Every drop counts

“It’s not like if you run out of milk you’re fine, we’ll go without milk. If you run out of blood, there are lives at risk, so the stakes are very high.” – Christopher Godfrey, Founder/CEO of Bloodbuy [2]

 

In early 2013, Chris Godfrey, graduate from Brown University with a Master’s in Health Leadership, founded Bloodbuy-  a cloud-based healthcare technology company whose platform brings hospitals and blood centers together to improve the distribution and access of blood products to patients in need [1].

The platform often considered the “Priceline for blood products”, reduces hospitals overpaying and experiencing supply shortages. Additionally, the platform connects facilities across the country to improve inventory management, lower wastage, and generate growth [2].

 

What’s blood got to do with it?

Blood is a commodity at the core of healthcare. It is critical to carry out many life-saving operations and procedures yet is often subject to disruptions in its distribution and overall supply-chain. Although the FDA has clear standards in the composition of blood products, which in theory should limit price differentiation, hospitals often pay inflated pricing for blood due to the mismatch in supply and demand [3].

Blood products, transfusion consumables and inventory account for 3-7% of non-labor expenses in acute care facilities [4]. In the Affordable Care Act (A
CA) world, hospitals are incentivized to find cost savings while maintaining a high level of care for their patients [4].

Blood supply is also tricky to manage. First, blood products have a short shelf life and expire quickly . Second, supply varies by region. There may be a greater donation volume in Chicago, IL and smaller donations in San Diego, CA.

 

A marketplace for blood

To remedy this, Godfrey created Bloodbuy with a clear goal –  leverage technology to help hospitals overcome a disparate supply chain and gain transparency in pricing by opening their needs to a larger audience. According to Godfrey, “we act as a technology backbone that sits in between them and connects everybody.” [2]

The model is simple. Blood banks pay a nominal fee to list their inventory on the platform. Blood bank data is aggregated and displayed to hospitals and acute-care facilities. Details include the amount of inventory available, expiration dates and pricing [5]. When buyers enter the platform, Bloodbuy deploys a set of algorithms to find the best-priced deal for user’s needs based on available inventory. Upon selection, the buyer can place an order directly with the blood bank thereby reducing their dependence on local outlets.

Hospitals typically pay $170-$300 for a pint of blood [5]. initial pilots, Bloodbuy has saved hospitals approximately 22% in spending [6]. Added benefits to hospitals include: expanded supply chain channels with less dependence on local markets, lowered re-stocking and outdating expenses, and analytics to compare operating metrics to their peers [4].

The platform also offers significant benefits to the suppliers. With the ACA, demand for acute care facilities is likely to  decrease, consequently lowering demand of blood products. With Bloodbuy, blood centers can diversify their risk, penetrate new markets, and find new buyers while offsetting potential of reduced local demand and minimizing inventory waste [3].

 

Where the future leads

Bloodbuy has received a myriad of awards and recognition for its innovations in the healthcare sector. In 2016, it won the first Harvard Acceleration Challenge at the Harvard Forum on Healthcare Innovation. It was recognized by Becker’s Hospital review as one of the 4 companies that have the potential to change healthcare delivery. Most recently, it was featured at Premier Inc.’s Annual Innovation conference [7].

With enough data, Godfrey hopes Bloodbuy can generate forecast models to “predict shortages and prevent states of emergency” in blood supply [5]. To do so, the company will need to increase brand awareness and on-board new hospitals, acute care facilities, and blood centers. One strategy the can consider implementing is partnering with large organizations like the AMA or medical centers like Harvard Medical School to promote their platform. Furthermore, Bloodbuy may want to consider expanding their platform to other types of healthcare commodities or use this as an avenue for vaccine management.

 

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Endnotes:

[1] “Team.” 2016 BloodSolutions, LLC. https://www.bloodbuy.com/about/, accessed November 2016

[2] Lauren Silverman, “Bidding for blood, the Priceline way,” January 13, 2015, http://www.marketplace.org/2015/01/13/business/bidding-blood-priceline-way, accessed November 2016.

[3] William Looney, “Brown University’s Masters in Healthcare Leadership: A Mission to Transform,” August 1, 2014,  http://www.pharmexec.com/brown-universitys-masters-healthcare-leadership-mission-transform?id=&sk=&date=&pageID=2, accessed November 2016

[4] “For hospitals.” 2016 BloodSolutions, LLC  https://www.bloodbuy.com/for-hospitals/, accessed November 2016

[5] Jodi Helmer, “This Startup is Pretty Much a Priceline for Buying Blood,” October 21, 2016,  https://www.wired.com/2016/10/vant-ship-blood/, accessed November 2016

[6] Richard G. Hamermesh et. Al, “ The Harvard Contest That’s Trying to Improve Health Care Delivery,” October 2, 2015, https://hbr.org/2015/10/the-harvard-contest-thats-trying-to-improve-health-care-delivery, accessed November 2016

[7] “In the news.” 2016 BloodSolutions, LLC, https://www.bloodbuy.com/news/ , accessed November 2016