interesting report, like you said, and it's kind of suggesting that the, like a big lever for attacking this kind of nurse attrition problem is through nurse managers, right? Yeah. And give them managers more resources, more training, more support, more mentoring. Yeah. Um, and you know, the, the list is a bunch of things you can do, like reduce administrative burden and reduce stress.

Um, and I, I mean, yes to all the above, right? Yeah. I mean, like, I, I'm certainly not gonna argue against de-stressing. Yeah. You know, you know, managers. Um, I gotta tell you though, I, I also think that I, I personally think that. That we really need to kind of totally rethink the whole nurse and nurse manager model, you know?

Mm-hmm. I mean, 'cause what happens right now is you got the best frontline clinical workers, the [00:55:00] ones who are just really, really good at delivering nursing care, and they're the ones who are elevated up into the nurse manager Yeah. Position and, you know, potentially maybe their skills aren't that great for managerial role.

Right. May it may not be as rewarding too. Yeah, exactly. And they're taking outta clinical care. Yeah. And so, you know, clinical care, you know, that that potentially suffers the morality of the other nurses potentially suffers, you know, um, I, I don't know if the 

Vic: solutions, yeah, it's interesting. So one of my portfolio companies, which of course, I'm.

Completely biased for, uh, called Gracia Health. They, they found a really interesting thing that, so they, they're in nurse engagement and nurse retention. That's their line of business. And they found that if they could get a nurse to become a preceptor and they created an entire training system, um, not only did that help with onboarding new nurses and uh, which of course we need more preceptors to sort of help with that.

Last part of the training process. Um, but more that was not surprising, but more interesting is that nurse then, they didn't move [00:56:00] into management, but they felt much more rewarded and they, they retained along the, the one that learned to be a preceptor. I think it is more like you're building community and the nurse population and they kind of know each other.

And, um, I don't exactly know why, but it was interesting that if you become a preceptor, you're more likely to retain. 

Rick Abramson: Yeah, yeah, yeah. It's, that's, and there's also market, there's just market forces too, right? Mm-hmm. I mean, I think you get paid a lot more as a travel nurse, so a locums nurse than as a, as a permanent nurse.

And so you, all the nurses wanna go into locums work. And so in the healthcare facilities are doing more locums hiring and it's like, it's kind of like negative or positive feedback cycle depending on who you are. Yeah. And that's, that, that, that's not really, yeah, it's all doesn't get addressed by the managers.

Vic: Right. Virtual, uh, MSS K provider include health rebranded as. Uh, Lanya, how do you say it, Lana Health. Lena. Lena, maybe Lena. Um, and so this is a virtual physical therapy company and they are sort of [00:57:00] rebranding and focused on Roy bringing that to market. I think, um, it's related to the next story, so let's talk about that too, which is Hinge Health, which filed an S one to go public.

They've delayed it, which is not great for them, but it's good for us that we now are getting their financials even though they're not public yet. And they are doing really well in the same space, in that sort of, um, virtual physical therapy rehab space. And so I, I think these two. Sort of stories fit together a little bit.

Rick Abramson: Yeah, it really makes sense I think for include health to pivot over and follow Hinge. 'cause Hinge is doing so well. Right, right, right. Um, it looks like include Health used to make hardware, they used to make, um, strength training machines and now they're kind of flipping over into more of this kind of virtual, um, you know, I guess tech enabled service model.

Yeah. All Hinge, um, makes sense because Hinge has, has, has been killing it. Right. I mean they're doing amazing and uh, and they're showing nice [00:58:00] outcomes other than cost savings as well, from what I understand. Mm-hmm. So, uh, you know, it's virtual musculoskeletal care, right. Or, or you know, you get a behavioral coach or you might have a kind of like an app guiding you through Right.

Physical therapy. Um, and so you're saving cost for the employer, you know, based on. Uh, visit, you know, in-person visits, but you're also potentially decreasing the number of surgeries. Yeah. You know, people don't go to surgery. Um, you're decreasing the number of, um, prescriptions. Um, and they have some nice figures about, um, lower rates of usage of, of opioid prescriptions.

Mm-hmm. So, um, yeah, one of the things that I, 

Vic: I'm seeing, I wanna get your thoughts on is that digital health is now, um, getting much more kind of focused on one particular, uh, use case or one particular niche or specialty. So in this case, in these two examples, virtual physical therapy, um, and it is, um, you can customize the experience and it ends up just being miles better than that like, pack of paper that you'd [00:59:00] get post-surgery, Hey, do these five exercises, then you have like a static picture of one part of the exercise, right.

Um. And then I'll see you in several weeks or come to this, this location where we have physical therapy, um, to meet with your therapist. But obviously that's difficult with scheduling and driving out there and everything, so, yeah, that's right. 

Rick Abramson: And the question for me is, is whether, how, how does this model work outside of musculoskeletal?

Mm-hmm. Um, and there's a bunch of startups and, and, and more established companies that are trying to do it, um, with mixed success. Yeah, I think, right. Um, MSK is nice because it's, it's very defined. It's um, um, there's, there's good metrics, you know, success metrics, um, 

Vic: and it's a, mostly, it's an acute, it's back to the acute versus chronic.

Exactly. Right. It's pretty much an acute intervention. You had a surgery, you're trying to prevent a surgery. You wanna focus on it for the next three months and then hopefully you [01:00:00] feel better and you've built up your strength. And that's very different than if you're gonna treat diabetes or, or cardiac care or something, which is much more long term.

Yeah, that's right. That's right. Okay, so the next story in Fierce Healthcare as well, HIMS and hers Q1 revenue doubles. They had this Super Bowl ad and they were in questionable legal position compounding. Yeah, that's right. TLP ones. Uh, and it has really worked out for them. They got a lot of new users into their, you know, subscription service and then they ended up navigating their way to a, to a deal with Novo.

Yeah. Amazing. To now be legally selling Wegovy. 

Rick Abramson: Yeah, 

Vic: exactly. It's been a really, uh, really smart, well executed. So I'm not sure that they had all that foresight, but they were kind of. You know, luck favors the bull. They, they came out with a really strong, suitable bowl A and they figured it out. 

Rick Abramson: Right. And perfect timing too.

Right. Going from the, uh, I mean the announcement about the FDA kind of cutting, you know, clamping, not [01:01:00] clamping down, but saying there's no more shortage. Right, right. Which was the excuse for being able to, to compound semaglutide. Um, and now they have this, this great announcement with, with Novo nor Disc.

Um, so I think they, by what they like, uh, they, they hit their Q1 numbers, but they lowered their guidance for Q2 or the other way around. Well, either way they're, they're, they're doing really well. Um, and, um, yeah, and, and they've, they've done, they've plotted a good course, let's 

Vic: say. 

Rick Abramson: Yeah. Yeah. 

Vic: Okay. And on the other extreme, uh, weight, we have two bankruptcy.

So Weight Watchers has filed bankruptcy. They have been struggling for a couple years, I think, and they really, uh, made the decision to, to no longer offer that in-person weigh in. Consultative kind of session, which, uh, was a cost saving move. Mm-hmm. But I think that was the final nail. The, the few people that still liked Weight Watchers, that was the core thing they liked.

And so, um, and so why, even though it, [01:02:00] it saved money, they ruined 

Rick Abramson: the revenue. This, you know, they, they've been around for over 60 years. Yeah. I did not realize that. I, I remember with like the adults talking about Weight Watchers when I was a little kid. Oh yeah. Right. It, it's just like a, it's been, um, like a fixture in our society for so long.

But yeah, they're, they're, they're going bye-bye. And they, these legacy wellness brands, it's probably, probably, uh, 

Vic: there's better products out there. Yeah. 

Rick Abramson: Yeah, exactly. 

Vic: And then Rite Aid similar. Similar, yeah. They filed bankruptcy again, which I was really surprised about that quickly. I mean, inside of two years, it's hard for me to understand how you.

Strike a deal with the creditors in bankruptcy one, and then that quickly it falls apart. But it, but it did. They're like the Sears of pharmacists. 

Rick Abramson: It's just like the slow, well, it's not that slow, unfortunately, anymore. But, uh, yeah, they just weren't able to diversify their business. Right. And they, and they got killed with the, um, uh, opioid prescription litigation and they just, they just decided, well, they did have a, they 

Vic: [01:03:00] didn't have a PB m.

Rick Abramson: Yeah. 

Vic: So I think a lot of the pharmacy economics were hollowed out by the PBMs. That's right. And they were, PBMs were owned a lot of times by a company that also owned a pharmacy. That's right. Yeah. But Rite Aid didn't have that advantage vertically integrate or die. Yes. Um, okay. Moving into pharmaceuticals.

So Lilly, uh, had their earnings that they had revenue up. They're doing well. They have sort of been. A much better company and much better stock than Nova Nortis. Although Noble has made progress to sort of stem the bleeding recently. Lily has really just been killing it, really doing well, and they they did again.

So, and there's a us, you know, it happens to be in the US and so all the Trump policies, I think Benefit Lawyer, they already do a lot of work for sure. Their, 

Rick Abramson: their earnings report reads like a GLP one love letter, right? I mean, it's, uh, yeah. Yeah. And they're positioning for, I mean, they're obviously like, [01:04:00] you know, these drugs are not just for, I mean, you've talked about this before.

They're not just for obesity anymore. They're diabetes and metabolic health and Right. I mean, it's gonna be, you know, depression, 

Vic: they'll make your car run faster. I mean, it's in everything. Right. Right. And then Novo had their earnings and I think they are, um, they're doing better. You know, it's been a hard year with Novo, but they seem to be sort of, uh, turning around.

Yeah. 

Rick Abramson: And 

Vic: so. 

Rick Abramson: And I think some of their, I mean some of their headwinds was that competition from the very compounding 

Vic: pharmacies. Yeah. Right. So, so that is stopped. The question now is do they get the scripts and the fills? And they do, they see that growth again, um, through these distribution channels.

Yeah. And of course they're awaiting Trump tariff announcements as well. Right, right. Um, okay. I didn't know this company. So in Axios Pro biotech, ed struck a deal with Lilly licensing, uh, their technology to Lilly. They're in London, uh, and they're [01:05:00] developing sort of neurogenerative disease treatments.

What do you think about this company? This is, 

Rick Abramson: I didn't know about them either. They were really, really interesting to read about. So, yeah, UK based, like you say, and their field is resilience biology. So, you know, what's resilience biology? I mean, it's this idea that you, you find individuals who either have a disease or they have a genetic predisposition to a disease, um, who at the same time are not.

Showing manifestations of the disease. Yeah. Like their symptoms are mild or maybe the disease has not progressed as fast as you expect. And the idea is that these individuals are, they have something special about them. Right. Something, yeah. Something in their 

Vic: Yeah. Genetics or in their body that's helping 

Rick Abramson: them.

Exactly. Yeah. And so if it's an immune system, you know, there may be mm-hmm. If the immune system kind of a factor, maybe there's like an antibody that you can isolate mm-hmm. And use that antibody as as a commercial treatment. Yeah. And so that is the idea. Super, super interesting. I think it's interesting too with the, again, going back to the Maha, you know, mo movement, this is not really [01:06:00] that upstream in terms of prevention, but it is kind of looking upstream in terms of individuals who, um, you know, for whatever reason are not, you know, showing the, the disease Yeah.

Or the biology as, as, as aggressively as others, um, and using that to, to make a treatment. 

Vic: Yeah. And the licensing structure is interesting too, where they didn't sell altogether. They, they licensed it to Lilly, which I think. More creative deals than pharma would be good. Okay. In the, uh, about health and us, more of a health and wellness kind of section that Marcus and I touch on, we have a New York Times opinion piece.

So this is not in their hard news, it's an opinion piece. The titles in a world of addictive foods, we need GLP ones. And it's written by David Kessler, who is a former commissioner of FDA, um, pretty far back. Yeah. That what I think is call maybe during Bush. I'm not exactly sure. Um, and he has a new book coming out, diet, drugs and Dopamine, the Science of Achieving a Healthy Weight.

So, um, it's a long [01:07:00] op-ed piece, but really talking about the concept of food being addictive and the GLP ones being a way to kind of help you detox off of it. And then. You titrate off on the GLP one and, and you're eating healthy and living a healthy life. Yeah. Um, so anyway, what, what are your thoughts about this?

Well, it's another great 

Rick Abramson: piece, I think to hold up in this context of the, you know, this discussion of Maha, right? Yeah. 'cause like here, he's like, he's taking these GLP ones and he's like, here, he's like saying on the, on the one hand we have this miraculous drug. On the other hand, like they're kind of, the reason we need them is because we have this, this flu supply with these ultra processed, you know, highly addictive, you know, sugar and fat enriched foods.

And so it's like the GLP ones, are they, you know, are they, are they a real solution or are they just, uh, like a high tech bandaid, right? Is the, is the question, and ultimately, do we wanna be investing in prevention or, or profitable pharmacology? You know, [01:08:00] 

Vic: I, I, does it matter? I mean, maybe not, maybe not, maybe it's both.

Yeah, I think it's both. Like, I'm very much in favor of trying to bring healthy foods into a price point that. If you are struggling to feed a family of four, it is a really good option to have healthy fruits and vegetables and foods, which I don't know that it is today. Uhhuh. Agreed. Um, but I also think using GLP ones to help people who maybe have eaten, alter, processed, maybe not that healthy foods for 20, 30, 40 years.

Mm-hmm. It may not be enough just to start offering healthy foods, but to give them a, some way, some transition tool. Right. Um, so I think it could be both. Um, but we'll see. Yeah. I, I can't tell if it's like, um, with the Make America healthy again kind of movement and now all of the regulatory apparatus starting to turn that [01:09:00] direction.

I am noticing all of this health prevention activity. Because I'm paying attention to it more, or are people like Dr. Kessler writing a book that he's been thinking about for a while, but he feels like now's the time that kind of the zeitgeist is ready to absorb it. Yeah. Um, I don't know which it is, but it's definitely more, I'm noticing much more health and wellness sort of news stories and books and podcasts and everything.

Oh, 

Rick Abramson: absolutely. Everybody's, that's, that's what everybody's talking about. Right. And here, I'm, I'm, I'm wearing my aura ring. Yeah, right there. There, there you go. Um, you know, there, there was one, it reminds me there was another, um, kind of pushback or criticism of Maha that I meant to mention earlier that I didn't, and it's that, this idea that, um, and it kind of, kind of dovetails with what you're talking about, this, um, yeah.

This idea that like this Maha kind of zeitgeist, this ethos, it kind of puts a lot of. Responsibility slash blame on the [01:10:00] individual. You know, like the individual should be finding, you know, healthier food, the individual should be sleeping more and getting more exercise. And you know, the reality is there's like larger socioeconomic forces out there.

Yeah. Such that, you know, maybe people don't have access to healthy food. Yeah. Maybe for whatever reasons, you know, they, they keep, they, they can't sleep, you know, a good eight hours a night. And, um, and that's been a, a little bit of pushback too. And I think, you know, I think you need to bring that into, into context here too.

Not that I'm saying that GLP ones are the answer to that. Yeah. I think those are other answers to the socio socioeconomic problems. Yeah. But 

Vic: if we are subsidizing, um, corn and corn syrup mm-hmm. Which I think we do as a country, right. Maybe we could subsidize something else or take half of those subsidies away and try to find something more healthy than corn syrup.

Yeah, that's right. Um, but yeah, getting the price point down and making it easy for people, or even aous to raise a family that is struggling to get ahead. We need to make it so that it is the natural kind of, [01:11:00] um, low friction way to go to eat healthy. That's right. That's 

Rick Abramson: right. And I think the GLP ones are important and, you know, we can neglect that.

Um, but we, we need to take the wide lens view. Yeah. 

Vic: Okay. Getting into ai, so, you know a lot about ai, so I'm excited to, to get your perspective on this. Uh, in Fierce Healthcare, pager Health rolls out a new AI agent to guide health plan members through wellness. So again, wellness delivered through payers.

I think they also work with employers. I, and so it's an AI agent helping members with wellness and care navigation. 

Rick Abramson: Now is this, now, and I didn't read this one. Is this a, does the agent help navigate between different platforms? I mean, I know it's a care navigation platform, but is it, yeah, 

Vic: so it, I think it is, uh, you know, you have your, um, provider network in.

Um, we're in Tennessee, so maybe they're in Blue Cross of Tennessee. I don't know if pager [01:12:00] sells to Blue Cross, but the payer provides Pager Health's AI agent to their members and they sort of help with that navigation. What doc here in my network, how do I do this? But also they help with sort of general wellness.

Many questions you have. Maybe you don't need a doctor to you, you could ask someone else. And I think the reason they sell to payers is that reduce the cost of care, right? Like if you can answer it with a nurse or even a, a, um, call center, maybe the AI agent can answer for you and help you, um, understand there's an overcount over the counter solution or that you could, uh, maybe.

Walk more, get some exercise and you wouldn't have headaches as much, or whatever. I'm not sure those are right examples, but that's the concept I think. 

Rick Abramson: Yeah, yeah, yeah. Well, this kind of, and again, this, we, we've talked about this before. There's kind of, there's, there's two worlds out there. There's clinical AI that's actually [01:13:00] kind of making, you know, trying to impact on decision makings in Yeah.

For clinical care. And then there's nonclinical AI and mm-hmm. Nonclinical AI is far outpacing the clinical AI at this point. And so this, I think is a good example of that, of that nonclinical AI here kind of helping with this 

Vic: care. Care, yeah. This is in the coaching, uh, maybe they group together a hundred people that are trying to lose weight into like a competition challenge steps challenge or things.

Yeah. Um, but it's also, I think, going to affect the referral patterns where, you know, physicians and health systems then are impacted by it. 

Rick Abramson: Mm-hmm. 

Vic: Yeah. 

Rick Abramson: Yeah, you gotta just, I just have to ask the question. Like, if it's, if the core problem is the complexity of the healthcare system, you know, how about making healthcare less complex rather than building an AI tool for you?

Yeah, but I know that's naive, so. 

Vic: Okay. And DaVita, uh, the CEO of DaVita, Javier Rodriguez is leaning into ai. And so DaVita has been doing [01:14:00] dialysis for, you know, end stage kidney disease patients for a long time. It's not clear to me how he's leaning into ai, but, but he is talking about AI a lot. So what do you think about DaVita?

Rick Abramson: Yeah. Well, so I guess first when a dialysis giant starts sounding like a, like a data science, uh, data science, like maybe we're getting towards peak, uh, peak ai. Maybe the shift is real. Yeah. Um, yeah. Um, so they say they're gonna be using AI for, for risk stratification and care coordination. Um, you know, here, I gotta say like, you know, again, this is not, not meant to be cynical, but, you know, there's, there's, there's AI out there and then there's like.

Excel spreadsheets that are dressed up as as ai. Right. And I wonder what this is, right? I mean, I would love to take a peek inside, you know, what does this model look like? What are its inputs? Yeah, inputs. I remember a conversation I had a few years ago with A-A-C-T-O of a of another kidney, like chronic kidney care.

Mm-hmm. Um, uh, firm. And um, and, and [01:15:00] they also had a kind of a prop proprietary, they called the AI tool, you know? Yeah. For, for kind of risk stratification. And I asked them like, you know, what are your inputs? Like what's, it must be a really complex model. And you, after a couple of, I think it was after a couple of beers, right?

Right. And finally he finally said like, well, you know, don't tell anybody, you know, but like, basically we can get like 98% of where we wanna be with like a, a zip code and a creatinine level, you know? Yeah. And like the rest is just, you know, it doesn't really act anything. Yeah. So, 

Vic: I dunno, I wonder, um, I mean this patient population is pretty, uh, sick and I mean, it's end stage, so, so they're on dialysis.

There need to be risk stratified, but there, there, it's a, it's a very finite set of things. You're, you're risk profiling, right? I think. Exactly. That's just not as complex as, as a different parts of healthcare. That's right. 

Rick Abramson: But everything, anything that'll get, that can keep patients going and not Yeah. To push 

Vic: off the need for, for, for, for, uh, for transplant.

Okay. So moving into more of the ai, [01:16:00] uh, standard, uh, technology companies, open ai. Uh, so this is a Wall Street Journal abandons, the planned for-profit conversion, which I was shocked about when this came out this week. Uh, because they have raised money around the idea of turning into a for-profit. I think some of those investors can claw their money back.

So Adam, what, what were your thoughts about this story? Yeah, that, that 

Rick Abramson: was kind of where I went with this too. I mean, so again, background, this is part of this big soap opera that's been playing out, right? Yeah. With like Sam Altman feuding with Elon Musk, and then, you know, he was fired and he's rehired, and Satya Nadella from Microsoft is involved.

I mean, this's a whole big, big drama. 

Vic: Um, but well, as, as a vc, I think if one can start a business in the nonprofit setting, do a bunch of r and d on a tax de football basis mm-hmm. And then when, [01:17:00] when one works, so I, maybe I do my portfolio, all of that. I do 10 of them. And when one works, I flip it to for-profit, that, that doesn't seem like it, it works for our tax system.

Yeah. Like what was that nonprofit status for in the first place? Right. Right. Yeah. And so, so I, I think it's pretty complex to make this transition. Um. And it seems like it's, it's failed. They're not gonna be able to do it. 

Rick Abramson: Right, right Now, I doubt this has a big effect on, on, you know, chat GPT and you know, what OpenAI is doing commercially.

I mean, it's a commercial operation. Right? Right. I mean, it's making tons of money, but, uh, but yeah, my, my, my thoughts went to, um, investors and for future fundraising, you know, that I think it makes it more difficult. 

Vic: Yeah. And it, and it's going to, I think, impair Sam Altman's ability to have full freedom of movement, to do whatever he thinks is best for the business, uh, competitive landscape.

Yeah. He's gonna now be beholden to the nonprofit board, which has this [01:18:00] nonprofit mission, 

Rick Abramson: fiduciary duty to humanity. Yes. Yeah. 

Vic: Right. Which is, um, maybe vague, but, but very different than drive shareholder value. Right. Related to that, I guess, is they are gonna buy the startup windsurf. So the first, um, the first really big commercial use of AI that has taken off has been as a coding assistant, co-pilot, or sort of, you know, pear coder that is not a human.

Yeah. Um, cursor, which we'll talk about in a minute, was sort of the first in that space. Um, and then Windsurf is the one that sort of came out with the Pepsi version of Coke at half the price. Oh yeah. I've used both of them. Um, and it is as good at half the price and so I [01:19:00] switched over to Windsurf. There you go.

Um, I think it's really smart for open air to buy it because it, it will get a whole bunch of users and sort of solidify. You know, what is the number two player in, in the most attractive early space? What are your thoughts about this? Right? Yeah. 

Rick Abramson: And it shows that you, I mean, yes, they're remaining not, not-for-profit, but that doesn't mean they're not building aggressively.

Right. Um, yeah. So, so yeah, this is a big deal and, um, yeah. I mean, this is why I'm not really encouraging my kids to do a lot 

Vic: of coding. 

Rick Abramson: Yeah. Yeah. I mean, yeah. 

Vic: Yeah. That's right. And I don't know that there's not gonna be a third and a fourth and a fifth that just keep having the price. Yes. Right. Uh, but I think for open AI and for Windsurf, it's a good outcome.

Right. They, they, they sort of solidify their market position. The windsurf investors get out. Mm-hmm. I was at a dinner with a bunch of VCs, um, and the product lead for philanthropic maybe two [01:20:00] weeks ago, and that was the discussion. There are some business models that, um, you can have a huge advantage. Uh, but there's really no moat.

Mm-hmm. Right. So you can, you can grow really quickly, but you have to exit quickly. Right. Because it is just gonna be a, it's commoditizing everything. Um, and then the discussion at dinner was what, what areas are, is it possible to build a moat and really data and trying to lock in users in some way? But locking in users is hard, so it ends up you need some kind of proprietary data source.

Yeah. 

Rick Abramson: And the data becoming is becoming more plentiful, at least certainly in healthcare. So even that's not a great mode. 

Vic: Yeah. Well, yeah. It depends on, it has to be, depends where you are. Proprietary data that no one else can get. Yeah. Which is, you know, hard to find. Yeah, exactly. Yeah. Yeah. And data that can't be replicated right.

From another source. Right. Um, okay. Then PitchBook had a really interesting report on Cursor, which, you know, which is the one I just referred [01:21:00] to as their first entry into the software coding space. They have increased their valuation. 20 times, um, since August. Yeah. And so the number of months, so Cursor launched 27 months ago.

They didn't exist 27 months ago. And let's see, this is the three months ago. Vibe coding. Correct. This is the vibe coating. Yeah. Love that, that term. Yeah. Yeah. And so they're just, it's, it's just an exponential curve. They, they are valued at little over $9 billion right now and just growing incredibly fast.

Yep. I wanna see 

Rick Abramson: a graph like that 

Vic: on, on one of my portfolio. Exactly. Yeah. Yeah. But um, I think also they are, I mean, the market is growing very fast. Yeah. And they're the leader. But at the same time, windsurf came, started after them [01:22:00] and now just sold for 3 billion and. I used to use Windsurf and now I'm not using it anymore because I, I found another tool that is, um, better, I think and less expensive.

And so the sort of this commoditization is happening. I think Cursor is trying to go it alone, but um, they have to run pretty fast 

Rick Abramson: to keep up. Yeah. It's a great example of what you're talking about. I wanna find the next windsurf and invest there. I mean, but do it really quickly. Yeah, exactly. By somebody else.

Exactly. Exactly. 

Vic: Okay, so I want to talk about AI agents. You've been in the space for a long time. I've been looking at AI agents really out of the crypto space, probably for six months, but they have broken into the mainstream first with Google talking about it now, everyone seems to be talking about it.

Uh, but the Wall Street Journal had a pretty good article for our audience that maybe is in healthcare and hasn't really focused that much on the difference between an [01:23:00] AI chatbot. And an AI agent. And so the title in the journal is AI Agents are learning how to Collaborate and companies need to work with them.

And it's really talking about how agents, AI agents can interact with other AI agents in this kind of network of automated, um, semi-autonomous, pretty intelligent entities. And they're empowered to do a finite set of things, but, but they can do that autonomously. Um, and together they can be pretty, pretty impactful.

Um, what are your thoughts about where we are with agents? Is it all hype? Is it gonna be impactful? Should we be paying attention to this? What are your thoughts 

Rick Abramson: about that? Yeah. Well, a a AgTech AI is really hot right now, as you know. Um, you and Marcus have been talking about it a lot. Um, it's, it's, it was, um, it's been really talked about a lot ever since, uh, Jensen Wong's, uh, keynote.

Yeah. Right. A [01:24:00] few weeks ago, um, at the what GTC conference. Um, yeah. So, and, and I, I think that this article lays it out and you've, you've laid it out well before. I mean, I kind of think of agent ai really, really simplistically as, you know, if the, the current generation of tools will kind of answer your question and give you ideas.

The Agentic AI will actually do it, right. Actually carry out those ideas. Um, and, um, and that, that becomes really, really powerful if you st if you start thinking about it. Yeah. Um, especially if you start thinking about kind of agent AI talking with each other and kind of these complex right networks, um.

Yeah. The other thing I, I mean, another example would be like an agent ai, I could say to the agent ai, um, you know, use Google Maps to help me find the closest route to the airport or something. Mm-hmm. And the agent AI would open up Google Maps and, you know, to which doesn't seem like a big deal. I mean, I could, I mean, I, it's not hard for me to open Google Maps myself, you know, but it, you know, takes me a couple seconds to do it.

Yeah. But then you [01:25:00] think about like, some really, really complex workflow with like thousands and thousands of instructions. You know, AgTech AI could do it within a few seconds. It would take me hours to do. Right? And so that's when it starts kind of, and then you start thinking about, you know, things that can do for, for healthcare and finance and all these different industries.

Um, it can be kind of, kind of mind blowing. Um, but I, I mean, I think you guys were talking about this last week, I also kind of, uh, I, I think we need some, some pretty sharply defined guardrails on, on these things. Yeah. I, you know, the idea of kind of autonomously, I. Operating networked ais with agency, you know, starts getting a little Yeah.

Where 

Vic: are the, yeah, where are the boundaries? What, yeah. Um, and I think right now it's not clear. And speaking of that, uh, I feel like Zuckerberg every week with Netta is out, like pushing the, the boundaries further and further. But in the journal this week, Zuckerberg's Grand Vision, most of [01:26:00] your friends will be ai.

I think most of my friends are 

Rick Abramson: already ai. I don't, I don't know why this is such news. Um, 

Vic: most of your friends are AI right now, or No, I'm just 

Rick Abramson: kidding. But, um, I think 

Vic: that's, that's a dystopian world that I don't want, I know he's saying it as a positive thing. So the basic concept is that most people would like to have 10 to 20 close friends.

Mm-hmm. And most people, and he knows because he sees it on his network, most people actually have three to four friends. 

Rick Abramson: Yeah. 

Vic: And so his jump that I don't agree with is, therefore we should fill in with AI friends to fill the gap that's needed. I'm not sure that that is a good substitute. Yeah. 

Rick Abramson: Well, I don't know.

Is it, is it mu, is it, is it therefore we should, or this is gonna happen? Because that's inevitably that's, that's where we're gonna go. Yeah. I [01:27:00] mean, I, I mean we have so many point things pointing us in that direction. I mean, loneliness is a real problem. Yeah. Social isolation is a real problem. It's has only increased since Covid and it's propelled by, you know, all of technology, you know?

Right. We can do anything we want remotely and we don't have to interact with. With people anymore. And at the same time, you've got these LLMs that are getting better and better. We know from research that they are more empathic. Right? Yeah. Like, I mean, like comparing LLMs to physicians, right? You're the LLM is gonna be deliver more empathy and Right.

Have a better interaction than, than your physician. Um, and so yeah, they're, they're gonna be, they're gonna be our friends, they're gonna be our therapists, uh, they're gonna be our lovers. Right. I mean, we, we won't get into the whole discussion about meta and the, and the sex talk, but, um, from last week.

Well, yeah. But, um, so you think this is inevitable? It just is. I don't know if, if inevitable is the, is the word, but I, I think that we, I think our momentum is carrying us in this direction. Mm-hmm. Is what I would say. [01:28:00] Yeah. You don't think so? Yeah, maybe. I think it's sad though, so I'm resisting. Oh yeah. I'm not saying it's not sad.

Um, but 

Vic: um, but I, so it probably is, I think it is, there's a lot of momentum in this direction and it is self-reinforcing, right? So. As people get more connected with ai, they will see no reason to go work on a messy human relationship. Yeah, that's right. So then they'll be more lonely and more inclined to do ai and then Yeah.

It just, it just sort of perpetuates everything himself. That's right. Yeah. Yeah. So I'm fearful about that, but No, it's definitely, that's probably right. It's 

Rick Abramson: just, it's definitely a dystopian vision. But I think what Zuckerberg, and I don't wanna put words in Zucker's mouth, but, um, you know, I think he's, he's talking about a world where we are cohabitating with ai, you know, not necessarily AI replacing our social [01:29:00] connections, but maybe augmenting them in some way.

Um, but it's easy to kind of take that and go to some dark places. 

Vic: Yeah. As agents start doing things in the world, they're gonna need to pay one another. And pay for services, buy data from someone or maybe transact or something. Pay an influencer on social media or, um, buy a, buy a keyword in, in a search.

Um, and I've been trying to think about how that would happen. Visa is, is bringing out a, a tool that would allow me to sort of provide a budget and sort of, and let an agent use my Visa card. Mm-hmm. So that might be possible. But Tether came out this week, we're showing an X post by the CEO of Tether. So Tether, um, they do a bunch of things, but they're best known for their stable coin.

[01:30:00] Um, USDT, which basically, um, mirrors the value of a dollar. USDT is held at $1 per one USDT, so you can move in and out of tether. And ev, every tether coin is worth a dollar. Always. And then they are, um, backing that with mostly US treasury bonds, but other things too. Um, and it's a pretty interesting business model.

I wish that, um, you and I had thought of this. Oh man, I tried to invest in a stable coin, but I was just like a touch late. Um, but same year. I wonder if it was the same coin, but anyway. Yeah, yeah. Probably, probably. Um, so anyway, their business models for the audiences, they hold the US bonds, they, it makes 5% a year.

Say they don't pay interest on the dollars that you use to buy USDT, [01:31:00] so it doesn't pay interest on your stable coin. And then they are making that interest rate and they're just printing billions of dollars. It's a very successful model. So they have come out with Tether ai. Which is an open source, um, way to, in a sort of trustless, uh, fully automated way, allow ais to interact and pay one another.

Um, and I'm following this because I think a lot of the AI transactions are gonna be at the 1 cent, even below a cent. And you will need, AI will need some way to do that, uh, in a format that is not based on, I know Rick a Abrahamson and I trust that, uh, you didn't steal this money and it actually is gonna be sent to me.

Um, and Tether is the only stable coin that I know of that has [01:32:00] scale that you don't have to do, go through the KYC process, which in the us like I'm on Coinbase and other things, and it's fine. I can, I can give my driver's license and I pay my taxes. I'm not. Trying to dodge that, but if I have 15 AI agents doing various things, I don't know how to KYC, all those agents, I don't know, know what that means.

And so anyway, I'm following this. I wanted to see your thoughts on it. 

Rick Abramson: It's, yeah, it's super interesting. And I, I, when you first showed me, I had to, I had to double check to see that it was the same tether, right? Yeah. Right. But it is the tether USDT tether, um, which yeah, it's, it's a, it's an amazing success story.

They've had some compliance challenges, but like they are, yeah, they're a dominant player. Um, and yeah, it does make sense for all the reasons you said, um, for, especially for these kind of like fractional right fraction of ascent transactions, right? That, um, it might take place on, like this guy says, master place for 

Vic: agent.

Yeah. In for builders, I mean. [01:33:00] Exactly. 

Rick Abramson: Um, now the only thing, I don't know if necessarily if it has to, I mean linking, um, agent agent AI with a blockchain that makes sense and linking it with a cryptocurrency makes sense to me for those reasons. I don't know that it has to be a stable coin at the end of the day.

I mean, yeah, I don't think it has to be stable coin. Yeah. It just has to be something with fast transaction. Yeah. Like settlement speeds. I don't think you could do it on Bitcoin. Maybe on the Lightning Network. Yeah. On top of Bitcoin. I don't know. But, um, 

Vic: yeah. Uh, it ha has to be in a currency that most people understand what it means.

Yeah. So you could have, it could be the Euro, it could be Yen. Mm-hmm. Could be Bitcoin maybe. But there's, there's not that many that you could go to that would be, um. I don't know. That's an interesting question. 

Rick Abramson: Well, 'cause you could have the transactions occurring in pretty much any crypto token and then just convert it to your home, you know, native currency on the back end.

Vic: Yeah. But you'd have to have some kind of oracle keeping up with [01:34:00] the conversion rate. 

Rick Abramson: Mm. May yeah. If you're doing it in real time. 

Vic: Yeah, yeah. Right. Yeah, for 

Rick Abramson: sure. Right. It's really complicated. But that's, yeah, that's gonna be, 

Vic: that's gonna be fun to watch, play out. The Guardian had a story about Amazon making a fundamental leap in robotics.

They're bringing this invention to Europe, the uk, and Europe first. But the, the leap is that the arms or the appendages that, that, that the robot uses to grab things can now feel the, the item and use touch to, to distinguish between things. Um, and it's going to. Allow Amazon to bring many more robots into the picking and packing process in their warehouses.

Um, and so I think robotics is quickly sort of interacting with AI and kind of going, iterating [01:35:00] back and forth where AI is making robots better, robots are making AI kind of more useful. What are your thoughts about this story? 

Rick Abramson: Well, you know, it's like, it's, it's kind of like you ask yourself like, why aren't robots everywhere?

Right? I mean, we've got this amazing technology. Mm-hmm. I mean, we've got software that just blows your mind. Why, why aren't we using robots for like, every single chore, every single activity in our daily lives? And I, I really think that the, the big, one of the big rate limiting steps is this sense of touch, right?

Yeah. This tactile feedback. If I tell a robot to pick up like a wine glass, it's probably gonna crush the wine glass. Right? Right. Because like, that's really, really delicate feedback Yeah. That you need in order to grab something with enough friction to hold it, but not so much that you're crushing it. Um, and if this is what Amazon has come up with, I mean, there's.

Research teams working on this all over the world. Right. But I mean, that, that's, that, that's, that will be like a tipping point I think, you know? Yeah. That's this kind of tactile feedback. Right. The, I thought that the story itself was a little misleading 'cause I got all excited about Robot Touch, but it was more about, um, the robots [01:36:00] being able to know which boxes in the, in the warehouse they can pick up in which they can't, but I mean, but apparently it's a major step in that, in that direction.

Yeah. Right. Um, and that's gonna be, that's, that'll be huge. 

Vic: Yeah. Um, okay. And then the last story, uh, here in the us, Aurora is a, uh, automated driving company. Uh, they have focused on trucks like 18 wheelers. They now are fully autonomously driving these 18 wheeler trucks with loads of cargo between Dallas and Houston.

Um, making deliveries and there's a video that we'll link to where you can watch, there's no driver in it and it's, it's on the highway and other cars are around and it's, it's driving from Dallas to Houston. Um, that's awesome. What are your thoughts about this? My 

Rick Abramson: wife loves this. My wife. Oh, really? Well, yeah.

'cause she hates trucks. Well, okay. She doesn't hate trucks, she [01:37:00] doesn't hate truck drivers, but she hates trucks driven by truck drivers. She just thinks they're really unsafe. And so she's really, she, she's, she thinks the autonomous truck will be much safer. She thinks it'll be much safer and she'll be much happier on the roads with a, yeah, with an ai, AI driven truck.

So, uh, and I know that's, you didn't put that, I mean, I know that you put this in here 'cause you, you know, probably wanna talk about supply chains and, you know, lab, lab, lab testing and home delivery and all that. No, I think it's 

Vic: all already related. Like it is, it's, um, humans trusting that the autonomous driver is better than.

A human driver mm-hmm. Is a huge adoption question. Yeah. Oh, exactly. For sure. And so that's interesting that, um, I think that makes sense that truck drivers drive for long periods of time. Mm-hmm. And it's, it's a hard, it's a hard job. It's hard, they get tired. Right. Um, it's, 

Rick Abramson: it's, it's tough out there. Yeah.

Yeah. But I think to your point, the adoption question, I mean, there there is, there will be a safety [01:38:00] incident, right? Yeah. Some, something will happen and that's a real question. After that something happens, are we going to see a huge delay, huge setback in this technology? Or are people gonna realize that like, Hey, the rate of these accidents is like a mere fraction of the rate.

It is, you know, with normal human drivers. 'cause that's, that's what it is for cars, right? For self-driving cars. Right. Yeah. I mean, 45,000 automobile deaths a year, I think. Yeah. And we could, I mean, and, and a lot of human error. A lot of human error. Yeah. But unfortunately, like one, one incident with an AI driven car kind of sets the industry back several years.

'cause people are becoming more comfortable with it. Yeah. I think there's some ai, there's some Waymo cars that are here, are here downtown. Oh, here in Nashville. Somebody told me that last night. Okay. Yeah. 

Vic: I've been wanting to ride in once. I definitely wanna check that out. So, me too. Um, yeah, so I'm following this because I think, uh, Waymo seems like they have really gotten, they're figured out where they're starting to, to grow their, their base.

Mm-hmm. I'm excited if they're in Nashville. And then, [01:39:00] uh, this truck company I'd been watching, they were sort of delayed, but now it seems like they're, they're up and going and the interstates. Um, seems like an easier problem to solve than, than, uh, neighborhood traffic. Yeah. So, yeah. Yeah, I think so. I think so.

Rick Abramson: I 

Vic: wonder if they have, uh, robots 

Rick Abramson: loading the 

Vic: trucks. Yeah. I know. That's the thing they pro they probably, um, can add that over time. Yeah. Okay. Well, Rick, thanks for doing this. Really enjoyed, uh, talking through things. Lots of stories as usual. Uh, I appreciate you filling in this exciting, this was so much 

Rick Abramson: fun.

I am so honored. Uh, thank you for the invite. Yeah. This, this was a lot of fun. I'm, I don't think I'm leaving here knowing, uh, master level jiujitsu, but, uh, every time I spend time with you, yes. I, I come out smarter, so thank you. Thank you. Good. Well, it's been 

Vic: great to have you. And then people should check out, I'll put in the show notes, uh, episode 73.

It's a little bit dated, but we, we talked through AI last summer. Yeah. Which was great. We'll add that as well. Very cool. Thanks everyone. See you next week. See [01:40:00] ya.