Venture capital rebounds with strong first half ... or does it? (Morning Read)

Highlights of the important and the interesting from the world of healthcare:

Venture capital rebounds with strong first half … or does it? Maybe reports of the venture capital industry’s demise have been greatly exaggerated. U.S. In the first half of 2010, VC firms raised $7.5 billion across 72 funds, up 13.5 percent from the $6.6 billion raised by 68 funds a year earlier. But let’s not get too excited, and peHub lays out three reasons why: Big funds don’t mean big returns, 2009 was so bad that the comparison doesn’t mean much, and the numbers may be suspect.

VCs, part II: Venture capital founding father Arthur Rock offers a sobering assessment of the industry: “Returns of the venture-capital industry will be next to zero over the next 10 years because there is so much money around. Some of the good firms will do well, but I think the majority will have negative returns.” Ouch. Sounds a lot like the last 10 years.

With the Rise of AI, What IP Disputes in Healthcare Are Likely to Emerge?

Munck Wilson Mandala Partner Greg Howison shared his perspective on some of the legal ramifications around AI, IP, connected devices and the data they generate, in response to emailed questions.

Cuts at Merck: In a somewhat expected move after it’s acquisition of Schering-Plough, Merck plans to close eight research facilities and eight manufacturing plants over the next two years. The company hopes to save $3.5 billion. The resulting layoffs amount to 15 percent of Merck’s workforce.

Health reform’s surprises: Several lesser-known provisions of health reform are set to go into effect in the coming months, including the end of co-payments for some preventive services such as breast cancer screenings every one to two years, cholesterol blood tests and some sexually transmitted disease screenings. Also, a new program will help employers handle the cost of healthcare for retirees age 55 and older who are not eligible for Medicare.

Too much “medicalization:” Spending on treatments, pills and procedures to cure “nonmedical” problems boost American health spending by $77 billion a year, according to a new study. Some observers may question the study’s classification of the following as nonmedical issues: anxiety disorders, sleep disorders and normal pregnancy and delivery.

Good call on Berwick: Dr. Bob Wachter supports President Obama’s recess appointment of Don Berwick to head up the Centers for Medicare and Medicaid Services. “The very things that make Berwick right for the CMS role also make him a target in today’s political environment, where all serious debate is trivialized and caricatured via talking points and schoolyard name calling.”