What’s Your Health Data Worth? Startups Want to Help You Sell It

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By Sara Merkenand Dana A. Elfin

Startups Embleema, Hu-manity.co, and Nebula Genomics are banking that consumers, already sold on the idea of handing over their genetic data to DNA testing companies, will want to control how that data is used and make some money at the same time.

The three are among the companies that want to help you take control of your medical data and sell it too. They plan to provide individuals’ genomic and other health data to researchers and pharmaceutical companies.

The worldwide market for patient medical data is potentially huge, with estimates running as high as $67 billion. Embleema, Hu-manity.co, and Nebula are confident they can cut you a slice of that pie while keeping your data private and secure.

But the viability of their business models is an open question: Will these companies persuade patients to sign up with them, and will the pharmaceutical industry pay for their data?

“There’s a market for everything,” Bloomberg Intelligence analyst Jonathan Palmer told Bloomberg Law Oct. 25. “We all know data is valuable, whether it’s Facebook knowing what you ‘like’ to sell you advertising or a company like IMS aggregating and anonomyzing prescriptions.”

“The demand is certainly there,” Martha Bennett, a principal analyst with a focus on blockchain technology and business intelligence at Forrester Research, told Bloomberg Law.

Already, drugmakers like GlaxoSmithKline Plc are buying access to datasets from companies like 23andMe Inc. which sells DNA testing to consumers. 23andMe has created one of the world’s largest genetic databases, and it’s marketing the anonymized patient data for research. Anonymizing data means identifying particulars are removed from the data.

Prospective purchasers are likely to find large datasets more useful than individual records, analysts told Bloomberg Law said. The companies also need to attract enough customers willing to give their information to be marketable to the companies buying the information, analysts said.

Data Worth Billions

Founders of the companies, some of which have recently launched and others which are still in the beta-testing phase, are counting on consumers wanting to benefit directly from the sale of their health data. And they’re bullish there’s a market for their services.

“If you’re talking just the pharmaceutical industry and you’re talking about electronic medical health records, it’s about a 66 to 67 billion dollar industry,” Glenn Zimmerman, Hu-manity.co’s chief communications officer, told Bloomberg Law.

And once patients give their consent under the Health Insurance Portability and Accountability Act of 1996 [HIPAA] for companies to identify their individual data, it could be worth from two to four times as much as that data in anonymized form, he said.

HIPAA provides data privacy and security provisions for safeguarding medical information.

“The reason for this is because it makes research more efficient to have data that can be trusted and can be tracked back to the source (a real person),” Zimmerman said.

There’s a “worldwide market” for the data, Kamal Obbad, co-founder and chief executive officer of Nebula Genomics, said.

And Robert Chu, Embleema’s chief executive officer and chief technology officer, predicts strong demand for this type of data because the Food and Drug Administration is requiring pharmaceutical companies to collect such data—known as real-world evidence—under the 21st Century CURES Act. The law is aimed at speeding the development and approval of drugs and medical devices.

The FDA defines real-world data as “data relating to patient health status and/or the delivery of health care routinely collected from a variety of sources” including electronic health records, claims, and billing data.

"[W]e’ve been told that pharmaceutical companies are very interested in this because it would help to speed up the research; it would help bring drugs to market faster,” Zimmerman said.

Value Varies

The various companies collect and offer different types of data. Embleema, for example, stores hospital and care center patient discharge documents and wellness tracker data like Fitbit data. Nebula allows users to sell their genomic information.

The companies told Bloomberg Law they are aiming to collect diverse information, both in terms of the people that sign onto sharing their information and the types of data they provide.

And the value of the data to pharma companies and researchers will depend on the volume, the variety, and the quality of the information, Rich Ross, a research director in global research company Gartner’s health-care industry research group, told Bloomberg Law.

The companies will need to attract people who are willing to contribute various types of data, including genomic, clinical, and wellness tracker data to generate the most value, Ross said.

The companies could also provide valuable information to niche markets, such as offering data on patients with specific diseases for researchers, Ross said.

Consumer Ownership

The companies’ platforms are based on blockchain technology, which company executives say keeps medical information secure and ensures consumer privacy.

Blockchain is a type of distributed, decentralized ledger comprised of digitally recorded data packages called “blocks” linked together chronologically. Each block contains a “hash” (i.e., a link to the previous block), a timestamp, and transaction data. Information on the blockchain is meant to be unchangeable because every transaction is recorded and verified.

The companies are banking on the idea of a decentralized, seemingly secure technology to persuade consumers wary of massive data breaches to upload their data onto the platforms.

“You have these companies like Google and Facebook. They have these giant datasets that nobody can compete with. So the consumer ends up losing because there’s less competition,” Nebula’s Obbad said.

“That’s why we’re trying to push forward this decentralized approach, where not one entity owns all the data, and it’s back in the consumers’ hands,” Obbad said.

Safeguarding Data

A key challenge for the companies will be gaining trust from the individuals from whom they’re seeking data, Ross said.

The companies will need to prove they can protect the data, be transparent about the use of the information, and communicate the compensation and value proposition to attract consumers, he said.

Consumers should know exactly how their data will be used, he said.

The companies must ensure the information is only used by pharmaceutical companies and researchers for the purpose for which it was originally intended, Bennett told Bloomberg Law.

Embleema, Hu-manity.co, and Nebula told Bloomberg Law their companies will provide consumers with a variety of controls over what information to share and which institutions can access their data on the blockchain platforms.

And those controls—from the safeguards the companies put in place to secure consumer-provided information to how they handle consumer consent—will be key to whether the companies succeed, industry analysts told Bloomberg Law.

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