Google leaders think health is 'a painful business to be in'
July 7, 2014
Google has been taking bold steps into the health realm lately, from forming a biotechnology company to extend life to developing a contact lens for diabetics. Just weeks ago, it unveiled an Android app that would aggregate fitness and health data in one place.
But even Google executives think the health field is too heavily regulated to become a pillar of the Mountain View company's core business. In a recent interview with billionaire venture capitalist Vinod Khosla, co-founders Sergey Brin and Larry Page bemoaned such regulations.
"Imagine you had the ability to search people's medical records in the U.S.," Page told Khosla in the interview, which was posted online late last week. "Any medical researcher can do it. Maybe they have the names removed. Maybe when the medical researcher searches your data, you get to see which researcher searched it and why. I imagine that would save 10,000 lives in the first year. Just that. That's almost impossible to do because of HIPAA. I do worry that we regulate ourselves out of some really great possibilities that are certainly on the data-mining end."
HIPAA is the Health Insurance Portability and Accountability Act, which sets protections on patients' identity and privacy.
The health discussion was part of a 42-minute conversation that also touched on Google's self-driving cars and plans to develop artificial intelligence technology.
The executives did say they find health to be an exciting and novel field, especially in an age when extensive data sets can theoretically be combined and used to extract insights about medicine and patients' individual health risks.
"We have Calico, obviously, we did that with Art Levinson, which is pretty independent effort," Page said, referring to the CEO of Google's new biotechnology company, who is also chairman of Genentech in South San Francisco. "Focuses on health and longevity. I'm really excited about that. I am really excited about the possibility of data also, to improve health."
Still, the pair demurred when Khosla asked, "Can you imagine Google becoming a health company? Maybe a larger business than the search business or the media business?"
Brin expressed enthusiasm for the contact lenses that Google is designing to track a diabetic's blood sugar levels.
But he added, "Generally, health is just so heavily regulated. It's just a painful business to be in. It's just not necessarily how I want to spend my time. Even though we do have some health projects, and we'll be doing that to a certain extent. But I think the regulatory burden in the U.S. is so high that it would dissuade a lot of entrepreneurs."
If Google, with its billions of dollars, finds the digital health industry restrictive, then the environment must be even tougher for startups, Brin seemed to suggest.
Digital health is hot right now: It drew $2.3 billion in venture financing in the first half of 2014, surpassing the total raised in all of 2013, according to a report by San Francisco accelerator Rock Health.
The field is attracting dozens of entrepreneurs with little to no experience in health care, many of whom say the regulations are much tougher than those in, say, social networking or ride sharing. Brin and Page's words raise questions about how long those entrepreneurs' enthusiasm will last.
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