Renamed West Health Institute Names CEO, Creates Health Tech Incubator

8/15/12Follow @bvbigelow

San Diego’s renamed West Health Institute has hired a new CEO and is unveiling some organizational changes today, reflecting its continuing shift away from an exclusive focus on wireless health to a broader mission that studies ways to lower healthcare costs

The organization that began more than three years ago as the “West Wireless Health Institute” was initially billed as one the world’s first medical research organizations created to advance health and well-being through the use of wireless technologies. Gary and Mary West, the philanthropists who founded the nonprofit, have pledged $100 million to get the center going. But the institute began re-casting itself early last year, eliminating some commercial initiatives and severing some industry ties—notably with San Diego-based Qualcomm (NASDAQ: QCOM)—as it began emphasizing its role as an independent institute providing its expertise in a variety of ways to help lower health care costs.

The shift seems to be set against a broader conflict between mobile device makers and federal health regulators.

Nicholas Valeriani

In a statement this morning, the West Health Institute named former Johnson & Johnson executive Nicholas J. Valeriani as its new CEO. Valeriani, a vice president for strategy and growth at J&J headquarters in New Brunswick, NJ, succeeds Don Casey, a former J&J executive who left the institute in March, after about two years as the institute’s CEO.

While Casey’s resignation was a huge disappointment for many in San Diego, there’s a logic to the institute’s shift away from a tech-centric focus, says Rob McCray of the Wireless-Life Sciences Alliance, a San Diego nonprofit industry group.

The institute also announced the creation of a new business incubator, with about 10,000 square feet of space, for early stage health care companies developing innovative technologies. In addition to providing the space and infrastructure for new companies, the West Health Incubator will provide strategic guidance and access to corporate partners. Companies seeking admittance to the incubator must first receive an investment commitment from the West Health Investment Fund.

The investment fund was created about 10 months ago, with a separate $100 million endowment from the Wests. The couple said at the time that they established the fund solely to invest in “cutting-edge” medical technologies and services that offer “the potential to substantially reduce” healthcare costs.”

In January, Gary and Mary West also established the West Health Policy Center in Washington D.C. with a goal of identifying $100 billion in health care savings. The policy center was created to serve as an independent and bipartisan expert on health issues and to provide regulatory comment to the Centers for Medicare and Medicaid Services (CMS), Office of the National Coordinator (ONC) for health IT, and the Food and Drug Administration (FDA). The center also has assumed the job of hosting “Health Care Innovation” events that bring together industry, legislative, and regulatory leaders.

The reorganization brings together the four entities (which include nonprofit and for-profit organizations) under a coordinated leadership team, with Valeriani serving as chair of the executive committee of the West Health initiative.

“I’m not the first to say it, but no battle plan survives the first engagement,” says Joseph Smith, who has provided continuity over the past couple of years as the institute’s chief medical officer. “It’s been a long time coming, to have form follow the function.”

While innovations in wireless health and IT offer tremendous savings and efficiencies, Smith said it became clear that runaway health costs was a multi-dimensional problem that required a comprehensive approach that included public policy. “As you get into it and you have your successes, you go through the cycle and then you try to address the rate-limiting step,” Smith said.

“I think the recruitment of Nick Valeriani is a real coup and he’ll be a superb leader for the West Health Institute,” Eric Topol, a scientific advisor and board vice-chairman at the institute, wrote in an email. Topol, who is the chief academic officer at Scripps Health in San Diego and director of the Scripps Translational Science Institute, added, “I’m sure the Institute will be vigorously pursuing wireless medicine tools along with other key strategies to lower health care costs, so the renaming is in keeping with is mission.”

Connect CEO Duane Roth agreed.

“I think they want to entertain any technology or service that can impact lowering healthcare costs,” Roth said in an email. “My understanding is that wireless health will remain the key focus but the name change signals that they will expand into any innovation that may impact lowering cost and improving outcomes—especially good to see the announcement of the incubator to go along with their VC fund. We need as many of these options as possible.”

Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at bbigelow@xconomy.com or call (619) 669-8788 Follow @bvbigelow

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