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The Driver: Bayesian Health, a spinoff from John Hopkins University raised $15 million following its emergence from stealth mode in a funding round led by Andreessen Horowitz, along with Health 2047 Capital Partners, Lifeforce Capital, and Catalio Investments. Founded by the director of the machine learning and health care lab at John Hopkins, Suchi Saria, the company will use the funding to commercialize its sepsis detection machine learning algorithm and develop other models to detect conditions earlier to improve care. The Takeaways: According to the Journal of Patient Safety, approximately 400,000 preventable deaths cost over $17 billion a year. Almost 300,000 people per year die from sepsis, a complication from infection, accounting for 1 in 3 patients who die in a hospital according to the CDC. One in every six patients are affected by diagnostic errors and one in every 1,000 primary care visits cause preventable harm. Sepsis is treatable with early diagnosis and intervention yet the risk of dying from sepsis remains in the range of 10-30%. The Story: Founded in 2018 by Dr. Suchi Saria, Bayesian Health has received honorary recognition and awards for its digital health platform, powered by AI, allowing clinicians to quickly provide a better quality of care. Dr. Saria spent over 5 years researching and developing machine learning models to detect early signs of sepsis when she lost her young nephew to sepsis. Her research attempts to demystify health AI data has gained the trust of many healthcare professionals; it provides clinicians with reliable tools to improve the quality of care. Bayesian Health makes the EHR system more proactive by allowing physicians to catch life threatening conditions earlier with the use of AI models which are continuously analyzing patient’s data. The company’s system alerts healthcare professionals of actionable clinical signals during critical moments in patient care, allowing for prompt intervention. Bayesian Health platform is powered by over two dozen studies resulting in precision care delivery, reduction in bias, and improvement in the quality of evaluation and reporting. Bayesian’s research-first approach created a trustworthy AI platform which transforms delivery of care. Bayesian Health deployed its sepsis detection model to five hospitals (over a 2-year period) and found that “the platform drove 1.85 hour faster antibiotic treatment for sepsis where timely treatment directly impacts mortality rate.” Additionally, the platform adoption was sustained at 89% by physicians and nurses “driven by the sensitivity and precision of the insights and user experience of the software”. The Differentiators: Given the tremendous demands on clinician’s time with most doctors and nurses feeling overworked and facing burnout, there is strong demand for healthcare interventions that help prioritize critical interventions. In addition, given the increased deployment of technology, physicians are often overloaded with data but not adequately trained or equipped to understand or rely on the output of AI technology so they don’t appropriately use the data or output of AI-based systems to drive clinical decision making. Bayesian Health offers one platform where the EHR system is integrated with clinical workflows, allowing for manageable and actionable alerts. This is especially noteworthy as exemplified by a recent JAMA article which found that “the Epic Sepsis Model poorly predicts sepsis” generating a large number of false positives and leading to alert fatigue among clinicians. EPIC's model was crafted from the hospital’s billing codes, while Bayesian’s model “pools data in real time from the electronic health records and other data systems [and then] stitches all the data together to create a comprehensive, longitudinal patient view. As sepsis can be fatal and is an indicator of the quality of care provided, false and overactive alerts can influence morale issues amongst healthcare providers who feel in essence that they have let patients down by allowing them to contract sepsis. Bayesian Health reported that their “technology accuracy is 10 times higher than other solutions” which will not only improve detection but will also help associated morale issues. In addition to increasing a healthcare provider’s confidence, Bayesian Health uses “cutting edge AI/ML strategies such as a wait and watch strategy and real-time feedback loops to increase precision, and strategies to make the models stronger”. The Big Picture: According to the book, Medical Error Reduction and Prevention, “the most common diagnostic errors that occur in primary care settings include failure to order appropriate tests, faulty interpretation, failure to follow-up, and failure to refer with one in every six patients affected and one in every 1,000 primary care visits causing preventable harm.” For example, in 2018, the Department of Human and Health Services (HHS) reported that sepsis hospitalizations cost Medicare $41.8 billion, and the costs are expected to increase 12-14% every 2 years. Sepsis models are particularly useful for hospitals to administer because it is a preventable condition; if left untreated, patients can undergo septic shock which costs more to treat. Bayesian Health provides healthcare systems with an optimal solution to promptly treat sepsis which fits into the workflow, without the possibility of alert fatigue. While the company has started by targeting sepsis it is also looking at applying its AI technology to other high priority areas for hospitals such as in-hospital deterioration and pressure injuries. As noted earlier, systems like Bayesian’s will be key to incorporating AI into the care process and transforming the delivery of care by making AI explainable and trustworthy thereby increasing clinician’s usage leading to a more direct influence on clinical decision making. Moreover, with the increasing use of sensors and technology in both at home and inpatient care, clinicians will increasingly have to rely on the computational power of AI to help in decision making. However, while AI models will undergo extensive training and testing, the human body is not a predictable system and AI models will always need human oversight and intervention. AI models should always be used to optimize and augment clinician performance, not as a replacement for their clinical assessment or skills. Johns Hopkins Spinoff Building Risk Prediction Tools Emerges with $15M; Popular Sepsis Prediction Model Works ‘Substantially Worse’ than Claimed, Researchers Find; External Validation of a Widely Implemented Proprietary Sepsis Prediction Model in Hospitalized Patients

Our Take: Innovators relying on the ease of the FDA’s 510(k) streamline device approval process need to be aware of potential changes as well as what the ongoing threat of cyber security incidents could impose on both premarket and post market security management for those devices. Key Takeaways: More than 90% of medical devices enter the market via the FDA’s less intensive 510(k) pathway which has caused them to miss adverse events or lead to product recalls. While the FDA’s requirement for substantial equivalence to “predicate devices” can lead to more rapid approval some believe it can also lead to “device creep” and comparison to outdated and unsafe predicate devices. The FDA recently introduced the Safety and Performance Based Pathway to modernize and streamline premarket device testing. Device manufacturers and innovators should monitor how this evolves as it will have important implications for device approvals While devices approved via the 510(k) process make up the majority of recalls, devices approved via the PMA process pose approximately a 3x greater risk to public safety (JAMA Network Open) The Problem: The FDA has a three tier process for the approval of medical devices “based on their risks and the regulatory controls necessary to provide a reasonable assurance of safety and effectiveness”. Class I devices are considered minimal risk while Class III devices are considered to pose the highest risk for the patient. Under FDA regulations there are three major processes for applying for and receiving FDA approval for medical devices, 1) Pre-market approval or (PMA), 2) pre-marketing notification or more-commonly the 510(k) process, and 3) the humanitarian device exemption (HDE). Following several high profile medical device recalls that had been approved through the 510(k) pathway, in 2011 the Institute of Medicine (IOM) “recommended the FDA replace the pathway after concluding it was inadequate to ensure device safety and effectiveness to promote technological innovation.” As a result of this and other criticism, in 2019 the FDA introduced the Safety and Performance Based Pathway to modernize and streamline premarket device review and evaluation. As a result, innovators need to be aware of which products might qualify for approval via the existing 510(k) pathway as well as impending changes to the FDA’s device approval regimen. In addition, given the increasing use of networked devices in clinical settings and the ongoing threat of cyber security incidents, medical device manufacturers need to ensure that they are meeting FDA standards for cyber security controls. The Backdrop: Under the Federal Food Drug and Cosmetics Act a medical device is defined as: "an instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent, or other similar or related article, including a component part or accessory which is: recognized in the official National Formulary, or the United States Pharmacopoeia, or any supplement to them, intended for use in the diagnosis of disease or other conditions, or in the cure, mitigation, treatment, or prevention of disease, in man or other animals, or intended to affect the structure or any function of the body of man or other animals, and which does not achieve its primary intended purposes through chemical action within or on the body of man or other animals and which is not dependent upon being metabolized for the achievement of any of its primary intended purposes." In order for these devices to be publicly used in the United States, they must be approved by the Food and Drug Administration. As noted earlier there are three main approval processes used by the FDA to approve medical devices. First is the Pre-market Approval process or PMA. Given that Class III devices “are those that support or sustain human life, are of substantial importance in preventing impairment of human health, or which present a potential, unreasonable risk of illness or injury” they are required to receive PMA approval. As noted by the FDA, the PMA must contain “scientific, regulatory documentation to the FDA to demonstrate the safety and effectiveness of the Class III device”, including clinical trial data that demonstrate that the product’s benefits outweigh the risks associated with its usage. In addition, the data must show that the device will successfully help a majority of its intended population and that the applicants must prove their device’s data is independent of any other data reported by another device. According to an article published in the Journal of the American College of Cardiology, medical device approval via the PMA pathway can take anywhere from three to seven years. The second approval process is the 510k process accounting for about 90% of new device approvals. As noted in “Modernizing The FDA’s 510(k) Pathway”, in order for a device to receive 510(k) approval, the FDA “requires manufacturers to demonstrate that devices are ‘substantially equivalent’ in intended use and technological characteristics (with allowable exceptions) to currently legally marketed (‘predicate’) devices. A predicate device is one that is identical or similar to a device that is already legally approved and marketed in the United States for use. One must prove their device is substantially equivalent by meeting two requirements. First, the intended use of the new device must be the same as the predicate device. Secondly, for a device to be substantially equivalent to a predicate device, it must also display similar technological functions. If after review, a device is not determined to be substantially equivalent to the predicate device, then it is classified as a Class III classification, requiring PMA approval. According to data from a 2017 study from Emergo, the average time from FDA submission to clearance under the 510(k) pathway is approximately six months. A number of high profile incidents which led to recalls of devices approved via the 510(k) process, including highly publicized recalls of metal-on-metal hips, pacemaker and implantable cardioverter-defibrillator (ICD) as well as angioplasty devices has exposed weaknesses in the 510(k) process. This has raised questions and concerns about safety and efficacy. A recent study in JAMA noted that given the large majority of medical devices to reach the market do so via 510(k) clearance. Interestingly, although recalls of 510(k) approved devices make up the majority of recalls, new devices approved via the PMA process pose approximately a 3x greater risk of recall that would threaten patient safety, only partially reflecting the fact these are higher risk devices. As a result of publicity around device recalls and these safety concerns, in February of 2019, the FDA announced the Safety and Performance Based Pathway to aid in modernizing the 510k premarket process by no longer comparing new devices to predicate devices. In doing so, the goal is to potentially avoid any oversights missed in assuming device stability and reliability by using predicate devices’ data. The Safety and Performance Based Pathway would instead call for new applicants to compare the performance of moderate-risk medical devices to FDA-identified criteria. These criteria would also include agency-recognized standards that are objective, transparent and validated. The goal of this modernized process is to yield safer and well developed medical devices. Along with the PMA and 510(k) process, the FDA also has a third approval process called the Humanitarian Device Exemption (HDE). The HDE is a regulatory pathway typically used for rare diseases. This process is used under special and emergency circumstances whereby there are no other Humanitarian Use Devices available to treat or aid in illnesses. In addition to the issues in the approval process, given the increased connectivity of medical devices as well as incidences of ransomware, the FDA is becoming increasingly more stringent on the cybersecurity controls in medical devices. While this is particularly important for innovators in terms of premarket submissions, manufacturers must also pay attention to post-market surveillance as well. As noted in “Cybersecurity-Related Regulatory Considerations for Medical Devices” the FDA expects manufacturers to develop and maintain a set of controls around several general areas to protect the device from cyber attacks. For premarket controls, these include: 1) Making extensive use of encryption to keep data private, 2) using digital signatures to verify authenticity of devices, data, and instructions, 3) Designing devices to anticipate regular/routine cybersecurity patches, 4) Adopting the use of strong user authentication tools, and 5) Ensuring devices alert users when any cybersecurity breach occurs. With respect to device surveillance post-market the FDA recommends:1) Understanding, assessing, and monitoring assets, threats, and vulnerabilities, 2) Maintaining a process for software lifecycle management including ongoing updating and patching, 3) Deploying threat modeling techniques to assess the impact of threats and vulnerabilities on device functionality and end users/patients; and, 4) Having and participating in a coordinated vulnerability disclosure policy. Implications: Given the increasing pace of innovation as well as ongoing exposure to cyber threats, startups should anticipate additional actions on the part of regulators and increasing vigilance in terms of both approval and cybersecurity. Product developers should do their best to anticipate the needs of the FDA and prepare the documents accordingly by staying abreast of industry standards and guidance published by the FDA and industry bodies. First and foremost, startups must make sure they understand the appropriate regulations, what regulations apply to their product, and be prepared to supply regulators with the required data in support of their product. Given the current focus on the shortcomings of the 510(k) process, including the risk of “device creep” and undue reliance upon the use of outdated predicate devices, device manufacturers must ensure they are not overly reliant on the 510(k) process and be prepared for the possibility that they may have to pursue the PMA process. In addition, there are approximately 10-15 medical devices per hospital bed and that an increasing number of devices are being deployed in hospital at home configurations. As a result, medical device network security and remote monitoring security will be paramount. Moreover, developers must be aware of risks that reliance upon outside parties could pose to security. For example, developers who incorporate the use of “off-the-shelf software” are responsible for maintaining security of that software, not the vendor of the off-the-shelf software. Similarly, medical device manufacturers that incorporate the use of cloud services into their products should understand how and where their data will be stored (ex: domestically/overseas), what data security and privacy regulations that may expose them to and what the security obligations of their agreement with the cloud vendor are. In addition, innovators must realize that they need to incorporate a lifecycle management approach for their devices to ensure they “demonstrate a commitment to implementing cybersecurity best practices both before and after their devices are on the market.” Related Reading: FDA Safety and Performance Based Pathway Risk of Recall Among Medical Devices Undergoing US Food and Drug Administration 510(k) Clearance and Premarket Approval, 2008-2017 Drugs, Devices, and the FDA: Part 2 Cybersecurity-Related Regulatory Considerations for Medical Devices

Recently Somatus successfully raised an additional $60.1M, which follows it’s Series C round of $64M, bringing its total raised to over $165M. The funding was backed by lead investor Longitude Capital as well as Optum Ventures, eerfield Management, Town Hall Ventures, The Blue Venture Fund, and Flare Capital Partners. Founded in 2016, Somatus’ goal is to expand their integrated care model for patients with chronic kidney disease and end-stage renal disease. The Takeaways: According to the CDC, over 37 million (15%) Americans suffer from kidney complications, many of which are undiagnosed. 40% are unaware that they have chronic kidney disease (CKD) while living with severely reduced kidney function. When untreated, CKD can lead to cardiovascular issues and stroke. In 2019, as a result of an executive order, the Advancing Kidney Health Initiative had an ambitious goal of treating 80% of End-Stage Renal Disease (ESRD) with either at-home dialysis or kidney transplant by 2025 (American Journal of Kidney Disease) In underserved communities, the prevalence of kidney failure is persistent due to the social determinants of health (SDOH) factors which limit patients in receiving preventative care and managing their health and wellbeing. The Story: With a goal of becoming the world’s best integrated care provider for patients with kidney disease, Somatus was founded by Dr. Ikenna Okezie who wants to provide holistic patient care to improve patient outcomes. Somatus has partnered with major kidney care stakeholders (health plans, health systems, nephrology, and primary care groups) in an attempt to transform kidney care. The improved care model relies on a steady network engagement, dialysis provisioning, and field-based nursing. Somatus claims that their model leads to a 42% reduction in length of hospital stay (compared to the national average). The Somatus model also uses its proprietary RenalIQ® technology platform, an AI-powered diagnostic tool, which the company reports can help predict the disease, disease progression, and recommend the best course for treatment. Since there are no early symptoms of kidney disease, CKD often goes undetected until it has progressed to the final stages of kidney failure. Kidney failure is a progressive and permanent condition that leads to ESRD which requires dialysis and eventually a kidney transplant. Both treatment options are intensive and require proper continuous care. The Somatus’ value-based kidney care model has “seen high levels of engagement and adoption from patients and delivered significant quality and cost outcomes for partners'' According to the company, Somatus currently has over 600 employees in 34 states serving over 150,000 patients. In addition, in June of 2021 Somatus, announced it has been awarded access to the Centers of Medicare and Medicaid Services’ (CMS) Virtual Research Data Center (VRDC) which comprises a 20-year beneficiary database that will be used to examine how demographic data and social determinants of health (SDOH) can impact chronic kidney disease (CKD) outcomes. Somatus will be collaborating with John Hopkins’ Center for Health Equity to study various factors associated with CKD and mortality rates. According to the company, the study is expected to be released in 2022. This study will allow healthcare providers to understand the primary drivers of disparities and use evidence-based practices to intervene and provide better care for many patients affected by kidney disease The Differentiators: With over 600 Somatus partners, Somatus works with patients and providers to provide the best care suitable for the patient’s lifestyle. Somatus can provide at-home dialysis through trained nurses and community health workers who are also tasked with the role of informing the patients of their options, their current status, and their overall treatment plan. According to the American Journal of Kidney Diseases, peritoneal dialysis (PD), which can be administered at home, has greater patient satisfaction, fewer complications, and better health outcomes. Somatus holds a deep understanding of the elements of SDOH and works with their patients to ensure that social barriers are not in the way of their treatment. While providing a high-quality of care, Somatus is set on reducing avoidable costs associated with undertreated CKD. According to their website, though members with kidney disease make up a small percent of the health plan’s total population, the financial impact of ESRD is disproportionately high vs. other conditions. For example, on average, a Medicare beneficiary with an ESRD treatment plan can cost up to $90,000 per year. Additionally, 32% of the annual costs are spent on dialysis services. According to the CDC, in 2018, treating Medicare beneficiaries with CKD cost over $81.8 billion, and treating people with ESRD cost an additional $36.6 billion, with approximately 20% of the Medicare budget being spent on kidney disease. The Big Picture: To meet the Advancing Kidney Health Initiative by 2025, CMS updated their ESRD Treatment Choice Model to promote greater use of at-home dialysis, improving patient outcomes and reducing healthcare burdens. Somatus has been attempting to transform how kidney care is delivered since 2016. Somatus reports that the current state of kidney disease has a 33% readmission rate for dialysis patients (within 30 days of discharge) and 1.7 hospital admission per year per dialysis patient. Their mission is to equip healthcare providers with tools to detect kidney disease earlier and provide holistic interventions before reaching the final stages of kidney disease, particularly for patients in underserved communities. According to the company their tools include “personalized support and care plans that include nutrition and health coaching, medication management, home dialysis modality education, behavioral health, and social services.” All of these attempt to facilitate the use of home dialysis and increase the rates of kidney transplantation serve to help improve the cost and quality of care for patients with chronic kidney disease. However, studies indicate that home dialysis can often require up to 4-6 weeks of training for proper use, creating a significant opportunity for companies like Somatus. In addition, other studies indicate that training for home dialysis did not vary by education, indicating an opportunity to extend more effective and frequent treatment of chronic kidney disease to many underserved patients who may need it most. Somatus Lands $64M to Expand Value-Based Kidney Care Model; Home Dialysis in the United States: A Roadmap for Increasing Peritoneal Dialysis Utilization; Effect of Frequent Nocturnal Hemodialysis vs Conventional Hemodialysis on Left Ventricular Mass and Quality of Life

Our Take: The current regulatory landscape for digital health tools is complex and doesn’t lend itself to easily determining where digital health tools belong or how they should be regulated. As a result it is not clear how to design these tools within regulatory guidelines and what process they should or may need to follow for approval. This can risk the health and safety of patients as well as slow the pace of development of innovative products to market. Furthermore, it risks having devices or services that are not safe and effective coming to market with the potential of exposing patients to an unacceptable level of risk and vulnerabilities. In addition, it risks stifling innovation, lowering the ability of patients to monitor and participate in their own care and slowing the development of digital tools that could result in higher quality, lower cost care. As a result, for startups to remain compliant they must learn how to navigate this complex web of regulation and guidance and create a system for staying on top off any updates from the appropriate agencies. Key Takeaways: There is a lack of understanding about regulatory guidelines and how digital tools (i.e., software and medical applications) are classified. There are at least six guidance documents from the FDA broadly concerning software related to medical devices and mobile medical applications. The regulation of software that is based on Artificial Intelligence (AI) or machine learning (ML), created a whole new series of issues for regulators The market for mobile health apps, both those intended for medical use as well as health and wellness, is projected to grow over 800% between 2019 and 2025 (Statista) The Problem: Healthtech regulation affects everyone, including patients, healthcare professionals, and manufacturers. The current regulatory landscape is complex and not set up to rapidly respond to classifying the space in which digital health tools belong. As a result, It is not clear how these tools should be designed within regulatory guidelines. Startups that are developing medical devices and mobile medical applications need to keep this in mind when considering what regulatory pathway, if any, they will have to follow. The Backdrop: Even prior to the COVID pandemic there was a large increase in the number of digital medical devices as well as health and wellness apps. This number grew exponentially during the COVID pandemic as providers looked for ways to extend healthcare to those in need while keeping them out of physical facilities and away from exposure to infection. According to Statista there were approximately 54,000 mHealth apps on the Apple App Store in Q1 2021. Like most current technology, most devices are driven by software and it is the most important component in healthtech. As a result in 2019, the FDA provided guidance for the regulation of software in medical devices in a document entitled, “Policy for Device Software Functions and Mobile Medical Applications/ Guidance for Industry and Food and Drug Administration Staff.” The goal of the document was to help developers understand which mobile medical applications fall under the medical device oversight requirement based on their functions. Under the FDA’s classification scheme, software involved in medical devices broadly falls into two categories, 1) Software as Medical Device (SaMD) defined as software intended to be used for one or more medical purposes that perform these purposes without being part of a hardware medical device, and 2) Software in a Medical Device (SMD) which is defined as software that powers the mechanics of a medical device or processes the information that is produced by a medical device. According to the FDA guidance, how they regulate software is unrelated to the platform and instead is determined by the functionality of the software. As a result, the FDA only regulates applications (apps) that are intended for medical use (ex: provide a diagnosis) and not those that are intended just to help improve or monitor general health and wellness. In 2016 the 21st Century Cures Act came into effect which modified the definition of “medical device” and specifically excluded from regulation any software that is used “for maintaining or encouraging a healthy lifestyle and is unrelated to the diagnosis, cure, mitigation, prevention, or treatment of a disease or condition.” In its guidance the FDA noted that for certain types of medical devices, which meet the definition of medical devices but have low risk for the users of the device, the FDA will “exercise enforcement discretion.” As such developers wouldn’t have to obtain normal pre-market approval (PMA) from the FDA nor will manufacturers have to register devices with the FDA. According to the guidance document software, where the FDA expects to exercise enforcement discretion includes apps such as those that: 1) Help patients (i.e., users) self-manage their disease or conditions without providing specific treatment or treatment suggestions; 2) Automate simple tasks for health care provider, and, 3) Have software functions that coach patients with conditions such as cardiovascular disease, hypertension, diabetes, or obesity, and promote strategies for thing such as maintaining a healthy weight.” In 2019 the FDA launched a precertification program “to help address the regulatory challenges posed by novel medical software.” As noted in an article in Psychiatric News, “companies that are ‘pre-certified’ by the FDA will be given a fast and streamlined review process for all their digital health products and will then be responsible for monitoring the effectiveness and user satisfaction of their products and providing periodic reports to the FDA.” According to the FDA the goal of the program is “to provide more streamlined and efficient regulatory oversight of software-based medical devices developed by manufacturers who have demonstrated a robust culture of quality and organizational excellence, and who are committed to monitoring real-world performance of their products once they reach the U.S. market.” According to the FDA, “this proposed approach aims to look first at the software developer or digital health technology developer, rather than primarily at the product, which is what we currently do for traditional medical devices. The agency expects the program to “enable a modern and tailored approach that allows software iterations and changes to occur in a timely fashion under appropriate controls”. The regulation of software that is based on Artificial Intelligence (AI) or machine learning (ML), created a whole new series of issues for regulators. As a result, the FDA also recently proposed a regulatory framework for artificial intelligence (AI) in mobile medical apps (AKA adaptive AI). As noted in the Bioethics article cited above “the issue with adaptive AI is the software’s function can change over time as the AI algorithm learns. The implication is that software submitted to the FDA for review (and approval) could act and function very differently from the software eventually experienced by users.” The article notes that this has implications for the issue of “informed consent” as well as an issue of re-review by FDA. Currently the FDA’s guidance does not appear to cover apps that use adaptive AI that are not intended for medical use Medical apps and software also fall under the regulatory purview of the Federal Trade Commission (FTC) but generally only after they are released under their power to regulate “unfair and deceptive trade practices”. s noted in a 2019 article from Bioethics, on regulation of health and wellness apps, “the FTC has thus far taken on more of the regulatory role that one might expect the FDA would play. For example, a number of app developers have agreed to pay settlements to the FTC for making false claims about their app’s ability to improve vision, cognitive performance, and measure blood pressure.” Implications: The market for digital health tools is growing rapidly and the current regulatory apparatus is simply not fit to keep pace with either the pace of scale or change. According to Statista, the market for mobile health apps, both those intended for medical use as well as health and wellness, is projected to grow over 800% between 2019 and 2025. As a result the public is left with a market which is complicated and confusing, often leaving developers guessing which regulations apply to them and how to be compliant. While “intended use” of the company’s marketing the product is the key to determining how regulations apply, developers may not know or understand that they risk violating the regulations until they are notified by the FDA. Conversely, the labyrinth of regulations may slow the development of products to market or cause developers to inappropriately interpret regulations leading them not to apply their technology where it could have medical efficacy. Even worse yet, there is the potential that products may make it to market without the appropriate regulatory review of the medical technology possibly threatening patient safety and even potentially becoming ingrained in care protocols. As a result there are a number of steps that developers can take to ensure they are following the appropriate regulatory pathway. While this is not meant to be an exhaustive list and is in no way meant as a substitute for legal or other professional advice, these steps should help clarify the regulatory pathway. Clearly review the products “intended use” as well as “labeling, promotional statements, and other statements made on or on behalf of the marketer” including those on your website. Consult with regulatory authorities and take the time to review these with outside advisors/counsel early on in the process. Review FDA interpretive guidance including the Policy for Device Software Functions and Mobile Medical Applications cited above and referenced at the end of the publication as well as the Cures Act to determine how your product may be regulated (note the Cures Act specifically excludes certain types of software from regulation). Along those lines startups should consult the FDA guidance documents entitled “General Wellness: Policy for Low Risk Devices” concerning where “enforcement discretion” will be applied (also referenced below). Moreover, startups and their developers need to stay on top of emerging FDA regulations regarding the use of adaptive AI algorithms in medical devices and FTC actions on deceptive trade practices to ensure they are aware of and following the latest developments and guidelines. While all of the above should aid you in educating yourself in determining if you are subject to FDA regulatory approval and which pathway to take, it is imperative that you take steps to continually monitor any and all developments from the appropriate regulatory bodies. As a result, given the complexity of the regulatory landscape, innovators would be well served to bring in outside counsel and advisors at crucial decision points in the planning and strategy process as money spent early on in the development of products and services will likely help avoid regulatory issues or delays and will have a high ROI. Related Reading: Policy for Device Software Functions and Mobile Medical Applications Guidance for Industry and Food and Drug Administration Staff General Wellness: Policy for Low Risk Devices FDA Examples of Mobile Apps That Are NOT Medical Devices FDA Expanded FDA Regulation of Health and Wellness Apps - Bioethics FDA’s Streamlined Health App Approval: Better for Patients or Companies? Psych News

The Driver: New York-based Cleerly secured $43 million in series B funding providing a cutting-edge digital health platform with machine learning capabilities for early detection and treatment of coronary disease and heart attacks. The Series B funding was led by Vensana Capital, with additional backing from LRVHealth, New Leaf Venture Partners, DigiTx Partners, the American College of Cardiology, and Cigna Ventures. Founded in 2017 by Dr. James K. Min, a cardiologist and director of the Dalio Institute for Cardiac Imaging at New York Presbyterian Hospital/Weill Cornell Medical College, Cleerly has raised $54M in total funding. Cleerly has two FDA approvals and will use the funding to commercially scale their company, obtain more FDA approvals, and invest in Research and Development (R&D) for their “precision prevention” technology. The Takeaways: Cleerly has spent five years building out its data science teams, perfecting its algorithms, and obtaining some approvals from the Food and Drug Administration in order to have recently emerged from “stealth” mode. Cleerly believes that by applying their AI-based technology to analyze heart scans they could reduce costs of cardiovascular care by 60% including a 75% reduction in invasive cardiac catheterization tests. Heart disease is largely asymptomatic and the first sign of heart disease is often a heart attack. 60% of those who have a heart attack have no prior symptoms. The causes of heart disease are not thoroughly understood and healthcare providers rely on risk indicators that are insufficient to prevent heart attacks. The Story: James K. Min, MD FACC, founder, and CEO of Cleerly is attempting to revolutionize the diagnosis and prevention of heart diseases by empowering primary care providers to “reach patients earlier [prior to hospitalization] where costs spiral out of control.” Cleerly is meant to allow for intervention by primary care providers by helping them to understand and interpret its advanced imaging without the need for a specialist. This will allow earlier diagnosis and treatment, before the patient complains of chest pain which is the “end-stage phenomenon” reflecting arteries that are already compromised with plaque or fatty deposits. For example, while risk factors such as cholesterol levels are currently used to determine the patient’s cardiac health, there is an 80% overlap “of cholesterol levels for people who do and don’t have heart attacks” according to Dr. Min in a recent Forbes article. In other words, risk factors are not enough to prevent heart attacks. Indeed, Dr. Min noted that often the first symptom of coronary artery disease can be a patient actually experiencing a heart attack itself, indicating a need for earlier diagnostics and preventative care plans. The Differentiators: According to the company, Cleerly has a database of 50,000 CT scans that Dr. Min and his team have cataloged and labeled to highlight certain characteristics. He and his team used AI and machine learning to train the algorithms to identify common patterns which characterize cardiovascular disease including the “presence, extent, severity and type” of disease. Unlike an invasive cardiac catheterization test, which is expensive, requires sedation and several hours in the hospital for recovery, Cleerly offers non-invasive medical interventions to conduct “comprehensive coronary artery phenotyping” which will help healthcare professionals to formulate a preventative healthcare plan. In addition, Cleerly’s platform is based upon analysis of what are called Cardiac Computer Tomography Angiogram (CTA) images, which are non-invasive but can still take detailed images of the heart illuminated by a dye injected into the patient. Although CTA is not yet first line therapy in the U.S., the American College of Cardiology has noted that the technology holds great promise and United Healthcare does reimburse for the procedure for lower risk patients with chest pain. CTA became first line therapy for those with chest pain in 2016. In addition, while Min initially theorized that “the more narrow and blocked a person’s arteries were, the more likely they would be to experience a heart attack”, however his team found it was not the amount of plaque but the thickness of the plaque that mattered. Patients who had so called fibrofatty or necrotic core plaque in their hearts, which was more likely to be softer and made of fat, cholesterol and other fatty compounds. According to the National Institutes of Health, understanding how the necrotic core develops is an urgent goal in heart-disease research. While the company is not positioning its product to replace trained doctors who can interpret scans, a June 2021 study commissioned by the company noted that the AI had a diagnostic accuracy of about 99.7 when assessing scans of patients whose tests indicated they had severe narrowing in their arteries. The Big Picture: According to the U.S. Centers for Disease Control (CDC) approximately 650,00 people will die from heart disease this year and heart disease will cost the healthcare system approximately $219 billion annually. As noted above, often the first indication of disease is severe chest pain or a heart attack, with about 60% of those who have heart attacks never having any prior symptoms of disease. Cleerly intends to change this dynamic by reaching patients earlier in the process and through their primary care providers instead of the ER when it can be too late to intervene. Considering the nature of heart disease, silent and asymptomatic, Cleerly will allow various healthcare professionals (PCPs, specialists, radiologists) to quickly identify the presence and nature of the heart disease without the need for invasive procedures like cardiac catheterization. As a result the company believes it can reduce expensive, invasive procedures by 75% and lower costs of cardiovascular treatment by 60%. By taking advantage of AI, Cleerly’s technology can analyze CT scans within minutes, compared to the 8 hours it would take humans to manually analyze the CT scans which makes the analysis feasible and cost effective. By deploying a non-invasive test such as this, Cleery’s technology would likely allow for broader scanning of the approximately one-half of Americans who currently display one of the three highest risk factors for the nation’s number one killer; high blood pressure, high cholesterol or smoking. As such it may be a more effective and efficient way to find some of the almost 20M people the CDC estimates currently have heart disease in the U.S. As Clinical Guidelines Shift, Heart Disease Screening Startup Pulls in $43M Series B & This AI Startup Raised $43 Million To Save Lives (And Money) By Treating Heart Disease Earlier

Healthtech companies have to navigate a complex regulatory process to bring products to market and it’s important they understand the role of different agencies and what they look for. Perhaps the two most important aspects that companies have to deal with are regulatory approval and financial reimbursement which fall under the purview of the Food and Drug Administration and the Center for Medicare and Medicaid Services (CMS). Navigating the regulatory process should be managed in an integrated fashion allowing compliance to create a competitive advantage for startups who do so. Key Takeaways: The FDA’s main role is to ensure that drugs/devices/medical products are safe and effective for their intended use. As such, it is imperative for startups to understand that the FDA is by nature a risk-averse, slow-moving entity as mistakes carry significant consequences and are very high profile. CMS’s main role is to determine whether the cost of the product (medical device or drug) is “reasonable and necessary" for their beneficiaries of the Federal healthcare programs (Medicare, Medicaid, Tricare, etc.) in order to decide whether to extend reimbursement coverage and pay for the products. Commercial insurers typically follow the lead of CMS in extending coverage. Formulating an integrated regulatory approval and reimbursement strategy early in the startup lifecycle can significantly impact time to market, costs and addressable market opportunity creating a competitive advantage. Engaging regulatory agencies early on in the process and using expert consultants often has a significantly higher ROI than doing so later in the process as it can both help anticipate and answer potential issues and pitfalls which slow time to market. The Problem: Emerging healthtech companies have to balance their desire for bringing an often new and untested product to market as quickly as possible against regulators' responsibility to ensure public safety and value. In addition, rapid changes in regulations in response to events or legislation (either permanent or temporary) can create short term windows of opportunity or demand which may accelerate the tension between the need for digital health innovations and regulatory compliance. As such when designing and creating go to market plans for new technologies companies need to keep in mind that the FDA’s 4-step marketing approval process can take up to 7 years for the approval of medical devices and up to 12 years for drugs. Moreover, gaining FDA approval for a drug or product does not necessarily mean that CMS will cover a drug or product quickly or ever extend coverage to the approved device or drug. In addition, even if innovators see the likelihood of approval and reimbursement as high, they must also figure in the increasing cost of such approvals. For example, according to the Tufts Center for the Study of Drug Development between 2003 and 2013, there was a 145% increase in the costs of getting market approval for prescription drugs while the approval rate increased by only 12%. This is one of the risk reward decisions where founders need to make a careful assessment of their own limitations and understand what they don’t know. The Backdrop: The approval process for healthcare products in general can be incredibly burdensome and time consuming. For example, for certain technologies and interventions, including medical devices, and certain medical procedures. CMS issues coverage policy through one of two mechanisms: national coverage determinations (NCDs) or local coverage determinations (LCDs). As noted in the Journal of Law, Medicine and Ethics, “the responsibility for making the reasonable and necessary determination for the vast majority of devices falls to fiscal intermediaries that serve as representatives of different Medicare districts within the US. These contractors assess whether a device meets the reasonable and necessary criteria, resulting in a local coverage determination. LCDs may limit the coverage of items or services to specific diagnoses, or may preclude coverage entirely, with each decision applicable within the contractor’s local jurisdiction.” By contrast, CMS typically reserves NCDs for a select subset of 'big ticket' interventions likely to have a significant impact on costs or quality of care, or those which are associated with safety concerns and typically represent only a small percentage of all CMS coverage determinations. Add to the complication of going through CMS’s normal approval process the fact that the cutting edge technologies like artificial intelligence are incorporated into many new healthtech products and that process becomes even more confusing and lengthy. For example, the FDA is currently trying to determine the appropriate method of regulating products and devices that employ so-called adaptive AI where the treatment algorithm or protocols change in response to feedback learned by the product as it is actively treating patients. In addition, regulators are working to determine the nature and extent of what informed consent would look like for both practitioners and patients in such situations, including if and under what circumstances it would need to be updated based on changes in treatment protocols. As a result, products that currently use these technologies face an uncertain and potentially changing regulatory environment as they race to take advantage of being early to market (not to mention how this could impact product adoption). Moreover, this issue can create a snowball effect leading to additional questions and delays in reimbursement on top of what is already a median 9-month delay from FDA approval to initiation of a CMS NCD. Complicating all of the above is the fact that startups are often loath to spend precious cash on advisors and consultants who may be able to help them navigate the process, particularly early on in their incubation when course corrections are the least expensive. Often they will rely on friends and family as advisers who may have some experience with the requisite agencies but not in the relevant or appropriate specific area of expertise. This can be a costly mistake. Implications: Startups should formulate an integrated regulatory approval and reimbursement strategy early in their lifecycle knowing that it can significantly impact time to market, costs and addressable market opportunity creating a distinct competitive advantage. As noted by Ralph Hall, Principal of Leavitt Partners in a recent panel discussion we moderated at Georgia Bio, you need an upfront integrated strategy that links your FDA regulations, your reimbursement coverages (including private payers), your consumers, your professional societies, your market, your competitors. He also advised that you want to do it so if the FDA wants to change something, you have the foresight and can do a cost-benefit analysis. Given the need for speed to market in healthtech this kind of flexibility can be key. In addition, innovators should keep in mind that the Silicon Valley mindset of growth at all costs is likely to be at odds with the culture of the regulatory agencies which are risk averse. As noted by Mr. Hall, when dealing with regulators it’s important to keep in mind the environment of the agencies and the culture of the organization, “at the FDA, if you approve a product you’re carrying a risk.” As they wind their way through this process, it’s beneficial to anticipate the needs and requirements of both the FDA and CMS from their point of view and keep their organizational dynamics in mind. When hitting a roadblock companies should actively solicit the feedback of the agencies and if startups realize they are beyond their area or expertise or competency they should strongly consider hiring appropriate consultants or counsel to help them through the process. While it may be tempting to use political connections to go around the agencies, Mr. Hall strongly urges against this as this can irritate the regulators, particularly the FDA, and backfire. All of these strategies will help turn what is often an impediment in bringing products to market into a competitive advantage that should help secure FDA approval and CMS coverage more rapidly and more easily. Related Reading: Investing Amid Regulatory Uncertainty-Panel Georgia Bio MedTech & Digital Health Innovation Summit Evidence Supporting FDA Approval and CMS National Coverage Determinations for Novel Medical Products, 2005 through 2016: A Cross-Sectional Study Harmonizing Standards and Incentives in Medical Device Regulation: Lessons Learned from the Parallel Review Pathway

The Driver: On June 15th, San Francisco based startup Sempre Health announced that it had raised $15M in a Series B round led by Blue Venture Fund with UPMC Enterprises, Rethink Impact, and LifeForce Capital and Industry Ventures joining the round. Founded in 2015, the company offers behavioral-based discounts on drug copays. The company currently offers discounts on drugs for diabetes, cardiovascular and respiratory conditions. The company plans for use the proceeds to attempt to enroll more patients in the service and expand the number of drugs offered for coverage under their plans. The Takeaways: Medication non-adherence costs between $100M-$300B per year, and causes approximately 10% of hospitalizations, often driven by cost of the prescriptions. Sempre claims that its behavioral economics based approach can increase adherence by 15% on average while achieving a Net Promoter Score (NPS) of 92 from its members. The company states that they have had more than 125,000 patients managing chronic conditions on their platform and have one healthcare partner that implemented its program in January 2020 and is “on track to eclipse $1 million in savings for members in just seven months.” While a 2012 study noted “evidence is limited on whether [interventions to improve adherence] are broadly applicable or drive long-term outcomes, Sempre’s approach which incorporates both behavioral economics and dynamic pricing may hold promise. The Story: Sempre was founded by Anurati Mathur, who has a B.S. in microbiology and business for U.C. Berkeley and who has been involved in healthcare and healthcare startups including Propeller Health, Practice Fusion and DaVita Healthcare Partners. Mathur became frustrated when she went to pick up some prescription eye drops for an allergy, and left without the prescription when she found out it would cost $150. Realizing that patients like her often don’t pickup or take their medications due to cost led her to found the company. Under the program the company sends out text based reminders with information about discounts and how they might change depending upon when the prescription is picked up. According to Mathur the discounts help incentivize adherence. However, only patients who routinely pick up their medications are eligible for the discounts. The program is driven by a two-sided marketplace, whereby Sempre solicits drug companies to participate by adding their drugs and setting a budget on the Sempre platform, while it simultaneously works with its health plan customers to determine which of the plan’s customers it will invite to participate in the service. Sempre stated that they have had more than 125,000 patients managing chronic conditions since April 2019 and expects to surpass 250,000 on its platform by the end of 2020. In addition the company claims to have one healthcare partner that implemented its program in January 2020 and is “on track to eclipse $1 million in savings for members in just seven months.” The Differentiator(s): According to the New England Journal of Medicine 20-30% of prescriptions are never even filled and costs the U.S. Healthcare system anywhere between $100-$300B per year. Sempre uses incentives based on behavioral economics and dynamic pricing to drive higher engagement and better adherence and medication compliance. Compared to traditional copay programs Sempre’s program is targeted at high cost and chronic conditions and allows players to target the customers who will receive the discounts. In addition, by using dynamic pricing and text-based reminders Sempre works with patients to get them to refill and pick up prescriptions early in the process at lower cost creating a self reinforcing pattern where they control the size of their discounts as a direct result of their behavior. In addition, by using budgets from the pharmaceutical companies to fund discounts in copayments from insurers to consumers Sempre is connecting all the players in the ecosystem, something typically not found in healthcare. The Big Picture: As noted, prescription adherence and compliance is a major problem in the U.S. healthcare system, often driven by the cost of medication and copays. Sempre is simply applying the principles of behavioral economics used in other industries such as the airlines or automobile insurance (ex: good driver discounts) to influence behavior. Too often in healthcare, patient/consumer behavior cannot influence cost, leaving all patients at the mercy of arbitrary pricing mechanisms, disconnected from market economics. While Sempre’s programs are currently only being used for high-cost and chronic conditions there is the potential to adapt these mechanisms to any illness where improved compliance is an easy and cost-effective way to improve outcomes and quality. However, given that the program is currently directed to those who are already diligent about filling their prescriptions, it will be important to review how compliance and adherence are affected for those who are less diligent about filling prescriptions, a greater source of poor care and outcomes. Assuming behavioral economics proves as successful in healthcare as it has in other disciplines, this model could easily be applied not just to prescriptions but to other problem areas in healthcare where compliance and adherence are an issue, like routine diagnostic testing and even post-procedure follow-up appointments. While other factors influencing behavior might need to be factored into these types of programs, such as patients' access to transportation, this would likely be easy enough to design in (please note: these are hypothetical musings, and not product suggestions from Sempre Health). Programs such as these which inject an element of transparency and patient control into pricing and move healthcare towards a more market and consumer driven model are sorely needed as we move into a more value-driven, consumer centric model. This Startup Just Raised $15 Million to Help People Better Afford Their Medicines; Sempre Health Raises $15M in Series B Financing to Improve Medication Affordability

Our Take: Telehealth usage is increasing at a rapid pace as are the number of startups who are commercializing the use of telemedicine and digital healthcare tools. There are common mistakes that these startups can avoid as they begin to operationalize these tools. Some of the most common mistakes pointed out by Forbes and our recent presentation in collaboration with Georgia Bio include lack of diverse leadership teams, improper networking, unfocused go-to-market plans, and inept founders and strategic partnerships. There are approximately 63,703 startups in the United States of which 2,500 are healthcare startups (as of 2019) with an overall failure rate of 90%. In order for startups to succeed and avoid the most common mistakes, they should prepare beforehand, and spend money in the initial phases which will eventually lead to more cost savings and success in the long run. Key Takeaways: Being coachable and being realistic about your limitations, understanding the sales cycle and customer discovery and being conservative and realistic as possible with investors are key skills for founders Despite lacking early capital, startups should look to advisory boards, non-dilutive funding often available through grants and their advisors network of connections While there were almost 64,000 startups in the U.S. in 2019 and 2500 healthcare startups, with a failure rate of approximately 90% While every startup has its own unique set of opportunities and challenges, many tend to repeat a common set of mistakes that can be looked at in a five-part framework: founding, strategy/vision, funding, execution, scaling or growth The Problem: Healthcare accounts for approximately 18% of U.S. GDP amounting to a $640B industry that is projected to reach $1.3T by 2025 according to Pitchbook. They estimate that enterprise health and wellness startups raised approximately $8.1B over 330 deals in 2020 which was up over 80% in dollar amount with average deal size increasing to $150M from approximately $37M. According to Venture Scanner there were approximately 2,500 healthcare startups in the United States as of 2019. According to Fallory 20% of startups fail after one year, 30% of startups fail within two years and 50% fail within five years and the overall failure rate for startups is 90%, While there are numerous general and unique reasons for startup failure, lack of success are often traced to errors made in the following areas: 1) the founding principles of the company, 2) strategy or vision, 3) funding, 4) execution of the business, and 5) scaling or growth of the business. The Backdrop: While digital health was already growing rapidly before the Coronavirus pandemic, with the arrival of the pandemic and the waiver of many regulations limiting telehealth, usage of telehealth and other digital health tools as well as funding rose dramatically. For example, in 2020, global investments in healthcare startups reached a new record of approximately $81 billion in equity funding across at least 5,500 deals in North America, Asia, and Europe. To look at what may separate the winners from the losers and what pitfalls current healthcare startups should seek to avoid, our founder Jeff Englander recently moderated a session at the Georgia Bio MedTech and Digital Innovation Summit. This panel , entitled, “Startups: Common Mistakes and Lessons Learned”, featured Mr. Englander, Steve Tolle, partner at HLM Venture Partners and Nakia Melecio, Startup Catalyst at the Advanced Technology Development Center (ATDC) of the Georgia Institute of Technology. Using the framework noted above, the discussion highlighted a number of issues. With respect to issues that arise when founding a company Mr. Tolle noted that one of the biggest mistakes he sees is founders lacking or losing focus and failing to have a unique value proposition, Mr. Englander added that in finding your company’s own unique value proposition, startups should not seek to imitate the latest and greatest success as each company is unique. Mr. Melecio noted that new companies, particularly those that are making use of a university incubator or accelerator often fail to take advantage of all of the resources made available to them like subject matter experts (SMEs), executives-in-residence (EIRs), technology transfer assistance, etc. In terms of strategy and vision, two risks that were noted were the “celebrity CEO syndrome” and the “shiny penny syndrome”. Mr. Melecio defined the celebrity CEO syndrome as “where the hype around the founder doesn’t match the hype around the tech”, adding that “the technology and the problem you’re trying to solve should be the rock star”. Mr. Tolle defined “shiny penny syndrome” as startups letting their strategy get corrupted away from the original intent of the business by “going after something just because someone else got it”, not because it helps you reach your goals. Continuing with the five point framework, the panel then looked at the issue of funding. Mr. Englander began the discussion by noting that although the recent interest in healthtech and accompanying high valuations are often perceived as a positive they can have a downside as well. Mr. Tolle agreed noting in highly valued market like this companies may often stretch for an artificially high valuation but that may hurt them later. In addition, Mr. Tolle noted that many companies often make a mistake by taking too much convertible debt initially leading to valuation issues or problems should they need to raise money later. Mr. Melecio stressed that startups, particularly those that are coming out of academic labs, often fail to take advantage of non-dilutive financing and fail to de-risk their investment by accomplishing as many milestones as possible before seeking institutional funding. Mr. Englander also raised the issue of new entrants like private equity entering the market and potential risks that entailed. Mr. Tolle added that companies often don’t differentiate between the underwriting criteria that venture capital and private equity investors have to underwrite too and that can be a mistake. As companies move from the funding of business plan to execution phase the panelists noted a number of issues they should address. Mr. Englander noted that many companies lack a strong operating person or COO to maintain the focus necessary (noted earlier) and keep the company following its business plan. Mr. Melecio advised that many founders are not “honest with themselves about their limitations” and often neglect to consider bringing in a talent advisor or human resources consultant to advise them on helping find the right personnel for the business and help the founders evaluate their own roles within the company as it grows. Along those lines, Mr. Tolle pointed out that many startups often lack formal advisory boards and fail to meet with them regularly, suggesting that founders often rely on friends and family who are not true experts and who will not “speak truth to power”. Finally, in terms of the scaling or growth phase, Mr. Tolle advised that too often startups think nationally, advising startups to remember “healthcare is still a very regional and local thing, it is a lot of word of mouth between hospital CEOs or between hospital CIOs, or between providers.” Mr. Melecio also cautioned that as they grow company’s too often lose sight of “what problem they're trying to solve and ensuring how close the alignment is between your business model and their business model.” Mr. Englander and Mr. Tolle stressed that startups often make the mistake of giving away too much when trying to land a big contract with major partners, particularly those that are asking for exclusives to become part of their vendor network. Implications: Healthcare startups have an increasingly high failure rate given the risk averse culture, the siloed nature of the industry and the length of the sales cycle. However future founders can learn from the mistakes of previous startups and use them as lessons learned as they move forth with their new ventures. Keeping with the five part framework outlined earlier, below are some steps that startups can take to address the common pitfalls, to help ease the sales process and increase chances of longevity and success according to Englander, Tolle and Melecio. In terms of founding a company, Tolle stressed the importance of “getting traction” and that in healthcare “adoption is always the hardest part”. Mr. Englander noted the importance of startups taking the time to understand what they are really good at and positioning that correctly in the ecosystem. Mr. Melecio cautioned that for academically driven startups it is important to know where the IP will sit in the market, what it will be valued at and which tools may be open source and which ones you can protect. As they move forward into developing a strategy and vision, Mr. Tolle recommends the importance of “having a plan and critically and conservatively assessing where you are against that plan.” Mr. Melecio advises new healthtech companies to keep in mind that strategy is very different for every technology “drug discovery, medical devices, etc. all have very different runways, different pathways, and intent regulatory environments...you have to think about healthcare in its entirety and its whole value chain.” In terms of funding Mr. Tolle advised startups to be conservative in doing Series A and B rounds, particularly if they expect to need additional funding as of they get a valuation they have to “grow into” it can cause them to have to do a future down round which could lead to conditions and structures that would hurt them in the future. In addition he advised seeking to align themselves with angel or family office investors who are often more mission driven than institutional investors. Mr. Melecio stressed the advantages of Small Business Innovation Research (SBIR) and Small Business Technology Transfer Program (STTR) funds and other non-dilutive sources that allow emerging companies to run pilots and work and hit milestones thus de-risking the technology before going for institutional investment. With respect to execution both Mr. Englander and Mr. Tolle cited the need for operating talent but differed on ways to acquire the expertise. Mr. Englander suggested analyzing founders skill set or hiring a dedicated person with operating expertise, while Mr. Tolle suggested looking at a fractional hire. He added that “having the discipline [in sales forecasting] to know when to call something at a different stage in your pipeline and someone with the skill to do that is really important. As noted earlier, Mr. Melecio noted the importance of a dedicated talent advisor to both analyze the needs of the company as a whole and the skillset of the founders to determine if more permanent help at the senior level needs to be brought in. When looking at what new healthtech ventures can do to avoid pitfalls during the scaling or growth phase, Mr. Tolle strongly recommends the use of a formal advisory board that meets regularly, potentially with an ex industry executive who can help you in the market when you need it. All of the speakers noted the importance of drawing upon advisors and consultants who have strong networks who help you in growing your business. Along those lines, citing the local/regional nature of healthcare in general, Mr. Tolle advocated establishing “regional beachheads” to gain traction, pointing out that a startup's “best salesperson is often a customer talking to a friend of theirs on the golf course or at a conference.” In addition, Mr. Tolle also cautioned that when contemplating a partnership with an established industry player, consider how they are aligned to your business and how they will get paid for talking about your business observing that if there is no alignment it is unlikely to benefit your business. Finally, each of the panelists were asked to give some parting advice about actions startups could take to avoid mistakes going forward. Mr. Tolle advocated founders being “as conservative and realistic as possible when talking to investors”, Mr. Melecio emphasized the importance of understanding the sales cycle, the basics of customer discovery, understanding the healthcare ecosystem (who you’re talking to and why) and who’s paying for it. Mr. Englander concurred with earlier comments about founders being coachable and highlighted “the importance of being honest with yourself and your limitations” in order to be able to recognize when they needed help.

The Driver: NUE Life Health, a telemental wellness platform, raised $3.3 M in funding from investors including Jack Abraham, Shervin Pishevar, Martin Varsavsky, Jon Oringer, James Bailey, and Christina Getty. Founded in Miami, NUE Life uses the oral form of ketamine, Esketamine which was approved by the FDA in March and is given as a nasal spray. NUE Life has operations in California, Texas, and Florida and aims to expand its services with the new funding. The Takeaways: Although ketamine has been associated with being a “party drug” and was once used mainly as an anesthetic on battlefields and in operating rooms, it may hold promise for those who have not had success on other medications. While researchers don’t know exactly how it works, “a leading theory proposes that it stimulates regrowth of synapses (connections between neurons), effectively rewiring the brain.” The company believes ketamine will strengthen the neural connections weakened by chronic stress and depression thus allowing newer connections to form. Because ketamine uses a new mechanism to deliver its antidepressant effects, it may be able to offer help for those people whose depression has resisted previous interventions. The Story: Christina Getty, a co-founder, and investor in NUE Life Health stated that with approximately 20% of women in the U.S. on antidepressants and over 20 veterans a day committing suicide, they “felt compelled to launch a different kind of mental wellness company.” NUE Life offers treatment for major depression, anxiety, post-traumatic stress disorder, and bipolar disorder. Ketamine therapy itself is unique to the individual as there are variations in experiences, duration, absorbability, and dosage. NUE Life offers three different programs: Basic, Stabilize or Complete which offers a differing number of “experiences” (dosage). On their website, NUE Life listed their pricing which ranges from $850 for the Basic program to $2,750 for the Complete program. Currently, insurance does not cover ketamine-assisted therapy with NUE Life. The Differentiator(s): While COVID-19 gave rise to many telemental health platforms, NUE Life is offering at-home ketamine therapy combined with Artificial Intelligence recommended music therapy and treatment plan(s). According to an article in Psychedelic Spotlight, patients who are open to music therapy are more likely to experience lesser symptoms of depression than those who are not open to music therapy. According to the company, NUE Life “creates a detailed ‘knowledge graph’ of the patient which allows it to understand everything about them in order to diagnose and treat their mental health condition, using an approach called integrated psychiatry.” NUE Life most often ends up recommending the Stabilize program. This program contains 6 experiences that NUE Life suggests be taken twice per week over a period of 3 weeks. Depending on the patient’s needs, the program can assist patients with up to 18 experiences over 3 months. According to a report in the Harvard Health Blog, “people who experience some relief from depression within one to three ketamine treatments are probably likely to extend these positive effects if the treatment is repeated several more times”. However, the blog goes on to say there are now standard dosage guidelines and “the subsequent sessions may help prolong the effect of ketamine, rather than achieving further dramatic relief of symptoms.” The ketamine tablet is to be administered orally after completing the initial screening and sitter agreement form. During the experience, patients are asked to fill out their “experience tracker” which is followed up with NUE Life’s Medical Director. The platform creates the above mentioned Knowledge Graph that illustrates the patient’s mental health condition, diagnosis, and ongoing treatments. The HIPAA compliant platform will also provide the patients access to a community where they can resume their treatment even after completing the program. The Big Picture: Currently, ketamine-assisted therapy is the fastest-acting antidepressant for major depression. Focused on providing holistic mental wellness services, NUE Life taps into three key areas “mind, body, and lifestyle” which are essential for mental health wellbeing in the long run. NUE Life offers sustainable relief from mental health conditions as it disrupts negative thought patterns and guides patients into forming healthier neural connections. Patients are able to access NUE Life from the comfort of their homes and are able to partake in their daily activities, as there are no long-term side effects from ketamine. The traditional therapy approaches often risk poor compliance and outcomes leading to treatment-resistant depression (TRD). According to BMC Psychiatry, treatment resistance occurs commonly in up to 30% of those treated for major depressive disorder. In addition, the Society of Biological Psychiatry, reports that TRD is relatively common where at least 50-60% of the patients report poor health outcomes. As there is an existing gap in research surrounding the biology of depression, the traditional treatments haven’t proven to be very effective. A patient’s health status, age, and gender are factors associated with the probability of TRD, where women and senior citizens experience TRD at higher rates. NUE Life has the potential to help alleviate the mental health burdens on vulnerable populations by offering a sustainable and quick treatment plan. Ketamine For Major Depression: New tool, New Questions; NUE Life Health Raises $3.3M For Its Psychedelics-Meets-Tech Mental Wellness platform

Our Take: Though President Biden’s proposed new biomedical research agency (Advanced Research Projects Agency for Health or ARPA-H, modeled on DARPA (which is credited with creating the internet) can provide “cutting edge solutions” unless healthcare’s underlying social infrastructure issues are addressed first, the initiative will not succeed. While President Biden has proposed this initiative to potentially eradicate major diseases such as cancer, Alzheimer’s disease, and diabetes, the plan will have to reach populations most impacted by these and other chronic conditions who are often those most impacted by significant health disparities. As such, the success of such a plan will be a function of President Biden’s American Job’s Plan which expands the traditional definition of infrastructure (ex: roads, bridges, ports, etc.) to include other human infrastructure elements such as broadband, childcare, and skills training. While we would not argue that every provision of the initial proposal must pass or would qualify as infrastructure even in a modern sense, we must expand our definition beyond the traditional definition for ARPA-H to succeed. Key Takeaways: Modeled after the Defense Advanced Research Projects Agency (DARPA) the ARPA-H is a high-risk, high-rewards development agency aimed at enhancing medical advancements without the limitations of bureaucratic red tape. While only one example, a recent study found the social determinants of health in Texas have resulted in $2.7 billion in excess medical spending, and another $5 billion in lost productivity. The budget of ARPA-H is tied to the National Institutes of Health (NIH) where $6.5 billion is reserved for ARPA-H. With the many competing demands on the NIH budget many researchers have urged the existing functions of the NIH be protected and suggested that healthcare-related research remain grounded in clinical trials and testing. The Problem: ARPA-H’s goals are to eradicate chronic conditions and, essentially, to improve overall population health. In order to improve population health, the definition of infrastructure must also include human infrastructure improvements such as programming and resources that also improve access to education, resources, food and water, and healthcare services. As demonstrated by the COVID pandemic, while there can be dramatic breakthroughs in healthcare and healthcare technology, these developments often bypass the underserved and increase disparities. For example, although there was a dramatic increase in healthtech funding during COVID and there was a surge in the number of telemedicine and remote care services to address healthcare needs due to the lack of in-person care, people of color were inordinately impacted by COVID and often were disproportionately unable to utilize these advancements. These disparities were evident even prior to the COVID crisis and appear to have been magnified by it. For example, data from the National Telecommunications and Information Association revealed that “the proportion of households that accessed health or health insurance records online grew from 30 percent in 2017 to 34 percent in 2019” that “households communicating with a health professional online increased by two percentage points, and households that researched health information online grew by one percentage point between 2017 and 2019.” However this data also revealed that a majority of those who used telehealth and telemedicine type resources were higher educated, wealthier and lived in more metropolitan areas. In addition to broadband, issues like child care and prenatal care can contribute to healthcare disparities all of which hurt us economically. For example, in Texas, Black and Hispanic children are more likely to grow up in neighborhoods of poverty and their families are more likely to lack health insurance, causing large disparities in health status, disease prevalence, and premature death. According to Episcopal Health Foundation, Texas is incurring $2.7 billion in excess medical care spending annually as well as $5 billion in lost productivity due issues associated with social determinants of health. In addition, this lack of care leads to 452,000 life years lost due to premature deaths valued at $22.6 billion. The Backdrop: The first step to addressing the lack of broadband access and other disparities is to redefine what infrastructure means as noted by President Biden when he unveiled his proposal in the American Jobs Plan. The plan redefines what infrastructure means in modern-day America, placing an emphasis on improving infrastructure for both child and home health care. The care infrastructure notion entails improving access to healthcare services, clean water, and broadband enhancements; these elements are important to promote health and wellbeing for all Americans. Given the digital nature of our society broadband is at the heart of many problems that impact healthcare and social determinants of health. For example, according to USA Today, prior to the pandemic an estimated 10-16M of the nation’s school age children completely lacked access to the internet to aid them in their school work. Even for those that do have access, the situation may not be all that it seems. In 2019, Microsoft released a study illustrating that at least 163.2 million Americans are not accessing broadband at its optimal speed. The study, backed by 6 different independent studies, foreshadowed America's system inefficiencies marking the correlation between broadband access, and job and GDP growth. This lack of broadband access also impacts health as many health experts now have begun to classify broadband access as a “super-special” determinant of health. This is due to the fact that broadband access is needed to book appointments, monitor bus schedules and ride-share apps, navigate the health insurance platforms, and so on. The lack of broadband access has put the burden of care back onto the consumers. As a result, this can lead to consumers in underserved communities facing higher barriers to access and or even becoming unable to access digital health platforms entirely. In fact, data from the National Telecommunications and Information Administration indicate that only 12% of those with an annual household income of $25,000 or less used the internet to communicate with their healthcare provider compared to 40% of those making $100,000 or more in 2019. Hispanic, American Native/Alaska Native and African Americans had the lowest rate of internet use for health related activities, trailing White and Asian Americans. Similarly, these racial groups also represented some of the most underserved populations in America. Implications: Redefining what infrastructure means is an uphill battle. Edward Glaeser, a Harvard University economist working on infrastructure projects for the National Bureau of Economic Research, noted that a cost-benefit analysis must be established with each proposed program to fully grasp the impact of the proposed care/human infrastructure. We risk increasing racial and health inequities if the lack of broadband access and other care infrastructure programs do not pass. In addition to this digital divide, there is also a large inequity among those suffering from chronic diseases such as cancer and diabetes and other diseases. For example, over 40% of Black females suffer from hypertension and over 10% have diabetes. Prevalence rates of many chronic diseases like these are concentrated among those who are less affluent. As noted in a 2020 study published in Health Affairs, there is a strong correlation between socioeconomic status, patient care access, and lack of health insurance and rural living. Telehealth is a vital tool and in fact one of the advancements like those envisioned by ARPA-H to improve the quality and delivery of health care to millions of underserved Americans. The proposed ARPA-H program and its mission to “end cancer” have potential but it will not reach those who are truly impacted unless it addresses issues like broadband access, education and childcare. As noted in the earlier example of Texas, the state is incurring almost $3B in additional medical costs and $5B in lost productivity. Any CFO facing a similar decision about factory equipment which would save a significant amount of money and effectively extend the useful life of the equipment would be hard pressed not to make it. Lastly, health experts agree that for an improvement in population health and to sustain the positive influence of these interventions and medical advancements, health literacy must be prioritized. The social and super special determinants of health must be sustainably addressed to close the racial and health gaps amongst Americans. Related Reading: In His Biggest Speech Yet, Biden Pitches a New Health Agency to Help ‘End Cancer As We Know It’ President Biden Proposes Creating Two DARPA-Like Agencies Biden Plan Spurs Fight Over What ‘Infrastructure’ Really Means Economic Impacts of Health Disparities in Texas 2020

The Driver: Clearing is developing a digital healthcare platform for chronic pain sufferers looking for non-opioid pain relief. According to Crunchbase News the New-York based company recently raised $20 million in a seed round led by Bessemer Venture Partners and Founders Fund with additional backing by Flatiron Health, Curology, Hims & Hers, Seamless, Grubhub, and Forward Health. With the funding, Clearing plans to address the chronic pain market’s shortage of pain specialists, by prescribing patients non-addictive treatment plans. As noted by CrunchBase, Clearing is moving the pain management market online and then combining clinician visits with a combination of affordable physical therapy and compound pharmacy programs. Clearing claims to already have 10,000 patients on their waiting list and the company hopes to expand its platform and work with sports teams and other medical professionals. The Takeaways: According to the CDC 1 in 5 or 50M Americans suffer from chronic pain, yet there are currently only 7,000 pain specialists in the U.S. Chronic pain causes loss of productivity and costs America up to $635 million, a year according to American Health & Drug Benefits. Although there were a number of root causes of the opioid epidemic, part of it can be attributed to the fact that prescribing opioids was cheaper than detailed pain management plans which require multiple visits and referrals Approximately “70% of chronic pain sufferers reported an increase in chronic pain” during the pandemic due to disruptions in care and the need for non-addictive pain management plans. The Story: According to the CEO and Founder, Avi Dorfman, each year an additional 2 million Americans are added to the roles of those with chronic pain and in need of pain management plans.. Clearing offers “stage one intervention” or holistic treatment plans with non-addictive elements which includes anti-inflammatory creams and at-home exercises. The ingredients in the topical pain relievers (creams) are FDA approved and the prescription strength can be adjusted according to the patient’s needs. Importantly, Clearing does not require insurance plans as their treatment plans are extremely cost effective and cost less than typical insurance copayments. According to the company, after completing a virtual consultation, patients are paired up with a pain management specialist who prescribes a comprehensive plan and follows up with the patients on a regular basis. The direct-to-consumer platform delivers their prescription right to the patient’s doorstep, eliminating the hassle of having to pick up prescriptions. One notable risk is that CEO and Founder, Avi Dorfman is currently in the midst of a jury trial to validate his status and ownership stake in Compass, a real estate brokerage platform. Given his role as CEO this could divert management attention and focus at Clearing as he prepares for and participates in the trial. The Differentiators: Currently, Clearing is the first digital platform to offer comprehensive pain management at a low price point. This is particularly important because the digital aspect of Clearing can make pain management accessible to millions of Americans, particularly the underresourced, who may currently lack health insurance. Clearing validates its treatment protocols through the use of a medical advisory board that has accumulated over 150 years of combined experiences and represents leading medical institutions such as Mass General, Johns Hopkins and Harvard. The company notes that the medical advisory board demonstrates a clear understanding of pain management and its members have authored over 465 peer-reviewed journals on chronic pain. The platform relies on self-assessment of the patient’s pain-level and symptoms. Moreover, given the role that patient self assessment plays in the Clearing platform it has the potential to alleviate some of the racial and gender bias patients often face when doctors conduct pain assessments. A number of studies have demonstrated that black patients are consistently undertreated for pain due to false beliefs held by doctors. In addition, though women are disproportionately affected by conditions that cause chronic pain, several studies have demonstrated that they are less likely to be properly diagnosed or receive proper pain management treatment than their male counterparts. The Big Picture: As noted above, chronic pain impacts the quality of life for over 50 million Americans and has been clinically linked to depression and anxiety and other behavioral health disorders. During the COVID pandemic where access to in-person care was difficult or impossible for many, access to medication and providers who could help alleviate this pain disappeared and the need for comprehensive pain management via telemedicine emerged. Clearing’s direct-to-consumer digital platform is less likely to be disrupted by external factors and can simultaneously help address the shortage of pain management specialists. In addition, many lack insurance or cannot afford the high costs of insurance deductibles or co-pays, Clearing’s low-cost direct model offers an affordable and efficient solution. Clearing aims to provide pain relief for millions of Americans without adding to their expenses. Moreover given the movement towards increased consumerism in healthcare, Clearing offers a straightforward platform allowing patients to self-assess their pain levels without having to get caught in the healthcare coverage/reimbursement maze. This should reduce barriers in accessing pain management treatment plans for people of color and women and result in improved care at lower costs. Clearing Targets Chronic Pain With $20M Seed & Clearing Revolutionizes Relief for Millions of Americans Suffering from Chronic Pain

Our Take: An increase of women’s representation on both ends of venture capital-investments and startup entrepreneurship- will result in substantive benefits. By providing opportunities for women-founded companies, venture capitalists create room for billions of dollars in GDP growth and work toward closing the gender gap. Differently, if left undealt with, the lack of women in tech roles could have detrimental effects on the economy, rewind the progress made in gender equity, as well as stunt the growth of industries where women compose large portions of users and intuitively help drive innovation such as healthcare. Although the recent COVID-19 pandemic revealed and exacerbated cracks in venture capital, there are a few areas where improvements can be made to solve this issue such as hiring more women into leadership roles in venture capital firms and supporting women founded startups. Key Takeaways: Despite almost a 15% increase in venture funding in 2020, women-founded companies raised just 2.2% of the total, down from only 2.6% in 2019 For every $1 in funding, women-founded companies returned more than 2.5x in revenues per dollar invested than companies founded by men Women venture capitalists are twice as likely to invest in women founded companies Gender-neutral venture evaluation is a false premise. Investor standards are applied in gendered ways and female entrepreneurs must be prepared to navigate within this flawed system The Problem: As noted in an article entitled Venture Capital Funding Boomed in 2020. But Women’s Share of the Pie Shrank to 2.2%, while venture capitalists raised a total of $150 billion in 2020, a 13% increase from 2019, startups founded by women were left behind. For example, while venture funding increased 13% in 2020, women-founded companies raised just 2.2% of the total, a slight decrease from the 2.6% of total venture funds raised in 2019. By contrast, the percentage of venture capital funds allocated to male-founded companies increased to 85.8% from 83.5% in 2020. While there isn’t yet a clear understanding for this year’s drop in venture capital received by women-founded companies, many have speculated it is related to the continued effects of the COVID-19 pandemic and women’s roles as primary caregivers for children and family. The Backdrop: From child care to caring for sick family members, women’s lives were disproportionately affected by the pandemic in 2020. A Harvard Business Review analysis showed that women’s jobs were 1.8 times more likely to be affected than men’s jobs. Furthermore, even though women make up only 39% of the global employment, they were affected by over 50% of the job losses in 2020. The loss of women in employment has major repercussions not only on gender equity but on the economy as a whole. According to a Boston Consulting Group analysis, for every $1 in funding, women founded companies returned more than 2.5x in revenues per dollar invested than companies founded by men. Although according to the U.S. Census Bureau women hold more than three quarters of healthcare jobs, an Oliver Wyman study showed women hold only 13% of CEO roles and 33% of leadership positions. Furthermore, as one looks at the leadership of venture capital firms, there is a minimal women’s presence. Many women serve as associates and analysts but only 12% of decision makers at venture capital firms are women, while many don’t have any female partners at all. An analysis conducted by All Raise found that only 27 women joined venture capital firms in 2020 compared to 54 in 2019. Of these 27 women, only one woman was Black while none identified as Latinx. All Raise founder Pam Kostka named another impact of the COVID-19 pandemic that affected women in venture capital; due to social distancing, fear and increasing illness, less networking events occurred that allowed women to network and promote their ideas. Kostka called this inability to connect with new startups, “known founder effect”, where investors essentially stuck to what and who they knew prior to 2020 which, in a historically male dominated field, means men. This was best illustrated by the increase of funding given to later-stage deals in comparison to such in 2019. Harvard Business Review writers, Ashley Bittner and Brigette Lau, likened the current state of the venture capital community to a “boys club”, making it even more difficult for women founders to participate. An article entitled, Why Women-Owned Startups Are a Better Bet, looked at why the disparity exists in venture capital and came to three conclusions. First, women generally received more pushback and challenges during their presentations when compared with men and were less likely to directly address criticism. This was particularly true around the amount of technical knowledge they possess regarding their own ideas. Secondly, men were more likely to over-sell themselves and their ideas during pitches while women remained generally conservative- even asking for less than men. Lastly, male venture capitalists were generally less familiar with the services and products that women were founding. As one founder noted in the article “this lack of understanding shows up also in terms of social class when entrepreneurs pitch products for people at socioeconomic levels significantly lower than that of the typical angel or VC investor.” Implications: The lack of women in venture capital has a number of effects that if left unaddressed may lead to an undoing of progress in social equity, contribute to a continued lack of diversity in the workforce and potentially leave a number of market opportunities poorly addressed or even unaddressed entirely. This issue is one that is representative of matters of gender inequity, difficulties in women’s employment, and minimal growth of women in leadership roles across the industry. For example, since studies show that women venture capitalists are twice as likely to invest in women-founded companies, women who have the means to do so are empowered to build a virtuous cycle by starting their own firms and even their own venture capital firms. Women owned firms also help increase diversity in the workforce as they tend to fill their staff with 2.5 times more women and these startups often have social (as well as financial) missions that create lasting, long term impacts for others. When women create, they create companies that focus on making social contributions and build healthy relationships with employees. Also, as noted by Frost, “with 50% of the global population as target customers and a market potential of $50 billion by 2025” female entrepreneurs are ideally positioned to capture a good portion of this market. Failing to empower them to do so would clearly lead to missed opportunities. That being the case, what can be done to improve the amount of capital directed towards female founders? The 2018 Canada-United States Council for Advancement of Women Entrepreneurs and Business Leaders Report on increasing women’s access to capital recommended the following things, among others, 1) given that female entrepreneurs ask on average for $89,000 in debt financing while males ask for $124,500 lending institutions must work with female entrepreneurs by shifting their conversation from a transactional one to a strategic one; 2) examining the business plan to assess which amount of capital can be reasonably required given the business potential; 3) lenders could be encouraged to invest concomitantly with government-funded loans, as well as cooperate with their female entrepreneur customers to seek out lower cost financing sources that, in turn, can be leveraged further with private debt; 4) Governments…should continue to pursue programs that ensure female-owned businesses are included in Government tender processes on a preferred basis. In addition, a recent article in the MIT Sloan Management Review entitled, How Women Can Improve Their Venture Pitch Outcomes, noted that in dialogues where women stress risk, the likelihood of obtaining a positive funding proposal was significantly reduced. Avoiding words such as ‘risk’ and ‘defend’ increased the likelihood of women getting what they were asking for. In addition, based on the difference in perception by investors the authors suggested that female entrepreneurs specifically focus on promoting goals and upsides rather than highlighting how they will prevent downsides. Moreover the article noted that female founders are encouraged to do their homework on the gender composition of investors well in advance of pitching their ideas and they should go in being prepared to shift their pitch so as to ensure a focus promoting returns. As the authors note in concluding the article, “these findings indicate that gender-neutral venture evaluation is a false premise ...our results show that investor standards are applied in gendered ways.” As such, female entrepreneurs must be prepared to “navigate within this flawed system” to increase chances of success. Related Reading: Venture Capital Funding Boomed in 2020. But Women’s Share of the Pie Shrank to 2.2% Women-Led Startups Received Just 2.3% of VC Funding in 2020 Achieving a Better Gender Balance Across All Levels of an Organization Why Women-Owned Startups Are a Better Bet COVID-19 and Gender Equality: Countering the Regressive Effects