A regional health system in Minnesota is trying to spur healthcare innovation, particularly in health IT, by becoming a partner with a new healthcare accelerator based in Chicago.
Earlier this week, Ridgeview Medical Center, a health network comprising an acute care hospital and seven clinics in the far western suburbs of Minneapolis, announced that it is partnering with Healthbox, which will launch a three-month acceleration program for healthcare tech entrepreneurs in January. Healthbox was created by venture capital and business incubation firm Sandbox Industries, which co-manages the $116 million BlueCross BlueShield Venture Partners fund.
Participating in such an entrepreneurial program reflects a shift in thinking at Ridgeview.
“Our philosophy has changed over the past couple of years in that we want to be involved in healthcare innovation and in the development of disruptive technologies,” said Robert Stevens, president and CEO of Ridgeview Medical Center. “We want to create change within the industry as opposed to complain about what’s happening to healthcare by changes coming from the outside.”
Ridgeview is not new to the conversation about healthcare innovation. In June 2007, the health network founded a for-profit entity called CreateHealth that ultimately spun out WellClicks that has created a community portal that can be embedded within a health system’s website.
Ridgeview’s role in the Healthbox program is mainly mentorship in that it can help entrepreneurs who are selected to the program to better understand what the market is for their product, Stevens said. The main focus of the accelerator program will be on health IT and technology-enabled delivery of healthcare.
“Maybe we can be a beta site for (an entrepreneur’s) idea or product,” Stevens said. “The benchmark for us is access to the thinking of entrepreneurs.”
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
In exchange for that access, Ridgeview is also making a small, $50,000 investment in Healthbox, which plans to select around 10 companies nationwide for the three-month program. Other health systems are also planning to participate and invest in the microfund that has been created to finance the program operations, said Dan Phillips, director of the program at Healthbox. Phillips declined to name them because they haven’t signed any documents yet.
He explained that the main focus of the accelerator is to assist entrepreneurs developing the next health IT or tech-enabled services tool. The short, three-month program would not be appropriate for entrepreneurs developing novel medical devices or drugs because such products have a long produce-development cycle, Phillips noted.
“But if their product is already approved and they are looking for a way to go to market, then we could help them,” he said.
Applications to the program will be available in mid August on the Healthbox website. This fall, Healthbox will host networking events in eight cities, including Boston, Minneapolis, San Francisco, San Diego and Atlanta. Entrepreneurs selected to the program will receive the following:
- $50,000 in seed capital in exchange for some equity
- Direct access to industry leaders, investors and established entrepreneurs in both structured and informal settings
- Workshops conducted by experts in disciplines that are relevant to early stage healthcare businesses
- A collaborative workspace that stimulates knowledge sharing and innovation
The three-month acceleration program ends with the so-called “Investor Day,” where entrepreneurs can pitch to a targeted group of angel and venture investors as well as potential customers.
