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Yearly, hundreds of bankers, enterprise capitalists, non-public fairness traders and different moneybags flock to San Francisco’s Union Sq. to pursue offers.
Scores of safety guards maintain the homeless, the snoops and the patent-stealers at bay, whereas the dealmakers pack into the cramped Westin St. Francis resort and its surrounds to satisfy with cash-hungry executives from biotech and different well being care corporations.
After a number of years of pandemic slack, the 2024 J.P. Morgan Healthcare Convention regained its full vigor, drawing 8,304 attendees in early January to speak science, drugs and, particularly, cash.
Synthetic intelligence: Revolutionary or not?
Of the 624 corporations that pitched on the four-day convention, the largest overflow crowd could have belonged to Nvidia, which in contrast to the others is not a well being care firm.
Nvidia makes the silicon chips whose computing energy, when paired with ginormous catalogs of genes, proteins, chemical sequences and different information, will “revolutionize” drug-making, in line with Kimberly Powell, the corporate’s vp of well being care. Quickly, she mentioned, computer systems will customise medicine as “well being care turns into a expertise trade.”
One would possibly assume that such advances may get monetary savings, however Powell’s emphasis was on their potential for wealth creation. “The world’s first trillion-dollar drug firm is on the market someplace,” she dreamily opined.
Some well being care techniques are additionally hyping AI. The Mayo Clinic, for instance, highlighted AI’s capability to enhance the accuracy of affected person diagnoses. The nonprofit hospital system offered an electrocardiogram algorithm that may predict atrial fibrillation three months earlier than an official analysis; one other Mayo AI mannequin can detect pancreatic most cancers on scans sooner than a supplier may, mentioned Matthew Callstrom, chair of radiology on the Mayo Clinic in Rochester, Minnesota.
Nobody actually is aware of how far — or the place — AI will take well being care, however Nvidia’s not too long ago introduced $100 million cope with Amgen, which has entry to 500 million human genomes, made some convention attendees uneasy.
If Massive Pharma can uncover its personal medicine, “biotech will disappear,” mentioned Sherif Hanala of Seqens, a contract drug manufacturing firm, throughout a lunch-table chat with KFF Well being Information and others.
Others shrugged off that notion. The primary AI algorithms beat clinicians at analyzing radiological scans in 2014. However since that yr, “I have never seen a single AI firm companion with pharma and full a section I human scientific trial,” mentioned Alex Zhavoronkov, founder and CEO of Insilico Medication — one of many corporations utilizing AI to do drug growth. “Biology is difficult.”
Weight reduction capsule earnings and doubts
With predictions of a $100 billion annual marketplace for GLP-1 agonists, the brand new class of weight reduction medicine, many traders had been asking their favourite biotech entrepreneurs whether or not they had a brand new Ozempic or Mounjaro within the wings this yr, Zhavoronkov famous.
In response, he opened his parlays with traders by saying, “I’ve a really cool product that helps you shed weight and acquire muscle.” Then he would hand the individual a pair of Insilico Medication-embossed bicycle racing gloves.
Extra standard discussions concerning the GLP-1s targeted on how insurance coverage will cowl the present $13,000 annual price for the estimated 40% of Individuals who’re overweight and would possibly need to go on the medicine.
Sarah Emond, president of the Institute for Scientific and Financial Evaluation, which calculates the associated fee and effectiveness of medical remedies, mentioned that in the UK the Nationwide Well being Service started paying in 2022 for overweight sufferers to obtain two years of semaglutide — one thing neither Medicare nor many insurers are overlaying within the U.S. even now.
However research present individuals who go off the medicine sometimes regain two-thirds of what they lose, mentioned Diana Thiara, medical director for the College of California-San Francisco weight administration program.
Current analysis reveals that the usage of these medicine for 3 years reduces the danger of loss of life, coronary heart assault and stroke in non-diabetic obese sufferers. To do proper by them, the U.S. well being care system must reckon with the necessity for long-term use, she mentioned.
“I’ve by no means heard an insurer say, ‘After two years of treating this diabetes, I hope you are completed,'” she mentioned. “Is there a bias in opposition to these with weight problems?”
Highlight on tax-exempt hospitals
Nonprofit hospitals confirmed off their funding attraction on the convention. Fifteen well being techniques representing main gamers throughout the nation touted their worth and the viewers was intrigued: When headliners just like the Mayo Clinic and the Cleveland Clinic took the stage, chairs had been stuffed, and late arrivals crowded at the back of the room.
These hospitals, that are supposed to offer group advantages in alternate for not paying taxes, had been desirous to show monetary stability and showcase money-making mechanisms in addition to affected person care — they name it “income diversification.” PowerPoints skimmed by latest working losses and lingered on the hospital techniques’ huge money reserves, growth plans and for-profit partnerships to commercialize analysis discoveries.
At Mass Normal Brigham, such analysis has led to the event of 36 medicine at the moment in scientific trials, in line with the hospital’s presentation. The Boston-based well being system, which has $4 billion in dedicated analysis funding, mentioned its findings have led to the formation of greater than 300 corporations prior to now decade.
Hospital executives thanked current bondholders and welcomed new traders.
“For these of you who maintain our debt, taxable and tax-exempt, thanks,” John Mordach, chief monetary officer of Jefferson Well being, a well being system in Pennsylvania and New Jersey. “For individuals who do not, I believe we’re a fantastic, undervalued funding, and we get a fantastic return.”
Different nonprofit hospitals talked up institutes to attract new sufferers and increase into profitable territories. Sutter Well being, primarily based in California, mentioned it plans so as to add 30 services in enticing markets throughout Northern California within the subsequent three years. It expanded to the Central Coast in October after buying the Sansum Clinic.
Cash from new — and previous — remedies for autoimmune illness
Autoimmunity medicine, which earn the trade $200 billion globally every year, had been one other sizzling theme, with numerous corporations speaking up growth applications aimed toward utilizing present most cancers drug platforms to create treatments for circumstances like lupus and rheumatoid arthritis.
AbbVie, which has led the sector with its $200 billion Humira, the world’s best-selling drug, had delight of place on the convention with a presentation within the resort’s 10,000-square-foot Grand Ballroom.
President and Chief Working Officer Robert Michael crowed concerning the firm’s newer autoimmune medicine, Skyrizi and Rinvoq, and bragged that gross sales of two-decades-old Humira had been going “higher than anticipated.” Though 9 biosimilar — primarily, generic — variations of the drug, adalimumab, entered the market final yr, AbbVie expects to earn greater than $7 billion on Humira this yr because the “overwhelming majority” of sufferers will stay in the marketplace chief.
In its personal presentation, biosimilar-maker Coherus BioSciences conceded that gross sales of Yusimry, its Humira knockoff listed at one-seventh the worth of the unique, could be flat till 2025, when Medicare adjustments take impact that might push well being plans towards utilizing cheaper medicine.
Biosimilars may save the U.S. well being care system $100 billion a yr, mentioned Stefan Glombitza, CEO of Munich-based Formycon, one other biosimilar-maker, however there are challenges since every biosimilar prices $150 million to $250 million to develop. Seeing 9 corporations enter the market to problem Humira “was stunning,” he mentioned. “I do not assume this can occur once more.”
KFF Well being Information, previously referred to as Kaiser Well being Information (KHN), is a nationwide newsroom that produces in-depth journalism about well being points and is likely one of the core working applications at KFF — the unbiased supply for well being coverage analysis, polling, and journalism.
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