Rooting for Schumpeter's Gale

Not familiar with Schumpeter’s gale?  You may be more familiar with the term “creative destruction.”  Schumpeter’s “gale of creative destruction” is the inevitable “process of industrial mutation that continuously revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one.” 

Credit: Shutterstock

We need a Schumpeter’s gale in healthcare.

What made me think of this was the news that Tik Tok became the most popular internet site in the world, surpassing even Google.  It reminded me that things sometimes do change; perhaps there is some hope for healthcare after all.

If you missed the news about Tik Tok – perhaps you were too busy on it or too busy ignoring it – it came last week in Cloudflare’s Radar 2021 Year in Review. Tik Tok was a fairly distant 7^th a year ago, well behind leader Google and #2 Facebook, but shot up in 2021. Tik Tok has gone from being simply silly short videos to a force in social justice, the job market, celebrity status, and mental health.  It plays a role in Gen Z/Gen Y’s lives that Facebook desperately wishes it did.  Facebook’s demographic issues had been well known, but Tik Tok surpassing Google? 

That’s the kind of change I wish we saw tech bringing in healthcare.

The dominance of “Big Tech” – a.k.a., Alphabet/Google, Amazon, Apple, Facebook/Meta, and Microsoft – is oft discussed, and usually lamented, but we have to keep in mind that such dominance is typically transitory.  Twenty years ago Apple was an also-ran, Google was trying to be an also-used, and Facebook had yet to be invented.  Amazon had a market capitalization under $4b. Microsoft was still Bill Gates’ company, not the open source, cloud-based, subscription-oriented company Satya Nadella pivoted to within the last decade.

In twenty years, maybe within ten years, that list of Big Tech companies will look very different.  Maybe it will be Web3, maybe the metaverse, maybe quantum computing or AI, or even something few of us have even heard of yet, but new waves will come and will bring new tech giants.  That’s why Apple is investing in “face computers,” Facebook is transitioning into Meta, and Google has a “moonshot factory.”  Those efforts and others may help keep them relevant, but the barbarians, so to speak, are still coming.

Go back twenty years, on the other hand, and the big hospitals/hospital systems are pretty much the same.  Same for payors, pharma, medical device companies.  There have been mergers and consolidations, but the dominant companies then are mostly the dominant companies now – only moreso.  That’s not how it is supposed to work.  That’s not how it works in tech.

In last week’s “On Tech Newsletter” in The New York Times, Shira Ovide flatly says “technology won.”  She explains:

Tech is more like a coat of new paint on everything than a definable set of products or industries. Health care is tech. Entertainment is tech. Schools are tech. Money is tech. Transportation is tech. We live through tech.

Technology is also in a liminal phase where the promise of what might be coming next coexists with the complicated reality of what is happening now.

Credit: HealthTech Zone

You can certainly make an argument that “health care is tech,” and that much of that transition has happened in the last twenty years.  We have widespread electronic health records, minimally invasive surgeries, new types of cancer treatments, all sorts of 3D printed objects, CRISPR, greatly improved protheses, VR treatments and training, and, of course, more types of digital health efforts than even today’s venture capitalists can throw money at. 

It’s all very impressive, but you’d get a lot of argument that our nation’s health is better as a result, that our experiences in the healthcare system are better as a result, or that our healthcare is any cheaper as a result.  None seems true. Tech, in healthcare, is a bolt-on; it adds costs, it removes more of the human touch, and it does not fundamentally reshape the healthcare system.

Unlike the actual tech industry, tech in healthcare serves to further cement the position of the incumbents, not displace them. It doesn’t make the healthcare experience new, it just makes it seem “newish.”  TikTok is not going to dethrone Epic or The Mayo Clinic. People in healthcare aren’t too scared of the “what’s next” in tech.

Much has been made of the record setting 2021 for digital health investments -- $28b, which was double 2020 – but when I look at them I still don’t see an Uber or an Amazon, a company than is trying to break an existing industry.  I see a lot of innovators who think they can remedy some pain points, but within the existing system, and I see investors who mostly want their slice of the $4 trillion healthcare sector. 

Credit: Getty Images

I want to see tech innovators who look at our healthcare system and think, hmm, there’s too many people and places doing too many things for too much money – and, often, too late, after there is a problem. Who want to bring the cost structure down not 5-10% but to 5-10% of our current levels. Who want health to be an ongoing process managed in our daily lives.  Who want health tech – and the resulting healthcare -- to be ubiquitous, invisible, and largely autonomous. Who don’t think we need to rely on millions of highly trained healthcare professionals (and whose training, in fact, becomes one of the cost problems in the healthcare system).

Tik Tok would understand that.

With all due respect, I’m not sure that David Feinberg, for example, would. People who have spent their professional lives in the healthcare system can often see how to improve it, but not to fundamentally reshape it and almost never how to bring creative destruction to it.

I’m not expecting Tik Tok to revolutionize our healthcare system – but ByteDance or WeChat, maybe. An AI company?  Of course. A synthetic biology or nanorobotics company?  For sure.  By contrast, what CVS, Walmart, even Amazon are trying to do in healthcare are interesting, but, honestly, they’re like helping us hear the orchestra on the Titanic better: OK, but that’s not really the problem. 

If we recognize the healthcare system in 2050, if some Schumpeter’s gale hasn’t blown the current version away and replaced it with something truly new, we will have failed.   

Not Just Token Tokens

I recently watched some of the recent Congressional hearings on cryptocurrency, and, boy, if there’s anything funnier than watching experts try to educate most members of Congress on anything crypto-related, it’s probably me trying to explain it.  I don’t own any digital assets, still don’t see the point of NFTs, and am not going to buy any real estate in the metaverse.  

Credit: Colin Evran/Protocol Labs

All that being said, there’s something about Web3 that fascinates me).  Knowledgeable people are talking about Web3 “reinventing the internet,” “democratizing” it, giving people more ownership of/control over what they do on it.  It’s a counterbalance to the how the internet – both the traffic and the infrastructure -- has increasingly grown dominated by a few very large firms, such as Google, Facebook, or Amazon.

As the Web3 Foundation declares, Web3 is an internet where:

• Users own their own data, not corporations
• Global digital transactions are secure
• Online exchanges of information and value are
•  decentralized

All that sounds very intriguing to me, especially as someone who has dim views of how healthcare likes to silo information, has placed too little value on patient ownership of their own data, and is rushing to centralize.

--------

Credit: Euromoney Learning 2020

If I’ve got this right, the heart of Web3 is the concept of distributed ledgers – a.k.a., blockchain. Information is not stored in one place, controlled by one entity, but across these distributed ledgers.  Activity – transactions, changes to the source information, etc. – updates the blockchain, preserving the history and verifying the activity across the distributed ledgers. Someone wanting to change or use your information without your permission faces a large challenge because of its distributed nature.

On the distributed ledgers, you can do transactions (e.g., buy/sell), use “smart contracts,” participate in social networks, and many other interesting activities. If trying to do anything quickly across a distributed network sounds daunting, Bloomberg reported:

Operating through a distributed network can be clunky, but the user experience is getting better. “It’s still early, but it’s been transformed in the last six months,” says Jonathan Dotan, founding director of the Starling Lab.

To assist, there’s a related concept of a “distributed app,” which is, I suppose, to Web3 as apps have been to Web 2.0.  There’s even a “dapp store” called DappRadar that claims to allow you to “discover, track & trade everything DeFi, NFI and Gaming.”

We are already seeing DAOs – decentralized autonomous organizations – to help create /run Web3. “I think DAOs will be as ubiquitous as companies, clubs, nonprofits, and different kinds of ‘official’ organizations today,” says Maria Shen, a partner at venture capital firm Electric Capital told Bloomberg.

There is an explosion of funding in blockchain-based startups; CB Insights reports $15b in 2021, up 384% from 2020.  In The Wall Street Journal, Christopher Mims notes:

Almost every company with “Web3” or “blockchain” in its pitch deck describes its mission as a user-centered quest to empower—and just as often, enrich—its users, making them owners and investors as much as customers.

 That. Is. Intriguing.

---------

We can’t get away from Web3 without discussing tokens, which many associate with digital currency like bitcoin. That’s not entirely incorrect, but not quite right either.  Digital currencies are associated with specific platforms – e.g., bitcoin and Ethereum run on different platforms – but tokens are digital assets that transcend platform.

Cryptopedia says: “Tokens — which can also be referred to as crypto tokens — are units of value that blockchain-based organizations or projects develop on top of existing blockchain networks.”  It goes on to clarify:

• “Typically, crypto tokens are programmable, permissionless, trustless, and transparent.
• While crypto tokens, like cryptocurrency, can hold value and be exchanged, they can also be designed to represent physical assets or more traditional digital assets, or a certain utility or service.”

Tokens can be used, for example, like “voting shares” that help govern dapps or other structures.

This leads to something that Mr. Mims also discussed as one of the “inspired weirdness that is Web3”:

If money can become code, then money can be way more than a means of exchange; it can also do anything that other software can do.

This core insight, a sort of E = mc equivalence between money and software, is why true believers in Web3 think it could have a huge impact. Suddenly every activity humans engage in, from buying and selling a house to liking a post on social media, can be made part of a token-based financial system of a scale and complexity that makes today’s look like an antique.

I love the “E = mc² equivalence between money and software;” no wonder people are excited about Web3.

--------

Not everyone is a fan. For one thing, generating some blockchain takes tremendous computing power, which has a host of environmental impacts. For another, it can be a way for evading regulation, which could be a concern for fields like finance or healthcare.

Even more troubling, as Cornell professor James Grimmelmann told NPR:

"Web3 is vaporware… It doesn't make any sense.  The vision says the problem with the internet is too many centralized intermediaries. Instead of having lots of different applications and sites, we'll put it all on blockchains, which puts it all in one place.

Web3 has to be bigger than blockchain.

---------

I don’t know what a Web3 for healthcare would be, but I have some ideas. Of course, the idea that we own and control our health records, storing them on blockchain and giving permission for them to be viewed/added to, should be tempting to anyone who has had to fight or access to their own records. That’d be a necessary but not sufficient component of a healthcare Web3.

Credit: Aïda Amer/Axios

Imagine, if you will, a future where anytime you interact with the healthcare system, that interaction is not only stored in a blockchain record that you control, but also earn tokens for that interaction.  Imagine all the data from your fitness or other trackers also going into that blockchain record, and earning more tokens. Image all those tokens giving you voting rights in the governance of that healthcare system. 

We’re not at Web3, and we’re not going to be there Credit: anytime soon.  Moreover, experts predict, it’s less about Web3 supplanting Web 2.0 as becoming incorporated into it. Still, as Esther Crawford, a project manager who is helping Twitter orient towards Web3, told NPR: “For a long time, Web3 has been very theoretical. But now there is a surge of momentum to build."  Ignore it at your own risk

I can’t wait to see who is going to build what Web3 for healthcare.

The Eisenhower Principle

I’ve finally come to understand why the U.S. healthcare system continues to be such a mess, and I have President Dwight Eisenhower to thank.

I’ve been paying close attention to our healthcare system for, I hate to admit, over forty years now. It has been a source of constant frustration and amazement that – year after year, crisis after crisis – our healthcare system doesn’t get “fixed.” Yes, we make some improvements, like ACA, but mostly it continues to muddle along.

Then I learned about President Eisenhower’s approach to problems:

That’s it!  All these smart people, all these years; they didn’t know how to solve the problem that is our healthcare system, so they all took the Eisenhower approach: enlarge the problem.  Let our healthcare system get so bad that not addressing it no longer is possible.

If, indeed, there is such a point.

The actual Eisenhower quote is more nuanced than the above version. It was:

Whenever I run into a problem I can't solve, I always make it bigger. I can never solve it by trying to make it smaller, but if I make it big enough, I can begin to see the outlines of a solution.

I guess we’re not yet at the point when the outlines of a solution are clear (Bernie Sanders notwithstanding).

Instead, we’ve been chipping away at the problem, trying to make it smaller. For example:

• Employer-sponsored health insurance tax preference (WWII)
• Hill-Burton Act (1946)
• Medicare/Medicaid (1965)
• Federal HMO Act (1973)
• Stark Physician Self-Referral Law (1989)
• DGRs (1983) & RBRVS (1992)
• CHIP (1997)
• Medicare Modernization Act (2003)
• Affordable Care Act (2010)

ACA signing. Credit: Doug Mills/NYT

I could add a plethora of non-legislative efforts, largely private sector driven, such as second surgical opinion (1970’s), PPOs (1980’s), centers of excellence (1980’s), disease management (1990’s), value-based purchasing (2000’s), or digital health (2010’s).  Each was well-intentioned, each was expected to make a dent in a problem, and each was subsumed into the maw of our healthcare system. 

But we still pay way more than any developed country for our healthcare system, for health outcomes that put us, at best middle of the pack. Tens of millions of us still lack health insurance, in part because some states refused to expand Medicaid and in part because people still can’t afford/don’t see the value of health insurance, despite subsidies. Health inequities abound, particularly for people of color.

Yes, some of the best care in the world can be found here, but most people shouldn’t expect to receive it – it takes luck, money, and/or the right location. Our malpractice system penalizes physicians without protecting most victims of malpractice.  “Public health” has at best been ignored (like most other of our infrastructure) and at worse seen as some sort of Communist plot.

One might have thought that a global pandemic would make the problem big enough. We’ve got over 800,000 people dead already, we’ve overwhelmed many of our hospitals, we’ve burned out large numbers of our healthcare workers, we’ve exposed the fragility of our healthcare (and other) supply chains. Yes, we’ve thrown trillions of dollars at the pandemic, yes, our scientists have developed very effective vaccines in record time, but too many people refuse mitigation measures that might finally bring it to an end.

Yet still the outlines of a solution continue to elude us. It seems there is no health problem so big that we can’t turn into a political issue, not even a pandemic.

Even before the pandemic, we were facing epidemics of chronic diseases, such as diabetes and obesity, as well as gun violence, opioid addiction, and mental health. We know we should address these, we know we could, but mostly we just shake our heads and offer “hopes and prayers.”

How many Americans will have to go bankrupt from the cost of healthcare they received? How many Americans will have to suffer or die from the care they didn’t receive – or from the care they did receive? How embarrassed are we willing to be about our health disparities? How reluctant do people in other countries have to get about living/visiting here due to the risk of getting caught up in our healthcare system?

In Gen Z’s lifetimes, much less those of millennials or Baby Boomers, the problems in our healthcare system have grown from huge to unfathomable.  When it comes to healthcare, we’ve let the problem get big enough. It’s been enlarged to the point it is hurting us, our economy, and our futures.

Yet here we are, still fumbling for solutions.

It’s possible that the pandemic will cause our healthcare system to collapse and force us to take action on fundamental reforms. More likely, due to the valiant efforts of our healthcare professionals, it will survive this too, and the pandemic will just be one more insult added to our injury.

It’s possible that when health spending reaches 20% of GDP – as it is projected to do by the end of the decade – we’ll decide we’d had enough, but I remember when we thought 10% was the limit.

It’s possible that we’ll suddenly recognize that, hey, our declining mortality – which is not all due to COVID -- is a real problem, but that’s probably too slow and subtle an indicator for us to act.

By now, we shouldn’t just have shadows of solutions. By now, the problem is so big that solutions should be crystal clear to everyone. But they’re not.

We shouldn’t be surprised. We’re very good at kicking the can down the road. We should be very concerned about the national debt, but we add to it blithely. We should be terrified of the impact that climate change is already having and how much worse it will soon be, but addressing it would require us to make too many changes.

Our infrastructure is aging, brittle, and outdated, but even the recent Infrastructure and Investment Jobs Act is much smaller than it really needed to be. The racial wealth gap is a consequence of shameful historical patterns, yet continues to widen; it is not survivable for a democracy.

We’ve learned only half of Eisenhower’s adage: we’ve got the letting the problem get bigger part down, but we’ve forgotten the part about how/when to come up with solutions.

Where’s Eisenhower when we need him?

DNA Storage in the Yottabyte Era

Did you know we are living in the Zettabyte Era? Honestly, did you even know what a zettabyte is? Kilobytes, gigabytes, maybe even terabytes, sure, but zettabytes? Well, if you ran data centers you’d know, and you’d care, because demand for data storage is skyrocketing (all those TikTok videos and Netflix shows add up). Believe it or not, pretty much all of that data is still stored on magnetic tapes, which have served us well for the past sixty some years but at some point there won’t be enough tapes or enough places to store them to keep up with the data storage needs.

Credit: iuriimotov/Freepik

That’s why people are so keen on DNA storage – including me. 

A zettabyte, for the record, is one sextillion bytes. A kilobyte is 1000 bytes; a zettabyte is 1000⁷. Between gigabytes and zettabytes, by powers of 1000, come terabytes, petabytes, and exabytes; after zettabyte comes yottabytes. Back in 2016 Cisco announced we were in the Zettabyte Era, with global internet traffic reaching 1.2 zettabytes. We’ll be in the Yottabyte Era before the decade is out.

People have been working on DNA storage for many years; I first wrote about it in 2016, when I speculated it might mean we could literally be our own medical record. We’re not at the stage of practical DNA storage yet, and we probably won’t be for many more years, but it’s hard to believe we’re not going to be there eventually. Unlike every other form of recording we’ve come up with, DNA can persist almost indefinitely, and, as long as there are intelligent species based on DNA, they’ll want to read it.

Most importantly, DNA can store a lot of data. As MIT professor Mark Bathe, PhD told NPR: “All the data in the world could fit in your coffee cup that you're drinking in the morning if it were stored in DNA.”

Mind. Blown.

DNA storage process. Credit: Microsoft/UW

What prompted me to write about this now was an announcement from Microsoft. Working with researchers from the Molecular Information Laboratory at the University of Washington, their paper demonstrated a “proof of concept” molecular controller that allowed them to write to DNA “three orders of magnitude” – that’s 1000x – denser. As the announcement said: “Ultimately, we were able to use the system to encode a message onto four strands of synthetic DNA, proof that nanoscale DNA writing is possible at dimensions necessary for practical DNA data storage.”

I’ll spare readers the detail of what they did – I don’t pretend to understand it – but the paper concludes:

we project that the technology will scale further to billions of features per square centimeter, enabling synthesis throughput to reach megabytes-per-second levels in a single write module, competitive with the write throughput of other storage devices…We foresee these assemblers being used in other areas like material science, synthetic biology, diagnostics, and closed-loop massive molecular biology experimental assays.

Similarly, the announcement concludes: “we foresee the technology reaching arrays containing billions of electrodes capable of storing megabytes per second of data in DNA. This will bring DNA data storage performance and cost significantly closer to tape.”

You can bet Microsoft is taking this seriously.

--------

Lest anyone think only Microsoft is working on this, there have been several other promising developments in recent weeks. Interesting Engineering highlighted a few of them:

• Georgia Tech Research Institute researchers have developed a microchip that allows faster writing to DNA, and expect it to 100x faster than current technologies. Lead researcher Nicolas Guise told BBC that, since DNA can survive so long, “the cost of ownership drops to almost zero.”
• Northwestern University scientists have demonstrated a new “enzymatic system” that encodes three bits of data per hour. The NU announcement explains: “Our method is much cheaper to write information because the enzyme that synthesizes the DNA can be directly manipulated.” The researchers believe the technique could be used to install “molecular recorders” inside cells to act as biosensors; the possibilities are astounding.
• A team at China’s Southeast University used a new process to split content in sequences, rather than one long chain, while “downsizing” the instruments used. TechRadar speculates could lead to the first mass market DNA storage device. Professor Liu Hong told Global Times: “Now we are aiming at the combination of electronic information technology and biology, which might be used in various aspects including data storage and nucleic test for virus.”

Gene Roddenberry

Interesting Engineering may have missed the most interesting use yet: Business Insider India reports that Roddenberry Entertainment has created a NFT (non-fungible token) of Gene Roddenberry’s signature on the first Star Trek contract and is storing it on DNA implanted in a bacteria – “ the first-ever living ecological non-fungible token (NFT).”  The bacteria is currently dormant, but if revived it will duplicate the NFT as it reproduces (which sort of goes against what I thought NFTs were).

Somehow I don’t think that’s what the Microsoft researchers were intending DNA storage to accomplish, but, hey, anything for Star Trek.

As Professor Bathe told NPR, if cost/efficacy issues are solved – and they are well on their way – “Then, you know, the sky's the limit in terms of just storing everything that we ever wanted to and ever will need to.”

---------

It’s possible that DNA storage will never get fast enough or cheap enough to replace existing storage methods. It’s possible that some other new technique will emerge that will be even better than DNA storage (e.g., holographic storage?).  But we are DNA-based creatures and the possibility of using the technique that nature builds us with to store and manipulate the data we generate is irresistible.

There already are DNA-based “robots” and DNA-based computers so, honestly, DNA storage doesn’t surprise me at all. We should be expecting molecular DNA recorders…and trying to anticipate what we do and don’t want them used for.

In the 21^st century, biology is computing, and vice-versa. DNA isn’t just our genetic history and future, but information that we can read and write in. We call it “synthetic biology” now but as the field grows and grows we’re going to forget the “synthetic” part, like “digital health” just becomes “health” (or “cryptocurrency” just becomes “currency”).

Life in the Yottabyte Era is going to be very interesting.