By Sy Mukherjee and Clifton Leaf
January 23, 2017

I recently gave a talk on the importance of betting on people rather than on projects. The presentation focused on the NIH’s “R01” system, the process by which federal money is awarded for specific, circumscribed research proposals. The system, venerable though it may be, is extraordinarily, mind-bogglingly inefficient. Scientists spend half or more of their time just applying for these and other lab-sustaining grants, only to fail roughly nine times out of ten. They then have to begin the cycle all over again or they’re out of a job.

One of these days, I’ll devote another essay to that sticky problem—and why it often fails to provide the best science, too—but for now, I’d like to focus on the people part. It seems that everywhere I turn these days people are talking or writing about the remarkableness of, well, people.

Take the very human notion of judgment. The ever-inspiring Dov Seidman, the CEO and chief philosopher of LRN, shared this important couplet of wisdom with the New York Times’ Tom Friedman earlier this month, and more recently with me: “Machines can be programmed to do the next thing right. But only humans can do the next right thing.” (He’s right.)

Or take the unique wisdom and perspective that comes from human experience—from having seen the world through one’s own eyes. My Fortune colleague Ellen McGirt wrote two beautiful features for the magazine this month on the topic—one that offers a thoroughly surprising look at PwC’s U.S. chairman, Tim Ryan, and the other that dives into Google’s efforts to examine its own blind spot on diversity.

Or take the issue of leadership. Yes, that too is a very human concept—and one we cogitate on and ruminate over and reflect upon endlessly at Fortune. Why? ’Cause it’s important. Really important.

I’ve been thinking a ton about leadership these days, and about what it means. Part of that is due to the fact that we’re beginning to assemble Fortune’s annual list of the 50 World’s Greatest Leaders. (Here’s how we put it together, along with our 2016, 2015, and 2014 editions, for those who are curious.)

But it’s also because physician-scribe David Agus, my good friend and co-chair of Fortune Brainstorm Health, suggested we examine true leadership in the area of healthcare—and celebrate it not only in our conference in May but in the pages of Fortune as well. So I’m reaching out to you, dear Daily readers, to invite you to offer your suggestions on who the best leaders in healthcare are today.

What makes a person a leader, importantly, isn’t the official role she or he has at a company or organization. (So please don’t send me a list of CEOs—or only of CEOs.) Real leadership, rather, is the act of moving and motivating others—even in the face of significant barriers, resistance, or the paralyzing force of inertia. True leaders bring other individuals into a common mission and then they work together to overcome a common challenge. Natural leaders run step-in- step with change, not frantically away from it.

So please take a moment to email me with your nominations, leads, and other suggestions. And I’ll give you a sneak peak in this newsletter at who makes our final list.

Until then, here’s Sy with the news.

Clifton Leaf
@CliftonLeaf
clifton.leaf@fortune.com

DIGITAL HEALTH

Could a CRISPR competitor be coming to town? A controversial enzyme called NgAgo, a which has previously been touted by some as an alternative to the gene-editing CRISPR-Cas9 enzyme, just picked up a big booster in Denmark-based Novozymes. The firm has struck a deal with China’s Hebei University of Science and Technology in Shijiazhuang to examine potential uses for NgAgo. But at this point, it’s still unclear whether or not Novozymes believes the enzyme can be used to edit the human genome more efficiently than the revolutionary CRISPR method or whether it might be tested in “gene silencing,” wherein a gene is stopped from expressing itself (rather than snipped off by molecular shears like Cas9). The controversy around NgAgo centers on the fact that some scientists have been unable to reproduce results suggesting its potential as a genome editor. (Nature)

McKesson, Change Healthcare IT deal cleared by regulators. Drug distributing giant McKesson and health tech outfit Change Healthcare have won regulators’ blessing to proceed with a merger of the latter firm with McKesson’s technology unit. Back when the deal was first announced, McKesson executives argued that it would create a powerful new entity for processing claims and easing a transition to a value-based health system. “This is a bold, innovative transaction that creates a company with an enhanced ability to help customers address their increasingly complex financial and clinical challenges,” McKesson CEO John H. Hammergren said at the time. The combined company is projected to have annual revenues of about $3.4 billion. (Modern Healthcare)

“FishTaco” technique could help unlock gut bacteria mysteries. Research into the microbiome, or the totality of tiny organisms that make up the human body, is a burgeoning field. And University of Washington researchers believe they’ve found a novel new way to figure out how specific types of microbiome bacteria relate to various diseases. The specific “FishTaco” method (a more convenient way of saying “Functional Shifts’ Taxonomic Contributors”) involves analyzing the bacteria species within the microbiome and mapping out their total genetic makeup. For instance, they examined how specific microbes in type 2 diabetes patients could cause certain biological imbalances associated with the disease. The hope is that these microorganisms can one day be targeted or harnessed in order to combat a variety of disorders. Pharma giants such as Merck and others have been pouring heavy money into microbiome research in recent years. (FierceBiotech)


INDICATIONS

Merck hands over $625 million plus royalties to settle Keytruda patent spat. It seems that biopharma companies are trying to quash (or at least mollify) intellectual property fights left and right these days. The newest agreement: Merck is forking over $625 million and future royalty rights for its superstar cancer immunotherapy Keytruda to rival Bristol-Myers Squibb and partner Ono. That puts an ongoing IP dispute between the drug and its competitor, Bristol-Myers’ Opdivo, to rest. And it’s some good news for BMS after a rough setback last week which caused the firm to lose about $11 billion in market cap in a single day of trading. As I explained on Friday, Keytruda is well on its way to becoming a dominant, go-to therapy in the lucrative lung cancer market at the expense of Opdivo, which has been fizzling out in that particular space. Merck’s cash payment – plus a royalty stream of 6.5% of Keytruda sales through 2023 and 2.5% of sales through 2026 – could help Bristol-Myers somewhat make up for its clinical shortcomings in lung cancer.  

A $0 EpiPen alternative is on the way. Kaléo high-tech alternative to Mylan’s EpiPen, Auvi-Q, is making its way back to the U.S. market next month after a voluntary hiatus. And the manufacturer says it will be making the product available for $0 to all insured patients (and many uninsured patients, too). “We met with patients and physicians and listened to the very real challenges in the current healthcare environment with obtaining access to affordable medicines,” said Kaléo President and CEO Spencer Williamson in a statement. “As a result, starting Feb. 14, for more than 200 million Americans with commercial insurance, including those with high-deductible plans, the out-of-pocket cost for Auvi-Q will be $0.” Furthermore, uninsured households with an income of less than $100,000 will also pay nothing out of pocket while other uninsured people will be able to buy Auvi-Q for $360, or $60 more than the recently-introduced generic version of the EpiPen. Williamson said that the patient assistance model is necessary for customers to be able to afford it. Of course, the money for the device, which is reported to cost thousands of dollars, has to ultimately come from somewhere – and that’s where insurance companies that cover the product may feel some heartburn. Earlier this month, CVS announced that it would be selling a generic EpiPen competitor for $110 (before discounts and rebates) at all of its pharmacies. (Tech Times)


THE BIG PICTURE

Trump’s first days consumed with health care action. As one of his first acts as president, Donald Trump signed an executive order Friday telling government agencies to “waive, defer, grant exemptions from, or delay the implementation” of Obamacare regulations that impose fiscal burdens on states and individuals. That’s a pretty wide-ranging statement; for now, it appears that the order is meant to encourage the Department of Health and Human Services (HHS) to ease enforcement of the health law’s mandate to buy health insurance and that employers provide coverage to full-time workers. But it’s difficult to assess what, if any, practical effects it will have for now since Trump’s HHS Secretary and other key leadership positions at the Department have yet to be filled. Trump adviser Kellyanne Conway also elaborated on the administration’s legislative health care plans during media interviews Sunday, including the expansion of health savings accounts (HSAs) and turning Medicaid into a block grant. Trump also signed an order re-instating the so-called “global gag rule” on Monday, slapping aid funding restrictions on organizations that discuss or provide abortion services in poor nations. (Fortune)

Scientists join Women’s March protests against new administration. Cities across America (and the world) held massive protests against the Trump administration Saturday in a movement dubbed the Women’s March. And scientists donning white lab coats as supporters of the group 500 Women Scientists took part in the action, too, reports Nature. “Having this man be elected, and the people he’s placed so far [in government], is unbelievable,” one geoscientist at Pennsylvania State University in University Park told the publication. “They’re not supporting evidence-based anything.” Trump and his Cabinet have drawn scrutiny from scientists over a variety of issues, including unfettered support for vaccinations to belied in the reality of man-made climate change. Vice President Mike Pence has also made a number of eyebrow-raising statements about science over the course of his career. (Nature)

Aetna-Humana merger halted by judge. As expected, a federal judge on Monday halted health insurance giant Aetna’s proposed acquisition of rival insurer Humana, saying that the merger would significantly lessen competition in certain individual health insurance markets and Medicare Advantage plans. “We’re reviewing the opinion now and giving serious consideration to an appeal after putting forward a compelling case,” said Aetna spokesman T.J. Crawford in a statement. (Reuters)


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