The Future of Healthcare Technology with Eli Lilly and Company's Diogo Rau

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Welcome to Revisionist History.

We have a special treat today.

I had a chance to sit down with a guy named Diogo Rao, who worked for years at Apple, Way API, and then left to become the chief information and digital officer at Eli Lilly ⁇ Company, one of the biggest drug makers in the world.

Diogo, as you will learn, is irreverent and fascinating, and sees a good 10 years ahead of the rest of us.

At the end of our conversation, Diogo said to me, you know, we never got to AI, which is true.

Can you imagine a conversation about technology so interesting that you never get to the subject of artificial intelligence?

That's what you're about to hear.

We're going to talk about a whole number of things, but I wanted you to start because you're a very unusual figure.

You work for Eli Lilly, but you are a very unusual figure at Eli Lilly.

Is that a fair statement?

I think I have that reputation of being unusual.

At least I like to try to do things a little bit differently.

You know, I was talking about your background.

Yeah.

Yep.

You worked in the tech industry for how many years?

I worked in the tech industry, well, really my whole life.

But the last 10 years before I came to Lilly, I was at Apple.

And before that, I was doing other kinds of technology work at McKinsey.

And before that, I was in the startup world.

So I've really spent my whole life in technology.

How many people do you think have moved from Apple to a life sciences company?

About five.

I think I know them all.

Do you guys get together?

I think we did most of them.

Oh, I see.

And how do you, sorry, this is a kind of, I want to start on this little, um, on this little tangent, but how did that work exactly?

So somebody comes to you and says, have you ever thought to work for a pharma company?

Well, yeah, and that's the way a lot of these things start.

It's, you know, there was a recruiter that I worked with who

gave me a call and said, hey, I've got this opportunity.

It's in life sciences.

And I was like, I've never done anything in life sciences before.

He's like, that's okay.

So I look at the spec and the spec is, you know, it's pretty interesting.

So I'm like, okay, it's worth a phone call.

And then I meet our CEO and our head of HR.

And like, these people are really nice.

And so that's like the second thing that I noticed is that they're really, really, really nice.

And that's, that's a big difference, by the way, coming from versus the tech world.

Happy to say a little more about that.

And then I start talking to our head of research and development about some of the problems that we're trying to solve in life sciences.

And I realized, wow, this is like a fascinating space.

I kind of thought that like everything exciting in the world was happening in tech.

And then I came to realize, no, actually, there's a lot of exciting stuff that's happening outside of just the tech world.

Yeah.

So let's start.

So you make this.

When did you start your job at Lilly?

May 17th, 2021.

So go through,

just off the top of your head, the most surprising things you learned moving from Silicon Valley to a life sciences company.

Well, the number one thing that I actually saw was actually the nice nice people part.

But, you know, the second thing that I noticed was really long time scales.

Like the size and the duration of things is just

beyond belief.

My first executive committee meeting in 2021, we were talking about a revenue forecast that was for 2030.

And that was nine years out.

Like in tech, like looking like 18 months out of revenue is ridiculous.

Wait, so when you see that,

what's your reaction?

Oh, yes.

There's like no way we can predict our revenues for nine years from now.

And of course, now I realize that I'm in here, that there are a lot of things that you can predict.

And it is actually very predictable.

It's a big bet.

And if it works,

you'll hit it.

But it's much less volatile.

These time scales are crazy, though, because at our last executive committee meeting right before the break, we were talking about a product launch.

I'll ask you a question.

Guess when our product launches that we were talking about in December?

Well, now that you've primed

it's going to be five, six, seven years.

No, 2036.

Oh my God.

And so there is, I can guarantee you there are zero tech companies right now talking about what they're going to launch in 2036.

Yeah.

Yeah.

And

not only, so there is certainty that this product will be approved, but just the

You can be you can be 10 years away and be certain it'll be approved, but know that you still have 10 years worth of work to do?

Yes.

You can't be certain, of course, that anything is going to be approved.

And so we apply a probability of technical success.

This phrase that I never heard of before I got here, but every step of the way has probability of technical success.

And so you factor it in and

you take all that into account.

But you know when you have a good medicine and you know what it's going to take, but it just takes 10 years to bring a medicine to life.

And I don't think that was one of the things that I realized before I came into this, just how long it takes and how much money it takes.

So it is possible that you will work on things that you will never see come to fruition.

In fact, most of our scientists that work here will never see their medicines that they're working on come to life, which is kind of crazy to think of.

Does it affect the culture of the organization?

It gives it a really long-term perspective, like crazy long-term perspective.

When we're talking about things, making decisions, we're really not thinking, you know, like at an executive committee level, there are some things that we're doing on a, you know, on a this year basis, but there are a lot of things that we're doing that we're really talking about, like the 2030s, like just a much different time scale from anything else.

And so we're not going to do anything stupid, I think, is one of the good things.

We're not going to trade off some of the long term to get a little bit of benefit in the short term.

So I think it makes us much more

rational that way.

I guess I would say we play the long game.

But I want to go back to, so you come to Lily, and I'm curious.

So what did they want from you?

My boss, our CEO,

gave me a mandate to really change, to like bring in technology into everything that

we did.

So it was not a caretaker role, sort of a mandate.

You know, we want you to just keep running the things.

We want you to really figure out like what can you do to shake things up.

And so

that was really the goal.

And I think a big part of it was bringing a consumer orientation as well.

And I think this is an industry that has has largely worked the same since the 1950s.

I mean, if you look at it, the way you get medicines today as a patient is basically unchanged.

You go to your doctor, they write a form.

Maybe now they submit your prescription electronically.

You still have to make sure you can pay for it.

You still have to go to a retail pharmacy in most cases.

None of that's really changed since the 1950s, even though we have so much more.

So, a big part of what we're trying to do is actually,

a big part of my mandate is to really bring this into the 21st century, or at least the late 20th century.

But is there within the portfolio of things that Lilly does, do you touch on everything or just are you are you focused on the on the consumer side of the business?

I mean what's the kind of what you remit?

The great thing is that I get to focus on all of that stuff.

So everything that's technology related.

I do cover everything from the discovery side through the consumer side.

And actually those are probably some of my favorite parts.

And I'm going to, because of course I shouldn't be saying favorites, but you know, I love the discovery side and discovering new molecules and what we can do there.

A lot of cool stuff, especially with AI, we could talk for hours about.

And the consumer side is also the place where I see where I have a passion coming from my prior life at Apple and just seeing the potential we have to change everything there.

And I think this whole industry hasn't really focused on how do we make it an amazing experience and work backwards.

I think the kinds of things that you see at Apple and a lot of other consumer-oriented companies just

haven't arrived here yet.

And how does putting the customer first in

that chain of kind of interest groups change the way you do business or change the way you think about what you're doing?

That was the most fundamental thing that I learned from my time at Apple.

And I think most companies will say, oh, we care about the customer, but whenever you start a project, people will have, I don't know, they'll have five pillars or five things they need to go after.

Well, maybe there's the business case, the product, the customer,

you'll have like five or six different things.

And the way you'd always do things at Apple was different.

You would always start by like, what's the customer, the consumer experience that you want to create?

And then work backwards and then figure out, you know,

can you make it a financial case around it?

Well, maybe you can't.

Okay, so we need to, maybe we can see how we can change things back and forth.

But it really was, everything was centered on the customer experience.

It wasn't like a pillar of one thing of five.

It was like the thing that was that was guiding everything.

And I think that's, we're not there yet, but that's like, that's the kind of thing we need to do like every single time.

We need to go,

we need to go back and see what's the customer experience like.

We need to actually focus on like making customer experience better.

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You have a whole

table full of goodies over there.

I want you to pick a goodie, and let's use

this as a specific, walk me through the kind of thinking behind the product,

the kind of specific challenges, how it represents this process that you've been talking about.

You pick.

Okay, great.

Just so people know, there's about

a couple of feet from

Diego, is there, there's about, looks like eight to ten

Mysterious boxes that are.

So

I have to share with everybody that like Malcolm and I had a little prep call before, you know, a couple of weeks ago, and it was only about 10 minutes because he just said, okay, you know, if you've got any toys, any goodies, like bring them along.

And so like my team gave me a box of goodies here, which is all splayed out on the table.

And then

I think you said, okay, I don't want to talk too much more.

Let's not do any more prep.

Well, the thing is, if you have small children as I do, you think exclusively in terms of

shiny little gifts.

You'd be surprised.

I almost said, can you bring snacks?

That would be another thing on the top of mind.

That's awesome.

All right.

So let me grab a box.

All right.

I'm going to show you something that's, that is, no, let me grab that one.

Yep.

And

I'm going to hide it here for just a second, tell you what the problem is that we're going after.

One of the big challenges in the world right now is medicine and medicine safety.

When I was at Apple, I saw counterfeit iPhones and I couldn't believe it.

You wouldn't know that they were counterfeit until you actually picked them up and played with them for like half an hour.

And sometimes we'd have to send them in and have them get x-rayed to know that

they're fake.

Well,

those were were on products you know that was like a thousand dollar product that electronics very hard to make a counterfeit but the economics were there medicines are a lot easier to fake or at least make them look fake all you need to do is copy the box uh and you know if it's in a vial you know put a label on it something like that and uh with some of the medicines that are out there right now there's a huge financial incentive for people to have to make to say that uh they're making medicines that they really are not and they're faking them.

What would be just it's just fascinating.

What's Is there a particular kind of medicine for which the counterfeiters

motivation is greatest?

Well right now

in chronic weight management we have the GLP1 medicines and so both for us and the other leading maker of GLP1 medicines

counterfeiting is a real real threat and back to formularies and things like that a lot of insurance plans do not cover chronic weight loss management And so there's a huge financial incentive on the black market to say, hey, we're going to go.

And some uncertainty about outcomes, so you would take you a while to figure out you're taking a fake.

Correct.

And

I mean, it's not only

a fake, it's actually, many of these cases are risky because

once you see the sterile environments that these medicines go through to be made,

in the best case, it's harmless, right?

I mean, the best case is you don't get any effect.

And so what I've got here is a product.

I'm going to, this can be any product

and

it's so don't pay attention to what product this actually is.

And I've got the product right here and I can tap my phone against it and I will get it put in an NFC tag.

And that NFC tag is just like when you do a contactless payment.

And it will bring up it'll bring up a page to show you that it could actually verify that the packaging matches something that we've produced.

Unlike a QR code, it can't be copied.

It's cryptographically secure.

And this is where the technology part gets interesting because they could copy the box, they could do all kinds of things like that, but they can't copy that tag.

There's one and only one tag that you can tap, and then we can verify it.

Yeah.

How long did it take to develop that particular technology?

So it took, this is something we did within my first few months of coming here, and we haven't launched it yet.

So the designing it is very easy.

The developing it is very hard.

So, you could, you could, what you're saying is what you have is a technology that could be a platform for building an interaction between the

consumer of the pill, the patient,

and

the manufacturer.

That's absolutely right.

And, you know, we actually don't even care about it necessarily being just for us.

Like, this is the kind of thing where we'd say, this is a great thing if adherence can improve for patients across all medicines, all manufacturers.

That would be fantastic.

Yeah.

How, but you've put that RFID tag on the box.

Correct.

But now there's still a thing inside the box.

There's still a thing inside the box.

So this is version one, which is on the box.

And then version two, which we'll come to later, will be on the individual medicine itself.

What about protecting against an unauthorized use of the medicine?

What if the wrong person taps their phone against?

Absolutely.

Then you could actually make sure that you're taking the right medicine.

I also think making sure that you haven't taken your medicine more than once in a day is also an important thing because you know what?

It's actually very very easy to do i also think that in a hospital environment it also is you know you could tie it into systems and make sure that you're actually administering the correct medicine uh not something that uh you can imagine an alert flashing up on uh on the uh health healthcare provider's device if it's the wrong medicine so this is beta with the box yeah how long how many years before you think you'll be actually in the pill itself

the pill itself i don't know if we'll ever get past the consumer

uh acceptance of RFID, like if it like actually being in the pillow itself.

But if we could get there,

that's not super far out.

That's probably

five years out.

Yeah.

But it's not the technology is.

The even better version is that you point your phone at your gut and you find out all the stuff that's in there.

You're like, oh my goodness,

what do they have for dinner?

Yeah, exactly.

It might not be good to find that out.

Pick another wearable because now I'm interested.

First of all, has Lily ever done a wearable before?

No.

We've not produced a wearable of our own.

And it ends up being a little bit challenging as a manufacturer.

It would be a lot easier if we didn't make drugs

to actually launch a wearable.

But because you make drugs,

then the question is, well, are you using this to, does it have to be, is it required for somebody taking the medicine?

So there's a whole host of things that makes it really complicated for us to do it.

So

for the most part, where we use these things are in clinical trials.

So how many wearables, take me 10 years into the future.

Yeah.

How many wearables am I wearing if I want to be completely, you know.

If you want to nerd out on all of this.

You know, I think it's probably on the scale of

two to three, I think.

I think there are only so many places that you're willing to put a wearable.

You know,

you can imagine there's your ring, there's a watch,

you know that you might be able to uh if you've ever had like a uh zyopatch or anything like that a heart patch those are not uh terribly uncomfortable insoles uh you know you could uh you could imagine but after that um you don't have that many more places i think that you would that you'd be willing to wear something so i i'll go with i'll go with the three tops i was going to say eyes i was reading eyes yeah that's a really uh i was reading a really fascinating study that was looking trying to figure out what the difference is between a novice police officer and an expert police officer and they use eye tracking gave them scenarios and figured out they're looking at different things right so you have a scenario of like a bad guy here and this happening here and someone throwing this here and we see the experts like looking doot doot doot doot doot doot doot doot and the novice is looking whoop

right yeah one spot versus but I'm just curious about like you know this

my sense is this is kind of once you start going down this road yeah there's lots and lots and lots lots and lots of things.

No, I thought you were going to go down a different path, which is like the

what you might like enhancing your eyes or your hearing or things like that, which is also like that's just another fascinating space of science.

And yeah, yeah.

Why

you one of the things you said earlier piqued my interest when you said that if you're making drugs, and the question, one of the questions that comes up is, are you using the something like this,

a wearable to market the drug?

But I'm I'm wondering whether that's, there's another way to frame that is,

surely one logical step here is that you start to,

you're not just giving someone a drug, you're giving someone a drug in combination with a set of wearables that allow us to maximize the value of the therapeutic, right?

Is that what we're, are we going to be, are we going to be, are you going to be getting from your pharmacist or your doctor a package of things to take home along with your medication?

We do that with some of our clinical trials.

You'll get like, here are the devices to take with you.

But if you look at weight loss medications,

we're already all doing that right now, like because we all have scales in our house, right?

And so and so I think that is a great example of like, if you give feedback to the person taking the medicine, they're going to be more likely to stay on it.

At least that's one of my hypotheses.

I think that if you took away, if you took away scales and you took away mirrors, I think a lot of people, a lot more people would drop off the chronic weight management medicines early on.

But the fact is, when you get on the scale and you can see, hey,

I lost some weight, you want to stay on it.

We don't have anything like that for stats or anything else, right?

And that's, again, like why people drop off.

Just imagine if you could just see, oh, hey, actually,

you know, or I'm taking cholesterol medication and you know what?

Hey, my cholesterol went down versus yesterday, not versus three months ago.

Yeah.

Who controls this data?

So interesting, you began this conversation in talking about the multitude of steps that exist between the manufacturer of some of these medicines and the user.

That's right.

Now you're talking about a system where presumably the manufacturer can speak directly to the patient.

Correct.

Does this mean that you cut out some of the middlemen?

That's my hope.

But

the data ultimately, the first part of your question, the data really should be with the patient.

And I think there's a tendency to say

even still today in this industry that the data is really for the healthcare provider.

And

I think that's a mistake.

I think ultimately the data is for the patient and the patient can choose to share it with the healthcare provider and the healthcare provider can look at it.

But it really is, it's really the case.

So my mom is in a nursing home, has arthropods,

which acts up on,

and so she moves around a lot.

This is a perfect tool for her.

So somebody, so does she, is the model here that she checks her movement scores and that's a way of, and she can choose, she can see oh this is time to share that my data with a practitioner isn't it more efficient for her to have someone who is or some ai or something that's continuously monitoring her

i think the continuous measurement part is you're you're absolutely correct about it and but i think it needs to be i think she always needs to be able to see the data herself yes and

and by the way that's not an that sounds that's one of those things that sounds obvious if you're coming from outside the industry to inside but inside the industry is uh it's like, wait, why would you share the data with the patient themselves?

You want to, you know, that's something that the healthcare provider should see first.

I mean, what happens if your mom misinterprets the data without the advice of a healthcare provider?

That's kind of the big caution that would

keep the industry from saying your mom should be able to see that data herself.

But I take a very different view on that.

But we're moving, what's interesting, and a lot of these things, the implication of a lot of what you're talking about is we are moving

the primary primary point of contact from the hospital or the doctor's office to the home.

Correct?

Right?

This is.

That's, if you don't mind me going on a tangent on that, too, that's one of the reasons why I'm really, really excited about how we can change things too.

Because if you look at it today,

there are so many barriers to getting medicine.

You know, like first, you have to get a doctor's appointment, which we've all suffered through.

Like, it can take months

to get one.

Then,

even after you have one, then you also have to be able to get it, actually get access to the medicine, which is a big problem because I don't know if you've heard these stats before, but 45 million Americans live in pharmacy deserts.

46% of communities in the country are in pharmacy deserts where there's no pharmacy within 15 minutes

of your house.

And so

I think...

And so if you add all that together, it can take months from like the moment you say, you know what, I'm not feeling well or there's something I want to change in my life to like the day that you get the medicine.

I want to bring that like down to like the same day.

You should be able to say, you know what,

today's the day that I want to do something and you should be able to go in, you know, get a telehealth appointment.

And if a medicine is appropriate, get it shipped and get it arrived, delivered, you know, this, the exact same day.

One last question for you.

Define what success looks like for you.

So you're, how old are you?

I just turned 50.

But you're a young man.

I don't get to hear that very often.

So you, let's assume you retire from Lilly at 65.

Okay.

And I, so take me 15 years into the future and tell me what would have to happen for you to feel like your time at Lilly has been a success.

The biggest thing for me

is going to be the...

consumer side and actually making really cracking this and being able to like get that vision of people saying i want to take a medicine and I'm going to get it the same day and then I've got the tools to stay engaged with it forever.

Like that would be, that's millions and millions of lives touched by just getting medicine and staying on medicine.

That's one side.

The other side

where I would love to make a mark is on the discovery side.

Discovering new medicines with particularly with AI and could talk for hours on that.

But I think we're going to see medicines no human could have ever imagined coming out over the next decade.

And because it takes 10 years or more to develop a medicine,

it would take about 15 years for that to come to life.

Yeah.

I was thinking, you know, when you were talking, and this is maybe a little bit far-fetched, but in the world of deterrence, so the question is, if I have a law

that punishes you for a certain crime,

the deterrent value of that law is a function of three things.

The certainty of punishment, the swiftness of punishment, and the severity of punishment.

And of the three, we spend the most time thinking about severity.

Secondly, thinking about certainty.

And the one that we neglect is swiftness.

It takes years and years and years.

And the argument that many people make is that swiftness is actually the most potent.

of the three.

If you know you're getting punished the next day, then you're...

Now, it's funny, because if you map that onto what you're talking about, you were talking about the idea of getting medicine the same day.

What you're saying is the swiftness variable is the neglected one here.

And what if

we improve swiftness, do you think we would change the psychological circumstances around which people use drugs?

In other words, would the adherence problem be solved if we address the swiftness problem?

I think so, actually.

I think if we got swiftness and you could actually see an effect and know that something was happening, that would change things.

And by the way, I love that model that you just mentioned.

In the technology world, we have things break all the time.

And what everybody focuses on is like, what's the root cause?

And what's the severity?

And

how likely is it?

The thing that nobody ever focuses on, which is where I always try to get teams to focus on, is swiftness, the mitigation, time to mitigate.

How long did it take you to mitigate?

That human process of like, how quickly did you take the feedback and adapt?

That's really,

you can have all kinds of risks as long as you've got, as long as it's reversible and you can switch, uh that's great so when it comes to medicines yeah if you could try it and get feedback that it's not working or not trending in the right direction and change it that would be uh that that would be amazing and i think you would find that people would people would say hey now i know that you know this medicine i tried wasn't working i'm going to try a new one today i can see progress i'm going to i'm going to stay on it because i know it's doing something well this has been um really fascinating uh best of luck with all the work you're doing um i hope next time i see you i'll be i have at least three wearables.

Excellent.

Thank you, Malcolm.

Yeah,

Revisionist History is produced by Lucy Sullivan with Nina Bird Lawrence and Ben Nadaf Hafrey.

Our editor is Karen Shikurji, mastering by Jake Gorski.

Our executive producer is Jacob Smith.

Special thanks to Matt Romano, Eric Sandler, and Kira Posey.

I'm Malcolm Gladwell.

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