THE BLOG

Disruptors Break Through the Clutter

04/10/2015 12:01 pm ET | Updated Jun 10, 2015

I want to focus the lens on leaders who I admire. The common characteristic among my ever growing list of notable leaders is that they are creating something others have not seen to do, and often do this against stiff odds.

When Dr. Molly Coye graduated from the Johns Hopkins School of Medicine in 1977 with a M.D her specialty was in family medicine, she did not realize that her career would evolve into a leadership role within public health. In 1986 Dr. Coye was appointed the Commissioner of Health for the State of New Jersey, and in 1991 she became the Commissioner of Heath for California overseeing a $16 billion budget.

Dr. Coye experienced the implementation of public health on daily basis. Over time she observed that the health services sector needed new interventions to address the complexity of public health delivery. In 2001, she founded the non-profit Health Technology Center, dedicated to the use of beneficial technologies to improve healthcare. She saw an unseen need and was determined to find solutions to fulfill it.

Today Dr. Coye is the Chief Innovation Officer at UCLA Health System Institute for Innovation in Health. She has a vision of applying Moore's Law to healthcare; creating ever advancing technology that enables cheaper and easier to use services on a mass scale. Tackling better and more efficient healthcare services in a complex ecosystem is not for the faint of heart. She attributes her relentless attack to possessing the "pioneer gene", which she describes as thinking very deeply about real problems and configuring solutions that make things better.

Dr. Coye shared with me her thoughts on the impact of technology, not from a theoretical point of view, but from the practical application of it. She has created remote home care training for chronically ill patients who live in housing projects and typically have limited access to public transportation. After training, residents are able to transmit basic health tests back to health clinics, without having to leave home. This innovation is leading to fewer emergency services and reducing healthcare costs by 20 to 60 percent.

Dr. Coye also looks forward to collecting the data, as the more data you have to analyze, the clearer the identification of a developing condition becomes. Big Data, too, is innovating healthcare, but to be useful it has to be analyzed for specific application. Predictive analytics are helping to fill this application need.

Dr. Coye is not only pushing the envelope at UCLA, but now has a consortium of over 100 institutions working in tandem to bring rapid change to the use of technology for delivering better healthcare to the masses. Now that's leadership.

There is an expansive spectrum for healthcare delivery services, and this is also occurring in the lab. A topic that continues to hold my attention is development and delivery of orphan drugs. These are drugs that are abandoned by pharmaceutical companies for one primary reason; the population who needs the drug is too small to justify the long and costly road to market. So it would seem that someone who would undertake the challenge of perfecting an orphan drug would have a strong reason to do so, and this was the case when Dr. Martines Rothblatt focused on the drug Flolan, which pharmaceutical company Glaxo had sitting on the shelf. At the time, Flolan could treat a life-threatening pulmonary hypertension condition that her daughter, Jenesis was diagnosed with, but not available in a pill form.

Dr. Rothblatt had already established herself as a lawyer and entrepreneur. She had created Sirius Satellite Radio Network. Dr. Rothblatt remarks that transferring her interests to biotech was just another frontier and she was undaunted. She later obtained her PHD in medical ethics from Barts and The London School of Medicine and Dentistry.

After identifying the Glaxo pharmacologist, James Crow, who worked on Flolan, she relentlessly pursued him until she convinced him to develop the drug with her. Glaxo had seen no market for further development of the drug and they sold the patent to Dr. Rothblatt in 1996 for $25,000 and 10% of future revenue streams. Many years of clinical tests followed, which Dr. Rothblatt primarily self-financed by setting up a research foundation. In 1999, she took the research foundation, known as United Therapeutics public to raise more capital. By then, Flolan was in the third clinical trial stage.

At the time, Flolan had to be administered to patients intravenously with a constant flow of the drug delivered to the heart. Dr. Rothblatt wanted to get Flolan into pill form, so that it would be less invasive and easily digested. The battle for approval took 18 years and a tremendous amount of capital. Undaunted though, she forged on through two failed attempts and got the Flolan pill to market in 2013. And what about those payments to Glaxo? United Therapies paid $100 million to Glaxo in 2014, the last year of the contract obligation. Going forward, all the profit will be to the benefit of research at United Therapies.

Reviving orphan drugs isn't the only thing that amazes me about Dr. Rothblatt. She is also working on xenotransplantation, the transplant of organs from one species to another, in this case pigs lungs for human replacement. As she explained to me, transplants are really the only way to relieve people suffering from pulmonary hypertension and other lung diseases. Transplants eliminate the problem but less than 10 percent of the people needing lung transplants receive them.

For twenty years, scientists had been trying to develop the right conditions to bring pigs lungs to market, but were unable to achieve a life cycle beyond two hours. In just three years, Dr. Rothblatt's work has extended the life cycle up to eight hours, a tremendous accomplishment. When I asked Dr. Rothblatt if she had a timetable for bringing transplantable pigs lungs to market, she replied that she has a timetable and cost structure for everything she undertakes, so of course she has a dateline for this one. She expects to have market-ready lungs for human transplant in 2019. Let's hope for the sake of those who will need lungs that she is right.

Another facet of health delivery is happening in local school cafeterias. Kristen Tobey and Kristin Richmond are the founders of Revolution Foods, and they are overhauling the preparation and delivery of school lunches. Kristen and Kristin met while pursuing their MBAs at Haas School of Business at University of California Berkeley.They connected over a shared interest of food and nutrition and the observation that school lunches lacked nutrition value.

While pursuing their MBAs, Kristin and Kristen developed a business plan that identified and addressed the lack of access to healthy foods within low socioeconomic school systems. After the business plan was completed they rented a corner of a catering kitchen and got cooking. Food cost are what make or break a business, so very early on they partnered with Whole Foods and received wholesale prices equal to those obtained by Whole Foods stores. This was a critical factor in controlling cost and Revolution Foods was on its way.

Two years before the launch of their first school lunch program in 2006, Revolution Foods had raised angel capital. The most recent round of funding in 2014 topped off at $30 million and was led by Steve Case's Revolution Capital. Not only are angel investors, VC's, and foundations excited about Revolution Foods, the students they serve also play an important role; they are in charge of helping design the menu and most importantly the flavor profile for recipes. Through this hands on process, the Revolution Foods team has adapted menus according to regional flavor preferences. For example, in San Francisco, Firecracker Chicken Recipe is on the menu. Both the flavor and name were influenced by local kids.

A challenge faced by Revolution Food is to be accessible to all. They are facing this challenge head on and everything is seen through the lens of their mission. Menus for schools meet the fee structure for local and federal reimbursement fees. In the retail sector newly created meal kits at Safeway and Walmart, price on par with mainstream brands.

Currently, Revolution Foods provides services for nine culinary centers that distribute to eleven states, twenty-seven metro markets, and with each contract they aim to be a right hand partner. Aware of keeping a variety of foods within schools, they do their best to regularly distribute different snacks, breakfasts, lunches, and suppers.

Many schools are making the meals themselves and Revolution Foods is providing customized product lines. In some charter schools they provide all three meals and snacks for students, while in other public schools they may provide only some entrees. They do not provide cafeteria services, only products, this controls their operating cost.

Talking with Kristen and Kristin, the old saying "you are what you eat" rings true, as a result from the shift to nutritious foods, principles are seeing improvements in kids' performance. In addition, the change within school food programs is establishing a new dialogue with parents. Not only are students' performances improving and there is an increase of parent involvement, but Revolution Foods is boosting economic growth. Currently, there are 1,500 employees, compared to their first year, which was a team of six. Both Kristin and Kristen are proud of their company growth and in 2015, their revenue will exceed the $100 million mark. Revolution Foods has identified the blind spot in our school lunches and there is no turning back.

Kristin and Kristen are relentless learners and their leadership is energizing students, parents, VC's and building healthier communities. Now, I will have to look up that Firecracker Chicken recipe.