Humedica Wants to Dose U.S. Healthcare Crisis with Clinical Analytics, Raises $30M from Investors
Imagine a national repository of detailed information on patient populations organized by their disease types, treatments received, and other metrics—similar to a U.S. Census for healthcare. Hospitals could use this trove of data to track the quality and costs of care. Pharmaceutical companies could gain new insight into how their products are consumed. Humedica, a new Cambridge, MA-based healthcare informatics firm coming out of stealth mode today, is creating such a repository with backing from a bevy of industry bigwigs and marquee investors.
Humedica, quietly formed in July 2008 to commercialize its clinical analytics software, raised $30 million in a Series A round of venture capital from Bain Capital Ventures, General Catalyst Ventures, North Bridge Venture Partners, and Leerink Swann last summer, according to the company. The startup has also formed a partnership with the American Medical Group Association (AMGA), a trade group representing 95,000 physicians in the U.S., and its healthcare informatics subsidiary, called Anceta. This partnership gives Humedica access to medical groups around the U.S. to build its clinical information repository.
Humedica’s plan for a national-level healthcare informatics system based on data secured from electronic medical records is ambitious. Some previous companies in this business have relied on electronic claims data from health insurers to construct a picture of how healthcare is consumed on a national level, but claims data focuses on individual transactions and lacks many details on patients’ overall health and medical histories. Also, the landscape of available data on patient care is evolving dramatically with the Obama Administration’s multibillion-dollar investment in mainstream adoption of electronic health records and new studies to compare the effectiveness of treatments. There will be an unprecedented amount of electronic data on patient care—including such details as how well treatments worked for certain patients, the costs of that care, and exactly where the patients were treated.
Humedica wants to be the first and largest company to secure the data in electronic medical records from healthcare groups all over the country, comb it with sophisticated business intelligence and analytics technologies, and then provide it to paying customers in the healthcare, life sciences, financial services, and government sectors, said Michael Weintraub, a founder and CEO of the company. The firm says it safeguards the patient data in accordance to laws that protect such information. There are firms that offer software and services to help healthcare groups create their own electronic warehouses of such patient data, but Humedica is taking a software-as-a-service approach to make its system available over the Internet to multiple stakeholders in healthcare.
“Nobody [other than Humedica] is mapping a large capability to analyze populations in common diseases and therapeutic areas and doing it in a way where it is a software-as-a-service model where the burden of implementation is not put on the local site,” Weintraub said. “We’re taking on that execution and implementation challenge.”
Weintraub began pursuing Humedica’s informatics platform while working for Leerink Swann, a Boston-based healthcare investment banking firm. He headed its Medacorp business, which supplies investors with insights and opinions from network of some 30,000 healthcare experts from around the world. Last year he led the spinout of Humedica (which was initially called Health Insight Technologies) from Leerink with several other employees. Leerink is a shareholder in the startup and its exclusive partner for providing its informatics platform to the financial services sector.
The long list of prominent people behind the startup includes its chief medical officer, Paul Bleicher, the founder and former chairman of the fast-growing Waltham, MA-based clinical trials software firm Phase Forward (NASDAQ:PFWD), who joined the company last November. Weintraub’s own successful career includes serving as CEO of Watertown, MA-based healthcare informatics firm Pharmetrics, which was acquired by Norwalk, CT-based IMS Health (NYSE:RX) for an unspecified amount in 2005. North Bridge Venture Partners was an investor in both Phase Forward and Pharmetrics before backing Humedica. Humedica’s team also includes executives from Leerink, Pharmetrics, Cambridge, MA-based healthcare network provider NaviNet, and others.
While stacked with talent, Humedica faces the challenge of getting hospitals and other healthcare organizations to provide the firm with patient data. In addition its partnership with the AMGA, the company has also reached an agreement to provide its informatics platform to Christus Health, an Irving, TX-based group that manages 40 hospitals, says Weintraub. Humedica plans to provide access to its system to groups like Christus in exchange for access to their patient records as well as certain fees. Securing data from more groups such as Christus will give the company larger sample sizes to be analyzed with its software, making it more valuable to customers such as life sciences companies that want detailed insights into the entire U.S. market.
The company’s analytics tools are designed to give participating medical groups insights into their own patient populations, as well as to help them compare their costs and care standards to those at other healthcare organizations. Hospitals, for example, can use the company’s platform for real-time patient surveillance to alert doctors that, say, a patient needs a certain treatment. Medical groups can also view the connections between the costs of patient care and the clinical outcomes of their care. It will be cheaper for hospitals to pay Humedica for access to its systems than to build such informatics and surveillance capabilities themselves, Weintraub says.
It was no surprise to hear that securing patient data is a major emphasis for Humedica, given the strict rules and standards for security and privacy in the federal Health Insurance Portability and Accountability Act, known as HIPAA. To integrate layers upon layers of security to meet the requirements of HIPAA, the company has been working with legendary BBN Technologies, of Cambridge. The security for the system involves the use of technology to de-identify patients for certain people who view the information. This prevents, say, an investment analyst using the company’s informatics system for market research from seeing records on individual patients. Yet caregivers who have certain access privileges to the system will be able to view data on their individual patients.
Allen Kamer, a co-founder and vice president of corporate marketing and development at the company, says its informatics technology could also be useful in so-called “comparative effectiveness” studies that compare how well different healthcare products such as drugs treat the same illnesses. The President’s $787 billion economic stimulus package includes $1.1 billion for comparative effectiveness research. Kamer is investigating ways that Humedica could benefit from this federal spending.