Apollo Medical Holdings announced the appointment of Eric Chin as the company’s new CFO effective July 1, 2018. Chin will be replacing Mihir Shah, who has served as ApolloMed’s CFO for the past two years. Additionally, the company has decided to eliminate the position of president, currently held by Gary Augusta, and transfer those duties to ApolloMed’s Co-CEOs, Warren Hosseinion, M.D. and Thomas Lam, M.D. Augusta will remain as a member of ApolloMed’s board of directors. Chin has served as the Chief Financial Officer of Network Medical Management, Inc., one of the company’s subsidiaries, since March 2018.
Wednesday, June 6, 2018
Medicines Co. started at buy by B. Riley
The Medicines Co. initiated with a Buy at B. Riley FBR. B. Riley FBR analyst Madhu Kumar started The Medicines Co. with a Buy rating and $55 price target. The analyst believes the company has a “disruptive” cholesterol drug with “de-risked safety.”
Xencor started at buy by BTIG
Xencor initiated with a Buy at BTIG. BTIG analyst Dane Leone started Xencor with a Buy rating and $56 price target. The analyst is optimistic for the use of XmAb5871 in the treatment of systemic lupus erythematosus into the Phase 2 read-out during the second half of 2018. Further, he believes the commercialization of Xencor’s partner assets, ALXN1210 and MOR208, should help support its cash flow for the next several years.
CVS announces management team after CVS-Aetna deal
CVS Health Corp. CVS, +2.76% announced early Wednesday the management team that will serve once its acquisition of health insurer Aetna Inc. AET, +1.91%closes. Aetna Chief Financial Officer Shawn Guertin will serve as CVS Health’s executive vice president and chief financial officer, with CVS Health current CFO David Denton planning to leave the company at the deal’s close. Rick Jelinek, Aetna’s executive vice president, head of enterprise strategy, will serve as CVS Health’s executive vice president. Karen Lynch, who is currently Aetna’s president, will also be CVS Health’s executive vice president. Several Aetna executives will also continue on in their roles, with Aetna serving as a standalone business unit within CVS Health. Other executives who plan to leave once the deal is finalized include Aetna executives Steven Kelmar, Thomas Sabatino and Thomas Weidenkopf; Aetna Chief Medical Officer Harold Paz and EVP Meg McCarthy will remain for some time to help with the transition. Until the deal closes, the two companies will continue to operate separately. Many CVS executives will also continue on with the company, including CVS Health Chief Operating Officer Jon Roberts, EVP and General Counsel Thomas Moriarty, CMO Troyen Brennan, EVP and Chief Human Resources Officer Lisa Bisaccia and Alan Lotvin, who will serve as executive vice president of transformation. CVS shares rose 0.6% in premarket trade. Shares have dropped 6.4% over the last three months, compared with a 0.8% rise in the S&P 500 SPX, +0.86% and a 0.3% decline in the Dow Jones Industrial Average DJIA, +1.40%
Amazon and Uber Could Teach Medicine About Electronic Health Records
The software and medical communities should look for models outside of healthcare as they work to make electronic recordkeeping more meaningful for patients and less frustrating for physicians, said panelists at a Stanford University School of Medicine symposium held Monday.
New research conducted by The Harris Poll for the university suggests that a clear majority of primary care physicians (59%) support a complete overhaul of electronic health records (EHRs), Stanford said in a press release. The poll also indicates that 40% of doctors find more challenges than benefits with EHRs, and 71% think they greatly contribute to physician burnout, while only 18% of those polled reported being “very satisfied” with their current EHR systems.
Physicians often doubt that the time spent on EHRs will improve the health of their patients, with these systems sometimes demanding seemingly irrelevant data, panelists at the Monday symposium said. Panelist Taylor Davis, vice president of analysis and strategy at research firm KLAS, contrasted the different attitudes about computers seen in medicine and aviation. Working with regulators, the airline industry has developed systems over decades that allow pilots to rely heavily on the instruments in their cockpits.
“If I were getting on a plane and I heard a pilot say ‘Stupid computer system. It’s not my job to know how to use this computer system,’ I’d turn around and walk back out off the plane,” Davis said, stressing the need to build similar confidence in computers used in healthcare. “The challenge is that today there are clinically stupid things in EHRs that are hurting the trust that clinicians have.”
Taylor has conducted over 3000 interviews with healthcare professionals over the 11 years he has been with KLAS, according to the biography listed for him for the Stanford symposium. He cited an example from his recent work to explain why healthcare professionals have ample reason to doubt the value of their recordkeeping tasks.
“I read a comment from a physician who said ‘I can’t trust this EHR because it’s still asking me to input whether infants are chewing tobacco,’ Davis said.
The research presented by Stanford does indicate that physicians see some value in EHRs. In this online poll of more than 500 primary care physicians, 63% indicated that EHRs have generally improved patient care, Stanford said. And 66% were at least somewhat satisfied with their current systems.
But primary care physicians also reported spending a “disproportionate amount” of time per visit interacting with EHRs, with many saying that recordkeeping competes with their patients for already limited time and attention, according to Stanford. On average, the physicians polled reported that interacting with EHRs consumed about 8 minutes of a 20-minute, in-person patient visit, with another 11 minutes of EHR interaction following once the patient visit had concluded.
And 49% of those polled reported through the poll that using an EHR detracts from their clinical effectiveness, Stanford said.
“If pilots didn’t trust autopilot, they wouldn’t turn it on,” Davis said. “Physicians often don’t trust their EHRs, so they don’t use it the same way. So we’ve got to get to a place where physicians trust their EHRs the way that pilots trust autopilot.”
Fighting “Information Chaos”
Christine A. Sinsky, MD, vice president of professional satisfaction for the American Medical Association, picked up on Davis’ suggestion. She urged more thoughtful choices about the data recorded and transmitted through EHRs.
In aviation, engineers and planners weed out information that’s judged to be only incrementally beneficial in deference to the cognitive workload of pilots, she said. There needs to be the same mandate for a “manageable cockpit” to combat the “information chaos and information overload” in medicine, Sinsky said.
“What we need to do is model after the airline industry where a group of engineers studiously determines whether or not a new light, a new warning, a new buzzer is warranted within that cockpit,” she said. “As we start to recognize the importance of the cognitive workflow cost and we recognize the importance of the manageable cockpit, we will design, implement and regulate differently.”
Sinky said she’s worked with two of the most widely used EHRs as a practicing physician, using one for a dozen years and the other for the past 4 years.
“It’s gotten harder and harder over that period of 16 years, not because the EHRs have changed, but because of the expectations of use, the expectations that every act must go through the EHR, that we translate the clinical experience into digital data for the convenience of others, and not for advancing clinical care,” she said. “Those pressures have increased.”
EHRs still heavily reflect the demands of medical billing more than medical practice, said panelist Amy Abernethy, who serves as chief medical officer, chief scientific officer, and senior vice president of oncology, at Flatiron, a technology company focused on cancer research. She argued for a need to envision a different model that’s centered around healthcare professionals and patients.
“We are seeing a world where software has been built to the specs at hand,” she said. “If you look across the United States, the predominate decision making about which EHR to purchase was made more at the CFO level.”
Looking to Uber and Amazon
Several of the panelists spoke about how the rapid changes in consumers’ retail experiences, due to data sharing among companies and contractors, will boost their expectations for what’s possible in EHRs.
“Our experiences in healthcare are going to be colored by our experiences in purchasing retail on Amazon, or taking a ride with Uber,” said panelist Judy Murphy, RN, the chief nursing officer at IBM Global Healthcare and a former top federal health information technology official.
“People are starting to say already ‘I don’t understand why you don’t have my allergies. I don’t understand why you don’t know about that thing I had taken care of across the street’ ” when getting medical care, Murphy said.
Consumers have grown used to being able to quickly compare prices and shop online. Murphy said this attitude may soon carry into their approach to elective procedures.
“We’re not going to walk into a hospital not knowing how long we’re going to be there, how much it’s going to cost, who’s going to touch us, when we’re going to get a chance to leave,” she said. “In what other aspects of our lives do we do that kind of stuff? Nowhere.”
In many fields, increased use of computers has led to automation of more mundane tasks, while the opposite has proven true with EHRs, said panelist Don Rucker, MD, MS, MBA, who leads the Office of the National Coordinator for Health IT (ONC) under the US Department of Health and Human Services.
“What other industries use computers to make more work for (themselves)?” Rucker said. “Medicine is the one holdout in a funny kind of way.”
As the nation’s top health information technology official, Rucker is overseeing efforts to bring to medicine the same kind of innovations that other fields have experienced due to an easier flow of digital information. The success of businesses like Amazon and Uber rests on rapid exchange of orders among interested parties, such as the companies selling their products through the online retail giant and drivers signaling that they will accept a fare.
“There’s ground for optimism” about EHRs, Rucker said. The 21rst Century Cures Act includes several mandates related to EHRs. The law mandates that ONC encourage use of open application programming interfaces. The 21st Century Cures Act also requires ONC to lead a public-private initiative to create a trusted exchange network and a common agreement that will include rules for trusted exchange.
These are part of the groundwork for a major shift that Rucker expects in EHRs.
“We think all of those things are going to create an ecosystem that is going to absolutely transform what we have had…[which is] a very, very narrow vision of up until now,” he said.
Icahn buys small stake in drugmaker Allergan
Billionaire investor Carl Icahn has acquired a small stake in Allergan Plc (AGN.N) at a time when the drugmaker is under pressure from other activist shareholders, people familiar with the matter said on Wednesday.
Icahn’s intentions are not clear, though he has been a longtime supporter of Allergan Chief Executive Brent Saunders, pushing for him in 2013 to become CEO of Forest Laboratories, which through mergers and acquisitions became Allergan.
Icahn, who had invested in Allergan in the past, believes the company’s stock is undervalued, the sources said, asking not to be identified because the matter is confidential.
Icahn did not respond to a request for comment.
“We welcome all investments in the company,” Allergan spokeswoman Amy Rose said.
Bloomberg News first reported on Icahn’s new position in Allergan.
Earlier this week, investment firms Appaloosa LP and Senator Investment Group LP wrote a letter to Allergan’s board of directors urging it not to pursue transformative acquisitions but instead shake up its board, including separating the roles of CEO and chairman, which are both held by Saunders.
Allergan plc155.38
AGN.NNEW YORK STOCK EXCHANGE
+3.17(+2.08%)
The letter came shortly after Allergan said it had concluded a strategic review it launched earlier this year.
As a result of the review, Allergan is exploring divesting its women’s health and infectious disease businesses, opting to focus on areas where it has strong leadership positions.
It also said it would pursue a more disciplined capital allocation strategy.
Icahn last showed his support for Saunders in 2016, when he unveiled a stake in Allergan after its planned $150 billion sale to Pfizer Inc (PFE.N) was shot down by changes the U.S. government implemented to the rules on corporate tax inversions.
In 2016, Allergan sold its generic drug business to Teva Pharmaceuticals Inc for about $40 billion. In April, Allergan said it was considering an offer for rare disease drug maker Shire Plc (SHP.L), only to reverse course after Allergan shares plummeted on the news.
It has spent much of the money on stock buybacks, debt reduction and a series of small-to-midsized acquisitions, including medical technology company ZELTIQ Aesthetics Inc and drugmaker Tobira Therapeutics.
Immunomedics started at buy by B. Riley
Immunomedics initiated with a Buy at B. Riley FBR. B. Riley FBR analyst Madhu Kumar started Immunomedics with a Buy rating and $53 price target and added the shares to his firm’s Alpha Generator list. The company has the makings of a blockbuster cancer drug, Kumar tells investors in a research note.
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