Business Monday

A health system bets big on Miami’s future in health-tech

The Advanced Pediatric Care Pavilion at Nicklaus Children's Hospital is a new state-of-the-art family-centered facility that houses Nicklaus Children’s intensive care units as well as new neurology-neurosurgery and hematology-oncology units.
The Advanced Pediatric Care Pavilion at Nicklaus Children's Hospital is a new state-of-the-art family-centered facility that houses Nicklaus Children’s intensive care units as well as new neurology-neurosurgery and hematology-oncology units.

Daniel Silberman runs Miami-based startup Mediconecta, the largest telemedicine provider in Latin America. It is also eying the U.S. Hispanic marketplace.

Juan Pablo Segura founded Babyscripts to provide a new way of managing pregnancy care to detect problems faster and to help the doctors do their jobs better.

David Heenan’s Aces Health has created a technology platform that automates many aspects of clinical trials. The goals: Save time and money, and create better outcomes.

All three startup founders and a handful of other young companies are working closely with Nicklaus Children’s Hospital as part of a comprehensive innovation strategy within Miami Children’s Health System, Nicklaus’ parent health system. Partnering with and/or investing in startups is one important leg of an innovation strategy that includes promoting transformation from within and working with other health systems, said Dr. Narendra Kini, Miami Children’s CEO.

“We recognized we had an opportunity to solve problems that we saw while caring for kids. Some of the problems were related to struggles parents have. Some were clinical. Some were related to all the other things in the care process, [such as] billings, admissions, discharge, etc.,” Kini said.

“If we had those problems, we realized every other hospital had them too,” he said. The idea: Invest in solving problems and do such a good job that other hospitals would be willing to buy their solutions.

To be sure, digital health — healthcare delivered with a big assist from technology — is hot in the venture capital world. Global equity funding to private digital health startups grew for the seventh straight year in 2016, hitting a record high of $6.6 billion, with the majority of financing going to early-stage companies, according to venture analyst CB Insights. Locally and across the nation, healthcare systems and universities are sharpening their focus on innovation and accelerating digital health solutions.

In the five years since it embarked on its innovation strategy, Miami Children’s Health System has created an entire department dedicated to creative solutions. It is run by Michael S. Davis, senior vice president of strategy, business development and innovation, with experts in venture capital, finance and technology on the team.

Miami Children’s also has partnered with Startupbootcamp, a digital health accelerator program and seed fund in Miami that connected Mediconecta, Babyscripts, Aces Health and other startups to the health system. Nicklaus Children’s Hospital in turn has become a living laboratory where these burgeoning businesses can test concepts and receive valuable feedback from doctors and clinicians, patients, families and staff.

In addition, MCHS has invested money in a few startups and has developed a couple of innovations in house. Citing market competition, Kini wouldn’t reveal the private health system’s investment except to say “it is quite a few million dollars.”

MCHS’s ultimate goal, he said, is to be known as a center of innovation and to attract the right talent to Nicklaus and its community. Kini calls innovation a strategic imperative. “We want to make this an ingrained part of the way we do business.”

The health system’s partnership with startups accomplishes the crucial synergy that an evolving entrepreneurial ecosystem needs and that the Beacon Council’s Connect & Grow initiative was designed to address, said Jaret Davis, Greenberg Traurig’s Miami co-managing shareholder who also chairs the Beacon Council, Miami-Dade’s economic development organization, and is vice chair of Nicklaus Children’s board. Large entities need innovation to suvive, while startups need corporate partners to be first adaptors to gain traction, as well as for guidance and potential sources of capital. “The combination of these factors is extremely powerful and makes the partnership represent an unbelievable synergy that represents both sides,” he said.

To illustrate the strategy in action, one need look no further than Miami Children’s partner in the startup trenches, Startupbootcamp Miami.

Christian Seale, the managing director of Startupbootcamp Miami, became passionate about the possibilities for solving healthcare disparities with the help of digital tools. He spent time in Latin America, where he founded other startups. He moved to South Florida in 2015, as plans for a digital health accelerator program were beginning to percolate. Soon the Knight Foundation agreed to fund the Miami expansion of Startupbootcamp, Europe’s largest acelerator, with a digital health focus.

Today, the program mentors and funds selected health-tech startups, many of which it attracts to Miami. Startupbootcamp Miami works with a number of health systems, health plans, business executives, serial entrepreneurs and academics who provide the companies with mentorship, connections and partnerships.

Kini was one of the first industry executives Seale met, introduced by Jaret Davis.

“It was like a mind meld. It wasn’t even in a pitch. It was OK, how do we do this,” Seale said. “He’s an amazing ambassador for innovation, not just in Miami but in healthcare in general.”

MCHS has made good on its promise to open up its institutions to Startupbootcamp companies, dedicating time, expertise and financial resources. “Miami Children’s was very upfront about saying, ‘Here are our problems. Here are our interest areas, and here are what we would be interested in testing and potentially investing in.’ That drove a lot of our sourcing [of startups] and continues to,” Seale said.

The result: Startups can hit the ground running. That not only benefits MCHS, it helps raise the city’s profile in healthcare innovation.

MCHS has worked with about six of the nine companies in Startupbootcamp’s accelerator; about half of the cohort has plans to move to or continue a presence in Miami.

Babyscripts is one of those companies. It offers a remote monitoring system, that includes a customized app and a physical “mommy kit” given to the patient during or shortly after their first appointment with their doctor. The app, which requires a doctor’s prescription, contains a to-do list from the patient’s doctor and advice for her pregnancy; the mommy kit contains a weight scale and blood-pressure cuff.

Patients take their weight and blood pressure weekly. The data goes immediately to a secure cloud. Any abnormal readings will alert the patient’s doctor in real time so the physician can intervene, said Segura, Babyscripts’ CEO. This new model for prenatal care is already capturing about 10 times the amount of data that has ever been captured in conventional pregnancy care, Segura said.

Babyscripts is wrapping up a $3.5 million financing round. Startupbootcamp’s community has funded a sizable portion of that, he said. Babyscripts will be used by two health systems in the area, and the company is talking about a partnership with a large health plan, Segura said.

But Babyscripts always planned to expand into post-partum patients. That’s where Nicklaus Children’s entered the picture.

The leadership immediately understood the value, Segura said. During pregnancy, patients are using the app and Mommy Kits every week, but then the engagement stops at birth. Because technology can play a huge role after the delivery as well, for example, to help treat postpartum depression, Nicklaus Children’s offered to partner on the expansion. “It’s a great culture of innovation there,” Segura said.

Both Startupbootcamp and a health system in Orlando, where Babyscripts also has a key partnership, are trying to woo Babyscripts, which is based in Washington, D.C. “Florida in some way will be very important to us,” Segura said.

Meanwhile, Aces Health of Atlanta is already establishing an office in Miami. Its mobile-first, cloud-based platform reduces time and labor costs of clinical trials while improving outcomes. Currently, most patients in drug trials record their reactions in a journal — yes, with pen and paper. People forget to carry them and then recreate their entries later, which leads to biases and inaccuracies, said Heenan, Aces’ president.

Aces provides a secure HIPAA-compliant smartphone app that conveniently collects data and connects to other platforms that monitor various factors. “If we are serious about patient-centric research, we have to meet the patients where they are,” said Heenan, who co-founded the company with Jordan Spivack.

Heenan was attracted to Startupbootcamp because of its many partnerships, including arrangements with Accenture, Becton Dickinson and Univision. Aces quickly began working with Nicklaus Children’s.

“Being part of the Nicklaus family has already paid dividends,” he said, citing the health system’s experience in clinical research and FDA compliance, and the expertise of clinical research director Jennifer McCafferty. “They have opened up an opportunity for us to showcase our ability in a really good testing ground.”

Miami-based Mediconecta, now with 50 people, operates its telehealth platform in Mexico, Chile, Peru, Ecuador, Venezuela and the United States and expects to open in another Latin American country in the coming weeks, CEO Silberman said. Thanks to a new partnership with cell provider Telefonica, Mediconecta has subscribed 30,000 people in just two months.

Silberman first met with Kini during Startupbootcamp’s “selection days” last summer, before Mediconecta had been selected for Startupbootcamp. MCHS wanted to get into telehealth in a bigger way and extend services to families in Latin America. Mediconecta already had a strong network and telehealth platform in Latin America and wanted to expand its primary care-focused solution into other specialties, such as pediatric medicine.

As part of the partnership, Miami Children’s physicians would be available to offer second opinions for patients in Latin America that Mediconecta serves, said Davis, of MCHS. “We have a large effort under way in our global health department internationally, and companies like Mediconecta will allow us to go with more speed and cover more scale in a shorter period of time.”

Since 2012, MCHS has also worked with California-based Invoy, which developed a product to monitor and measure acetone via breath analysis. Acetone is a predictor of fat loss that can deliver greater accuracy than other weight-loss systems in the market, according to Davis. After a series of refinements, Invoy’s product is being commercialized, Davis said.

When it comes to development within its own walls, Miami Children’s has created a device to safely shave the nails of fidgety toddlers rather than using clippers, and another to easily remove ear wax, Kini said. Employees can submit app or product concepts for development consideration into an idea portal.

“We love when our MCHS family, the 4,000 employees of the system are part of the process. They can bring forth ideas they have in their own workspace,” Davis said.

Locally and across the nation, other healthcare providers are increasing their focus on digital health innovation. The University of Miami Health System, Univision, Jackson Health System, Florida Blue and Aetna are also piloting or partnering with Startupbootcamp startups. And innovation chiefs from pediatric hospitals nationwide gathered in Miami in January for PEDS 2040, a conference hosted by MCHS at the Intercontinental Miami, to discuss their programs, trends and challenges, particularly in digital health.

For instance, Children’s Healthcare of Atlanta, Georgia Tech and Emory University have partnered on a healthcare tech initiative, investing $10 million to date. Strategic services firm Accenture has created innovation labs, hosted healthcare startup competitions and helped connect startups to providers around the nation.

In Ohio, Cincinnati Children’s Hospital Medical Center provides a seed fund, mentorship and access to local and global partners — a program that has resulted in the commercialization of a dozen companies and one significant sale, said Jennifer Dauer, a senior vice president.

For the past seven years, Boston Children’s Hospital has fostered an innovation program aimed at making it easier for inventors and entrepreneurs to bring new concepts to fruition. Its 50-person innovation team includes more than a dozen software engineers who become part of the internal startup teams, a group for testing products and another set of health and business experts who serve as advisers, said John S. Brownstein, chief innovation officer of Boston Children’s and a Harvard Medical School professor.

Boston Children’s has built a digital health accelerator and it has a portfolio of about 10 companies it is taking to the marketplace, Brownstein said. He also said Massachusetts has a statewide effort aimed at identifying, supporting and investing in promising digital health companies.

At the conference, the organization agreed to collaborate more to cast a wider net and make a bigger impact on digital health technologies. That could be a platform to share best practices and an organization-wide network or super-fund to support the development of promising digital technologies. “We can be stronger together,” Dauer said.

Closer to home, Kini is bullish about a digital health future in Miami-Dade, where a cultural melting pot and poverty can create healthcare challenges. “How do you see a doctor, how do you get admitted, how do you get data, how do you send it to your doctor, how do they educate you? There’s a whole set of challenges for the Hispanic population,” Kini said. “This is an incredible opportunity for us to serve one of the fastest-growing populations in the United States ... and for Miami-Dade to be a leader in this area.”

But Miami needs to be able to attract and retain the right talent, Kini said. Like others in the local startup community, Kini said the area is short on tech expertise in artificial intelligence, big data and intellectual property.

“Even if the idea is brilliant, we might be limited by the types and numbers of talent we have to scale it up,” he said. “I truly believe we need the right numbers of highly talented people but we also have to have the appropriate ecosystem to convince them to come here and stay here. These are my two big worries.”

Kini contends the state and county should do more to back this kind of enterprise, perhaps offering seed or grant funding to accelerate the ecosystem efforts.

South Florida has enjoyed homegrown successes in medical devices and pharma, and now it’s time for digital health, Seale said.

“We have all the ingredients. We have the petri dish with health systems and health plans and we have the entrepreneurial energy and the capital is here, and with the right opportunity will flow correctly.”

Nancy Dahlberg: @ndahlberg

[READ MORE ABOUT CORPORATE INNOVATION: A techie takeover in an old-school industry]

Innovation at Miami Children’s

Health System

The innovation strategy at Miami Children’s Health System rests on several prongs:

▪ A system-wide strategy that encourages innovation among MCHS’s 4,000 doctors, nurses, researchers and staff.

▪ A partnership with Startupbootcamp Digital Health to connect MCHS and Nicklaus Children’s Hospital with innovative startups solving problems MCHS is experiencing. Those connections have led to mentoring, pilot testing, partnerships and potential investments. MCHS also has partnered with and invested in outside startups from other networks.

▪ An in-house program to identify good ideas and develop products and apps.

▪ A dedicated in-house innovation leader and team.

▪ A commitment to help the South Florida entrepreneurial ecosystem to become a stronger magnet and support system for health-tech innovation.

▪ A commitment to partner with other pediatric health systems to bring ideas to market faster.

Startupbootcamp Digital Health

What it is: An innovation program and seed fund focused on transforming healthcare from Miami. It provides funding, access to world-class mentors and a network of healthcare providers, insurers and investors.

Founder and managing director: Christian Seale

Investments to date: Nine startups in first cohort, plus two additional companies, from across the U.S., Latin America, Canada and Israel.

Key partners: Knight Foundation, Miami Children’s Health System, University of Miami Health System, Univision, and a national ecosystem of over 150 healthcare customers and mentors.

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