Though Google is funding a biotech startup to look for drugs to slow aging; they are not willing to be in the health regimen.
The news surfaced in July this year when venture capitalist Vinod Khosla interviewed Larry Page and Sergey Brin, the cofounder of Google about their prospects in health care.
In reply to the queries made by Khosla, Sergey Brin replied, “Health is so heavily regulated that it became a real painful business to be involved” He further added that they did not want to spend their time in health care business. Even though there are some ongoing health projects, these will be done to a certain extent and the regulatory burden in the U.S. is so high that it would dissuade a lot of entrepreneurs to enter the health care industry.
Google is developing glucose-measuring contact lens with Novartis and is also funding, within its periphery, a biotech startup headed by Art Levinson, the former Genentech CEO, to develop drugs that will be able to slow down the aging process.
Sergey Brin’s reticence is easy to understand from the recent happenings in the Health care business. Gilead which developed an effective pill that is able to cure 95% of hepatitis C patients in 8 weeks, found out that AbbVie, had cut a deal with pharmaceutical benefit manager Express Scripts, to sell its own hepatitis C regimen, the Viekera Pak, far cheaper, locking the former out of Express Scripts’ formulary.
This created turmoil as the deal struck between Express Scripts and AbbVie dealt biotech stock bull market out of the blue with an unexpected permanent blow.
As the matter stands now, the reins of controlling prices of the drugs now lies in the hands of the extremely cost conscious insurance carriers and the pharmacy benefit managers making it really hard to stand out in the competition and guarantee the profits investors desire.
Sources close to health care industry revealed that it would be hard to replicate such moves for cancer but at the same time there is a definite need to keep drug prices from being sky high.
It is really surprising that a company that doesn’t think twice about taking up challenging scientific projects like driverless cars, is keeping a safe distance from health care business. It seems that the developments pretty much influenced Brin and Page’s view of healthcare as not to go for serious investment.
When asked about their ‘Calico’ project they briefed, “The Calico with Art Levinson focusing on health and longevity is totally independent project. I’m really excited about that. The possibility of data collection for ultimate improvement of health is exciting. But due to the heavy regulation imposed, it has turned up to be a difficult area. It is sad that we are regulating ourselves form great possibilities that certainly lie on the data-mining end”.
During the wide ranging conversation the co founders Brin and Page clearly emphasized their personal distance from Google eye catching ventures of health-related investments and opined that medicine needs to come out of the primitive ages to attract more investments.