David Himmel: Developing treatments and fostering partnerships that advance personalized health care is an important charge for biopharmaceutical leader Genentech. But health care in the U.S. is about more than good science—it’s about policy, too.

I’m David Himmel. I recently sat down with Genentech’s Fritz Bittenbender to discuss the policies at the forefront of the personalized health care conversation in Washington that will determine the fate of this next generation of care.

Fritz, thank you so much for being here today. How is your team working with policymakers to fulfill Genentech’s vision to transform patients’ lives and revolutionize our health care system?

Fritz Bittenbender: Thank you very much for the question. Genentech is, first and foremost, a science company. So, as a company, we approach everything we do from that scientific perspective including what we do in government affairs and policy development. We’re a company that goes up on Capitol Hill and says, “we want to work with you to make your policy solution better so that it can have a bigger impact on patients.”

We do that through government affairs as well and be really the solutions providers to a lot of the most thorny and difficult issues that we have. We have solutions that will lower healthcare costs for patients and the government while preserving the amazing innovation ecosystem that we have in the U.S. This is one of the reasons I’m so excited about personalized health care because there are a lot of policy issues that we have to address to make this work, but if we can make it work and really develop personalized health care, the impact that we’re going to have on patient health and lowering health care costs is going to be absolutely tremendous.

David Himmel: What are some of the specific regulatory and policy roadblocks that are preventing personalized health care from realizing its full potential? How do these barriers limit Genentech’s ability to develop the next wave of innovative medicines?

Fritz Bittenbender: Our healthcare system has been built up over decades and we have to now begin to look at it and solve problems holistically rather than one piece at a time. And that’s why it’s so critical that when we’re thinking about policy, we’re not just thinking about one industry. We’re thinking about the entire ecosystem and how those pieces interrelate and how changes in policy can make the entire system better or worse. And how we can all work together to have an even more positive impact for patients that provides better outcomes and lowers costs.

We have to modernize our reimbursement system in the US. One of the challenges that we’re finding, particularly when we are trying to develop value-based arrangements with insurers for the benefit of patients, is that a lot of the healthcare systems don’t talk to each other. So, it makes it impossible to really track patient outcomes in the right way. A great example of this is you might have a financial system at a hospital that does not talk to or marry up with the patient outcomes data from the same health system. So there’s no way to say that patient Y was on product X and had outcome Z and therefore the patient had a positive outcome and the medicine should be reimbursed at a certain level or the patient didn’t have a positive outcome.

The other area for us that is really important is we’re starting to see individual States take up data privacy. We do research across the entire country. If we have 50 different States setting 50 different personal data standards it’s going to actually add costs to our clinical trials or the health care system because we’re going to have to better understand all that and how we have to operate in Colorado is different than California is different than Pennsylvania. And that becomes sort of an increasing challenge. So part of what we’re trying to resolve is how do we get a national standard on data privacy? And then how do we get a global standard on data privacy so we can actually share data.

Most important is how do we protect individual patient’s data. How do we set standards that protect the patient, but also allow the data to be used, collected and shared for, for research purposes. That’s probably first and foremost, one of the most critical policy areas.

So we’re really concerned that some of the laws are being developed out there are not thinking about healthcare applications. And so some of the intended consequences may be us not being able to use that data the way we hope to be able to use it to have the most important impact for patients. And so that’s a real policy challenge that we have right now as different states set standards as the federal government thinks about a standard.

David Himmel: Let’s talk about that for second. There have been policy discussions around implementing an international pricing index model. And these proposals aim to lower costs and increase access, two problems that Genentech is working to solve for, it would also create new challenges when it comes to research and development. Let’s talk a little more about that. What’s at stake when it comes to R&D?

Fritz Bittenbender: There’s a lot at stake. One of the challenges is healthcare costs are lower around the world than they are in the United States, and part of that is because most places around the world have developed different health care systems. One of the concerns we have with IPI and international reference pricing is if you want to sort of allow other countries to set your prices in the United States, it's going to have a fundamental impact on the entire healthcare system. It's going to have an impact on access to medicine for patients and what patients can, can get. Patient access to medicines around the world is much different than it is in the U.S.

What’s most concerning for us is we don’t doubt that there’s a problem and we don’t doubt that we have to lower health care costs and we have to do something about rising drug costs and we actually have solutions that would have a really significant financial impact to our business. There has to be change. We just disagree on how to do that.

And we believe there's a way to pass that significant savings on to the government and patients. We put a proposal on the table that could save tens of billions of dollars over 10 years and fundamentally bring prices down for both patients and the government, but do in a way that preserve our ability to innovate and continues to, to ensure that America is a global leader in the development of new medicines for patients.

David Himmel: Unpack that a bit more. How would IPI decrease Genentech’s ability to invest in innovative solutions like PHC?

Fritz Bittenbender: We have some new molecular entities that are in our late stage research pipeline across a host of various diseases. And we can do that because we're investing $11 billion or more a year in research and that's, that is absolutely critical to us.

Over the last number of years, we've spent over $2 billion on Alzheimer's research because we believe that this is the one of the most compelling areas of need for patients.

Right now we can make a business decision to invest $2 billion in that research but if our research budget gets slashed dramatically, there are really important programs in, in our resource portfolio that we're just not going to be able to afford to fund. And that's not a scare tactic. That’s just a reality.

We believe you can still use market forces and mechanisms to significantly lower costs in a way that can preserve our ability to invest in innovative products and continue to invest in PHC.

David Himmel: As you look across your portfolio of work and the progress Genentech has made both scientifically and from a policy perspective, what excites you most about the future of personalized health care?

Fritz Bittenbender: One of the other exciting opportunities with personalized healthcare is also our ability to understand diverse patient populations so much better. One of the things we’re starting to understand through genomics is that medicines can actually impact different people differently. One of the real focuses that we have on Genentech is making sure that in our clinical trials we get a diverse patient population.

We can get hundreds of thousands, millions of data points, and each of those points when you look at them holistically can tell a very rich history about that patient, but also future patients who may be similar to that patient.

You know I've been around this industry, almost 25 years and the thing that excites me the most is the incredible pace of innovation that's happening right now.

If we can get to that level of medicine, we're going to fundamentally change people's lives and that's so exciting, but we're going to do it in a way that is going to keep people healthier longer. It's going to get them on the right medicines at the right time. So they're actually not losing time, energy and health care resources by being on the wrong medicine. We're going to be able to lower patient costs if we can develop those types of target therapies and we're going to be able to fundamentally bend the health care cost curve for our entire healthcare system.

And particularly when I think about personalized health care and the impact that that could have on patients for my generation but frankly, for my kids, I think it's just so exciting and it really is what gets me up every morning and challenges me to go to this job so that we can get it right.