What is Flatiron Health?
In the US, cancer affects 1 of every 2 men and 1 of every 3 women [i]. Odds are we all know someone who has been at the very least diagnosed. One company looking to reduce these dire numbers is Flatiron Health, a Series B healthcare IT company headquartered in New York City and founded in 2012. Flatiron’s mission is to fight cancer by organizing data, and with $130M from Google Ventures in its latest 2014 raise, it is well on its way [ii].
In the oncology space, data has traditionally been dispersed and fragmented. Only 4% of cancer patients are captured in clinical trials, a limited sample to draw from when considering the complexities of the disease [iii]. The remaining 96% of patients have medical information that are tangled up in disconnected, unorganized medical records and doctors’ notes. Much of this information is unstructured. This is where Flatiron comes in. Flatiron helps providers organize, structure, and consolidate its cancer information onto one platform called OncologyCloud to transform the delivery of patient care [iv].
OncologyCloud is a software suite that includes:
- OncoEMR: An electronic medical record platform to aggregate all patient data
- OncoAnalytics: An analytics tool to draw insights from this clinical and operational data (eg, alerting clinicians if a patient is eligible for a particular clinical trial)
- OncoBilling: A billing software to help streamline the claims process with payers on the back-end
- SeeYourChart: A patient portal to enable patients to be informed and engaged with their care
As of 2014, approximately 2,000 clinicians and administrators were using Flatiron’s platform [v]. Since then, Flatiron has grown in customers, employee count, and VC funding and thus far appears to be on an upward trajectory.
How Flatiron’s Business and Operating Models Align
Flatiron’s business model involves offering a software platform to providers to input cancer patient data. This product enables Flatiron to build up a centralized database, organizing the cancer data, and conduct analytics to draw key insights and better improve health outcomes. With this rich dataset, Flatiron is able to work with life science companies to inform drug research and development and find a potential cure for cancer.
While this process of creating a centralized oncology database and drawing out key insights may be daunting, I believe Flatiron is a winner. Its business model aligns with its operating model, where the data and insights sourced from the OncologyCloud software suite serves as the basis of Flatiron’s value creation. These models support one another, where moving more providers onto this software platform establishes a network effect that enables Flatiron’s database to grow larger and even more valuable. As providers become increasingly reliant on Flatiron’s offerings, it becomes even more challenging for competitors to enter the space. Although individual cancer institutes like Sloan Kettering and Mt. Sinai’s Icahn Institute have attempted to utilize their own datasets in a similar fashion, the value of Flatiron is that it is able to act as a third party platform to consolidate across a diverse set of providers [v]. Not to mention, Flatiron’s push to acquire and partner with various players in the oncology space, including Altos Solutions, Varian Medical Systems, and Foundation Medicine, has enabled it to have a strong established position of credibility and support [vi].
Internally, Flatiron has dedicated client teams for the provider and life sciences sides of the business, each of which partners with the data science, engineering, and clinical oncology teams to effectively meet the needs of their provider and life science customers. It is a complex operating model, requiring much cross-functional team collaboration and clear lines of communication [vii].
What remains to be seen is what will happen for Flatiron longer-term. Will they be able to effectively draw actionable insights from their database to find a cure for cancer? Will they remain an information technology company or could they move into other parts of the value chain? How will they continue to build out their provider and life science businesses? Time will tell, but in the meantime, I say hats off to Flatiron Health for tackling a challenging problem that affects so many of us.
- [i] http://www.cancer.org/acs/groups/content/@editorial/documents/document/acspc-044552.pdf
- [ii] http://techcrunch.com/2014/05/07/google-ventures-leads-130m-series-b-in-cancer-data-startup-flatiron-health/
- [iii] http://blogs.wsj.com/venturecapital/2014/05/07/google-ventures-leads-130m-round-for-big-data-medical-software-company-flatiron-health/
- [iv] http://www.flatiron.com/
- [v] http://fortune.com/2014/06/12/flatiron-healths-bold-proposition-to-fight-cancer-with-big-data/; http://fortune.com/2014/07/24/can-big-data-cure-cancer/
- [vi] http://www.businesswire.com/news/home/20140509005386/en/Altos-Solutions-Acquired-Big-Data-Leader-Flatiron; http://investors.varian.com/2015-05-26-Varian-Medical-Systems-and-Flatiron-Health-to-Develop-Next-Generation-of-Cloud-based-Oncology-Software; http://investors.foundationmedicine.com/releasedetail.cfm?releaseid=885539
- [vii] Flatiron Health conversation.