64 – VC Heats Up w/ 18 New Deals, Doctors Reach Breaking Point, Asthma Cured?

Marcus: [00:00:00] If you enjoy this content, please take a moment to rate and review it. Your feedback will greatly impact our ability to reach more people. Thank you. I’m a purple belt.

Vic: Yes. Congratulations. You have been married 10 years and you’re a pro belt.

Marcus: Yeah. Uh, it’s been, it’s been a crazy week. I didn’t, you knew about the 10 year anniversary, but you didn’t know about the purple belt thing.

Marcus: I didn’t know about the purple belt thing. That’s the way it works. You know, you never know. Like they just, right.

Vic: They, they. They judge you on a bunch of skills and activities. And then when you’re ready, they tell you. I was

Marcus: training on, what’s today? Thursday? So I was training yesterday. I was training yesterday morning and I was rolling with a guy.

Marcus: And then my professor came up to me and like, while, while I wasn’t looking, I’m like rolling. And like slapped me like five times on my back with a, with the new belt. Oh, nice. Nice. So that’s, that’s like the old school way of getting your promotion. So it was pretty cool. Yeah. I mean, it’s like, it doesn’t matter, but it [00:01:00] does matter.

Marcus: Um, it matters mostly because I wasn’t going to go to worlds this year. And if I didn’t get promoted, cause I just, I didn’t want to do two, three years in a row at blue belt is didn’t feel real. Um, but now I’m purple belt. So whole new group of people to beat. I got it. Got to go to worlds and got it. Got to train, got to train anyway.

Marcus: How was your week? But by the way, amazing episode with Paul.

Vic: Yeah, we missed you, but it was fun to have Paul on and talk to, you know, really good operator who’s, who’s. Been running hospitals and, and, uh, actually in the trenches doing stuff. It was fun. Dude, he did a

Marcus: great job. He’s well prepped. He clearly listens to the show because he knew how to like step into the role and kind of banter back and forth.

Marcus: Yeah. Um, it was awesome. So he’s, he’s welcome back anytime, Paul, anytime you want to come back. Uh, you know, we loved having you and, and, uh, you did a great job filling in. So, so thank you very much. Um, what else is going on, man? Anything else before we jump into, um,

Vic: no, I’m pretty good. Just the same, same stuff.

Vic: A lot of portfolio companies, uh, making [00:02:00] progress, a lot struggling. It’s kind of a fun time. I think there’s a lot of opportunity to, to bring new products to market and the healthcare system needs, needs help. So the buyers are willing to listen now, but we still got to deliver. Yeah.

Marcus: There’s definitely a lot more activity going on.

Marcus: And that’s going to be a theme of today’s show. So, uh, with that, let’s dig in.

Marcus: All right. So. Um, quickly, we’re just going to talk about the Fed and I think as we, as we keep talking about, um, the economy, I think we’re going to have to, I don’t want to say shift away from the Fed, but talk about other macro things, because it, it feels to me that we are, we’re, we’re basically in the Goldilocks, uh, Economy, right?

Marcus: I mean, all, all the economists are basically projecting that Q2, um, will, even though the consumer is weak, [00:03:00] uh, they are projecting that Q2 GDP will, will go up. So that will be an avoided recession. Um, you know, they’re saying there’s one, one and a half jobs for every person in America. So there’s a lot of open jobs right now, apparently.

Marcus: Um, and look, I mean, Stock markets, all time highs. We’re going to talk about that. It’s like, do you need a rate cut with all this? Right? So it’s just sort of shifting. I

Vic: think, no, I mean, if anything, I think the fed has achieved a, a reasonably soft landing, um, if they would be honest. and just say that 2 percent inflation is not their target, I think they would have everything lined up.

Vic: Yeah, it would be done. Yeah, it’d be done. We wouldn’t be talking about this anymore. The fact that they still pretend like they’re going to get to 2 percent when I don’t think that’s very likely, and, well, they’re not going to, I don’t think they’re going to cut the rest of the year. Maybe they’ll do one cut.

Vic: I think the odds are, [00:04:00] like, 40 percent for 2. And 70 ish percent for one, for the end of the year. My guess is they don’t do anything before the election. I’ve thought that for a long time. They’re just not going to want to get in the middle of the election one way or the other. But I don’t think that inflation is going to be down at two.

Vic: So I think we’re in this new world where we have inflation at three to four percent somewhere, which probably is okay. And we have a pretty, pretty good economy if you own assets, if you own stocks or financial assets, real estate. And if not, It’s, it’s a little bit harder.

Marcus: So two data points that we don’t have any links for, but just things that I kind of came across over the last week.

Marcus: One was, um, on the, uh, Prof G markets show, um, Ed Elson, who’s the analyst, uh, for, uh, for, uh, Scott Galloway was talking about CPI. I was talking about the shelter component and sort of [00:05:00] really dug into how the department of, um, Labor Statistics Bureau of Labor Statistics like actually generates that data and it’s it’s survey data And so he we we’ve already talked about how over the course of 12 months they smooth that shelter number because it’s kind of too hard to track on a Quarterly basis much less monthly.

Marcus: Yeah, so they smooth it out But but even more so he was like it’s a survey and it’s sentiment based Based survey, it’s not based on like actual data and he was comparing the, you know, the rent index that was the component of shelter in the CPI with the Zillow index. And he was like, and the Zillow one is real data, obviously it’s pulling from its marketplace.

Marcus: And he was like, the Zillow data is showing much, much lower rents than what CPI is projecting. And so what’s interesting about that is inflation may actually be lower. Yeah. Yeah. Then, then it seems right. Like we’ve, we’ve talked about in previous episodes, how people’s sentiment is [00:06:00] not actually a good indicator for how the economy is actually doing right.

Marcus: You know, people think it’s certainly like, it’s, it’s, it’s going bad across the whole country when in reality you look at it, it’s like, we’re actually have a great economy right now. Um, so. So I thought that was one really, really interesting data point. The second was yesterday was, um, Nashville’s, uh, hospitality luncheon, the CVC throws a luncheon and their keynote speaker was, um, this guy, Adam sacks, who’s the president of, I think the name of the firm is travel economics.

Marcus: And so it’s, it’s like the leading. Um, travel economics, you know, consultancy in the, in the space. And he, he actually gave us like a projection of what he thinks over the next 24 months, Nashville is going to do. And his basic thing was this year is going to be kind of a flat year. Um, maybe a little bit up, but if you compare it to last year, Like it’s, it’s time for a little bit of a correction because we just kind of blew it out the park last, last, uh, last year, [00:07:00] but then next year, we’re going to go back to growth.

Marcus: And the year after that, we’re going to go back to growth and that, you know, in certain categories, travel being a big one, people are continuing to prioritize for travel. Now it is hitting the lower income, um, uh, population harder, but the majority of travel is really done by the higher earning, uh, vans.

Marcus: And so. You know, everyone is a little bit skittish at the moment, but they’re all gearing up for a lot of travel over the course of the summer and planning on big traps, big trips for 2025. Yeah. I think,

Vic: I think, um, consumer leisure travel is pretty strong,

Marcus: but then the

Vic: trade show events is also strong.

Vic: It’s the business travel. That’s still like, we’re waiting around to see if people are going to start traveling.

Marcus: Correct. And the business travel. Um, has actually rebounded quite a bit, but it’s, it’s non committal, right? Like, like based on how things are going in the market or things are going in the company, they will cancel a trip.

Marcus: Like [00:08:00] without problem, no problem. Canceling it. Well, there’s

Vic: a good alternative now is just jump on zoom. And everyone’s used to that now. So it’s a, it’s a way to save money. Locking

Marcus: down travel, you know, for your employees. There’s a lot of that going on. Yeah. Um, so, so I think you’re right about that, but anyway, just sort of making the point that it feels like all this stuff is kind of priced in at, at this point.

Marcus: And, um, the one part of the economy that is actually. Struggling, uh, in terms of real wages, real earnings, um, is the working class.

Vic: Yeah.

Marcus: And you know, that’s where it is legitimately getting harder. Um, and it’s not just rent, right? It’s the cost of kind of everything is just up and your wages are not

Vic: in groceries and everything.

Vic: Yeah.

Marcus: Yeah. And your wages are not up. Um, and you don’t feel like you have a lot of latitude to move around from job to job right now. You know, we’re not kind of in that window where people were, um, Very noncommittal to their jobs. People are playing it a little bit more safe. So [00:09:00] anyway, yeah I mean, I think the reason

Vic: that we cover this is twofold inflation is really impactful to health systems and payers Labor and yeah, and labor costs is also part of that Their reimbursement is set by health system reimbursement is set by inflation largely largely.

Vic: Yep And so a lot of volatility, inflation going way up to six, seven, eight percent within one year and then way down is, is hard for the health system to react to because, because we only adjust reimbursement rates roughly once a year. And then, you know, we care a lot about the stock market and exits in our portfolio and when is it right?

Vic: When is it time to sell assets and not? Um, but I think you’re right. The next several quarters probably. I think we’re going to have pretty good GDP growth and inflation that is higher than the Fed really wants, but they’re not going to, I don’t think they’re going to do that much because you know, [00:10:00] honestly, it’s not the end of the world, the amount of debt we have, it’s not the world to have hot inflation for a little while, it’ll make the debt a little easier for the federal government to pay.

Marcus: Yeah. And just getting into the next two stories, right? So Um, first stock market all time highs

Vic: and literally record all time highs. Yeah. Did that hit

Marcus: 50? Yeah. Yeah. 000. I mean, like, so that’s all right. That’s what I mean when I say like, what do we need cuts for? Yeah. Wall Street is fine. Right. Wall Street is fine.

Marcus: There’s no need for cuts for wall street and you know, we’re going to get into VC deals later, but like, there’s a lot of deals going around and there was a lot of capital that sat on the sidelines. It’s now starting to move. So for our industry. We’re probably fine. Yeah. You know, we’re fine. We can just sort of adjust to the new, new norm and.

Marcus: Yeah. Get back after it target reports, another sales drop. So the, the consumer is weak.

Vic: Um, yeah. Walmart was last week targets this week. Both are taught. I mean, Walmart did better because they have lower price points, but both of them were talking about the [00:11:00] struggling consumer and they’re seeing the difficulties in that kind of bottom part of the K working class folks are not able to buy the same way.

Marcus: Yeah. Credit card balances are up. Yeah. 98 delinquencies are. At, I think, highs for the last 10 years. Yeah. Yeah. Um, so that’s all gonna come to roost. Yeah. And, um, you know, no more STEMI checks, et cetera, et cetera. So yeah, the consum, the consumer is weak, and that’s probably for the foreseeable future.

Marcus: Mm-Hmm. . Um, and on the other end of that, K you know, you’ve got Nvidia, right? So, right, right. Um, so Nvidia. smashes their quarterly targets, raises their outlook. Um, and when we talk about Nvidia, we need to just like talk about what they represent, right? You know, why, why is this stock just completely blowing it out?

Marcus: It’s it’s because this is a stock that businesses are going to. Um, be able to leverage to lower their OpEx and grow their bottom line. Like that’s just shooting all the way to the PNL of what AI really does. And certainly some of [00:12:00] that is going to be efficiency, but a lot of it’s going to be lower labor costs.

Vic: Yeah. There’s no question. And they are the company to focus on to see What is the, what’s the attention on ai or is there really pull through? Is it slowing down? And the answer is no. No, it’s, it’s still to the moon, 260% growth in a year. And, and on big numbers. I mean, I think it was 26 billion For the quarter.

Vic: For the quarter, yeah, for the quarter. And then they did it 10 for one split. Because what the, what the heck? You might as well when your, when your stock grows from a hundred to a thousand in a year. Yeah. We should do a 10

Marcus: to one split. It’s amazing. It’s amazing. And, and look, I mean, NVIDIA is the far and away leader in AI chip development.

Marcus: And we know Microsoft is working on this. Yeah. Alphabet is working on this, right? Um, they’re not going to be in this alone, but they’re just so far [00:13:00] ahead. I mean, they have

Vic: in the mid 80s market share, 85%, 84 percent market share. So even if they, They are going to get competitors. Everyone’s trying to build a chip, but, but they’re pretty good.

Vic: And, and, and they’re focused and that, yeah,

Marcus: right. They’re there, they’re, you know, completely focused on this one thing. Whereas all these other companies, they’re, they’re service providers, they have phones, you know what I mean? Um, so yeah, that’s, that’s story of the market right now. Um, markets, all time highs, AI dominating everything.

Marcus: Yeah. Um, which is just going to be, I think, more problematic for the consumer on the earning side, but also should hopefully lower. Cost and create more, um, efficiencies and higher quality services for them on the consumer side. So good. If you are tracking relatively well in terms of stability of your career and your income.

Marcus: And if you’re kind of on that edge where your job is a target for AI, probably pretty problematic. [00:14:00]

Vic: Yeah. And I think that’s going to be the, I mean, it’s a weekly show. That’s going to be the next six to 12 months. And so I agree. We’re going to have sort of a. Just an ongoing high growth in the economy and somewhat high prices.

Marcus: Moving on to VC deals, a company called Boulder Care. Boulder not for Boulder, Colorado, but Boulder for the metaphor of a boulder, meaning the weight of what it feels like when you are dealing with addiction. They raised 35 million for a virtual addiction treatment business.

Vic: Yeah, and they’re, they’re in six states right now and, and they raised this money to grow to 10, I think.

Vic: Um, so great. I mean, it’s a huge problem and great that they’re expanding.

Marcus: Yeah, we’re going to talk a little bit later on about, uh, a special interest story about Baltimore and also some really not so great things we learned about other cities in, in, in America. But, uh, the, the. Epidemic of opioids continues and it’s [00:15:00] it’s ravaging communities and, you know, we, we don’t have nearly enough, um, you know, firepower going at this problem.

Marcus: So this is a great round, you know, we’re really excited for this company, obviously, you know, Eleanor Health and our friend in Zynga, you know, I think they’re, they’re continuing to grow and, uh, we, we, We’re going to need more. We need it. All day. More revolutionaries working on this. Yeah. Yeah. Cause cause right now we’re, we’re losing the war for sure.

Marcus: All right. Fierce. Healthcare did our, did our job for us. Uh, so, uh, Heather Landy, thank you very much. The, the author of this article, uh, they did a full on. Sort of fundraising tracker. I think it’s probably covering the last 30 days, but a lot of these deals I remember seeing over the course of the last two weeks.

Marcus: So I think it might even be more recent than that. Um, 18 different deals that they, that they cover in this one article and sort of high level themes that you see in here. Uh, AI, clearly the, the far and away, um, the biggest theme capturing large, large, uh, checks. We can start with the [00:16:00] first deal here, lower health, uh, pockets 80 million for an app that combats the stress and loneliness, which, uh, I think when we talked about it seemed a little bit like on the frothy side of things, um, especially when they make their money from, uh, sort of healthcare savings, um, from a stress and loneliness perspective.

Marcus: Obviously, you know, there’s, we talked, what, two weeks ago about, um, all of the apps that are out there to be companions. Um, you know, chat GPT released, uh, you know, four zero, uh, four Oh, and, um, you know, now we’ve got the her voice. I mean, Minus the Scarlett Johansson issue. Right, right. Um, but we’ve, we’ve got, you know, audio companions that are right now.

Marcus: Distributed via chat GPT. So, you know, I wonder how much a, a health specific AI company is going to be able to do in this space and then furthermore, how they’re going to be able to track the healthcare savings. But, you know, look, AI is the, the rave and there’s going to be a lot of big checks [00:17:00] written, you know, chasing after the opportunity.

Vic: Yeah, I, I, I think I agree. Completely. The idea of value based care, I think, is really attractive. But the only successes I’ve seen have a very specific focus, usually on a disease state or or a geographical type of population, and trying to do loneliness, which is a horizontal thing across pretty much every disease state, with An AI tool that looks pretty similar to the one I have for 20.

Vic: I don’t know that I would have invested 80 million, but, but it’s, but there are a lot of lonely people, so whether they can show that they’re driving savings due to their app, it’s a good thing to give people a tool to be less lonely. I just don’t know if the business model. I have concerns about the business model, but yeah, I mean,

Marcus: there’s there’s there’s viability in the problem.

Marcus: [00:18:00] They’re going after. Yeah, right. Meaning, you know, stress and loneliness and how that impacts your health. And we’re going to talk about that later on as well. Um, but it’s just how ready is the market for that as a business solution, especially in terms of being able to measurably demonstrate healthcare savings.

Marcus: That’s a entirely different bar. Um, a couple of the other big themes here, a lot around revenue cycle management. A lot, I think there was three different deals in this list that, that sort of track that smarter DX raising 50 million is, is one of them and they’ve got Bessemer flare floodgate. So, you know, sort of usual suspects circling around that one radiology sort of, we talk all the time about radiologists being sort of ground zero for clinical, um, you know, decision support.

Marcus: And here’s another company rad AI that. That raised a 50 million scaling gen AI for, for, uh, rad techs. So, um, yeah,

Vic: I had a good lunch with a friend of ours. That’s a radiologist turned entrepreneur. I’m trying to get him to come on as a guest. Radiology is a really interesting space. Lots of complexity [00:19:00] and the regulatory environment, us and global.

Vic: And so I think we’ll have a, hopefully we’ll have a guest show talking about radiology, but, but the summary, I think in these 18 deals is. A lot of money going in to venture stuff, a lot of, uh, B, C somewhat later than we normally do and pretty big rounds. Yeah. So I think it’s, it seems pretty healthy. It might even be on the edge of getting or getting, you know, maybe not overheated, but it’s starting to be a lot of money coming in.

Marcus: Yeah. Yeah. It’s, it’s, it’s, it’s certainly exciting to see this many deals, uh, being listed in one article, right. That, that are from no more than 30 days. Right. Right. Um, I can’t remember the last time that I saw an article like this, so that’s, that is really exciting seeing so many of them, uh, targeting AI solutions, you know, it’s like, I, I’m all for the ones that are focused on revenue cycle management because there’s unending, you know, opportunity there.

Marcus: Um, the, the rad tech, I think that’s going to be a [00:20:00] very crowded and, and competitive space, but also really viable, you know, as well. And then I think there’s some of these that are more on the fringes, you know, like, uh, this lower health business that not, not to say that it won’t work, but it’s certainly to me, it’s riskier.

Marcus: It’s a riskier bet, um, to, to sort of, uh, go out on a limb and, you know, it would have been risky without AI. So you start to add in AI and now it feels a little bit speculative, but anyway, look, it’s, it’s, it’s great to see so many deals getting done, uh, moving on to policy. So HHS, they are sort of partnering with the white house on ARPA H ARPA H is sort of a play on the old DARPA.

Marcus: Um, model and really focused on how we can do moonshots in health. The H stands for, for health. Um, but these are advanced research projects that are being funded via effectively grants, uh, that are being written by, by, um, this, this, uh, carve out organization, ARPA H. And these are kind of, you know, special.[00:21:00]

Marcus: Grants that are given for real problems that we see in the healthcare industry. And, you know, they were focused on things around, um, aging, they were focused on things around pregnancies, but what has emerged as a massive issue in healthcare over the course of the last year, cybersecurity, right? Um, you can’t go a month without a major.

Marcus: Major company having a cyber security issue,

Vic: and they’re not like a one off thing. I mean, they’re down for a long time.

Marcus: Yeah,

Vic: yeah, like a long time.

Marcus: And it’s really, really scary how that impacts, you know, the ability for these systems to provide care for their communities. And so, uh, RPH is offering more than 50 million for hospital cybersecurity platform pitches.

Marcus: So, um, look, I like the responsiveness of it. I love the, I like the signal. This is a good way to signal that the government understands we need targeted innovation to start to focus on this problem. Obviously, 50 million is not going to be sufficient to safeguard Our, uh, sort of health system infrastructure in America, um, but at [00:22:00] least putting a bounty out there and, and getting, you know, ideas to come to the table, that is a good thing.

Marcus: So don’t want to, you know, uh, knock them for the, the size of the, of the sort of pitch, um, prize bounty, but more sort of celebrate the fact that, okay, we’re, we’re getting somewhere now.

Vic: Yeah, I think it’s, I agree. It’s, it’s valuable symbolism. I don’t know how much I trust that the, Government investing 50 million in pitches that they see is going to really combat significant black hat criminals who probably get 50 million per ransom that they’re doing.

Vic: But I don’t know what else the government should do. So they’re taking action and I think we should celebrate that.

Marcus: The one thing that I am looking forward to with this is, I don’t feel, and maybe you feel differently, I don’t feel that over the course of all these different stories, [00:23:00] I have a good sense of what the origin of the cybersecurity issues are, and so I’m hopeful that these pitches, um, they, they should be public, this is a government sort of program, I’m, I’m hopeful that these pitches provide some insight into what the, um, The vectors of threat are, I think we make assumptions that it’s people who are, you know, giving up access to sensitive data or to parts of the system that are administrated that they shouldn’t, um, but I don’t know that, like how much of it is actually social engineering versus APIs versus bad networks versus I don’t, I, the bottom line is, I just really don’t know.

Marcus: I don’t think anyone knows. Yeah. So, right. So maybe this pitch. You know, program will actually provide some visibility to the general public around, Hey, how are these things getting so lit on fire all the time?

Vic: Yeah. And I think that’s right. It’s also true that I think there’s a lot of cyber attacks that are not announced.

Vic: [00:24:00] Yeah. I was at a dinner. I don’t know, someday, after the show, so it was like Friday night or Saturday, and there were four of us at the dinner, and we were talking about, um, Ascension, which we’ll talk about in a minute, um, and three, I was the only guy that hadn’t been, uh, a victim, so the other guys that, that, um, you know, I’ll tell you that their names were off air, um, they lead healthcare companies here in Nashville, so, um, And they also had been attacked, but they had been, you know, sort of paid the ransom and made it go away quietly.

Vic: And both of their situations were a partner. Um, partner was compromised, didn’t know it, and so it kind of went and tunneled in through the partner relationship. Got it. And I think this is just, this is going on all over the place and it’s so quiet that then, you know, you don’t really know. And so you’re not aware the partner has been compromised.

Vic: And so it’s [00:25:00] just a, it’s a hard thing to get your hands around. Yep. And I don’t blame people for being quiet about it. I think it’s no, my gosh.

Marcus: I mean, look, there’s nothing good about the PR that comes from these things. And I think in some cases it’s too, it’s so big that you can’t get away from it. Um, but yeah, no, I, I don’t, I don’t blame them at all.

Marcus: I don’t blame them at all. All right. So this is a story about Nebraska suing a tick tock for allegedly. Harming minors. Um, I mean, Tik TOK is having a lot of weird stuff happen right now. They’re counter suing the government. Yeah. Um, well, a bunch of

Vic: Tik TOK influencers are right. I think, I think that’s what I heard.

Vic: It’s like 10, uh, Tik TOK influencers. Hand selected and to represent different geographies, different types of businesses. Oh, I, I thought

Marcus: Tik TOK itself was actually counter suing the government.

Vic: Maybe, but the, but I don’t think the, There’s that many hard feelings about TikTok, but the actual U. S. citizens that rely on [00:26:00] this.

Vic: They also are suing the government for taking away their business, taking away their First Amendment rights.

Marcus: Yeah, so it’s interesting now, you know, most of what we’ve heard coming out of AG offices around the country is that Meta is the big culprit when it comes to mental health issues. Um, you know, TikTok and It’s not really that social of an app, you know, it’s just kind of like a never ending stream of content, and it’s much more something that you you sit back and you consume than something you actually engage with.

Vic: Yeah, but their algorithm is really good at. Pulling you into things and continuing.

Marcus: It’s ridiculously addictive. Everyone, everyone knows that. I mean, that’s, that’s why you either like keep it off your phone or you just never get started with it because no one has proven to be strong enough to like, I mean, you know, a good friend, Nick Holland was talking about, God, I gotta get this thing off my phone.

Marcus: Cause

Vic: I deleted it off my phone for the

Marcus: same reason. Yeah. I deleted it because I don’t like the China thing. But, but, um, but yeah, I [00:27:00] mean, so it seems like someone is now the Nebraska attorney general is taking that. argument around the addictive nature of it and saying, Hey, that is creating compulsive behavior like a gambling machine.

Marcus: And so, I mean, I think, look, there’s no question it’s doing that. There’s no question that there’s no question. I think though, that most of what I have heard from people who are fans of tick tock, who have it on their phone, love it, use it every day. Is that the content is generally speaking more positive than what they get on meta.

Marcus: Um, you know, more informative, more sort of pure entertainment, sort of less, uh, I don’t know, nefarious, you know, meta seems to kind of go more down the dark path when it comes to the content that they’re serving up. Um, so it’ll be interesting to see how this actually plays out. You know, this feels like just another knock on tick tock.

Vic: Well, and I think there’s a, there’s a, to me, at least there’s a difference between Over 18 and under 18. Like, if you’re over [00:28:00] 18, and you can buy a pack of cigarettes and a You know, a court of Jack Daniels. Why can you not use Tik TOK 13, 14, 15, 16? I don’t, I don’t know. I think there maybe should be guidelines, but, but that’s up to the courses.

Vic: I don’t know if Tik TOK will still be around by then.

Marcus: I mean, let me, let me just ask you. Maybe a broader question, though, is do you think we’re going to get to a place where we can effectively age gate these, these social media platforms in America? I mean, it seems like the obvious solution, but how can you actually do that?

Marcus: Well,

Vic: there’s a difference between policing the law and creating the law in my mind. So the fact that let’s just use drinking. Cause that’s, cause that’s pretty established. Yeah. The fact that there is underage drinking in high schools across America. [00:29:00] Does not to me suggest that we should make it legal.

Vic: Right. Right. And, and I think it does give at least me as a parent, it gives, it gives you more credibility, more ability to say to your, I have sons, like you can’t, you can’t drink, it’s not, it’s not allowed. Right. Or if you can drink, have one drink with me, but you’re not allowed to, you’re not allowed to drink.

Vic: And we haven’t said that with social media. Now, if a parent. Decides to buy their child a case of beer and let them have a party with their friends in the basement or whatever. That’s really on the parent, but us as a society, we have said it’s not allowed, and if you then buy it for your son or daughter, I don’t know, I think that’s a different thing.

Vic: So yes, it is going to be very difficult to police it and like enforce it, but I think there should be some kind of age. I think these things are [00:30:00] as dangerous as other very addictive stuff.

Marcus: Yeah, but, but there’s, you know, you’re not going to force people to present their identification to create an account.

Marcus: Like that’s not going to happen. Yeah. You’re not going to hold parents, you know, responsible for their children and creating an account. Parents can’t necessarily know. Um, and no one seems to be willing to find these companies in a way that actually would be a deterrent, right? The algebra of deterrence is just not there.

Marcus: The fine, they’ll eat the fines for, you know, a light snack and keep on making money. You know what I mean? So I guess that’s, that’s why I kind of look at this and I feel like all of these AG suits and, you know, all the mental health stuff they’re claiming, it’s like, okay, but to what end and what kind of remediation are we as, You know, citizens going to get from all these different efforts.

Marcus: Like how performative is this versus actually, you know, moving towards making our children safer. It, that, that part is just not clear to [00:31:00] me, you know?

Vic: Yeah. I think it is. I think it is harming our kids. And to me, the, the fact that it is allowed and legal and, and anyone, I think it’s like 13 or something that they do make you say that you are 13 and if you’re not, I’m sure people just lie.

Vic: Yeah, they just

Marcus: lie.

Vic: That at least is a regulation. Now, there’s, there’s an enforcement thing. Right. But I don’t know. I think it’s fairly obvious that like they’re saying in this article. It’s very similar to other things that are very addictive and adults enjoy. And I just think adults are a different category.

Marcus: All right. So shifting to a topic we would not normally talk about, but I think you and I want to be on record because in the future, you know, if, if what we talk about here pans out, we want to have. Okay. Talked about it. So we can refer [00:32:00] back to it. There is a bill that was recently approved by the house of representatives called fit 21.

Marcus: And it’s about financial innovation. It really is centered around crypto and digital assets, digital dollars, et cetera. It was passed by the house. So that’s meaningful because. What has been the party line, this crypto has been a very partisan issue. And I think you and I never could figure out why, but it has been a very big partisan issue really for the entirety of, um, the Biden administration.

Marcus: Uh, time in office and even, you know, a little bit going back to, to Obama’s, um, you know, time in office, although crypto was nowhere near as big when Obama was in office, but for

Vic: whatever reason, the Democrats have until this week, yeah,

Marcus: not been in favor

Vic: of crypto

Marcus: broadly, right? And probably the big thing that turned everything [00:33:00] initially was that the Bitcoin ETF was finally approved and that got BlackRock and a bunch of other very, very legitimate, um, financial companies engaged in the crypto space in a very, very real way, um, BlackRock kind of very quickly followed up and did their own thing.

Marcus: little independent fund that they ran on Ethereum, not a private instance of Ethereum, but the public blockchain Ethereum. And I think what happened is we’re in, we’re in the election year. Every vote matters, especially in swing states. And somebody finally got the message to the White House that, um, They’re that the issue of crypto is actually a swing voter issue, and you actually are going to lose voters because you’re letting Elizabeth Warren and Maxine Waters, uh, you know, kind of drive the narrative here and and you’re letting this, you know, this Gary Gensler guy in the SEC, you know, demonize something that people feel should be a [00:34:00] fundamental American right, which is the right to, you know, buy and sell assets as they please.

Marcus: Um, and, and also custody those assets as they please and not feel like they’re doing criminal activities. And so, we have gone this week from, you know, Bitcoin being the only allowable cryptocurrency to just today, the SEC approved Yeah, like two hours ago. The, the, the Ethereum ETF. And so, we are now in a world where the two biggest, uh, cryptocurrency, uh, Assets are now approved for your 401k.

Marcus: Yes. And, uh, and then we also have in parallel, this fit 21 bill that has passed the house and almost certainly now based on what we just saw the sec do, which is a complete about face. That’s likely going to pass the Senate as well, which is Democrat controlled. And so you

Vic: mentioned Maxine water. She’s she turned, she’s.

Vic: saying she’s in favor of it. She’s politically savvy. I mean,

Marcus: what did she turn? Because all of a [00:35:00] sudden she had a change of heart in crypto? No. She realizes this is a stupid thing to lose votes over.

Vic: The Dems are, are, I mean, there’s people in Nashville, there’s people all over the place that vote Democratic, but their, their base is East Coast, West Coast.

Vic: Yeah. The West Coast has been all in favor of crypto for a long time, but the East Coast, Led by BlackRock and Fidelity for a long time was against it. Yeah for a long time for a long time and they all turned Because they can make money on it. That’s right. And I think that was that’s the thing It’s like now all their donors and it’s a it’s a swing vote.

Vic: And why are we fighting this again? Like everyone everyone wants it. So, um, yeah, so fit 21 Establishes the CFTC as the regulating body Which is interesting and probably where it should be. But then the sec approved the ETH ETF today. So they also seem to be [00:36:00] turning positive and I think it’s good. I mean, I don’t see any downside to it.

Marcus: Okay. So, so here’s why this is important. Um, this is important because at some point in the, we’ll just call it distant future, uh, What has happened this week, I think, is going to make cryptocurrency a legitimate innovation platform, um, for commerce, period. Yes. Full stop. For all things commerce. And, obviously, healthcare payments is a big piece of commerce.

Marcus: Um, I also believe we’re shifting more towards, and this is a, more of a demographic shift. Um, so we’re looking at this happening over the course of generations, but you know, we’re, we’re kind of in the middle of that shift right now. The boomers are on their way out. The millennials are in their way sort of into prominence.

Marcus: Um, we’re, we’re moving into this sort of demographic based shift where the patient for [00:37:00] reasons of. I have my record in my hand. AI is going to be super powerful. The physician workforce is getting, you know, pummeled and beat up. I want to be able to have personalized medicine based on my genetics. Um, the patient is going to have more power in healthcare in the near future.

Marcus: This is like, this is coming. And when this happens, all sorts of new models for payment are going to come into play as well. And not so much paying in Bitcoin or paying an ETH, but I do think paying in like USDC, um, where there’s no middle person and things can be settled immediately, uh, That’s going to be a new option that we’ve never had before.

Marcus: And to me, it never was viable until this week, but now that we have a regulatory sort of glide path for it, um, I think we’re going to start seeing as VCs, we’re going to start seeing deals, uh, that are talking legitimately about [00:38:00] how to integrate cryptocurrency into the healthcare payment flow.

Vic: Yeah. I mean, I start with healthcare’s 4 trillion a year, and something like a quarter of that, a trillion, which is, you know, a lot of money, is spent in the overhead, payment processing, revenue cycle management, adjudication.

Vic: It’s a trillion dollars a year, and it does not need to cost that much. And by the way, all of those systems are being hacked. And ARPA H would do much better to get on ETH and do some innovation, because it would be You would take away the honeypot of data. I think it’s, it is going to be sometime in the future, but this week is when the U S federal government shifted and is now trying to create regulatory apparatus to allow crypto to [00:39:00] have a path and the.

Vic: All the crypto, we know a bunch of crypto innovators that they’re not trying to do something nefarious. They’re, they’re trying to like, understand what am I allowed to do? What regulatory body do I submit information to and America should be the innovative place for AI and for all the web three crypto stuff.

Vic: And we will be as long now, the federal government has got out of the way. Look, here’s the

Marcus: deal. Like this all goes through, there’s going to be a massive influx of Capital and innovators. Yes. Who would prefer to be in America. Yeah. They’re abroad

Vic: in other domains because To get arrested here. Yeah. I mean, a few entrepreneurs have been arrested for things like the, the turbo cash and other stuff.

Vic: Exactly. Exactly.

Marcus: So anyway, th this is one of those things that like, I know the average listener’s just like, ah, I don’t wanna hear about that. Yeah. But I, this, this is a watershed moment [00:40:00] because if you haven’t been tracking it, you wouldn’t know what a 180 this was. I mean, like, this was kind of like a, you know, over my dead body kind of thing.

Marcus: For Gary Gensler and Biden

Vic: said a month ago, he would veto the bill. The bill, yeah. . . And then. You know, he started getting all kinds of, uh, campaign advice, and Trump was Whatever, tweeting or he doesn’t tweet anymore on, on whatever platform he’s on, just taking advantage. I don’t think Trump cares one way or the other, but he saw an opening.

Vic: Yeah, so it it the de the Dems, this is not a partisan issue. The Dems made it one stupidly. They made it one stupidly, stupidly. It’s a free market innovation thing. We have the best capital markets in the world because we are, we have the rule law, but we also allow innovation. Blackrock is leading it and they’re gonna make a bunch of money, but other people will get to play too.

Marcus: All right. Shifting to payers, uh, OptumRx puts emphasis on predictability with new pricing model. I mean, I think the long and short here [00:41:00] is a Optum, uh, will continue to evolve, continue to innovate and has the capabilities to do that, has the scale to deploy it in a way that most organizations don’t, and B.

Marcus: Mark Cuban has made his mark. Um, you know, if it were not for cost plus, you know, I don’t know that we would be seeing the changes that we’re seeing in the, in the PBM world, the way we’re seeing them. It’s, it’s, uh, it’s, it’s pretty impressive what he’s been able to get done in terms of, uh, you know, forcing innovation.

Vic: Yeah. It’s, it’s incredible to see an innovator. Go to market and show what, how the, how the healthcare drug pricing system could be better and easier to understand and fairer and strong enough that he’s not going to go away. Right. And then the, the, I mean, Optum is huge and they’re fast following him, which is great.

Vic: And now everyone. Everyone already had to follow and they’re going to have to fall again.

Marcus: Yeah. But this, this [00:42:00] is a win for us as, as Americans, right? This is a win. We, we, we are all going to have a better prescription purchasing experience now. And I think, you know, I don’t want to rewrite history. You know, Mark, Mark Cuban deserves some, some real credit for putting capital and his personal name, uh, you know, out there to, to drive this, this change in the market.

Marcus: This is great. Yeah.

Vic: Who might be able to use crypto to. Help Mark Cuban could

Marcus: Mark Mark Mark Cuban. I think has a lot more tricks up his sleeve. So yeah, looking forward to see what he what he brings to market Centivo. So this is a VC backed sort of new payer model focused on the employers segment. Two weeks ago.

Marcus: We talked about sort of the return of all the. Uh, VC backed, uh, payers, you know, after years of languishing, finally, they’re starting to turn, you know, the, the financials around, uh, incentivo actually is acquiring a virtual first medical provider called Eden health. Now the virtual first model, um, we’re seeing a lot of [00:43:00] weird, I don’t know, sort of churn in that space.

Marcus: You know, we’re seeing companies kind of go under, we saw Optum do some layoffs related to their virtual. Uh, you know, care, uh, business. So I think this is going to be an interesting one to watch, but Sentivo is, has purchased Eden health, but the, uh, intent to sort of roll it out across their entire base.

Marcus: And I think why this, one of the reasons why this is interesting is because, uh, Morgan health, which is JP Morgan’s sort of healthcare initiative, largely leveraging their influence as a large employer, but also writing checks, um, wrote, I think a 40 million check into Sentivo. So, um, that’s a good signal.

Vic: Yeah. The, the, the virtual first. Primary care business model is challenging, but I think it works really well as part of a payer, especially when focused on employers, because the employees are busy and they need to be seen quickly. And so I think it’s a great acquisition, and I think it’s really compelling as part of [00:44:00] sentivo, but I agree the overall advanced primary care and virtual telehealth stuff.

Vic: It’s just being integrated into. Other care systems. I don’t know that it’s that great as a standalone. You need sort of a niche or you need several partners if you’re by yourself.

Marcus: Yeah. As Paul said last week on the show, he was like, it’s, you know, it’s turned into a commodity, right? So, you know, maybe it’s a table stake.

Marcus: Maybe you don’t need to have as many employees that you had, as you had previously for it, but Sentivo, obviously moving down the, um, the payvider model here as well. So more and more, it looks like payvider model is, is the model for payers. Right. Moving into the health system side of things, uh, nowhere else that you could start except for Ascension.

Marcus: So, Ascension has a cybersecurity event update page on their website, and we’ll put this in the show notes. Um, it’s actually really great because they lay out sort of what’s happening by region and then a pretty good FAQ for They did a really

Vic: good job about disclosure. [00:45:00] And being transparent about what’s going on.

Marcus: I agree. Also, not only did they do a good job on disclosure, uh, you know, credit to the clinicians and the administrators, uh, in these facilities, they’ve done a great job of keeping the business going, um, under what is, you know, really very difficult circumstances, but continuing to see patients, continuing to keep their ER doors open and doing things on pen and paper, I mean, The, the resilience to, to sort of pivot and keep being an asset for the community is tremendous.

Marcus: So I, I just didn’t want that to go on set because that has nothing to do with the cybersecurity piece. The

Vic: people that are, that are in these systems and the people that change healthcare and the people in all these systems, they’re doing the best they can. That’s right. And when, uh, when a system gets hacked, I mean, you know what you start, the, the it department starts seeing data.

Vic: Being funneled out and they just shut everything down literally shut every [00:46:00] system down Yeah, and the next story we should go to NPR had a good story where they interviewed several Ascension Employees and there’s one from a NICU. Yeah, this Chris French’s In Austin, she’s saying it’s kind of like we went back 20 years, but not even with the tools we had then, like 20 years ago, we were used to working on paper, and now that they literally have like printouts of the EHR in a folder, and they’re like making handwritten notes, everything is slower and harder.

Vic: Medication, labs,

Marcus: imaging, nurse visits,

Vic: doctor’s rounds. The people in the systems are working harder. And they’re doing the best they can. And they’re keeping it running. Yes. Like And I think it’s also true that The patient care is not as good. It’s just not as good. I mean, I don’t mean just insult [00:47:00] the work they’re doing, but I

Marcus: mean, I think you’re just talking about what the impact of this kind of, um, you know, degradation is on

Vic: our health care, national infrastructure

Marcus: or

Vic: the ability to treat.

Vic: The 330 million people we have.

Marcus: And then just shifting away from that story for a second and moving to financial performance, you know, Ascension is sort of in the list of health systems that’s turning it around. Recurring operations. They’ve improved by 1 billion at the nine month mark of this fiscal year.

Marcus: Um, some really impressive statements here. I’ll just read from this article here in Fierce Healthcare. Leaving out impairment and non recurring losses whittled the city down. Systems, most recent recurring operations loss down to 25. 4 million, as opposed to the prior years, 647. 1 million recurring operations loss.

Marcus: Fiscal year to date income from recurring operations was 15 million. Well above last year’s nearly [00:48:00] 1. 1 billion loss. Man, that’s a hell. Of a 12 month turnaround, my God. Uh, so huge, uh, kudos to Ascension. I mean, it feels like, uh, we don’t know what the economic impact of this incident that they are going through is going to be, but they were clearly on the path year over year, you know, by next year, Turning this thing to a profit.

Marcus: I mean, you know, not withstanding any huge changes in policy or a pandemic or something like that, but they were clearly on the road to getting back to profitability. Um, and so hopefully this is not too much of a, uh, uh, an impact to them financially. It obviously will have an impact. There’s no question.

Marcus: Um, but hopefully that impact is not too much.

Vic: Yeah, I think they’ve, they’ve done a good job, but they’ll have to navigate through this new stuff. We don’t have visibility to that, but all these health systems have a lot of overhead. Right, so they really benefit from an uptick in more patient volumes and, and higher acuity [00:49:00] patients that leads to better reimbursement on the same, you know, there’s a lot of fixed asset, a lot of buildings, a lot of staff that are coming in, no matter what acuity patients they’re treating.

Vic: And so I think they, they’ve operated well, but also the environment’s better for it.

Marcus: Uh, okay. So Providence just really quickly also turned it around, uh, 176 million operating gain, uh, last year they lost, uh, 345 million, um, this year, uh, 360 million bottom line for the first quarter. So, uh, you know, just another great turnaround.

Marcus: Yeah. So

Vic: I think as we talked about in the economy, section. If we have inflation that stays a little bit higher than what we want, but stays reasonable and doesn’t shoot up, I think the health systems will continue to do well.

Marcus: Let’s talk about doctors for a second. Uh, so this is a great find. So, uh, there is a report that has come out from Doximity.

Marcus: Um, it’s the 2024 physician [00:50:00] compensation report. And, uh, the first half is, I don’t know, kind of just, uh, wrote, it’s just a bunch of different, you know, numbers on compensation

Vic: by subspecialty and

Marcus: location. Yeah. Well, we have the whole report in the show notes if you want to look at it. Not, not that interesting.

Marcus: Um, but. The headline here from fortune and their review of the report is about, um, burnout, right? Moral injury and says that, you know, 86 percent of doctors fear for the future of American medicine. Uh, that they are often stretched quite thin. You know, I think about, you know, my. My parents, primary care physician.

Marcus: Um, you know, she is, she’s amazing, but I feel like every time I’m in her office, she is like running pillar to post, you know, really, really maximizing every single minute. And I know like, you know, if she’s got high acuity parent patients, like my dad, you know, on top of that, you’ve got the, just sort of [00:51:00] the, you know, the humming urgent nature, and most people don’t think about that for primary care.

Marcus: Um, but that humming urgent nature of, you know, caring for patients, wanting to be responsive.

Vic: Every issue is really important to that patient and their family.

Marcus: Yeah. Yeah. And so I, I, I can’t relate because I’m not a physician, but I can relate insofar as like, I know physicians who I believe this is true that they are, they, they are just absolutely stretched too thin, you know, um, and I feel bad because, you know, as, as sort of the advocate for the patient and, you know, the power of attorney for the patient, I’m, I’m, I’m there for the patient, you know, you’re

Vic: not there to make her job, her life easier.

Vic: No,

Marcus: no, I’m, I’m really not. But we should,

Vic: we should figure out a way to make it easier for the dogs.

Marcus: Yeah. It’s like, if you have a doctor who, who does a great job, it’s impossible to not care about that person. Right. And so, you know, um, I, I certainly want better for her. I want her to have more bandwidth and, you know, You know, less stress.

Marcus: Um, [00:52:00] but there are some really interesting findings in this compensation. So the first

Vic: half is not the interesting.

Marcus: Yeah. But then you get to a section on gender pay gap. Uh, and this was shocking to me. I

Vic: don’t know why I wasn’t aware of this, but I wasn’t,

Marcus: no, but it’s just one of those things where like, okay, you hear about it in Hollywood and you can kind of like, understand how it goes down there because that industry sort of has a history of sexism, quite frankly.

Marcus: Well, Um, but you sort of feel like healthcare is supposed to be just a lot better about this kind of stuff. And it’s

Vic: supposed to be like a meritocracy and based on how you did in, in medical school and how you are performing a surgery or. Treating the patient.

Marcus: Yeah, and, and so they’ve got a slide here with a graph that shows a consistent gap not closing over the course of the last six years.

Marcus: It hasn’t closed at all. Okay, you know, both, both men and, uh, women physicians are [00:53:00] making more, right? They’re both making more on average. Um, but the gap is the same and the gap is over a hundred thousand dollars. Yeah. Like 20

Vic: percent over 20%. So men make 23 percent more than women for doing the exact same specialty, the same CPT code, same

Marcus: everything.

Marcus: So anyway, um, and then, you know, they sort of go down and they dig into the specialties and, and then they, they sort of bear it out because immediately you might say, well, maybe they’re in different specialties and then, and then no, they go specialty, specialty. And they sort of show you the difference in the, in the gaps, you know, in some of the specialties with the largest gaps, um, orthopedic surgery has a very large gap around, you know, 60 K and difference.

Marcus: Um, GI, um, has a pretty large gap, colon and rectal surgery, um, gastroenterology, ophthalmology, um, And then the ones with the smallest, uh, gaps here, uh, oncology, internal medicine, pediatric infectious disease, hematology, and medical genetics, also

Vic: the [00:54:00] ones that don’t pay material.

Marcus: And then, and then, you know, if you ask the different genders, like, you know, do they believe there’s a pay gap, you know, women, 75 percent say yes, men, 47 percent say no, 24 percent say unsure.

Marcus: So basically flipped. Yeah. You know, 75 percent of the men are like, I don’t know, or no. And 25 percent of the women are like, So, um, anyway, I, I just thought that that was, that was sort of very illuminating.

Vic: That was surprising. I knew that the burnout, so we’re going to get to the burnout. I mean, I knew that was an issue, the gender gap.

Vic: I just was naive about it.

Marcus: Yeah, that was a new one. So, so if you scroll further down in this, in this, uh, report, you know, they, they get into the importance of autonomy and work life balance. And I thought this was a really telling stat here. So, um, year over year. This trend is growing that more physicians, all physicians, whether they be women or men, but actually it’s growing more for men than it is for women, would accept lower compensation for more autonomy or work life balance.

Marcus: So that’s just telling you like the money cannot make up for the stress of the [00:55:00] work. It’s

Vic: growing and it’s 70%, 75%. So three quarters of Physicians out in our system would prefer to make less money if they had a better work life balance, more autonomy in their role. That is a staggering metric. When you say it that way.

Vic: So it’s grown from 71 to 75 in the last year. It’s, it’s almost everybody.

Marcus: Yeah. That’s, that’s rough. So anyway, uh, great report. It’ll be in the show notes. Yeah. Um, continuing on moving to more of a health equity story. Um, we we’ve talked a lot over the course of this podcast around real estate, corporate real estate, and we talked also about closing of, uh, drug stores.

Marcus: And so this, this story from the wall street journal kind of puts those two together, uh, and generally just focuses on, and then, you know, you take the, the weak consumer as well. And, uh, The story here is 3, 000 fewer drug stores were open for business at the start of this [00:56:00] year, compared with the same period in 2019.

Marcus: That’s a lot fewer drug stores, and you and I were talking about this in advance of recording, and this is a health equity story, right? Because, um, if you live in, um, A sort of really strong economic urban center and you have four computers in your household and three cars, right? A, you still have a lot of drugstores like in Nashville.

Marcus: We have no shortage of these drugstores. B, we have alternatives and grocery stores. You know, all the Kroger’s, all the Publix.

Vic: And it’s easy for me to get

Marcus: online. And then on top of that, you can go to Amazon if you want, right? And you’ve got all those options. But when you think about, um, you know, lower economic, uh, uh, environments, whether they be urban or rural, right?

Marcus: Um, drugstores, you know, it’s like when they talk about food deserts, drugstore might be the only thing that’s accessible. Um, and then, and then, you know, you would need a car to sort of get [00:57:00] beyond that drugstore and a lot of times you’re not going to have a car. And

Vic: I think though, I don’t have, it wasn’t in this story, but my belief is that’s where they’re closing the stores.

Vic: That’s where they’re closing the stores. Yeah.

Marcus: Yeah. And, and, and so. We are creating more health deserts across America. You know, we talk about hospital 000 fewer drugstores. That’s a meaningful number, right? I mean, that’s a number that you got to start to pay attention to. And the trend is we’re going to lose more.

Vic: Yeah, the basic function of dispensing drugs to patients is not a profitable business. The way that they’re economics have been pushed, it doesn’t, you don’t make money. Every, every script fill costs more in labor hours than you get reimbursed for. Yep. So systematically, it’s putting a ton of pressure on the independents.

Vic: And I think it’s going to continue.

Marcus: Alright, moving to pharma. GSK [00:58:00] has a potential blockbuster asthma drug showing promise in the latest trial. So, this is a big deal. Lots of people suffer from asthma. And, uh, this is a long acting biologic. Ultra long acting biologic. Six month dosing schedule.

Vic: Yeah. Yeah, I mean, you only have to get a treatment twice a year.

Vic: Which just makes it so much easier for compliance, which means there’ll be many fewer, you know, exacerbations and problems with asthma. It’s going to be, it’s going to be great. And it’s going to be a really, I mean, it’s like a multi billion dollar drug once they, it’s almost not quite to market. They went through a significant trial and get good results.

Marcus: You know, one of the things I immediately thought about is many of the people that I know who have asthma, um, they’re actually less active

Vic: exercise wise,

Marcus: because it’s just a damn hassle, man. It’s like they get active and then, you know, they get an attack and they got to have their inhaler with them. And [00:59:00] so they just kind of opt out of it.

Marcus: And they’re like, they’re just more sedentary because it’s, you know, it’s, It’s gonna trigger an attack. Mm-Hmm. exercise is gonna trigger an attack. This is a, you know, this is so promising. Can you imagine if, if you know all of those people now have this six month acting shot that they can take Yeah. Now, like, just go get fit.

Marcus: Right. You know what I mean? Like, how much progress can they make health wise over the course of a, you know, five month period of not having to worry about having an attack when they go out to run a mile? Yes. Yeah, that’s amazing. Yeah. So this, this was really, really exciting just because everybody knows somebody who has asthma.

Marcus: You know what I mean? Um, so that’s, that’s really cool. Uh, okay. On the digital health side, hims and hers is expanding weight loss program to include access to compounded GLP one medications. I think you said the stock price jumped up on this news.

Vic: They announced this on Monday. The stock price jumped like 40 percent in a day.

Vic: Came back down again. They are. compounding GLP 1 [01:00:00] medications themselves. Um, so it’s similar to ozempic and wagovi. Same, same active ingredient, but, but they’re making it themselves. Um, which actually is probably good because there’s a shortage. And hymns and hers, you know, they, they have a good distribution platform.

Vic: They have a great distribution. I’m sure they’ll sell a lot of it.

Marcus: Yeah. To me, they are a harbinger for, um, what is going to be a proliferation of DTC. So they, they kind of do all this stuff first. You know, they, they were kind of the, them and Roe were kind of the first ones to really jump on the scene with Viagra sort of in the mainstream.

Marcus: And now like you can buy Viagra from anywhere, right. You know what I mean? And so, um, I think. I think the same thing is going to be true here, right? You know, a lot of those DTC platforms with distribution and marketing capabilities are going to see this. Yeah, we did. It’s table stakes. They got to do it.

Vic: Yeah, we just looked for, uh, Foundry, our really early stage platform. We just looked at a bunch of companies to do this quarter’s [01:01:00] investments. And there were several. In this competitive space, compounding GLP 1 with a digital platform. We picked the best one and brought it to the selection committee. It’s just hard.

Vic: It’s hard. It’s hard, yeah. Yeah, they’re the best one, but there were 15 and Right, and him. And him has the biggest reach in the channel. But I think you’re right. There’s gonna be

Marcus: Yeah.

Vic: And many of them will struggle, but it’s gonna be good for access.

Marcus: Absolutely. Absolutely. All right. Moving into, um, stories about us, uh, as, as population.

Marcus: So this is sort of related to that Boulder health VC funding around, um, addiction is a story in the New York times talking about the opioid epidemic in Baltimore, uh, which I was. not aware of, but also it’s not that surprising. You know, it’s, it seems to be par for the course with the kind of challenges that Baltimore as a city has.

Marcus: Um, Baltimore is leading the country in, uh, in opioid deaths. And I did not know that

Vic: by, by a lot. [01:02:00]

Marcus: Yeah. Uh, I did not know that. Um, I mean, you pulled this story up, but what, what sort of struck you when you, you know, we’re reading it,

Vic: I think the times does a good job really Going pretty deep into a particular topic in a geography like this.

Vic: And so they, they, it’s a, it’s a kind of a long story. They, they, they. assess all the different parts. We know that fentanyl is really at the source of the overdose issue. We, we have an opioid addiction, you know, problem in the country, but the fentanyl aspect of it is what a lot of people die from. And so there’s, there’s a lot of detail.

Vic: They interview several people. The um, strength of fentanyl, no one understands. Because it is chemically mixed up in different batches or mixed different ways, there’s no, I don’t think there’s [01:03:00] any consistency. And so, even if you get it from the same dealer or whatever, the same source, and it, There’s no bad actors.

Vic: The, the way they mix it, one amount might be just the right amount to have your fix and get high and be okay. And then the next day you do the same thing and you overdose. And so they, they went into that, which was interesting and pretty scary. And then I was really looking for the tie into the port, because we talked about it when you went and visited Philadelphia.

Vic: I think that there’s a lot of fentanyl coming in through our, our big ports. I think that’s fairly well established and Baltimore has a huge port right there, but they didn’t, they didn’t go into that. But I think that’s a, I think that’s a source. And so, uh, Anyway, those were the two big takeaways. And then the charts were really [01:04:00] kind of sobering and sad.

Vic: So, um, let’s talk through the charts. So, in Baltimore, back to 1993, there were 40 deaths. roughly 40 deaths per 1, 000 people per year, which is well over the national average, but pretty stable. And then in 2013, when, when fentanyl arrived as a thing, it just go, I mean, for people that are listening, it goes, I mean, not vertical, but it goes up very dramatically to a peak of about 190 per 1, 000, which is way more than any other city in the country.

Vic: And there’s no reason why it would be worse than New York or Philly or DC that are all, you know, geographically very close and I think kind of similar, maybe not they’re exactly the same, but, um, so that was the first thing that they’ve had [01:05:00] this huge spike since 2013, which to me, at least very correlated with the introduction of fentanyl.

Vic: Absolutely. And then the next chart that was really scary for someone who lives in Tennessee. Is they showed like how dramatic Baltimore is compared to, I don’t know, five or six other cities around the country that also have a bad problem. And so they’ve gone down a little bit since the peak there this year, they’re at one 70, but that is, you know, uh, more than double most other cities.

Vic: Um, but then what caught my attention is this to Tennessee. metro areas that are number two and number three. Nashville metro area is the number three at 81 per thousand and Knoxville is 86. And I, I had no idea. I was completely ignorant about that. Yeah. So I live here and I’m in healthcare.

Marcus: Yeah. So we, we’ve got, you know, effectively a problem, half the size of [01:06:00] Baltimore’s, um, but still that’s a Baltimore’s the worst

Vic: in the country.

Vic: And we’re half the size where we, the national average. Is something like 20. And so

Marcus: we’re four times the national average and probably importantly, uh, Nashville seems to have, according to this chart, um, more opioid deaths per a hundred thousand people than Philadelphia, which we covered extensively because you went and visited, uh, and San Francisco.

Marcus: Yeah. Well, we all everyone likes to pick on San Francisco.

Vic: Yes. What the hell? Yeah, it’s, it’s terrible. And I need to do research. I mean, I just. Came across this yesterday, but I need to do some research, but I said I wasn’t aware, but it seems really bad here

Marcus: Yeah, we should talk to our friends in public health.

Marcus: Yeah here in Nashville. Yeah, sure get some more insight on that All right shifting out of that really kind of Terrible story. Uh, [01:07:00] we have this story here about Cadence, uh, which is a remote patient monitoring platform. Pretty, pretty scaled platform. Yeah. One of the bigger ones. In the space. Um, but they’ve come out with a study, an actual study that’s demonstrating that remote patient monitoring reduces costs and comes out with better outcomes for, um, heart failure patients.

Vic: Yeah, they did it in partnership with an academic researcher, got it published, uh, in the Journal of Cardiac Failure. Um, and I just think it’s important to point out stories like this when it’s published in, in a, in a respected journal and, and has good results. We just talked about how burnt out and difficult it is to be a doctor, how, how hard it is to be a doctor.

Vic: I think we need to keep, keep doubling down, keep adding to remote patient monitoring. It, it works. It sort of is done in adjunct with the doctor, in support of the doctor, and it seems to have good rec good results.

Marcus: Yeah, I mean, I told you, I have been [01:08:00] shocked. At how poor remote patient monitoring actually is in practice.

Marcus: And, uh, it makes me really mad, you know, at the sort of the resistance to innovation and people rolling their eyes at something like this, you know, when then you’re on the patient side and you really need a great RPM set up. And you realize like all that eye rolling has led to no one actually working on getting this in place, you know?

Marcus: And so. You know, kudos to cadence for actually, I bet this is what they’re finding, right? They’re like, we have to come up with some studies to actually prove, um, that this is necessary. And it’s just so ridiculous. It’s like, obviously if you just think about it, why is a hospital a good setting for care?

Marcus: Cause there’s a lot of reasons why it’s not a good setting for care, right? But what makes it good is the consistent monitoring. Yeah. Your vitals are being checked all the time, right? Like that, that guides healthcare decision making, right? Yes. And so when you get home, the [01:09:00] biggest thing that’s missing, everything at home is better than the hospital.

Marcus: Okay. Everything at home is better. The biggest thing you’re missing is the monitoring. Yes. And you don’t

Vic: need that much. I mean, three or four readings a week. Is, is, gives you a lot of data as a, as a clinician. And so it, I don’t think it’s that hard. Um, but yes, the eye rolling and, and I think we should double down on and do, do a lot more.

Vic: I think we should reimburse more. I mean, it, it’s having good outcomes. Yeah,

Marcus: yeah. We should, we should, uh, I mean, Cadence, we can get to them. We should, we should reach out to them and get that. We have, we have a lot of RPM. Connection. So we can, we

Vic: can talk to cadence.

Marcus: Yeah. I mean, I, I, I’d like to talk to them about like the rationale behind why they do the study exactly, you know, just, just, and also just hear from their perspective, like how do they feel things are going in the remote patient monitoring world, you know?

Marcus: Um, anyway, appreciate them doing that. All right. This was a cool story, uh, out of the wall street journal. This is a story that. [01:10:00] That the headline is anger does a lot more damage to your body than you realize. And I just like it because we are finally starting to get studies that prove that, you know, the physiological.

Marcus: Uh, impact of emotions, um, on our body’s functions, like things like, you know, blood flow, um, is material and it’s, you know, obviously you’re not going to never get angry, but if you have chronic anger issues, guess what? You’re probably going to have heart issues. Issues. Yes. Right. You know, and it’s not like an old wives tale.

Marcus: We’re now starting to gather data to demonstrate that we are tracking blood flow against a variety of different emotions, um, anger versus sadness versus anxiety. And we can point to anger and we can say anger is the one that is most detrimental to your blood flow, right? Exactly. So,

Vic: yeah, I, I agree. I think just educating myself, educating the community about this [01:11:00] really does make a difference and the idea of taking some deep breaths, counting to 10, doing some meditation, all of those things that we learned when we were growing up that were just kind of like a wives tales or things you should do, um, There’s science when you actually research it, there’s real connected science there.

Marcus: Yeah. And I think what that is going to do, and this is probably what the companies like lower health are, are angling for, um, it’s going to start to legitimize, you know, mindfulness. Yeah, it’s gonna start to legitimize, uh, you know, the importance of exercise, right? Not just on the positive effects, but you know, the dopamine and how that lasts for the rest of the day and how that stops you from getting angry later on, right?

Marcus: So it’s not just about the cardiovascular benefits or the muscle building benefits or the, you know, bone density benefits, but also like the endorphins and the, the, the. You know, the biochemistry, uh, that that’s going on there. So, yeah, I mean, I thought this was cool and I think we need more studies like [01:12:00] this, that just sort of demonstrate to people that you’re, you’re.

Marcus: The array of feelings and how often you feel certain feelings has real implications to your health care. Yes. Right. We all talk about it, but it’s completely different to get actual studies that are measuring blood. That’s right. So, uh, I thought that was really cool. Um, all right, moving into our AI segment and then we’ll, we’ll wrap up this show.

Marcus: All right. So Microsoft is, uh, full steam ahead on the AI side of things, and they are embedding AI into their lap, their laptops.

Vic: Yeah, that’s right. They, they’re creating a new type of PC that is kind of architected from the ground up to take advantage of all the AI stuff, and it’s going to be incredibly powerful.

Vic: It kind of puts AI into all of the, I mean, it’s in the operating system, and they have a chip with NVIDIA, and then they also have a Snapdragon chip. It’s going to be really powerful, and they’re [01:13:00] beginning to create this, like walled garden where the, if you really want to use all the Microsoft tool set, there’s a suite of really powerful AI tools that will help you.

Vic: And it’s, it seems really incredible. It also is locking you into the Microsoft world. Yep. And I don’t happen to be a Microsoft guy, so I don’t want to necessarily go into that world but, but there’s a lot of people that are in that world and so, um, it’s interesting that, that in the last 10 days you’ve had OpenAI, Google, Alphabet, and Microsoft all come out with their like omni Voice, text, uh, photo, like image with a camera.

Vic: Um, always kind of on watching everything you do because that’s going to be really helpful and it is going to be really helpful and it’s also going to be really helpful in helping them [01:14:00] monetize their users. But, but that’s. We’ve seen it before in social media and it’s,

Marcus: it’s

Vic: happening

Marcus: again. I don’t mean to be hyperbolic, but this all is just way too matrix plug in the back of my neckish

Marcus: You know what I mean? Like yes, yes. Like I, I, uh, I just don’t want that kind of surveillance. I, I view it as surveillance. I don’t, I don’t see enough upside. And whatever this thing is going to do for me to, to counterbalance the downside of this thing, capturing everything I’m doing, right? It’s like, Like enough is enough for, for me, for me, enough is enough.

Marcus: Like I, I want to use the ai, AI in the settings. I want to use the AI, and I want to know when I’ve turned it on, and I wanna know when I’ve turned it off. Yeah. You know, generally speaking, I want to continue to live in the real physical world with real people. Right. So, um, everything I just said there does not mean that these laptops are not [01:15:00] gonna.

Marcus: Be great. I mean, I, I think Microsoft is, is really starting to put a real dent in Apple’s overall positioning. I mean, Apple

Vic: is so behind. They’re going to announce something at their thing, which is like three or four weeks away.

Marcus: Yeah. But they just got the partner. They can’t do it on their own at this point.

Vic: It’s going to be interesting to see if they partner with open AI directly, which I think will happen. Where they should have Siri be the brand name that everyone knows, but it’s actually ChatGPT that’s communicating with you. That’s what I think will happen. They might announce a Microsoft slash OpenAI partnership.

Vic: It doesn’t matter. They’re going to do something, but it’s going to be a partnership. But I think what’s interesting is I agree with you completely about the surveillance versus empowerment aspect. And I also worry that if you don’t pick a walled garden to live in, These tools are going to be really effective.

Vic: Powerful. And so you’re giving up that for the [01:16:00] autonomy. And so I don’t know what the alternative is. We need to find an alternative.

Marcus: Well, I think it just depends on the timeline, you know. We’re tracking this every single week. My sense is that we are reaching a point of narrative saturation where these announcements are happening so fast and so furiously that like, they don’t mean anything anymore, even though they’re massively impactful.

Marcus: They, We don’t have time to respond or digest them or, or, or discuss them with other people. Like I know, but the only time I talk about this stuff is with you. I mean, I have a couple of chats where people are like sending a couple of links in every once in a while, but like, this is not day to day real life stuff I’m talking about.

Marcus: With people, so, you know, these guys are just innovating kind of all by themselves out there every single week, rolling out new stuff. And it’s, it’s amazing, but it’s, it’s still not clear to me how fast the uptake is going to be on these things. Um, cause it is a different workflow. You do have to work differently.

Marcus: And, and, and there’s [01:17:00] also just the fear factor, you know, and it is happening very, very quickly.

Vic: Yeah, I think it, I think that’s right. And when people upgrade their machine. But you get a new laptop, whether it’s Microsoft or Apple, the next one you buy is going to be like all, all optimized for AI tools.

Vic: And you’ll have it just embedded in, you use a Microsoft Word or, or whatever. Excel and it’s, it’s, it’s

Marcus: doing things for you. Banner health is investing in, uh, in AI to maximize operating rooms. This is a technology space. I’ve generally been very fearful of doing anything in because the OR seems to be just, yeah, just a cult of personality.

Marcus: Surgeons are, you know, don’t want anyone telling them what to do, how to do it. Um, but when the health system is doing it, they’re doing it at scale. Um, that’s a different, you know, thing entirely.

Vic: Yeah. Well, one, I was excited that Banner. Is getting in the game. Yeah. [01:18:00] Because they have a great platform. We know a lot of people over there and it’s good to see them in.

Vic: And then too, what they’re saying is that they, um, You know, there’s a lot of cost in ORs, and if they can utilize that asset more efficiently, get them more use, that’s

Marcus: better. Uh, all right. So here’s a story in Forbes headline, AI more likely to wrongly indicate breast cancer in black women, the, um, data in, data out.

Marcus: Uh, this, this is, you know, this is exactly why it’s so important to have organizations like the Coalition for Healthcare and AI. Um, we’re going to have to have requisite diversity in the training data. Um, this is really, really, really important. Um, and, you know, look, I’ve encountered it a lot of times, you know, when just basic things like, like, uh, general labs.

Marcus: Where, you know, you get these ranges on, on different, you know, biomarkers, um, in your, in your blood labs, publish

Vic: it for like all [01:19:00] Americans.

Marcus: Yeah. And it’s like, you know, they look, they look at my stuff and they’re like, Hey, you’re out of range. But the reality is like all African Americans are out of range for this particular thing.

Marcus: You know what I mean? Like, it’s just kind of the way it is. Um, and so, yeah, like, yes, AI, the way it is today is just simply a mirror and reflecting all the current bias and or holes that we have in our ability to effectively diagnose, um, you know, all sorts of people. And, and, uh, right now we definitely have issues there.

Marcus: And so the AI is going to be no different.

Vic: Yeah, that’s right. And it makes the next story. Um, interesting. So Epic came out with their first ever open source piece of software, which I honestly never thought they would have anything that came out open source. And so it’s an, it’s an AI validation tool.

Vic: Which is kind of a, um, interesting thing to put, put out an open source. What’s the validation tool? The validation tool is, would make sure that if you are checking [01:20:00] your mammograms using AI, that you have done appropriate training with a diverse data set, for instance. And so it’s great that they’re offering this.

Vic: It’s called seismometer. It’s on GitHub. Um, we’ll provide a link to it and it’s wonderful. It’s also going to be very effective at pointing out. Um, AI tools that epics open source system has decided are not done in the most effective validated way.

Marcus: Yeah. Now, the good news is it’s open source. So you can modify.

Marcus: You can well, and also you can read the code. So you can understand how the, How the validator works so that that is good. And I don’t want to, you know, knock them anything. They put

Vic: an open source can’t be bad. That’s

Marcus: that’s exactly right. But just reading from the, from the read me here on GitHub seismometer is a suite of tools that allows you to evaluate AI model performance using.

Marcus: These standard evaluation criteria to help you make decisions based on your own local data workflows, you can use it to validate a model’s [01:21:00] initial performance and continue to monitor his performance over time, although it can be used for models in any field. It was designed with a focus on validation for healthcare AI models, where local validation requires cross referencing data about patients, such as demographics, clinical interventions and patient outcomes and model performance.

Marcus: That’s pretty cool. It’s really a tool and then you get to customize it with your own, um, you know, foundational benchmark data and basically say, here’s what we would have come up with as an outcome. What did the AI model come up with as an outcome? And you get to, you know, it’s open source so you can install it locally in a secure environment, feed it your own sensitive EMR based data, um, and then see what the output is versus what, you know, your clinicians would have come up with when they were reading, you know, Results.

Marcus: So that’s, that’s pretty cool. That’s pretty cool.

Vic: Yeah,

Marcus: and

Vic: I think it’s interesting that, uh, Epic clearly understands and we talked about in the, in the VC segment, the number of AI tools that are being [01:22:00] released now and they’re trying to help the community and also help themselves keep some control on it.

Marcus: Yeah, I mean, well, certainly position themselves as, you know, um, the technology partner who cares about getting things right in healthcare, right? You know, to me, that’s what this whole initiative sounds like, and that’s consistent with the Epic brand. That’s consistent with the Epic brand. And probably good.

Marcus: Yeah. All right. Final story we’ve made to the end. Yes. Uh, Microsoft’s research blog, GigaPath, a whole slide foundation model for digital pathology. What’s this, Vic?

Vic: Yeah, so they Have created a new large model to be able to process. Slides like pathology lab slides. So typically you’re checking to see if a tumor is cancerous.

Vic: You put it on a slide. Um, and usually there’s an image taken of that slide so that whether it’s human or AI, you can more easily [01:23:00] read it, process it, save it in their record. It’s all done with images, even though it starts off with physical slides. And the way that traditional large language models work, it’s, it’s very cost prohibitive.

Vic: Just given the data resolution in this, so much data in the image that it’s, it’s prohibitive to use a traditional model. And so they created a new, a new entire process in order to be able, they call it dilated attention, which is sort of. Building on the Transformer attention is all you need model, but they basically I think of it as a sample Little segments of the slide.

Vic: Yep And so they limit the processing compute requirements, and then based on those initial readings, they almost focus in or dive in on the important area. But using a methodology that, you know, obviously you don’t [01:24:00] miss anything. So that’s my, you know, not that technical, but it was published in Nature, and it seems like a really important thing for medicine.

Vic: And as we go. You know, into actually using these things, labs and pathology reports are a huge piece. And so I think it’s good that they’re working on this and innovating

Marcus: it. Seems like a bit of like logical human process mimicry, right? I mean, kind of, what would you do if you were on the slide? You’d do like a high level scan.

Marcus: Yes. You’d look for Problem areas. And then you’d focus in and increase the resolution on a particular area of the slide. You wouldn’t like increased the resolution on the whole slide. Right. So it just, that’s what the human does. The human does. Yeah. So it seems like they’ve, they’ve changed the nature of the, the, you know, the memory stacking inside of this transformer to make it much more efficient where it’s effectively doing like a scan and then finding the anomaly and then digging into the area where the anomaly is versus, you know, trying to do that for the entire image.

Marcus: Yes. [01:25:00] I think that’s right. All right. We made it. Yes. Uh, lots of stories this week. Um, but, uh, I’m glad we kind of covered them all. I feel like, uh,

Vic: Yeah, thanks. If you’re still with us, thanks for hanging in a lot going on. And, uh, I don’t know. I just think it’s important to keep up with it because it happens so fast.

Vic: You miss it. And then you don’t know one of these stories going

Marcus: on. Yeah. Not every week is a big news week, but this, this was a pretty, pretty big news week. So anyway. All right. Thanks a lot. And, uh, we’ll be back next week with, uh, more coverage of the news.