Ariel D. Stern - Faculty & Research - Harvard Business School
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Ariel D. Stern

Assistant Professor of Business Administration

Technology and Operations Management

Ariel Dora Stern is an Assistant Professor of Business Administration in the Technology and Operations Management Unit at Harvard Business School.  She teaches the Technology and Operations Management course in the MBA required curriculum. 

Ariel's research focuses on the management of innovation in health care, with a focus on the medical device and pharmaceutical industries. Her projects seek to understand the drivers of innovation among firms and the determinants of how medical technologies are adopted and used in practice. Ariel is particularly interested in the intersection of the regulation, firm strategy, and economics of health care. She also researches the digital transformation of medical technology and health care delivery, investigating the policy and managerial questions raised by the growth of “digital health.” Her research has been cited by Bloomberg, The New York Times, and National Public Radio.

Professor Stern received her Ph.D. in Public Policy from Harvard, where she was a National Bureau of Economic Research Predoctoral Fellow in the Economics of Health and Aging and was honored with the Harvard Kennedy School Dean’s Award for excellence in student teaching. She holds an undergraduate degree in economics from Dartmouth College, where she was a Presidential Scholar and a two-time U.S. national collegiate figure skating champion. Before beginning her academic career, she worked as an economist on Wall Street and at the Federal Reserve Bank of New York, the German Institute for Economic Research (DIW), the German Development Bank (KfW), and LeapFrog Investments, an impact investment fund. 

Ariel is currently a faculty affiliate of the Harvard Business School Health Care Initiative and Digital Initiative and a Research Associate at Ariadne Labs, a joint center between the Brigham and Women’s Hospital and the Harvard T.H. Chan School of Public Health, which focuses on scaling health care delivery innovation. 

 

Journal Articles
  1. Physician Beliefs and Patient Preferences: A New Look at Regional Variation in Health Care Spending

    David Cutler, Jonathan Skinner, Ariel Dora Stern and David Wennberg

    There is considerable controversy about the causes of regional variations in health care expenditures. Using vignettes from patient and physician surveys linked to fee-for-service Medicare expenditures, this study asks whether patient demand-side factors or physician supply-side factors explain these variations. The results indicate that patient demand is relatively unimportant in explaining variations. Physician organizational factors matter, but the most important factor is physician beliefs about treatment. In Medicare, we estimate that 35% of spending for end-of-life care and 12% of spending for heart attack patients (and for all enrollees) is associated with physician beliefs unsupported by clinical evidence.

    Keywords: Health Care and Treatment; Spending; Geographic Location; Values and Beliefs;

    Citation:

    Cutler, David, Jonathan Skinner, Ariel Dora Stern, and David Wennberg. "Physician Beliefs and Patient Preferences: A New Look at Regional Variation in Health Care Spending." American Economic Journal: Economic Policy (forthcoming).  View Details
  2. The Central and Unacknowledged Role of the U.S. Food and Drug Administration in the Design and Execution of Medical Device Pivotal Trials

    Aaron V. Kaplan and Ariel Dora Stern

    The introduction of new medical devices has transformed cardiovascular care in recent decades. Devices, such as heart valves, pacemakers, stents, ventricular assist devices, and implantable defibrillators, have prolonged and improved the quality of life for millions of patients worldwide. Medical device innovation requires a robust ecosystem that involves medical technology innovators, often at start-ups, large medical device manufacturers, and clinical investigators. Central to this process is strong regulatory oversight, which in the United States is provided by the U.S. Food and Drug Administration’s Center for Devices and Radiologic Health (FDA/CDRH). This viewpoint discusses the effect of the regulatory approval process and the role that FDA/CDRH plays in the design and execution of the pivotal trials (clinical studies) that are used to support the regulatory approval of high-risk devices. We also review norms in the publication of pivotal trials in peer-reviewed medical journals; these publications often fail to acknowledge the role of the FDA/CRH or discuss results within the context of the device approval process.

    Keywords: Health Testing and Trials; Business and Government Relations; Governing Rules, Regulations, and Reforms; Information Publishing; Medical Devices and Supplies Industry; United States;

    Citation:

    Kaplan, Aaron V., and Ariel Dora Stern. "The Central and Unacknowledged Role of the U.S. Food and Drug Administration in the Design and Execution of Medical Device Pivotal Trials." JAMA Cardiology 3, no. 1 (January 2018): 5–6.  View Details
  3. Innovation Incentives and Biomarkers

    Ariel Dora Stern, Brian M. Alexander and Amitabh Chandra

    Previously, we have discussed the importance of economic incentives in shaping markets for precision medicines. Here we consider incentives for biomarker development, including discovery and establishment. Biomarkers can reveal valuable information regarding diagnosis and prognosis, predict treatment efficacy or toxicity, serve as markers of disease progression, and serve as auxiliary endpoints for clinical trials. Some have multiple uses, while others have a specialized role, resulting in diverse incentives across players in the healthcare system.

    Keywords: Health Care and Treatment; Innovation and Invention; Research and Development; Markets;

    Citation:

    Stern, Ariel Dora, Brian M. Alexander, and Amitabh Chandra. "Innovation Incentives and Biomarkers." Clinical Pharmacology & Therapeutics 103, no. 1 (January 2018): 34–36.  View Details
  4. How Economics Can Shape Precision Medicines

    Ariel Dora Stern, Brian M. Alexander and Amitabh Chandra

    Many public and private efforts in coming years will focus on research in precision medicine, developing biomarkers to indicate which patients are likely to benefit from a certain treatment so that others can be spared the cost—financial and physical—of being treated with unproductive therapies while more easily uncovering therapeutic signals. However, such research initiatives alone will not deliver new medicines to patients in the absence of strong incentives to bring new products to market. We examine the unique economics of precision medicines and associated biomarkers, placing an emphasis on the factors affecting their development, pricing, and access.

    Keywords: Health Care and Treatment; Research; Economics; Motivation and Incentives;

    Citation:

    Stern, Ariel Dora, Brian M. Alexander, and Amitabh Chandra. "How Economics Can Shape Precision Medicines." Science 355, no. 6330 (March 17, 2017): 1131–1133.  View Details
  5. Innovation Under Regulatory Uncertainty: Evidence from Medical Technology

    Ariel Dora Stern

    This paper explores how the regulatory approval process affects innovation incentives in medical technologies. Prior studies have found early mover regulatory advantages for drugs. I find the opposite for medical devices, where pioneer entrants spend 34% (7.2 months) longer than follow-on entrants in regulatory approval. Back-of-the-envelope calculations suggest that the cost of a delay of this length is upwards of 7% of the total cost of bringing a new high-risk device to market. Considering potential explanations, I find that approval times are largely unrelated to technological novelty but are meaningfully reduced by the publication of objective regulatory guidelines. Finally, I consider how the regulatory process affects small firms' market entry patterns and find that small firms are less likely to be pioneers in new device markets, a fact consistent with relatively higher costs of doing so for more financially constrained firms.

    Keywords: Technological Innovation; Medical Devices and Supplies Industry;

    Citation:

    Stern, Ariel Dora. "Innovation Under Regulatory Uncertainty: Evidence from Medical Technology." Journal of Public Economics 145 (January 2017): 181–200.  View Details
  6. Economic Implications of the Society for Assisted Reproductive Technology Embryo Transfer Guidelines: Healthcare Dollars Saved by Reducing Iatrogenic Triplets

    Malinda S. Lee, Brady T. Evans, Ariel Dora Stern and Mark D. Hornstein

    Objective: To estimate the national cost savings resulting from reductions in higher-order multiple (HOM) live births (defined as three or more fetuses), following the initial publication of the Society for Assisted Reproductive Technology (SART) guidelines on ET in 1998. Design: Descriptive use and cost analysis. Main Outcome Measure(s): Estimates of the total number of HOM deliveries prevented (from 1998 to 2012) following the publication of SART guidelines; the associated healthcare savings (2014 U.S. dollars). Result(s): A singleton live birth was estimated to cost $17,100–$24,200. A twin live birth was estimated at $66,000–$117,500. A triplet live birth was estimated at $190,800–$456,300. The percentage of HOM gestations among all ART pregnancies decreased from 11.4% in 1997 to 2.0% in 2012, with the sharpest year-over-year decline of 20.3% occurring in the year following the publication of the guidelines. The number of prevented HOM deliveries from 1998 through 2012 was estimated to be between 13,500 and 16,300, corresponding to cost savings of $6.02B (billion) (range, $2.35B–$7.03B, 2014 U.S. dollars). Conclusion(s): Iatrogenic HOM gestations represent a substantial economic burden to our healthcare system. The introduction of guidelines for ET in 1998 coincided with a dramatic decrease in the HOM rate in subsequent years and an associated cumulative cost savings of more than $6B. Further reductions in HOM gestations could save up to an additional $2B annually.

    Keywords: Technology; Cost Management; Health Care and Treatment; Health Industry;

    Citation:

    Lee, Malinda S., Brady T. Evans, Ariel Dora Stern, and Mark D. Hornstein. "Economic Implications of the Society for Assisted Reproductive Technology Embryo Transfer Guidelines: Healthcare Dollars Saved by Reducing Iatrogenic Triplets." Fertility and Sterility 106, no. 1 (July 2016): 189–195.e3.  View Details
  7. Will the Stork Return to Europe and Japan? Understanding Fertility within Developed Nations

    James Feyrer, Bruce Sacerdote and Ariel Dora Stern

    Only a few rich nations are currently at replacement levels of fertility and many are considerably below. We believe that changes in the status of women are driving fertility change. At low levels of female status, women specialize in household production and fertility is high. In an intermediate phase, women have increasing opportunities to earn a living outside the home yet still shoulder the bulk of household production. Fertility is at a minimum in this regime due to the increased opportunity cost in women's foregone wages with no decrease in time allocated to childcare. We see the lowest fertility nations (Japan, Spain, Italy) as being in this regime. At even higher levels of women's status, men begin to share in the burden of child care at home and fertility is higher than in the middle regime. This progression has been observed in the US, Sweden and other countries. Using ISSP and World Values Survey data we show that countries in which men perform relatively more of the childcare and household production (and where female labor force participation was highest 30 years ago) have the highest fertility within the rich country sample. Fertility and women's labor force participation have become positively correlated across high income countries. The trend in men's household work suggests that the low fertility countries may see increases in fertility as women's household status catches up to their workforce opportunities.

    We also note that as the poor nations of the world undergo the demographic transition they appear to be reducing fertility faster and further than the current rich countries did at similar levels of income. By examining fertility differences between the rich nations we may be able to gain insight into where the world is headed.

    Keywords: Income; Household; Gender; Japan; Italy; United States; Sweden; Spain;

    Citation:

    Feyrer, James, Bruce Sacerdote, and Ariel Dora Stern. "Will the Stork Return to Europe and Japan? Understanding Fertility within Developed Nations." Journal of Economic Perspectives 22, no. 3 (Summer 2008): 3–22.  View Details
  8. Evaluating the Impact of the Baby-Friendly Hospital Initiative on Breast-feeding Rates: A Multi-state Analysis

    Summer Sherburne Hawkins, Ariel Dora Stern, Christopher F. Baum and Matthew W. Gillman

    Objectives: Despite the passage of state laws promoting breast feeding, a formal evaluation has not yet been conducted to test whether and/or what type of laws may increase breast feeding. The enactment of breastfeeding laws in different states in the USA creates a natural experiment. We examined the impact of state breastfeeding laws on breastfeeding initiation and duration as well as on disparities in these infant feeding practices.

    Methods: Using data from the Pregnancy Risk Assessment Monitoring System, we conducted differences-in-differences models to examine breastfeeding status before and after the institution of laws between 2000 and 2008 among 326,263 mothers from 32 states in the USA. For each mother, we coded the presence of two types of state breastfeeding laws. Mothers reported whether they ever breast fed or pumped breast milk (breastfeeding initiation) and, if so, how long they continued. We defined breastfeeding duration as continuing to breast feed for ≥4 weeks.

    Results: Breastfeeding initiation was 1.7 percentage points higher in states with new laws to provide break time and private space for breastfeeding employees (p=0.01), particularly among Hispanic mothers (adjusted coefficient 0.058). While there was no overall effect of laws permitting mothers to breast feed in any location, among Black mothers we observed increases in breastfeeding initiation (adjusted coefficient 0.056). Effects on breastfeeding duration were in the same direction, but slightly weaker.

    Conclusions: State laws that support breast feeding appear to increase breastfeeding rates. Most of these gains were observed among Hispanic and Black women and women of lower educational attainment suggesting that such state laws may help reduce disparities in breast feeding.

    Keywords: Race; Nutrition; Laws and Statutes; United States;

    Citation:

    Hawkins, Summer Sherburne, Ariel Dora Stern, Christopher F. Baum, and Matthew W. Gillman. "Evaluating the Impact of the Baby-Friendly Hospital Initiative on Breast-feeding Rates: A Multi-state Analysis." Public Health Nutrition 18, no. 2 (February 2015): 189–197. (Selected as Nutrition Society Paper of the Month, July 2014.)  View Details
  9. Limits on Use of Health Economic Assessments for Rare Diseases

    Hanna I. Hyry, Ariel Dora Stern, Jonathan CP Roos and Timothy M. Cox

    Funding of expensive treatments for rare ('orphan') diseases is contentious. These agents fare poorly on 'efficiency' or health economic measures, such as the QALY, because of high cost and frequently poor gains in quality of life and survival. We show that cost-effectiveness assessments are flawed, and have only a limited role to play in reimbursement decisions for orphan drugs and beyond.

    Keywords: Cost; Health Disorders; Health Care and Treatment; Pharmaceutical Industry;

    Citation:

    Hyry, Hanna I., Ariel Dora Stern, Jonathan CP Roos, and Timothy M. Cox. "Limits on Use of Health Economic Assessments for Rare Diseases." hcu016. QJM: An International Journal of Medicine 107, no. 3 (March 2014): 241–245.  View Details
Working Papers
  1. Characterizing the Drug Development Pipeline for Precision Medicines

    Amitabh Chandra, Craig Garthwaite and Ariel Dora Stern

    Precision medicines—therapies that rely on genetic, epigenetic, and protein biomarkers—create a better match between individuals with specific disease subtypes and medications that are more effective for those patients. These treatments are expected to be both more effective and more expensive than conventional therapies, implying that their introduction is likely to have a meaningful effect on health care spending patterns. In addition, precision medicines can change the expected profitability of therapies both by allowing more sophisticated pricing systems and potentially decreasing the costs of drug development through shorter and more focused trials. As a result, this could change the types of products that can be profitably brought to market. To better understand the landscape of precision medicines, we use a comprehensive database of over 130,000 global clinical trials over the past two decades. We identify clinical trials for likely precision medicines (LPMs) as those that use one or more relevant biomarkers. We then further segment trials based on the nature of the biomarker(s) used and other trial features with economic implications. Given potential changes in the incentives for bringing products to market, we also examine the relative importance of public agencies such as the National Institutes of Health (NIH) and different types of private firms in developing precision medicines.

    Keywords: Health Care and Treatment; Cost; Health Testing and Trials; Product Development; Economics; Pharmaceutical Industry;

    Citation:

    Chandra, Amitabh, Craig Garthwaite, and Ariel Dora Stern. "Characterizing the Drug Development Pipeline for Precision Medicines." NBER Working Paper Series, No. 24026, November 2017.  View Details
  2. The Impact of the Entry of Biosimilars: Evidence from Europe

    Fiona Scott Morton, Ariel Dora Stern and Scott Stern

    Biologics represent a substantial and growing share of the U.S. drug market. Traditional “small molecule” generics quickly erode the price and share of the branded product upon entry, however only a few biosimilars have been approved in the U.S. since 2015, thereby largely preserving biologics from competition. We analyze European markets, which have had biosimilar competition since 2006. Using our own survey, we analyze how market features and public policies predict biosimilar entry, price, and penetration, finding significant heterogeneity across countries and products. Effective buyer institutions are associated with increased biosimilar penetration. Our estimates can inform ongoing policy discussions.

    Keywords: Competition; Market Entry and Exit; Health Care and Treatment; Spending; Pharmaceutical Industry; United States; Europe;

    Citation:

    Scott Morton, Fiona, Ariel Dora Stern, and Scott Stern. "The Impact of the Entry of Biosimilars: Evidence from Europe." Harvard Business School Working Paper, No. 16-141, June 2016. (Revised April 2018.)  View Details
Cases and Teaching Materials
  1. Twine Health

    Robert S. Huckman and Ariel D. Stern

    In late 2014, Dr. John Moore (CEO), Frank Moss (chairman), and Scott Gilroy (CTO) of Twine Health (Twine) had to resolve several challenges that threatened to restrict the widespread dissemination of its sole product, Twine. Twine was a cloud-based platform that enabled patients to create and manage chronic disease treatment plans in conjunction with their primary care providers and specialized coaches. Twine had already enjoyed impressive successes in early clinical trials and among early adopters. The issues Twine's leadership team had to address included identifying clinical care providers willing to pay for Twine, ensuring adoption and effective use by both patients and health care providers, adding capabilities to support the management of additional chronic diseases, and seamlessly integrating Twine with a client organization's electronic medical record (EMR) system and information technology (IT) infrastructure. The need to solve these problems had become more pressing since Twine was named a finalist in the Health Acceleration Challenge (HAC) sponsored by Harvard Business School and Harvard Medical School. Teaching Note for HBS No. 615-068.

    Keywords: health care; chronic disease; technology adoption; digital health; health acceleration challenge; information technology; health; strategy; disease management; Health; Health Care and Treatment; Information Technology; Mobile Technology; Technology Adoption; Health Industry; United States; Massachusetts;

    Citation:

    Huckman, Robert S., and Ariel D. Stern. "Twine Health." Harvard Business School Teaching Note 618-055, March 2018.  View Details
  2. Adaptive Platform Trials: The Clinical Trial of the Future?

    Ariel D. Stern and Sarah Mehta

    This teaching note provides guidance and recommendations for teaching HBS Case No. 618-025, entitled “Adaptive Platform Trials: The Clinical Trial of the Future?”

    Keywords: clinical trials; Drug Trials; Drug Testing; Cancer Trials; glioblastoma; platform trials; adaptive trials; adaptive platform trials; Health Testing and Trials; Health Care and Treatment; Business Strategy; Health Industry; United States;

    Citation:

    Stern, Ariel D., and Sarah Mehta. "Adaptive Platform Trials: The Clinical Trial of the Future?" Harvard Business School Teaching Note 618-048, March 2018.  View Details
  3. Adaptive Platform Trials: The Clinical Trial of the Future?

    Ariel D. Stern and Sarah Mehta

    In July 2017, Dr. Brian M. Alexander, president and CEO of the AGILE Research Foundation, was preparing to launch a new type of clinical trial—an adaptive platform trial—to study potential therapies for glioblastoma (GBM), an aggressive form of brain cancer.
    Alexander believed that the standard way in which new cancer drugs were tested—the traditional randomized controlled trial (RCT)—was limited in many ways. While statistically rigorous and still considered the “gold standard” in clinical research, traditional RCTs were time-consuming, costly, and limited to testing just one new drug at a time. Adaptive platform trials, by contrast, facilitated simultaneously studying multiple therapies for a given disease and promised a number of efficiency improvements. They also used statistical techniques to allow more patients access to promising therapies. As such, they had the potential to fundamentally change the clinical research process, making clinical trials for new cancer drugs more efficient, more accessible to patients, and more ambitious in scope.
    For the past three years, Alexander had been working closely with a group of like-minded oncologists, statisticians, and clinical trial strategists to design an adaptive platform trial for GBM in the hopes of identifying effective therapies more quickly. By mid-2017, Alexander and his colleagues had completed a master protocol for the trial. But now the research team faced several design and operational challenges as they prepared for the trial’s launch. Most pressing, how should Alexander and his colleagues finance the trial?

    Keywords: clinical trials; cancer; adaptive platform trials; platform trials; adaptive trials; glioblastoma; Health; Health Care and Treatment; Health Testing and Trials; Business Strategy; Innovation Strategy; Health Industry; United States;

    Citation:

    Stern, Ariel D., and Sarah Mehta. "Adaptive Platform Trials: The Clinical Trial of the Future?" Harvard Business School Case 618-025, September 2017. (Revised January 2018.)  View Details
  4. Twine Health

    Robert S. Huckman, Ariel D. Stern and Matthew G. Preble

    In late 2014, Dr. John Moore (CEO), Frank Moss (chairman), and Scott Gilroy (CTO) of Twine Health (Twine) had to resolve several challenges that threatened to restrict the widespread dissemination of its sole product, Twine. Twine was a cloud-based platform that enabled patients to create and manage chronic disease treatment plans in conjunction with their primary care providers and specialized coaches. Twine had already enjoyed impressive successes in early clinical trials and among early adopters. The issues Twine's leadership team had to address included identifying clinical care providers willing to pay for Twine, ensuring adoption and effective use by both patients and health care providers, adding capabilities to support the management of additional chronic diseases, and seamlessly integrating Twine with a client organization's electronic medical record (EMR) system and information technology (IT) infrastructure. The need to solve these problems had become more pressing since Twine was named a finalist in the Health Acceleration Challenge (HAC) sponsored by Harvard Business School and Harvard Medical School.

    Keywords: health care; chronic disease; technology adoption; digital health; health acceleration challenge; information technology; health; strategy; disease management; Health; Health Care and Treatment; Information Technology; Mobile Technology; Health Industry; United States; Massachusetts;

    Citation:

    Huckman, Robert S., Ariel D. Stern, and Matthew G. Preble. "Twine Health." Harvard Business School Case 615-068, March 2015.  View Details