The second shoe recently dropped at the prestigious M.D. Anderson Cancer Center in Houston. First there was the news of the large operating loss for the first two months of FY 2017 (see: MD Anderson records $102.4M operating loss in first 2 months of FY 2017) followed by the recent suspension of the Oncology Expert Advisor project powered by Watson due to "audit irregularities" (see: Touted IBM supercomputer project at MD Anderson on hold after audit finds spending issues). Below is an excerpt from an article on this subject:
A University of Texas System audit has found irregularities involving more than $40 million paid for outside goods and services as part of M.D. Anderson Cancer Center's now stalled effort to enlist IBM supercomputer Watson in the battle against cancer. The audit, posted at the system's website, reported the cancer hospital didn't follow established purchase rules for the project, which executives had ballyhooed would tap Watson's encyclopedic memory and lightning information-processing speed to tailor optimal patient treatment. "Because this review was limited to procurement for (Watson), one cannot determine whether the issues noted are unique to this large, complicated project," William McRaven, the UT System chancellor, wrote in a response to the audit..."The irregularities included service agreements that didn't undergo a competitive process, fees consistently set just below the amount that would have required board approval, spending of donations before they were received and untimely payment of vendors. The project, which has incurred costs of $62 million, was placed on hold prior to the initiation of the audit, and remains so at this time, an MD Anderson spokeswoman said this week. It's unclear if any of the project's costs contributed to operating losses at the renowned cancer hospital that have exceeded $430 million the past 16 months and that in January led to the layoff of 778 employees ....The audit was undertaken following concerns raised at MD Anderson about questionable activities involving the project....The project — known as the Expert Oncology Adviser, powered by Watson — was unveiled by MD Anderson more than three years ago (see: The Oncology Expert Advisor).
To deepen the plot, here's an excerpt from a very hard-hitting article on this same topic from Forbes (see: MD Anderson Benches IBM Watson In Setback For Artificial Intelligence In Medicine):
Watson, IBM’s language-based computing project, gripped the world’s imagination in 2011 when the supercomputer won an exhibition of the game show Jeopardy! against the show’s two highest-rated players. In March 2012, IBM signed a deal with Memorial Sloan Kettering Cancer Center in New York to develop a commercial product that would use the same technology to analyze the medical literature and help doctors choose treatments for cancer patients. MD Anderson, Memorial’s longtime rival, entered the fray after this agreement was already in place. Lynda Chin, the former chair of the MD Anderson Department of Genomic Medicine and the wife of MD Anderson president Ronald DePinho, set up a collaboration with IBM to develop a separate project. Chin left MD Anderson for another job within the University of Texas system in 2015. In a strange twist, MD Anderson would pay for the whole thing, eventually giving $39.2 million to IBM and $21.2 million to PricewaterhouseCoopers, which was hired to create a business plan around the product. According to the Washington Post, at least $50 million of the money came from Low Taek Jho, a flamboyant Malaysian financier whose business dealings are reportedly now under investigation by the U.S. Department of Justice. Usually, companies pay research centers to do research on their products; in this case, MD Anderson paid for the privilege, although it would have apparently also owned the product. This was a “very unusual business arrangement,” says Vinay Prasad, an oncologist at Oregon Health & Science University.
The conclusion is inescapable that both the management of the Oncology Expert Advisor at M.D. Anderson as well as perhaps the management of the entire cancer center has been less than ideal. There are also hints about nepotism and international intrigue with the involvement of Low Taek Jho. My view of IBM throughout my career in healthcare IT has been that the company over-prices, over-promises, and under-delivers. Also causing extreme eye-rolling on my part is the $21.2M bill from PricewaterhouseCoopers for a "business plan" for the project. Why does M.D. Anderson need a multi-million dollar business plan for a scientific, oncology/genomic initiative?
The Oncology Expert Advisor project may have seemed clever when launched but rather bizarre through the rear view mirror. It will be interesting to speculate about the fate of Watson and IBM at Memorial Sloan Kettering (see: IBM Watson, Quest Diagnostics, Memorial Sloan Kettering Cancer Center, MIT, Harvard combine forces for massive oncology, precision medicine initiative)? Will there be some Texas shock waves. MSK does not seem to have much exposure in that the hospital has been providing mainly access to its oncology database, OncoKB. This will be a topic for future blog notes as details become available.