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Rewriting the Clinical Trial Paradigm | $1B Paradigm Health Co-Founder Jonathan Hirsch
18 Plays6 days ago
Today we speak with Jonathan, co-founder of Paradigm Health, a startup which has raised over $500m+ to is build the infrastructure behind clinical trials in order to make them quicker and more accessible.
Jonathan walks us through his path from a UChicago neuroscience lab to dropping out of Stanford to launch CyApps, one of the earliest precision medicine companies. We dig into why US trial capacity is fundamentally broken — why oncology needs three times the current bandwidth, why studies are moving to China, and why providers (not patients) are the real recruitment bottleneck. Jonathan breaks down Paradigm's playbook across trial design, site selection, LLM-native patient matching, and real-time data collection, and how they "hacked" the cold start problem through aggressive fundraising and acquisitions like Flatiron's clinical research unit. We close on what keeps him up at night: the risk of the US losing its edge in clinical innovation, and the AI wave he believes can help us win it back.
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Transcript
Introduction to Healthcare Theory Podcast
00:00:00
Speaker
Welcome to the Healthcare Theory Podcast. I'm your host, Nikhil Reddy, and every week we interview the entrepreneurs and thought leaders behind the future of healthcare care to see what's gone wrong with our system and how we can fix it.
Jonathan Hirsch's Journey in Clinical Trials
00:00:14
Speaker
Today's guest in the healthcare theory is Jonathan Hirsch, the co-founder of Paradigm Health, which is a company that's raised over half a billion dollars to basically rethink how clinical trials are run. Jonathan's path started at the University of Chicago, where he worked on early healthcare and technology startups. He then went to Stanford and founded a company called Cyaps, which was a precision medicine company focused on helping physicians and pharma use molecular data in cancer care.
00:00:40
Speaker
And now, a Paradigm Health, he's tackling what I believe is one of the biggest bottlenecks in healthcare and biotech, which is clinical trials. We often think of drugs being the hard thing to discover, but so much of the problem is actually getting this in front of patients and seeing if it works.
Fragmentation of Clinical Trials
00:00:54
Speaker
So many patients want groundbreaking trials, And so many pharma companies want patients, yet there's consistently a shortage in slow clinical trials, which is delaying when drugs get to market. So today we talk about why the clinical trial system is so fragmented, and especially how we can bring clinical trials closer to the patients who actually need them.
00:01:13
Speaker
So hi, Jonathan. Thank you so much for coming on The Healthcare care Theory. Welcome to the podcast. Thank you so much. It's great to be here. Of course. And I think you have a little bit of a unique entrepreneurial background. i mean, you started up at UChicago, which seems to be an environment which just caters to academia a little bit. And while that's changing, when you were there, i know you worked on a couple of startups and was really had that like entrepreneurial bug, let's say. But I'd love to hear about your time at the University of Chicago.
00:01:38
Speaker
What really sparked your interest in entrepreneurship and building something? I know, especially back then, it wasn't as conventional, but sometimes
Founding CyApps and Precision Medicine
00:01:45
Speaker
it just strikes you. know Yeah, so thanks thanks for bringing that up and for having me. So I was an undergrad at University Chicago from 2003 to 2007. And when I was there, UChicago was definitely not only the place where fun goes to die, but it was also the place where our motto was, that's great in practice, but how does it work in theory?
00:02:08
Speaker
So UChicago was not exactly the place where you went to to start a company. So I spent a lot of my time in the lab. i worked in a neuroscience lab in undergrad.
00:02:19
Speaker
And then I spent all my time in the library. So the, you know, Carrar, which is the library for all the scientists and and medical students, and then the basement of the reg on Saturday nights. So that was how we- Yeah, same here still.
00:02:36
Speaker
Mm-hmm. And while I was in undergrad, I guess my first entrepreneurial itch was i actually created my own major in undergrad because I really wanted to study with the Committee on Social Thought, but it wasn't an undergrad major. So I kind of created an undergrad second major with the Committee on Social Thought and did that.
00:03:00
Speaker
But what I really started doing in undergrad in building companies was I got very involved with the Office of Tech Transfer and Tech Licensing. That got me involved with a few startups that UChicago had spun out.
00:03:14
Speaker
And I started working with those startups, mostly medical device and pharmaceutical companies to try to help them with various business operations, raising money, doing business transactions like licensing and partnership deals. And that really kind of got the bug for me And I started working on building a company in undergrad to facilitate tech transfer and and partnerships. And that company didn't really go anywhere, but it was the the start of an entrepreneurial bug for me. And I decided that I really felt that my future calling was in entrepreneurship and building companies.
Challenges in Precision Medicine
00:03:53
Speaker
So I went out to Stanford for grad school. So I i got out of UChicago to grad school at Stanford and Stanford is the opposite in every way which was basically Stanford is all about how you actually do something in practice.
00:04:12
Speaker
they're They're a little bit lighter on on the theory so they're all about turning an idea into a practical application. how do you work in teams? How do you build and cultivate a company and turn it into into an idea?
00:04:25
Speaker
And um I got to grad school to study neuroscience. I took a class at Stanford called Technology Venture Formation with a legendary ah person named Steve Blank.
00:04:38
Speaker
And it was the launching point for my first company, which was called SciApps. Awesome. um and So that's that's interesting. I definitely agree with the sentiment that like University of Chicago, it's really about, um I mean, academia, theory, um research is a huge part of the culture here. And Stanford, um MIT, Berkeley is where you see people doing that too,
Shift to Molecular Data in Cancer Treatment
00:05:02
Speaker
but they also are more willing to scale things out. And I think that even though the cultures of both of them are changing, and maybe converging a little bit,
00:05:09
Speaker
It's definitely really exciting. So i mean, working at going to Stanford for your master's, you said you spun out a company, PsyOps. I'd love to hear a little bit about that. So when you're at Stanford, what were you kind of working on that founded that original idea? And what made you realize that this is something that is not just a project to you, something you actually want to spin out and and build something?
00:05:27
Speaker
my My journey there was very serendipitous and had a lot of luck associated with it. I was studying neuroscience, I had a background on molecular mechanisms of Alzheimer's disease, and i really thought that neuro was going to be the place that I focused.
00:05:46
Speaker
And what happened was i just wandered into the intro cancer biology PhD class because you could just kind of take other classes outside your department.
00:05:58
Speaker
And I realized that they were 30 years ahead of where neuro was in terms of understanding the molecular basis of disease. And this was, remember, 2007. This is really at the early phases of the whole molecular revolution in biology and medicine.
00:06:20
Speaker
where we were starting to do things
Innovations by CyApps
00:06:22
Speaker
like next generation sequencing and starting to understand that cancer wasn't one disease, breast cancer wasn't one type of cancer, that there was a lot of heterogeneity driven by underlying molecular factors.
00:06:36
Speaker
And importantly, we were starting to, as an industry, develop drugs that were specific to molecular subtypes, including some drugs that could work across tumor types that had the same molecular drivers.
00:06:51
Speaker
So I got in this class and my universe was opened up and I said, this is what I have to be working on. If I'm staying in neuro, I'm going to be behind. I have to work in in cancer.
00:07:04
Speaker
I have to build a company in oncology. And what I came to the realization of is that there's going to be this avalanche of molecular information coming in healthcare, care starting in oncology, and physicians and pharmaceutical companies and insurance companies, we're all going to be completely unprepared to deal with this change in approach from a very observational method of diagnosing and selecting therapy,
00:07:35
Speaker
to a method that was more driven based on underlying molecular and other physiological factors. So I dropped out of grad school. I started this company i called Cyops and it was all about how do we make precision medicine a reality. So how do we help physicians and pharmaceutical companies and diagnostic companies and insurance companies use molecular information to drive different ways of caring for patients?
00:08:11
Speaker
And it was a very good journey. It was actually 12 years from the original conceptualization of the company in my dorm room, dropping out, teaming up with some co-founders. So it was a 12-year journey that included a lot of really interesting aspects. so we were one of the first organizations to deploy a clinical system on a on a cloud, so on AWS.
00:08:41
Speaker
So that was a very early thing that I did Another early thing was we created the interoperability method for genomic and molecular data. So when the reports kind of go from the laboratory to the health provider and that's exchanged electronically, we built that system out and kind of made that available to the industry.
Transforming Precision Medicine Industry
00:09:04
Speaker
And we were one of the very early companies doing clinical decision support for physicians in the context of of their care. And ultimately, what that company kind of showed me was that the difference between building a product in an existing industry with an existing buying pattern,
00:09:27
Speaker
which is not what we were doing, versus building a brand new product category and convincing someone that they needed to pay for it and that that the product category added value, which was very much what we were doing. No one knew that they needed software for precision medicine. No one knew that they needed real-world data, including clinical and genomic information. No one knew that they needed decision support help to select the right therapy for a patient. So we were pioneering a lot of categories
00:10:06
Speaker
And it was a very difficult process to convince various buyers that they should be paying for what we built.
00:10:16
Speaker
But ultimately, we were successful. We helped transform
Inefficiencies in Clinical Trials
00:10:20
Speaker
an industry alongside various other companies that that kind of came into the mix and and also were building out similar solutions. So i'm very proud of what we built and I'm very proud of the industry changes that we helped effect.
00:10:35
Speaker
Yeah, precision medicine is definitely an interesting one. I know within cardiology or oncology, we've gotten pretty far, but in neuroscience, it's still hard to really understand what differentiates one person from another within depression. I mean, they're totally separate biologies for different types of depression. So I think we're still far away, but precision medicine, I think we've had a lot of guests that really say that it's going to be the future. do find the part interesting where you say that it's um difficult to like really show someone that they need this thing before they even like know what it is.
00:11:06
Speaker
And I think that's a common problem with a category of defining companies. But the real thing is like, do you just have a pain point and are are you addressing it? And eventually um people will like adopt it. And it is you' interesting. You have precision medicine now. We have so many more therapies these days. Like,
00:11:21
Speaker
biomarker-driven oncology, gene therapies, ah RNAs, and so many different ways to identify disease subtypes. I mean, we're nowhere near perfect, but we're getting there. It's gotten more advanced. But, I mean, part of the reason I see where you're working today is this clinical trial system still has so much friction. And I think part of that's like the interoperability issue.
00:11:40
Speaker
um It's just communication, but there's also like slow recruitment, really fragmented execution. There's so many issues there. and it doesn't seem to be like a new or like fringe or niche problem. It's it's universal almost across clinical trials in America. And I'd love to hear, I mean, from your vantage point, you came into from PSYOPs with a good understanding of how these different stakeholders come into play. But when you began to understand what's going on clinical trials, what was your initial conception? How do you how do you think about the way it's situated, the ecosystem? Why is why is the way it is today?
00:12:13
Speaker
Where this started for me is that during my my days helping run SIAPS, I had actually participated in building two clinical trials that were pretty groundbreaking. So one of those trials was called GBM Agile.
00:12:31
Speaker
And that was Bayesian adaptive ah randomized platform trial for glioblastomas where we had multiple pharmaceutical and biotech companies participating in putting their drugs into this platform study.
00:12:46
Speaker
And then the other trial was called TAPER, which is run by ASCO, American Society for Clinical Oncology. And that initially had started as a registry, but very quickly moved to being signal finding phase two study where again, in a similar concept, multiple pharmaceutical companies were testing their drugs through this trial. looking for label expansion or additional indications that were genomically driven for therapies
Sustainable Infrastructure in Trials
00:13:20
Speaker
that had already been approved.
00:13:22
Speaker
So both of those trials were new concepts or evolved concepts of of prior experiments where what we were doing was we were standing up a generalized infrastructure for a type of trial, so a a master protocol.
00:13:39
Speaker
And we were building infrastructure under that protocol, activating sites, for that trial, master contracts with those sites, master infrastructure. So we basically had built these big platform studies that could persist over time and create a lot of efficiency in trial conduct. So was part of starting both of those up and 10 years later, actually 11 years later, both of those trials are still running and are highly productive.
00:14:12
Speaker
And in fact, GBM Agile became the global coalition for adaptive research. And part of that infrastructure that we had built was then used for trials like Remap COVID.
00:14:24
Speaker
So i it was a very, very good effort. And what those efforts showed to me is that it's possible to build repeatable and sustainable infrastructure for trials that you use over the course of years that test multiple different drugs in in those studies where you can create a tremendous amount of efficiency for the whole
Formation of Paradigm Health
00:14:50
Speaker
system. So for physicians and sites and patients and sponsors, you could create a lot of efficiency.
00:14:58
Speaker
But the setup for those studies was bespoke. So we had to create all the setup ourselves. We talked to the regulators. We talked, in this case, to the FDA. And we had to explain what we were doing and convince them that it was OK. And they were very willing to to work with us on it. But we still had to go through this very extensive process of convincing every stakeholder that this would work.
00:15:25
Speaker
and then also building a lot of the infrastructure from scratch. And when I looked at that, I basically thought, well, we could build a company out of this concept to make trials more efficient.
00:15:39
Speaker
And what really prompted me to want to tackle the trial problem was coming out of COVID, where we saw what was possible with Operation Warp Speed in moving the trial ecosystem incredibly quickly,
00:15:55
Speaker
But then we encountered the reality of what was happening in the post immediate post COVID period, which was health providers were absolutely crushed with work.
00:16:07
Speaker
They were burned out. They didn't want to be doing more work than they had to be doing. People were leaving the workforce. So you kind of had this incredible opportunity for innovation and impact in trials But then you had the people running trials, which are the health providers, saying we can't do any more work aside from the the core of our clinical care jobs. So when you put those two things together, what it actually means is that there's an opportunity to do something truly
Patient-Centric Clinical Trials
00:16:41
Speaker
disruptive and innovative.
00:16:42
Speaker
So that's why I wanted to work on the trial problem. And again, we could talk about the formation of a paradigm, but a lot of this has to do with luck and serendipity. we form companies and we could talk about that.
00:16:59
Speaker
Of course, yeah. um I do want to get into that trial problem a little bit first. I think that when a lot of people think about what's going, what's wrong or difficult about clinical trials, they think about patient recruitment. And I think the key word there is patient. That's really what they think about the most is how can we get patients like direct contacting and other other forms like that or AI matching. But A huge part of that I think people are missing and that you guys have identified is that providers are often the main ways you interface with patients in some in some ways.
00:17:27
Speaker
um They provide awareness. They know most about eli eligibility and that criteria. so But this problem maybe gets a little bit less attention or had gotten less attention, maybe now a little bit more. but um From what I understand, like oncologists and general physicians see the majority of ah patients in this country, but they don't really have much infrastructure to screen for trial eligibility. um You would think that's there, but it's not. So I'd love to hear what does that gap look like in practice? like Why are providers so integral to keeping clinical trials quick and accurate and getting the right patient population? What makes them so important? Where do they fit into this puzzle?
00:18:04
Speaker
it's It's a great point. The way that I and and we as a company view clinical trials is that you roughly have two types of trial.
00:18:15
Speaker
One is a trial that's looking for healthy people, and then another is a trial that's looking for people with a condition, with a disease, an illness, with some form of condition.
00:18:28
Speaker
So if you're looking for healthy volunteers, this everything that I'm going to say does not really apply. right If you're looking for healthy volunteers, there are lots of ways that you can go out and find them and recruit them.
00:18:40
Speaker
When you're looking for someone who is who is sick, someone who is properly defined a patient, The patient's receiving care from someone.
00:18:51
Speaker
And you have to start with the premise that a patient is receiving care, they're seeing some form of physician or care provider, they're going to some sort of clinical care enterprise,
00:19:04
Speaker
And the best way get that patient on a trial, or at least to present them with the opportunity to go on a trial, is to bring the trial into the environment in which they're already receiving care.
00:19:19
Speaker
And if we just make this you know very real from a patient experience standpoint, we probably all know people who have or had cancer. And if you are a patient with metastatic lung cancer and you have you know maybe you know a few years to live, um you don't want to you know you might not want to spend your time getting on an airplane and flying you know halfway across the country for that clinical trial.
00:19:53
Speaker
yeah Some people do, and and maybe the patient will. But time is really precious for these patients. And a really humane and effective way to make the patient or to to help the patient get access to a trial is to bring the trial to the patient rather than bringing the patient to the trial.
00:20:15
Speaker
So that really forms the underlying basis and philosophy for how we approach this problem of identifying and we're recruiting patients to trials. we We start with the fundamental recognition that the most accessible trial is the trial that is at the patient's health provider, where we're not asking the patient to change something that they don't want to change.
00:20:40
Speaker
And I would say that there's another underlying element here, which is there is ah a trust element. So the patient will develop a trusted relationship with their health provider. Maybe they've been seeing them for you know a few months or a few years.
00:20:54
Speaker
And asking the patient to go on a trial is a big enough ask. Asking them to then change their care provider and where they're receiving care, that's a pretty big ask. and again Patients will do that. we We know that patients travel to academic centers um and go outside their care experience for that, but it's not you know it's not the norm.
00:21:15
Speaker
And we have to normalize bringing the trial to the patient rather than expecting the patient to bear the burden of of going outside their care ecosystem. So that's the recognition that we start with.
00:21:27
Speaker
And then once you establish that as your philosophy, then the rest of what you have to do becomes more clear. You have to make sure that the trial sponsors, so
Innovative Clinical Trial Operations
00:21:40
Speaker
typically pharmaceutical companies, biotech companies, you have to make sure that those companies site select the actual health provider organizations that the patients are seeing rather than the you know the referral center that might be two states away or across town.
00:21:57
Speaker
You have to then make sure that the physicians are educated about what the trial is and what the trial options are. You have to make it easy for those practicing physicians to screen and identify patients um within you know their busy schedules.
00:22:12
Speaker
you know Remember, the average community oncologist is seeing 40 patients a day. you know versus the average academic who might be seeing five patients a day. So the community oncologist doesn't have time to sit there and you know manually do all this screening work. so and And there's various other things that that we do, but it starts with the recognition that you just have to make it easy within the workflow.
00:22:37
Speaker
And when you make it easy within the workflow, you optimize the probability that the patient will be offered the trial and that they'll then enroll. Yeah. And so I guess I'm basically seeing like three strands of a problem. mean, first is that providers need to be a larger part of this system.
00:22:54
Speaker
And then second is that it's interesting that to me, most healthcare care is delivered in community hospitals, like ambulatory care facilities, regional systems, but basically almost all, or maybe a decent portion of clinical research is done in academic medical centers, which is which are not really as common. They're not accessible geographically to most people.
00:23:13
Speaker
um we have Chicago med here, but not, um It's just not as common in most cities or towns and and rural areas. I know Paradigm partnered with Flatiron to kind of help sound that problem. and then also, I think there seems to be a data AI problem. You have this data locked up in EH stars.
00:23:30
Speaker
That's integral to actually getting sure making sure that matching is as good as it needs to be. so I think it's maybe the best time to talk about what you guys do at Paradigm. You Paradigm. great experience with CyApps, but now you're looking at a new venture. And I'd love to hear what does really, what does CyApps do at the core? You're not really a CRO, you're not really a software company, and you're not really a recruitment company. You'd elements of all three, which to me is very interesting.
00:23:54
Speaker
um So i'd love to hear from your perspective, when you're looking at this problem, this difficult patient recruitment problem, what were the things that you set out to solve for? And how would you say that really what that says about what Paradigm does today?
00:24:06
Speaker
Yeah, so Paradigm Health really started through myself, um my co-founder, our CEO, Kent Tolke, then our third co-founder, who really was kind of the incubator of this, Bob Nelson at Arch Venture Partners, who also has a University of Chicago connection because ah Bob and Arch were UChicago and emerged from that ecosystem.
00:24:33
Speaker
is So fun fun fact there. But it really started with aye each of us coming at the problem from a slightly different perspective, but
Enhancing Trials with Software
00:24:45
Speaker
all saying, and and really led by Bob, saying,
00:24:49
Speaker
how we do trial operations is antiquated it's messed up it introduces delays into the trial ecosystem it puts burden on all the wrong parties and we just need to you know change the paradigm uh so that's uh hence the name of the company And Bob had seen this from the standpoint of funding biotech companies.
00:25:13
Speaker
So every year, the cost of a trial increases. It increases in excess of you know normal kind of scaling laws. And in fact, it should be decreasing over time as we get better and better.
00:25:26
Speaker
And Kent had seen this from the standpoint of actually operating a ah CRO. So Kent had built three global CROs um and was kind of off ah off thinking that he was going to retire after selling PRA Health Sciences to Icon. um And Bob managed to pull him out of retirement. So we we all teamed up with a number of other investors and some advisors and brought a lot of folks to the table around it. But the the starting premise of the company was we have to change the whole dynamic of trial operations. It wasn't that we're going to start with one individual piece, it's that we're going to change the whole thing. And if we approach changing the whole thing, it means that we can make longer term decisions about building for scale, ah which is really imperative and important for the company. So in terms of what we do, we focus on full end-to-end trial operations.
00:26:26
Speaker
And our main angle for how we tackle the problem is that we are embedding our capabilities. So it's mostly software, but a little bit of services.
00:26:38
Speaker
We embed those capabilities within healthcare provider organizations because we recognize that the healthcare provider is the one who's actually conducting the trial.
00:26:48
Speaker
So we give the health provider a bunch of software and tools and we make their work much more efficient. And then we are partnering with the provider to form a tech enabled, efficient clinical trial conduct network. And we go to life sciences companies and then we are acting as a clinical trial conduct organization for those life sciences companies.
00:27:13
Speaker
So what that really means is that we focus on four big elements of of the equation. So the first is trial design. So we are designing trials and protocols from scratch.
00:27:28
Speaker
And sometimes we're iterating on existing protocols and optimizing them. What we're doing there is we are making sure that the protocol is actually feasible to be run in large healthcare settings.
00:27:45
Speaker
And it would probably surprise you how many protocols are designed in a way that that restrict the ability of patients to participate in a manner that is probably unnecessary.
00:27:57
Speaker
And it's not just what people talk about like eligibility criteria, but it's also things like visit schedules. um and procedures. If you're going to ask the patient to do a liver biopsy, which is super invasive, you should be really sure that patients are willing to do that liver biopsy. Otherwise, no one's going to anticipate on your study. right so That's kind of our first area.
00:28:21
Speaker
Our second area is planning where the trials are going to occur. So people will call this feasibility and site selection, but what it really is about is is efficiently mapping the supply and demand equation of who has
Innovative Trial Execution Responsibility
00:28:40
Speaker
trials that need to be done who has capacity to do those trials and where are the patients available for those studies.
00:28:48
Speaker
So we do effectively a big supply-demand capacity mapping of the pharma companies and biotech companies who have specific trials, where those trials should occur, and we do all the kind of matchmaking and coordination to get those trials situated at the right health providers.
00:29:05
Speaker
The third area is what you were asking about before, which is patient recruitment. So we have some elegant software that reads all the patient's medical records and all the source documents that we can get our hands on. The software is LLM native, which has been a very good journey for us because we happened to start the company at the right time when LLMs were just coming into into maturity. So we use LLMs to do a bunch of patient eligibility assessment and matching and navigation and some some very effective things there.
00:29:45
Speaker
And then the final piece, which is actually probably the largest element of what we do, is optimizing all of the study data collection and workflows. So that was the subject of our recent um ah collaboration with the FDA that was announced last week called Real-Time Clinical Trials. But effectively what this is is eliminating the documentation burden for study data collection, source data verification, monitoring, etc. So we have software that
00:30:18
Speaker
effectively helps the provider do all of the documentation more efficiently and helps get it to the sponsor more quickly and helps the sponsor much more efficiently do all of their reviews synthesis etc so that's kind of um what we do in in a nutshell and then what we've just launched which is very cool is a new offering a new solution offering where for certain types of trials, so phase three post-market commitments and phase four studies, we'll actually run the entire thing using our capabilities.
00:30:54
Speaker
So we have an abstract coming out about that at the upcoming ASCO conference um in in conjunction with a major sponsor that ah that I won't name, but folks can go can go look on the ASCO abstract website for that. But we have a number of sponsors where we will go to the sponsor and say, we'll do the entire thing in our network using our technology because we're so confident in our ability to execute that we'll take full end-to-end responsibility.
00:31:27
Speaker
So that's where we're that's where we're evolving for certain types of studies. So that's what we do. Yeah, that's super exciting. and also, I imagine very difficult to appeal to four stakeholders at once and or maybe really more so than that. But I would be curious to know, I mean, we've had um and your your our venture partners, Rob, also worked on CROs. So, i mean, you've had CROs be kind of the traditional um option. They have their own site networks, their own way of running trials. And they're well embedded within the procurement teams of these biofarmer companies.
00:32:00
Speaker
So it seems like you're not really just selling a better product or a better alternative. You're structurally, you're asking sponsors to really think about structurally change how they think about site selection and patient recruitment, data capture.
00:32:12
Speaker
And so what is that conversation with the sponsor? I mean, and could you provide an example of the trial that you guys have done that maybe changes the the paradigm of like what clinical trial should look like?
00:32:22
Speaker
Oh, for sure. the The good part about this this industry is that everybody understands the the problem that exists, which is Patient accrual is slow.
00:32:40
Speaker
It's getting slower. um And it's particularly getting slower as you have more and more trials that are operating ah and
Challenges in Trial Industry Collaboration
00:32:50
Speaker
looking for the same patient populations.
00:32:52
Speaker
So you can go look on clinicaltrials.gov for the number of trials that are looking for first-line metastatic non-small cell lung cancer KRSG12 targeted an agent.
00:33:05
Speaker
There are a lot of them, and that's a fairly rare patient population. There are so many trials looking for that patient population. Everybody is competing for that, and what that leads to is everybody is slowing down. So the reality of the situation is that we need today in oncology three times the amount of patient and provider capacity to run trials that exists at this particular moment to satisfy the current clinical trials that are running, let alone the new trials coming up with the tremendous tailwinds that are being provided through AI-based drug discovery, which is here and and is influencing early-stage pipelines.
00:33:50
Speaker
So the fundamental issue is that we have a broken capacity problem in the United States, and this is why you see trials going to China. So people are moving trials outside the United States.
00:34:04
Speaker
This has been going on for a little while, but it is dramatically accelerated over the past two to three years with studies going to China, starting with you know some of the early phase. Now it's kind of creeping later and later phase.
00:34:16
Speaker
So there's not a single pharmaceutical company or biotech company that would say, I'm satisfied with the current equation. And this is not to say that any particular party is doing something wrong. yeah This is, you know, people...
00:34:33
Speaker
lots of parties are doing a great job. This is just a hard problem and we need new ways of thinking about things. That doesn't mean that a pharmaceutical company, if they use a ah CRO and like the CRO, it doesn't mean that they have to get rid of them, but it means that they're going to expand what they do. So the pharmaceutical company might have to change how they think about site selection. So I won't name the company, but we had a chief medical officer of one of the largest prominent um i pharmaceutical companies say to us, well, this is pretty simple. We should just run the experiment of the paradigm suggested sites versus the sites that our internal team suggests and versus the sites that our CRO suggests
00:35:25
Speaker
and we just test that and we see what works better so pharmaceutical companies are willing to do that it sounds so simple but this is ah an attitude shift for pharmaceutical companies and you know for us when we test our model with a pharmaceutical company where we compare a paradigm suggested enabled site against you know one that came from a different source with different capabilities uh and you know this is we've published on this um a little bit before but we see anywhere from a 25 to a 350 percent increase in accrual rate you know as measured by total numbers or per unit time, numbers per unit time.
00:36:12
Speaker
So yeah the proof is in the pudding and you can you know you can test these things fairly easily. You just take a trial and you open sites through us and you open sites through ah traditional method and you see what does better. And it's not to say that every time we're going to be better, but most of the time we are better. um So I think that there's room for all sorts of different models.
00:36:35
Speaker
I think what we don't have room for as an industry is just doing nothing. We don't have that luxury. The trials are all going to leave the United States. That's unfortunately what what will happen. So we all have to try new things. And to the point of you know established players, I would say that this industry is actually fairly collaborative, um which is which is good. Meaning, you know as you can see from our very public relationship with a CRO ParXL,
00:37:08
Speaker
yeah we we ah we work with
Building and Growing a Trial Network
00:37:10
Speaker
them yeah We work with different players and you know no one's going to do everything and we're all here and working in healthcare because we want to make a difference for patients. So we'll cooperate and work with other players to accomplish the goal.
00:37:25
Speaker
Yeah, I think that's awesome. And i I have a couple more questions on this. or just um And would it's very interesting to hear how i mean how adaptive people are to these products. And I think that does strike me a little bit because network effects are generally hard to build. i mean, what's interesting is that the value compounds in a way that a peer software, a peer service business does, and every provider you bring on makes it more credible. Every pharma company you bring on makes it more credible. And then you have larger, diverse patient populations too when you do that. So um I can't imagine there wasn't like an inflection point when that flywheel was just like you asking people to take bets on you and then eventually it turned into a flywheel once you hit a certain density. But I would love to hear. I mean, you have this general cold start problem building a network effect. It's hard to get someone take a bet on you before you have.
00:38:11
Speaker
much proof of traction here. And it seems like you guys right now in oncology may be planning to move into new sectors in the future, but how do you think about expanding beyond oncology? I don't know how, and i would love to hear how building that network was at first. And how do you think about expanding beyond oncology and what that re-situation of getting new providers and new patients that in a totally different, I guess, a therapeutic area, what does that look like for you guys in terms of building that network out past year your original sector?
00:38:38
Speaker
It's such a perceptive question, so thank you for asking. This this fundamentally is is a multi-sided network problem in how we how we build the business. you know our our this software The software has intrinsic value, but where the value is is in creating the network that this that is running on the software.
00:39:01
Speaker
And when we have multiple pharmaceutical companies participating, it adds more value to the individual hospital or provider group, and then vice versa is also true.
00:39:12
Speaker
What we recognize very early on is that there absolutely is this cold start problem. And if we're going to cold start, we're going to be sitting here for a very long time. And this is where i i I acknowledge that there are various different ways to build a company. And we built a company in a very unusual way, which is we raised a lot of money out of the gate.
00:39:36
Speaker
And we partnered very closely with a lot of venture firms. So Arch, General Catalyst, Google Ventures, Mubadala, a lot of firms.
00:39:46
Speaker
And what that allowed us to do is have the cache and importantly the capital to effectively buy our way out of the cold start problem. So when we started the company, we acquired a small company that had been in the space for a number of years.
00:40:05
Speaker
ah That company had built a clinical trial matching system that was deployed in community oncology and a few hospitals. We then had a network to start with, and that allowed us to sign on more providers ah because we had a product, it was proven, and we did a lot to rebuild the product and rebuild elements, but we still had a core product that someone could point to and say, yes, others are using it.
00:40:33
Speaker
We then went from community oncology to hospital systems that are multidisciplinary, and Rural systems like All True Health, larger community systems like Sanford Health in the Dakotas. So we signed a bunch of very large hospital groups that are multidisciplinary with the premise that we would start an oncology, but then expand out to other therapeutic areas and and service lines as we wanted to expand our capabilities.
00:41:05
Speaker
And that kind of gave us enough proof point on the provider side to then go to pharma and say, look, we've got these providers. They already use us and they're loving us.
00:41:17
Speaker
We're happy for you to go talk to them about us. Give us a study or two and take a chance. And we made the decision as a company, which we had the luxury to do because of the capital that we had access to.
00:41:31
Speaker
we made the decision not to take on business from pharmaceutical companies until we were confident that we could deliver and we actively turned down business in the early days because we did not want to take something on and then fail to execute.
00:41:47
Speaker
Not every company can do that. We really had the luxury and it is a tremendous credit to to Kent, our our CEO, as well as to our board that we had the flexibility and the the freedom to make that decision, which most companies cannot afford to do.
00:42:07
Speaker
So that's how we hacked the cold start problem. It was through acquisition, really focus on building up one side of the network with some intrinsic value and then going to pharma. And that really then culminated in the acquisition that we did at the tail end of 2025, which was acquiring Flatiron's clinical research business unit.
00:42:29
Speaker
And as your audience probably knows, Flatiron Health had started in the mid-2010s. They built out a a really important electronic medical record for community oncology. They built a real-world data business based on that. And they had started doing a little bit in clinical research and in clinical trials.
00:42:51
Speaker
And we thought that there was a really good marriage of what we're doing and what they're doing. And we ultimately decided that we would acquire that business unit from them, which meant that we took over all of their pharmaceutical business for clinical research. So feasibility, trial matching, ah study data collection,
00:43:11
Speaker
And then we also took over ownership of certain products and services that they were providing to the practices that use their
Global and Technological Shifts in Trials
00:43:20
Speaker
EMR and to a number of academic medical centers like MD Anderson and and others.
00:43:27
Speaker
So we took that over and that really you know was another inflection point because now we had a much larger provider network that we were working with. We also had a number of pharmaceutical companies, deeper business and than we had before. So those two acquisitions were very important for the overall growth trajectory of our company. And when you kind of combine acquisitions and organic and some other partnerships that we've done, like our partnership with ParXel, what it means today is that
00:44:00
Speaker
We have somewhere around 165, 170 health provider organizations. We are in almost every state.
00:44:10
Speaker
Our clinical trial sites are accessible to somewhere around 78% of the cancer population in the U.S., and accessible meaning 30-minute drive or transit time.
00:44:23
Speaker
um And ah in addition to that, we work with 20 of the top 25 global biopharma companies in meaningful ways, not not just a pilot, but in you know in in fairly meaningful ways, um including as you you know probably as your listeners probably saw the FDA announcement last week where with Amgen and AstraZeneca, we were able to very quickly do an innovative real-time implement something called a real-time clinical trial, which we could talk about.
00:44:54
Speaker
Yeah, I think that's super, that's that is super exciting. and I think this cold star problem is something that you see so often in healthcare. In insurance, you have to appeal to employers and employees, providers all at the same time. In pharma, clinical trials, you do too. In so many other sectors, it's um a multi-headed problem. You have to figure out who do you want to start with and How can you add value to them while you get the other stakeholders on board also, which is so difficult? I'm sure um fundraising a lot can help you there, too. But um kind of for our last question here, there's so many things going on in this space. On the provider side, there's more um consolidation of providers, a huge supply demand discrepancy.
00:45:30
Speaker
um In the pharma side of things, like there's more trials and development happening in China. AI might accelerate things, still a bit of a question marks there. um And then on the pharma side, huge patent cliffs too. i mean, there's so many things going on in this industry, so many modalities in biotech now. So I'd love to hear from you. What keeps you up at night? What's the one thing that keeps you up at night over the next five years, whether it's exciting or scary or something in between? What are you kind of thinking about the most and the way healthcare, your industry might change?
00:46:01
Speaker
I'll give you probably the negative one first and then I'll give you the positive one. Okay. You saved the good news for last. Yeah. Yeah, exactly. So yeah the thing that I worry about is that the United States and other allied countries like Japan and other countries...
00:46:22
Speaker
I worry that we will lose our edge in terms of moving quickly and rapidly to solve the underlying problems that relate to, i frankly, innovation generally in healthcare and life sciences, but specifically on clinical trials, related to changing a lot of fundamentally broken or stagnant or inefficient ways of working And what that means is that you know the next 50 to 100 years are going to be dominated by other entities, um whether it's China or or other places,
00:47:02
Speaker
where you know they might then be able to insert more control over us and our ability to operate as a country. you know If we have our clinical trial um work, if we have our supply chains, if we have all that in China, that provides leverage for them over the United States. And I think for all of our sakes, you know we want to make sure that the US has a very strong clinical innovation ecosystem, including clinical trials,
00:47:31
Speaker
And that's not just about the type of work that we do at Paradigm. It's also about fundamental things like making the IRB process efficient and making sure that INDs are filed in an effective and efficient manner. So there's all sorts of elements. There's manufacturing and supply chain.
00:47:49
Speaker
There's a ton of elements beyond just what what Paradigm is tackling. But for Paradigm Health, I mean, we are tackling, i think, one of the most critical problems, which is the infrastructure for running the trials in the United States and you know other countries. So we work in Japan, we work in Israel. There are other countries that we're expanding to as well that are aligned with the U.S.
00:48:10
Speaker
In terms of what gives me what keeps me up at night that gives me hope, ah I'm sure this will be the answer that most people will give you these days. But it is the rise of ai and LLMs and productivity tools that will really help us capture or recapture our leadership edge.
00:48:31
Speaker
We have the ability to have tremendous productivity gains that have positive benefit for all of our lifestyles um and our well-being, you know both as individuals and and as a country. And i am always night i'm always awake at night Thinking about how do we embrace this? How do we lean more into this? How do we infuse this into the work that we do at Paradigm? Not just into our products, but into the daily motion of what we do.
00:49:03
Speaker
And then also, you know, from a personal life standpoint, thinking about how do I use my ah how do i use my agents to to to schedule my schedule my appointments renew my car registration all all those things but it is so difficult to keep up with because the progress is so rapid and i fear that have certain parts of the country might be left behind if they don't kind of embrace and and lean into this and for paradigm health part of our focus is working with rural health systems and other other systems that are not you know typically the the groups that you know maybe ah like a Silicon Valley based tech company is gonna work with. So we really focus on how do we democratize access and make sure that everybody has access to this, whether you're St. Charles Health in rural Oregon, or your m d Anderson or
Conclusion and Future of Clinical Trials
00:50:00
Speaker
a big health system like UPenn. So we we really focus on that democratization. So that's ah that's what keeps me up at night, both bad and good.
00:50:08
Speaker
Yeah, I think that's exciting definitely exciting. um it's It's funny because I guess you kind of hinted at this in your answer, but there is really no truly bad or good trend in healthcare. Everything has a little bit of bad, a little bit of good.
00:50:19
Speaker
China ideally will help accelerate drug discovery, help solve and new patients. But of course, it can be an issue if it's leveraged the wrong way. Same for AI. I mean, AI will... it's already transforming a lot of lives, but it could, there could be some caveats too. So I'm both excited yet also a little bit fearful of where things might go, but generally more excited, I hope, as an optimistic young student. so I really appreciate you. I mean, coming on, I think the clinical trials problem seems to be one of the largest things that I've been hearing about recurring. And I think just redesigning this whole system is exciting. So thanks again, Jonathan, for coming on, walking through your time at Paradigm and what's going on in the clinical trial space broadly.
00:50:58
Speaker
Thank you for having me and congratulations on an amazing podcast.
00:51:04
Speaker
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00:51:16
Speaker
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00:51:29
Speaker
Repeat, thehealthcaretheory.org. Again, i appreciate you tuning in and I hope to see you again soon.