An Interview with Alice Zheng (Principal at RH Capital)
In celebration of Women’s History Month, Wharton Femtech Club is spotlighting extraordinary female leaders in the women’s health space.
Interviewed by Emily Chen (W’23)
Alice is a Principal at RH Capital, responsible for leading investments in innovative women’s health companies. Alice has been a women’s health enthusiast throughout her career spanning global health, clinical medicine, and the private sector. Alice was previously a women’s health practice leader and management consultant at McKinsey & Company, where she served biopharma, diagnostics, global public health, and private equity clients across R&D and commercial strategy topics.
Earlier in her career, Alice’s passion to improve lives for the underserved led her to work in East Africa and Asia in reproductive health and family planning with EngenderHealth, Marie Stopes International, and other nonprofits. As a clinician, she focused on women’s health globally and published articles examining healthcare in low-income countries. Alice holds an MBA from Harvard Business School and MD and MPH from the University of Michigan, where she was a Dean’s Merit Scholar.
EC: You bring so much breadth into the healthcare investing and startup community, having received an MD, MPH, and MBA, and spending many years working abroad on global reproductive health projects. How did you first discover your interest in women’s health and when along that journey did you realize this is what you wanted to commit your career to?
AZ: I have always been drawn to underserved issues, particularly ones that affect women. When I was in college, I was actually in the Vagina Monologues [play] three times because back then, that was the really provocative female-centric movement going on. In the public health world, I was also drawn to women’s issues which were highly stigmatized. I was working with women who had obstetric fistulas, which is a condition that occurs through childbirth and can cause really terrible symptoms throughout life. When I went into clinical care, I was really drawn to Ob/Gyn. Ob/Gyns are often standing on a soapbox and I just felt like our values really aligned.
At McKinsey, I realized that women’s health, even on the business side, is also an underserved area. Compared to other therapeutic areas, there’s not a lot of historical investment and thus a white space for innovation. That’s what led me to the current fund that I’m at now called RH Capital. We are focused exclusively on women’s health. We were one of just a couple of funds a few years ago [focused on women’s health], and now there’s a growing number of funds. It’s great to see others join in.
EC: What does working in women’s health mean to you personally?
AZ: A lot of founders in the women’s health space had a personal health experience that inspired them to then start a company to develop something that would help their situation. For me, I got into women’s health more on the professional side, wearing all the different hats: the public health hat, the clinical medicine hat, the business consultant hat.
The personal journey actually occured very much in parallel. My personal experiences have in many ways strengthened my resolve to be in this space, and it also gives me a unique lens when I look at companies. A lot of times I have been or still am the type of patient that a particular company is looking to serve. Throughout my journey in having children, I’ve experienced different types of challenges from infertility and going through a lot of IVF to getting an abortion. I’ve also become a high-risk maternity patient because of a fetal anomaly as well as a complications with my last pregnancy.
So, in many ways, when I’m looking at companies that are serving women, whether on the mental health side of pregnancy or with fertility challenges, I can actually put myself in the shoes of that potential customer and evaluate if it’s something that would be appealing.
Of course, we should all not just invest in things that we’ve experienced personally, but at least in some areas, I’ve been able to bring in that lens.
EC: What areas of investment and innovation are you personally most excited about?
AZ: Women’s health has been through different waves. It started out with patient-focused digital solutions such as the menstural cycle trackers. Then there was a wave of innovations around maternal health on the patient side, like patient education, trackers for pregnancy, and fertility solutions that help patients navigate their care.
Right now, we’re really excited about menopause. It’s been incredible seeing the growth in companies in the menopause space, from consumer products to devices that help with menopause symptoms and more.
Another area we’re looking closely at is endometriosis. Endometriosis has gained a lot of attention in the past couple of years. It really wasn’t well known even though 5% to 10% of women of reproductive age have it. Right now, it takes women 7 to 10 years to get diagnosed, and it’s a surgical diagnosis. As with other areas in women’s health, we don’t have enough therapeutics in endometriosis.
Even though there’s over a dozen diagnostic companies that recently emerged, I can count on one hand the number of therapeutic companies.
We need a deeper understanding of the underlying biology and disease pathophysiology to develop new therapeutics.
EC: That actually brings me to my next question which is all about therapeutics. There is growing exposure and funding going towards women’s digital health, but it seems like there’s less awareness of the treatment side of these diseases. There’s a huge gap in women’s health and clinical trial data, but there’s also broader health system issues at play. For example, there’s still stigmas around speaking up about certain conditions and how much pain women can tolerate, etc. so payers aren’t paying and providers may not be advocating enough.
AZ: I have a lot of thoughts. In some cases, it’s an issue of patient education, such that patients are not aware that they can seek treatment or that they have a condition. Other times, it’s an issue of access to care, and women are not able to get to the doctors or doctors are not trained in those conditions. There are other times where the issue is really on the life science side and the fact that we don’t have new scientific discoveries in these conditions. We really can’t develop new diagnostics or therapeutics if we don’t know what is happening biologically.
Right now, a lot of women’s health conditions are treated by shutting down your reproductive system, like birth control pills for endometriosis or treatments that send people into early menopause, which is not a long-term solution.
Point number two is that what’s really gotten traction in the public is digital health more than the life sciences side within women’s health. There are a couple of reasons. For one, there’s just been a general wave of digital health innovation that women’s health is riding alongside. Historically, we don’t have a lot of investment from big pharma companies or medical device companies, so women are taking things into their own hands and developing digital health solutions. There’s also a lag on the life science side in making the discoveries that enable you to develop drugs and the time that takes.
The other point is why big pharma isn’t investing in this space. If we roll back a couple of decades, birth control was invented 50, 60 years ago, and that was life-changing for many women. Since then, birth control innovation really has just been different formulations of the same hormones. There are a couple of companies developing non-hormonal birth control innovations, but the space has been dominated by the existing products.
Another example is hormone replacement therapy. It was very popular a couple of decades ago, but then some studies showed that there may be adverse health consequences and it went out of vogue. Now, there’s research showing that those studies weren’t necessarily showing the full picture and that it’s still beneficial for some women.
So, those are two big waves in the pharma space. I do think there is promise for big pharma companies to be interested in women’s health and new kinds of science, new biomarkers, new pathways to target. Then payers will pay for that because you have a superior product.
But I will caution that women’s health is an area where physicians are not used to a ton of paperwork for drugs and usually when there are new drugs, they’re quite expensive. Payers are going to be very careful about who’s able to get it.
The reason I’m still optimistic is that there are emerging new therapeutics, such ones as for endometriosis we’re looking at that are non-hormonal and also disease-modifying. I’m actually really excited about the potential here, and I do believe that these products will be able to get the payer reimbursements and the physicians excited to really penetrate the market.
EC: I do want to go back to digital health because RH Capital does have several digital health investments in its portfolio too. As you just mentioned, women are taking control of their health, and we’re seeing a surge of women’s digital health companies. How would you advise current and aspiring entrepreneurs to build a differentiated, sustainable women’s digital health start-up?
AZ: I was reflecting on this right before we talked and thinking of companies that are successful versus ones that might struggle to raise or just are starting out and are needing some guidance. There are four things that I think are really important to consider:
One is to define your product and service very clearly. There are times where companies try to do everything under the sun, but then it’s not very clear what exactly the product is. It’s definitely good to have a road map showing where we are today and where we want to get to, but clearly articulating today’s product is super important for investors, for customers, for partners, and anyone in the ecosystem.
Second is to be really thoughtful about your business model and how you will build a sustainable one. The person who pays might be different from the one who is using the service and maybe even different from the one who is prescribing the service. Thinking with my investor hat on, I’m asking questions like, “who is going to pay” and “why would they pay?” What is the value proposition for your product?
If you are selling to employers, then what is the ROI for them? Is it about retention, productivity, satisfaction? What measures matter to them? If you are selling into payers, what kind of information are you going to collect on outcomes? Finally, if this is a direct-to-consumer product or service, being really clear on that value position as well is super important.
Third thing is to really know the competitive landscape. Women’s health is growing quickly. There are definitely some spaces where I see multiple companies starting to converge or look very similar where it can be really difficult to be differentiated. It’s important for any founder to be crystal clear on the competitive landscape and also know the adjacent players.
The last consideration is that there is a bit of a trade-off and tension right now in women’s health between being a point solution or a platform. This is a debate that we have as investors as well. There are a lot of solutions emerging and customers, whether it be payers, employers, or the women themselves, may feel a little bit inundated. “Do I need one for fertility, and one for maternity, and one for mental health,” “Does it feel like there’s just too many things to manage,” and “Is it better to have a platform instead for everything?” It can actually be hard to be good at all those different verticals when you’re just starting out, so you do have to start somewhere, but that is one tension to just be really thoughtful about.
RH Capital is an impact-first, venture capital fund that invests in early-stage startups promising to revolutionize women’s health and improve health equity in the US. We invest across all healthcare segments, including the life sciences (diagnostics, devices, therapeutics), digital health, services, and consumer health, with a focus on contraception, maternal health, and a broad range of other high-impact and underserved areas in women’s health.
To learn more, visit https://rhcapital.vc/.
