Alphabet’s Health Care Laundry List

May 5, 2016

When an 800-pound gorilla stakes a claim in an industry sector, the incumbents sit up and take notice-particularly when the gorilla is named Alphabet and is the parent company of Google. Cassie Arnold reports.

When an 800-pound gorilla stakes a claim in an industry sector, the incumbents sit up and take notice-particularly when the gorilla is named Alphabet and is the parent company of Google.

Despite the fact that Google founder Sergey Brin famously characterizing health care as a “painful business”, four Alphabet subsidiaries are either health care focused or have significant health care plays.

The oldest, pre-dating the Alphabet moniker, is Calico, an acronym for California Life Company. Calico was hailed in a Time magazine cover as “Google vs. Death” when it was launched in September 2013. Former Genentech CEO Arthur Levinson is CEO of the venture and has been consistently tight lipped about the company.

It is clear that the company is focused on the diseases of ageing. It has announced six drug research and development partnerships with organizations ranging from AbbVie to universities to the genealogical data company Ancestry. It has not drawn on Google veterans to fill its ranks. Rather it has recruited researchers from academia and Genentech alums. It’s stated targets are cancer and neurodegeneration.

DeepMind is a London-based artificial intelligence company that was acquired by Google in early 2014. In February 2016 it launched DeepMind Health, a new division that is working with clinicians at Britain’s National Health Services (NHS) to develop a range of technologies to improve patient care. Its first project with NHS is an app to help clinical staff detect cases of Acute Kidney Injury.

DeepMind Health’s other initiative is called Hark, a digital health app to manage clinical workflow. The Hark tool has been used in early stage pilots at St. Mary’s Hospital in London.

The company’s website states that it is devoted to developing tools that “can help shift more resources away from reaction and towards better prevention.”

Google Ventures (GV) is Alphabet’s venture arm. Funded entirely by Alphabet, fund managers have said it plans to invest heavily in health care. The $2.4 billion fund ramped up its health care investment from six percent of the fund’s total investment in 2013 to 31 percent in 2015 according to Bloomberg.

While most tech investors avoid the health care space due to the long development times and strict regulatory regimes, GV seems undaunted by such hurdles citing the sector’s unique potential to improve human health and global quality of life.

The fund says it is targeting medtech, biotech and digital health opportunities including telemedicine, genomics, population health and chronic disease management.

But Alphabet’s biggest bet on health care is Verily. Previously known as Google Life Sciences, Verily was launched two years ago when it spun out of Google’s X Lab.

Verily is the home of the company’s widely touted smart contact lens technology that can continuously monitor a patient’s blood glucose level. That technology is now being developed in partnership with Novartis.

All in all Verily has more than half a dozen industry partnerships targeting chronic conditions with large markets such as diabetes, cardiovascular disease, cancer and neurodegenerative disease. Most of the projects announced to date involve sensor based technologies and the software to support them.

Diabetes is where the company has been most active so far. In addition to the Novartis partnership, Verily has also cut deals with device developer Dexcom, that markets wireless glucose monitors, and French pharma Sanofi. Interestingly, as re/code reported, Novartis has said that the contact lens will go into human clinical trials next year, but for the treatment of sight disease, not as a glucose monitor.

Other Verily projects include:

  • A $50 million partnership with the American Heart Association to develop a multi-disciplinary team with the goal of understanding, reversing and preventing cardio vascular disease.

  • A partnership with Biogen that involves wearable sensors and aims to treat multiple sclerosis.

  • Projects to leverage wearable digital health devices and smart pills to act as nanodiagnostics or drug delivery devices

  • Liftware, developer of a spoon that controls tremors in Parkinson’s patients that Verily acquired through its only acquisition to date

  • A partnership with Johnson & Johnson to develop surgical robots that goes by the name Verb Surgical

Verily is also involved in data driven projects that fit closer in Alphabet’s traditional wheelhouse. Baseline will develop a comprehensive snapshot of what a healthy person looks like. It is also building what it calls “the Google of human systems biology”, with the broad ambition of gathering information from academic hospitals, physicians, universities and patients to make it easily accessible to researchers.

The company’s most recent product announcement is called the Connectivity Bridge. The device can quickly collect patient data in either a clinical or home environment and transmit it to the cloud, and it doesn’t require internet access.

Verily’s staff is rumored to number in the hundreds but is expected to increase rapidly – the company recently signed a lease for Onyx’s former 400,000 square foot facility in South San Francisco that can house up to 1,000 workers.

Cassie Arnold
Principal, KMA & Company
www.KMAandCo.comcassie@KMAandCo.com