Fighting the pandemic, from both the front lines and the office
Emergency physician and health care investor Rodney Altman says it’s a privilege to serve patients in his dual roles.
Although the emergency rooms of the Stanford and Kaiser Permanente hospitals in Northern California have not been overwhelmed with COVID-19 patients as they have in hospitals in other parts of the country, medical staff like Dr. Rodney Altman must treat every patient as a potential COVID-19 case.
That means medical staff suit up in special equipment and take extra precautions as part of their process, and there is the additional emotional complexity of having to isolate critically ill patients away from their loved ones.
“It’s a privilege to serve these patients,” Altman said. “During the past few months, hospital patients and their families have been going through the worst impacts of the pandemic. Overall, the staff and administrators at the institutions where I work have weathered the storm, while remaining prepared for much worse.”
Treating patients, Altman noted, has also afforded him the privilege of seeing the health care industry up close. More than 20 years ago, he decided that being at patients’ bedsides wasn’t enough. He also wanted to use his knowledge and experience to impact change within the broader system.
“It’s a privilege to serve these patients. During the past few months, hospital patients and their families have been going through the worst impacts of the pandemic.” — Rodney Altman
He went back to school for a business degree while practicing, and for 20 years, his full-time focus has been his work as a health care investor while he continues shifts in the ER on a limited, part-time basis. Altman joined Wells Fargo Strategic Capital’s team that focuses on health care as a managing director in late 2019.
Bringing front-line knowledge to doctors and patients
As a health care investor, Altman helps make decisions about which health care companies to invest in and how capital is allocated to them.
“Being a health care investor allows me to have a wider, but perhaps less direct, impact than I could ever have as a physician,” Altman said. “I feel lucky that I can play a greater role in what goods and services get into the hands of doctors and patients.”
Many of the health care companies seeking capital from Wells Fargo are working to deliver improvements in outcomes, including for those affected by COVID-19.
“We are thankful to be part of a solution, working with health care companies that are innovative and focused on the advancement of technology to not only improve the delivery of health care, but to help in this current crisis,” said John Ryan, managing director and leader of the health care investing team for Wells Fargo Strategic Capital.
“Being a health care investor allows me to have a wider, but perhaps less direct, impact than I could ever have as a physician. I feel lucky that I can play a greater role in what goods and services get into the hands of doctors and patients.” — Rodney Altman
The health care division within Strategic Capital provides capital solutions using various financing structures including equity, debt, or both, to foster strong relationships with growing companies that are at a late venture or growth capital stage, with revenues up to $1 billion. The team generally invests $5-$30 million per transaction.
“The employees within the health care group at Wells Fargo Strategic Capital view ourselves as long-term investors,” Altman said. “We are looking for investments that may experience favorable tailwinds due to the COVID‐19 pandemic, but will be good investments in the long run.”
When the health care companies that Wells Fargo invests in succeed, Altman says, it’s not just about their bottom lines.
“In health care, what is right for patients and customers usually correlates closely with business success,” he said.
The prognosis for the industry
Altman has long applied what he sees in the ER to his decisions in his day job. Now, during the pandemic, he feels his dual roles in both the ER and the financial industry positions him to serve patients, on both fronts, like never before.
“Having current medical knowledge, understanding what goes on at the bedside, and understanding workflows, has been very helpful to me as an investor. When combined with the expertise of other members of the team, my perspective is a valuable part of making decisions,” Altman said.
The health care system is one of the largest sectors of the economy, representing more than 18% of the U.S. gross domestic product. Altman focuses on the products and services that reduce costs and make the health care system more efficient — saying these are key to serving the needs of patients, medical staff, hospitals, and payers, while also supporting some of the best opportunities for investment.
COVID-19 has accelerated some of the trends Strategic Capital has been tracking, while others have been slowed by the virus, but are expected to pick back up, Altman said.
“There are numerous areas of growth in health care, but a few examples are telemedicine, remote monitoring solutions, behavioral medicine, ambulatory surgical centers, and diagnostics.”
Telemedicine, or visiting with a doctor remotely, has seen dramatic increases in use during the pandemic, Altman said. This is one of the investment areas his team is tracking.
“Because of the pandemic, clinics and physician offices were closed, and regulatory barriers came down. Now, payers, physicians, and patients are all more comfortable using telemedicine as a solution, so usage is way up."
“Being part of a group that provides Wells Fargo with a more significant presence in the entrepreneurial ecosystem of emerging private companies gives me a great opportunity to benefit society, in addition to being a part of the medical community during this challenging time.” — Rodney Altman
Ambulatory surgical centers, which perform medical procedures in settings other than hospitals, are an example of a health care industry growth area that slowed during the pandemic when they closed. But as communities open back up, and elective surgeries pick up in volumes again, patients, payers, and physicians are expected to return to these settings, especially as an alternative to going to the hospital.
“The move to ambulatory surgical centers is the one that is, I think, unstoppable,” Altman said.
Behavioral medicine, for those suffering emotionally or mentally, has been another area of market growth for years, Altman said. The growth correlates with the lessening of stigmas toward mental illnesses and increasing awareness of behavioral illnesses.
The demand for behavioral medicine will likely go up, Altman said.
“There are going to be more people going through challenges and extremely stressful events related to COVID-19, which will likely result in more people seeking behavioral medicine.”
Another area of increased demand, which has been accelerated by the pandemic, is diagnostics.
The health care industry had already become more attractive because of scientific advances that enabled precision medicine. Seeing this, the health care team within Strategic Capital successfully invested in companies like 10x Genomics. 10x Genomics tools enable researchers to gain a more detailed understanding of how viruses impact infected patients and assist in the process of finding therapies and vaccines.
Whether serving as a doctor or health care investor, Altman said he is glad to bring both perspectives to his work.
“Being part of a group that provides Wells Fargo with a more significant presence in the entrepreneurial ecosystem of emerging private companies gives me a great opportunity to benefit society, in addition to being a part of the medical community during this challenging time,” Altman said.
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