Google Health's dismantling and Big Tech's health care challenges

Happy Thursday, readers.

Don’t think of it as a death. Think of it as yet another transition in Big Tech’s seemingly never-ending quest to reshape American health care.

I’m referring to the sudden departure of Google Health chief David Feinberg and the accompanying dissolution of the unified Google Health division reported by Business Insider last week. As my colleague Jeremy Kahn notes, electronic medical records giant Cerner put out a statement last Friday announcing Feinberg as its next CEO. But Google executives say that the unit’s work in health care AI, tech-fueled diagnostics, fitness tracking, and a smorgasbord of medical projects will continue.

What exactly will that look like on a corporate level, and can the firm finally make a tangible difference in American health care when so many other tech giants have failed? That’s a more complicated question with plenty of uncertainty baked into the cake.

Google executives did offer some details on what comes next. Jeff Dean, who heads up the artificial intelligence division Google AI, said that staffers will work on individual projects across separate divisions within the company. “As we’ve broadened our work in health across Google (Search, Cloud, YouTube, Fitbit, …), we have decided to move some @GoogleHeath teams closer to product areas to help with execution while nurturing some earlier stage products and research efforts,” Dean wrote in a Monday tweet.

In essence that amounts to undoing what Google Health was originally designed to accomplish: Take a bunch of ambitious, ragtag health care ideas and bring them together under a single umbrella. “Feinberg, who held the rank of a vice president at Google, was hired with great fanfare in 2018 to head the tech company’s newly formed Google Health arm. The division was supposed to consolidate multiple efforts to break into the health care market and to provide health care–related technology—initiatives already underway in different areas of the company,” Jeremy writes. Now it’s back to a more federated strategy.

Tech giants like Google, Apple, Microsoft, and Amazon have all staked out missions to transform medicine. But as impressive as these companies’ sleek apps, algorithms, and services are, breaking into such a fractured and labyrinthian business ecosystem with longstanding players and mountains of regulations is easier said than done. Syncing Fitbit app data with a consumer’s health profile or creating machine learning tools that can help radiologists is one thing; Making a true dent in health care costs and the inner workings of industry players is much more laborious.

But that won’t be stopping Google any time soon, even if its ambitions are structured differently. The health care dream lives on for Big Tech.

Read on for the day’s news, and see you again next Thursday.

Sy Mukherjee
sy.mukherjee@fortune.com
@the_sy_guy

DIGITAL HEALTH

Headspace, Ginger merge to expand digital mental health therapy. Meditation app Headspace and virtual mental health therapy platform Ginger plan to merge in a partnership that would birth a company valued at $3 billion and provide services in an increasingly popular space. The coronavirus pandemic has been an opportunity for digital health firms to show the appeal of their services in a largely remote world. The combined entity would be called Headspace Health. “We are witnessing a mental health crisis unlike anything we’ve experienced in our lifetimes, yet the majority of mental healthcare today is neither broadly accessible nor affordable,” said Headspace CeCe Morken in a statement. “Together, as Headspace Health, we will address the systemic challenges of access and affordability in a fundamentally different way by creating the world’s most holistic, scalable, and effective mental health and wellbeing company.” (TechCrunch)

INDICATIONS

A battle of biopharma titans. BioPharma Dive reports that the legal dispute between California biotech Gilead and pharma mainstay Bristol Myers Squibb over patents to a key cancer treatment technology is getting more heated. A federal appeals court on Thursday reversed a jury trial decision that would have forced Gilead to pay Bristol Myers $1.2 billion for alleged patent infringement for a type of cancer therapy called CAR-T, a highly personalized therapy which re-engineers a patient's own immune cells to become targeted cancer killers. Gilead, of course, welcomed the decision while Bristol Myers Squibb disagrees with the decision and is weighing its options. (BioPharma Dive)

THE BIG PICTURE

Cigna to significantly expand Obamacare footprint. Health insurance giant Cigna is boosting its presence in the Affordable Care Act's, aka Obamacare's, health insurance marketplaces. The company will begin offering health plans through the insurance exchanges in three more states and across 93 counties and reflects a growing trend over the past several years by firms skeptical of the marketplaces combing back to the fold and even growing the flock, including UnitedHealth and Aetna. (Bloomberg)