This is the transcript of my interview last month with Sermo’s Daniel Palestrant on the announcement of the deal between Sermo and the AMA

Matthew Holt:  This is Matthew Holt with The Health Care Blog and a quick impromptu podcast today, because I have on the line with me Daniel Palestrant. Daniel’s the CEO of Sermo, and we’ve had Daniel on the blog before a couple of times. Those of you reading the blog know that Sermo is one of the leading online physician communities, and Daniel of course will be at the Health 2.0 Conference coming up in September. Daniel, how are you today? And after you’re done with that, you have some interesting news. So tell us.

Daniel Palestrant:  That’s right, Matthew. Thank you for having me. I really always appreciate the opportunity to speak with you and the many readers of the Health Care Blog. As you mentioned, we’re very much looking forward to the conference later in the year; it sounds like it’s going to be quite a show. As far as the news that we’re talking about on this particular interview, it’s a strategic announcement being announced between Sermo and the American Medical Association.

Matthew:  So tell us a little bit about what that’s going to mean for Sermo, for the AMA, and for the future of doctors in communities online.

Daniel:  Well, this is a relationship that’s actually been in the works for several months now; I’d almost say going on a year. There’s many different ways to look at the relationship. Sermo, of course, is the largest online physician community. Now, with almost 16,000 physicians, growing at anywhere between 500 and 1000 physicians a week. The AMA, as I’m sure most of your readers know, is the premier physician advocacy organization in this country. Indeed, it probably has the exclusive franchise as being the voice to represent all physicians in the United States. So, as Sermo gained more and more momentum, it became more and more logical for us to look to have some sort of a partnership with the American Medical Association. Indeed, it was the members of the Sermo community who started putting more and more clarity around what that relationship would look like.

So it is multi-faceted, but to touch on some of the key points, I’d say first off that this is a powerful way for the American Medical Association to tap into the voice of Sermo. If you think about it, there’s an interesting dynamic: You have the American Medical Association, which is among the oldest of the associations in this country, well over 150 years old and the essence of establishment institutions. Then you have Sermo, which is this grassroots – what some people might describe as Web 2.0 – phenomenon. Physicians in all walks of life and all phases of their career coming together and having a voice. So what Sermo does very effectively is create a place for those people to come together and for those voices to be heard – and then, within the unique Sermo architecture, for specific messages to come out. What the AMA does very well is to advocate for the messages of the physicians. That was the first cornerstone of this relationship: Sermo being a mechanism of allowing physicians to have their voices heard, and the AMA being an organization that’s uniquely suited to act on that voice.The second aspect of the relationship is a new paradigm in information and publishing. As many people might know, the American Medical Association is a publisher of several of the top medical journals, including the "Journal of the American Medical Association," or "JAMA." And then the "Archive" series, including the "Archives of General Medicine" and the "Archives of Surgery." Through the Sermo relationship, for the first time ever, Sermo members will be able to gain free full-text access of those journal articles, both current and archived versions, through Sermo. This will be free of charge; it will be part of being a Sermo member.The hope is that this will herald a new era in physicians’ being able to contribute to the academic literature and being able to comment in real time on the academic literature.The third component of the relationship is what you might call a co-development, where Sermo and the American Medical Association will be endeavoring to develop certain technologies for facilitating group discussion and group communication among AMA groups and AMA subgroups.

Matthew:  That’s pretty interesting. Let’s go back to the
second one. I get the first one. People have looked at my analysis
somewhere on the blog before; there’s a mechanism which is very clever
for filtering through and ranking and rating answers and that kind of
thing. And I can imagine that that works for the first one, the hot
topics. It’s an information source for the AMA folks when they’re doing
their advocacy.

The second one is quite interesting, though,
which is the commenting on journal articles. It’s been a little tricky
to this point to comment on JAMA articles and to think about how the
clinical trials and clinical medicine analysis done in these articles
relates to everyday practice. I assume you’re suspecting there’s going
to be significant interaction around some of those. There probably
already is, within Sermo, but I suspect there’s going to be more
interaction generally around those articles.

Daniel:  I think there are many trends coming together to
make the publishing aspect of this so exciting. The first trend would
be this phenomenon that the moment something is published, it used to
be that that’s when the discussion would end. But indeed, today, that’s
where the discussion begins. We see this phenomenon well reflected in
great organizations like Digg or the new Netscape model or Newsvine,
where many people find as much or perhaps even more value in this sort
of ripple-effect discussion around an initial piece of information.
This is perhaps accentuated in the medical community, where publication
might be a new piece of clinical data, or it might be a new guideline.
But in many cases what physicians want the most is to get a sense of
how their peers are interpreting this.

Matthew:  Right.

Daniel:  So the first thing I think the relationship will
get is a way for the Sermo community, in real time, to be able to
recognize and respond to what had been static publications. The second
aspect of this is another trend. The moment something hits the press,
there’s this increasing recognition that it’s almost old news. The idea
is, "How can publishing organizations like the American Medical
Association better link themselves to the here-and-now concerns of
physicians?" Sermo, by its very nature, is almost a bearer of what is
of most interest and most concern to the American medical community.
And so Sermo can act as a very powerful springboard for those
publishing mechanisms to take information and then pursue it further,
whether it’s with actual clinical research, editiorialization, or
perhaps an in depth article. So it’s a push or pull model.

Matthew:  That’s pretty interesting. Let’s talk about a
couple of other things briefly. First off, let’s talk a little bit
about the business relationship between the two organizations.
Obviously you have a large, established institution (as you mentioned)
that’s very old and it has a membership-driven focus. Then you have a
startup, for-profit software community company that’s a technology
company. Tell me a bit about the business relationship between the two
of you. Just explain how it’s unfolding.

Daniel:  Of course. As you alluded to, Matthew, Sermo is
a for-profit venture. We’re actually very, very excited about our
business model. It’s worth noting it and explaining it. I can discuss
the AMA and our relationship in that context. Sermo is entirely free to
physicians. We don’t charge the physicians. We also provide a medium
which is completely free of any advertising or any outside influence.
The way we make money is we create almost an arbitrage between our
physician community and our clients. The way our community is
structured is that information is able to bubble up, and then our
clients are able to very quickly and effectively, through a completely
separate product, see that information – albeit anonymized, so they
don’t see the actual physician’s names or the physician’s contact
information. But they are able to see trend data forming in real time,
and indeed, to be able to ask questions of that community. You might
imagine for an organization like the American Medical Association,
that’s extremely exciting. The AMA is constantly looking for topics to
advocate for, or what sort of is on the zeitgeist of the American
medical community. Those exact same tools that our financial services
customers, current pharmaceutical customers, find interesting. And
valuable are extraordinarily valuable to the American Medical
Association. Interestingly enough, they’re using the exact same tools
but they’re using them to look at very different data and ask very
different questions.

Matthew:  Yeah, I’d say that within the stuff I’ve seen
on Sermo, there’s a lot of stuff about clinical issues but there’s also
a lot of stuff about business and politics issues. I assume if you’re a
pharma company you care about the clinical stuff, and if you’re the AMA
you probably care a lot about the political and business stuff.

Daniel:  Yeah, Matthew, you’re 100% right. That’s perhaps
what’s most exciting about this. Take for example, last week; one of
the hottest topics on Sermo was physicians’ perception of nurse
practitioners and physician assistants. And it’s very clear that it’s
turning into a very incendiary topic among physicians. While that might
not be data that’s particularly of interest or value to a
pharmaceutical company or a Wall Street organization, that’s literally
the essence of what the AMA is very interested in and they’re able to
see that in real time. So an aspect of the relationship is that the AMA
is becoming a Sermo client; they will have access to the Sermo client
product within all of the restrictions and guidelines that our other
clients use it by.

Matthew:  But you’re also going to be promoting – and
this perhaps strays into the second point I want to raise – while the
AMA is going to be promoting this to their members –and I mean you’re
already promoting this to all American physicians, but now you’re
getting a membership organization that has a third of American doctors
in it–that’s presumably a big fillip to you as well. I assume they are
going to be promoting this to their members and using some of the tools
on their other publication sites?

Daniel:  Absolutely. Again, one very exciting aspect of
the relationship is Sermo and the American Medical Association will be
jointly working to engage all physicians. And it means, you might
imagine on top of that, that this might be the AMA’s existing body of
physicians. So there are about 150,000 AMA members in this country, and
Sermo and the AMA will be working in concert to engage them through
several mediums.

Matthew:  And that raises sort of… The interesting
point for Sermo, I think here, is that the AMA – those people who read
my blog know – doesn’t always have a political outlook that may be
shared by some non-physician groups, but also, in particular, hasn’t
necessarily over the years been shared by all physicians. Although it’s
a leading physician organization, it’s tended to skew in its membership
to certain types of physicians. Typically the main divider is between
the typical solo physician member of the AMA, versus the big group
doctors who have perhaps different political and economic interests. And
over the years the AMA has been trying to promote itself. It’s trying
to promote its membership and reach out to do other things within the
physician community. But still nonetheless it has a fairly, if you
like, stereotyped political identity among physicians. Do you see that
as being an issue for Sermo? And the other question, is this kind of
the first of many? Are there other, either specialty organizations or
other physician organizations, that you’re also going to be going
after? Or does this relationship preclude that?

Daniel:  Let me answer the first part of you question
first, and then perhaps we can run through it to the second part.
Indeed, less than one-quarter of physicians in this country are members
of the American Medical Association. If you look at Sermo’s membership,
I believe it’s less than 10% of our members are AMA members.

Matthew:  Right.

Daniel:  As excited as we are with the phenomenal growth
that Sermo has seen, and the fact that we’re, without measure, now the
largest physician community, or online community, we have to also
recognize the fact that we are still what you would call an early
adopter or an early stage phenomenon. To move into sort of the broader
body of the American American medical community, I think it’s important
to say, "What are the types of relationships and the types of
partnerships that allow you to enter into that arena?" And in that
regard I think the American Medical Association is a very, very
powerful ally. To the point that you’re making, the types of physicians
who are attracted to Sermo seem to be not the same population of
physicians who have historically been attracted to the American Medical
Association. Indeed, I’d actually think that’s one of the strengths of
this relationship and one of the most exciting parts. If we were all
targeting and working with the exact same groups of physicians and
appealing for the same reasons, there wouldn’t be a whole lot of reason
for a partnership. What became very, very clear from the start between
the discussions between Sermo and the AMA is that we were appealing to
different types of physicians in very different ways. But there was no
question that together, the whole could be more than the sum of the
parts.

Matthew:  Do you anticipate doing similar relationships with other physician organizations?

Daniel:  Well, the AMA is the only nationwide physician organization.

Matthew:  I’m thinking perhaps about some of the big
specialty societies or perhaps some of the other – either the statewide
ones or some other combination; getting to more doctors that way.

Daniel:  Correct. So, insomuch as AMA is, I think both
literally and figuratively, an institutional voice for US physicians,
the AMA/Sermo relationship is a mutually exclusive relationship between
Sermo and the AMA. Having said that, your point is very well taken that
in the last 10 or 15 years, the so called specialty societies – the
American College of Cardiology, the American Heart Association, the
American Society of Clinical Oncologists – have risen in prominence and
now they are ready to enroll in advocating for physicians. And indeed,
I think you’ll see some announcements in this space in the very near
term. I think it’s important then to recognize, though, that those
specialty societies classically advocate for very different things than
the AMA has advocated for. So whereas the American Heart Association
understandably advocates more towards cardiovascular and heart type
issues, or American College of Cardiology has cardiology interests as
its first interest, the American Medical Association is the only
organization that’s looking out for the overall good and well-being of
the physician profession. And insomuch as that’s a key element of
healthcare in this country, no one else plays that role. So I
think to answer your question in summary: yes, we will be making some
announcements in that space. But I think it’s also very important to
say that we don’t see those as being competitive to what we’re thinking
of trying to examine.

Matthew:  That’s very exciting. Well, Daniel, you’ve
certainly got a tiger by the tail here. I’m looking forward to seeing
how this plays out. Again, I’ve been talking with Daniel Palestrant.
He’s the CEO of Sermo, which just today announced a big relationship
with the American Medical Association. More proof that this Health 2.0
stuff is moving into the mainstream, and perhaps rather quicker than
some of us might have thought it would do. So, Daniel, congratulations
on the announcement and thanks a lot for talking with us today.

Daniel:  Likewise, Matthew, and I thank you for the opportunity to speak with you