Globally, healthcare is approaching 7 trillion dollars, and life sciences products account for roughly 35% of that spending. This is a huge opportunity for Pittsburgh if we recognize that the rules for success are changing. Historically, health care providers have been compensated on a fee-for-service basis – unfortunately this can promote volume over outcomes. The future is value-based, which requires both improving quality and decreasing costs simultaneously. So, given this backdrop, how well is Pittsburgh prepared?
We’ve said that Health IT is in everything. To deliver value-based care, we must know more about patients. Cloud and mobile apps are reducing complexity in obtaining data; enabling mobile health, remote monitoring and telemedicine. For Pittsburgh (a global center for AI, Machine Learning and Cybersecurity), these market shifts enable regional prosperity.
Let’s talk about medical devices. This segment continues to be plagued with regulatory uncertainties and a lack of premium pricing. 510Ks’ regulatory strategies have fallen out of favor due to their lack of competitive differentiation and label claims. We anticipate a shift in investor interest into PMA and BLA regulatory approvals over the next 24 months. Both ALung Technologies and Carmell Therapeutics are local examples aligned with this trend.
In 2017, consumers spent $333 billion on prescription drugs. The biotechnology, diagnostics, and pharmaceuticals sectors are linked in decreasing the cost of prescription drugs & making drug discovery and commercialization more efficient. Biotechnology uses living cells as tools to mirror the workings of normal and diseased cells to increase drug discovery and predict early failures. Why is early failure prediction so important? Because the cost of failure is inevitably spread into the price of marketed drugs. Local examples like CMU’s Impact Proteomics are unlocking new information about proteins, while Pitt’s, SpIntellx is using AI tools. Switching to diagnostics, this segment is using genetic and molecular profiling data to match patients with the treatment that provides the most therapeutic benefit – this is called Precision Medicine. Two great local examples are: Precision Therapeutics, who tests how tumors respond to specific drugs and Ariel Precision Medicine, who integrates a patient’s symptoms and genetics with artificial intelligence to uncover disease patterns. The goal? Get the right treatment to the right patient.
What about big pharma? They need more new drugs in their pipelines – creating a significant opportunity for start-ups. Pittsburgh is becoming a center for immunotherapies, starting with cancer. Neurological disorders, such as ALS, Alzheimer’s, and Parkinson’s are the focus of such companies as Knopp Biosciences and Cognition Therapeutics.
Life sciences is healthy in Pittsburgh, our universities produce world-class technology and our local entrepreneurial community grows these technologies into commercialized companies. Pittsburgh is aligned with global trends, and we anticipate great breakthroughs in the year ahead.