Tag Archives: Wikipedia

Save the Patient. Make Exorbitant Profits. Is This Okay?

How do you feel about projecting excessive profitability in a health care business plan?

Over the weekend I saw the pitch for a brilliant business plan, with great technology, for developing medical electronics that could significantly reduce some kinds of complications in some kinds of surgeries.

Soaring Health Care Costs Time Magazine Bitter Bill

“The world needs this,” I thought. “I hope these people succeed. I hope they get the investment they need.”

But then they got to the financial projections.

Their sales forecast soared to tens of millions of dollars, but their technology was so good that it seemed credible. They had PhDs and patents and a strong team. No problem there. 

But they also projected 80-85% EBIT (earnings before interest and taxes). And that got my attention. It’s not just my chronic skepticism about absurdly high projected profits in business plans; it’s also about intentions, exploitative pricing, what Wikipedia calls price gouging. And about ethics. 

It reminded me of the Steven Bill cover story in Time Magazine a couple of months ago, called Bitter Pill. Or if you want the short version, watch this Jon Stewart interview with Steve Brill. He says: 

It’s the people who organize the care, who sell the equipment, who sell the drugs; they’re the ones making the money. 

Later I asked the inventor about the ethics of pricing. He understood the problem. He gave me a sensitive respectful answer. He said he trusted his more-businesslike co-founders who set the prices. He explained that pricing is set by the whole system, pretty much what Brill’s piece suggests. He didn’t say that profits from this one product would go straight back to research for other products, more inventions, and more improvement in surgical equipment. Insurance companies set the price. His company can beat the existing costs with something much safer. So, if they can execute their plan, they’ll make huge profits. 

Medical costs will still go down, if it works, because it reduces complications. Patients will benefit too, with less pain, illness, and death. But according to their own numbers, they could charge a third of their planned price and still make healthy profits. 

What do you think? 

(Editorial note: I’m not giving specifics on purpose. I don’t want to make this about a specific company. And at this point it’s all hypothetical anyway, just a few numbers in a business plan.) 

Charting the Lesson of Wikipedia’s Jimmy Appeal

Yesterday I posted here David McCandless’ fascinating 18-minute talk on data visualization, in which he puts up charts and graphs as a window into patterns and relationships in numbers.

Watching that talk led me to discover his Information is Beautiful blog, which is a great source of ideas and insights.

For example, the chart shown here, from that blog, titled The Science Behind Wikipedia’s Jimmy Appeal:

business chart

That’s just one recent example. Fascinating stuff.

Do You Know What Labor Day Is?

I didn’t know this, probably  because I’ve never bothered to ask, but the U.S. Labor Day celebration today dates back to the 1880s, the days of robber barons and unbridled abuses of capitalism, to celebrate the labor movement. 

I suppose that should have been obvious. But we had a discussion over dinner the other day, and nobody knew. One person said they’d talked about it at their office, and decided that it had nothing to do with women giving birth.

It’s a good reminder of what the labor movement did for people back in the beginning. This is from Wikipedia:

The first Labor Day in the United States was celebrated on September 5, 1882 in New York City. It became a federal holiday in 1894, when, following the deaths of a number of workers at the hands of the U.S. military and U.S. Marshals during the Pullman Strike, President Grover Cleveland put reconciliation with the labor movement as a top political priority. Fearing further conflict, legislation making Labor Day a national holiday was rushed through Congress unanimously and signed into law a mere six days after the end of the strike. The September date was chosen as Cleveland was concerned that aligning an American labor holiday with existing international May Day celebrations would stir up negative emotions linked to the Haymarket Affair. All 50 U.S. states have made Labor Day a state holiday.

Still, I like the pithy summary I see in the bumper stickers in our parking lot, which we share with the local headquarters of Service Employees International Union (SEIU) headquarters. For example:

Which is particularly effective when coupled with this one:

I’ve been a union member twice, both times more than 40 years ago, once in the sugar workers and once in the steel workers union. I think we pretty much take unions for granted these days, along with what they fought for. And who knows – maybe the power has shifted so much that we see unions’ excess too, like when public schools can’t fire poor teachers, and public employees get sweetheart retirement deals, better than the private sector, that drag down public budgets. What do you think?

(Image credit: the old drawing is from Wikipedia. And those bumper stickers are available for sale at labornotes.org.)

The Web as Random Acts of Kindness

Researchers put a cute-looking cardboard robot on the streets of New York. It could only go forward but it had a note asking people to help it to its destination. It got there quickly with the help of 43 people. They asked for nothing in return.

A teenager got caught on YouTube with a humiliating video that spread like wildfire. Editors at Wikipedia make a point of keeping his name off of the story.

The Wikipedia itself is a marvelous example of people helping people, for free, because they want to.

People helping people, asking nothing in return. In the TED talk here, Harvard Law professor Jonathan Zittrain talks of the web as random acts of kindness. Node by node, computers are shared. Volunteers run the soft spots and correct problems. There’s a very refreshing optimism here, a reminder that technology isn’t necessarily making us all more lonely and isolated.

(If you don’t see the video here, you can click here for the original on the TED site.)

Here is more on Jonathan Zittrain from the TED site:

He is an investigator for the OpenNet initiative and co-founder of Harvard’s Berkman Center for Internet and Society, has long studied the legal, technological and world-shaking aspects of quickly morphing virtual terrains. He performed the first large-scale tests of Internet filtering in China and Saudi Arabia in 2002. His initiatives include projects to fight malware (StopBadware) and ChillingEffects, a site designed to support open content by tracking legal threats to individual users.

(Photo credit: that’s a screen shot from the video of the talk, about 17 minutes in.)