McGuireWoods was pleased to recently sponsor a "DC to VC" roundtable during Chicago’s TechWeek featuring Aneesh Chopra, the United States Chief Technical Officer and 35 venture capital investors and early-stage health IT companies. Mr. Chopra and the venture capitalists exchanged thoughts on the following key issues facing Health IT investment opportunities:
- Opportunities for Data Analysis. Hospital electronic medical records systems, the Medicare, Medicaid and health insurers are compiling an enormous amount of health data. This data is not currently being used effectively to achieve physician decision support, cost savings and better patient outcomes. Investors are looking to for opportunities to capitalize in this space.
- Investors in Health IT Need Certainty. To invest in healthcare, investors need certainty in the regulatory process. Venture funds are deterred from investing in companies with products that require FDA approval due to uncertainty in treatment and time to get approval. FDA’s new draft mobile application guidance provides some assistance in this regard but the results of the IOM report on the 510(k) clearance process will likely hurt investment.
- Large Health Systems Are Not the Only Customers in the Market. Although many health IT systems are intended for use by large health systems, there exists opportunity to sell products to smaller groups of physicians and providers as they grapple with new challenges and opportunities. Mr. Chopra gave the example of smaller groups of 15-25 primary care physicians who seek to qualify as an ACO.