Cue Health layoffs, HIPAA post-Roe, and AI’s race problem

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Cue Health faces layoffs after a pandemic whirlwind


Covid-19 has catapulted dozens of health tech companies forward in time — and few more than Cue Health, a 12-year-old testing company that was mostly stuck in R&D mode until January 2020. Over two short years, Cue pulled in a half-billion dollar deal with the Department of Defense, one of the biggest single federal testing payouts of the pandemic, and rode that revenue to a $2.9 billion valuation after its IPO last September.


Like many companies that saw the pandemic give way to massive revenues and public debuts, though, Cue now has to contend with its post-Covid future — and the transition won’t be easy. Last week, facing dwindling test demand and a spiraling stock market, Cue laid off 170 of its employees in manufacturing, roughly 10% of its workforce. And earlier this month, it filed a lawsuit against its biggest benefactor, the United States of America, objecting to its exclusion from another lucrative testing contract. Read Katie’s full investigation into Cue’s trajectory and future.

HIPAA won’t protect key data after Roe decision


The overturning of Roe v. Wade highlights a stark reality in the world of health data: HIPAA will not protect the privacy of reproductive health information in the face of aggressive prosecution. That was the consensus of several legal experts we spoke with in the hours after the decision. HIPAA contains exceptions when a person’s health data becomes evidence in a criminal case or another legal proceeding. It also doesn’t protect a vast amount of data recorded on cell phones, shopper’s loyalty cards, reproductive health apps, and social media sites. It remains to be seen how state legislatures and local prosecutors will react to the ruling. But the takeaway at this precarious moment is clear: Be careful what you share. Read more.

Alzheimer’s tech gets a boost

Cognito Therapeutics, which is developing technology to treat Alzheimer’s disease, has raised a fresh $50 million from Silicon Valley-based Founders XMario reports in this exclusive. Unlike many digital therapeutics companies, Cognito isn’t developing an appified version of cognitive behavioral therapy: Instead, it pairs light pulses with sound to activate brain changes that it hypothesizes can treat and even reverse cognitive decline — a goal that’s long eluded pharmaceutical interventions. With the new funds, the company will continue to push on its clinical trials for an eventual FDA submission; it plans to launch its phase 3 trial for patients with Alzheimer’s and mild cognitive impairment this year.

How race creeps into machine learning models 

Clinical AI developers are increasingly attuned to the potential for bias to seep into their algorithms. But new research shows that even when computer scientists try to remove race from the equation, machine learning models can still figure it out. “There’s no way you could erase the race,” said Leo Anthony Celi, co-author of a preprint that showed models trained on clinical notes can predict self-reported race, even when the text is stripped of racial identifiers. A model learning race isn’t necessarily bad — but when it’s unclear how it’s learning, it becomes much more difficult for humans to supervise and correct. Read more in Katie’s story.

A low bar for evidence in digital health

As digital health companies have pulled in billions in investment, evidence for their claims haven’t kept up with funding, illustrates a new study in the Journal of Medical Internet Research. Using a funding database from Rock Health, researchers identified 224 digital health companies that had raised more than $2 million, and measured their ‘clinical robustness’ — the sum of FDA filings and registered clinical trials. No surprise: Scores were low across the board, especially in clinical areas like oncology and primary care.

Even more, there was no correlation between a company’s score and the number of claims it made. “The lack of meaningful clinical validation for nearly half of digital health companies highlighted a major gap in health care technology today,” the authors write.

A $7 billion valuation yields a big layoff

  • The virtual care company Ro said it will lay off 18% of its workforce just months after rising to a valuation of $7 billion, TechCrunch reported. The company said the cuts will “increase the efficiency of our organization and better map our resources to our current strategy.”
  • Meta has released an advertisement emphasizing the potential of its virtual otherworld to be a training ground for the next generation of surgeons. “The Metaverse may be virtual, but the impact will be real,” the ad states, flicking at a future where virtual reality augments traditional training regimens.
  • Nomad Health, a tech-enabled health staffing company, raised $105 million in a funding round led by Adams Street Partners and Icon Ventures. The company is seeking to expand beyond nurses to serve a broader group of workers, including lab techs and physical therapists.
  • Myriad Genetics inked a deal with Epic to allow physicians to order its genetic tests from their EHR screens. The companies said the deal will create a “seamless” workflow in which physicians can access the tests and review results without clicking off screen.

Stepping up and stepping back 

  • Cori Bargmann announced that she would be stepping down from her position as head of science for the Chan Zuckerberg Initiative, where she managed billions in research grants, to return to her Rockefeller neuroscience lab. She’ll remain a member of its scientific advisory board, while CZI Biohub leader Steve Quake steps into her role.
  • As it expands its footprint in remote patient monitoring, Withings has named a new chief marketing officer: Elizabeth Coleon, who most recently held the role at French company Qonto, came on in May.

What we’re reading

  • Digital back doors can lead down the path to health inequity, STAT First Opinion
  • Talk therapy apps face new questions about data collection from senators, The Verge
  • Congress is closer than ever to formally authorizing ARPA-H. But the details aren’t as final as they seem, STAT
  • How Covid tracking apps are pivoting for commercial profit, Wired
Source: STAT