Phillip Balakirsky

IM Source List
Sorensen, Morten, and Ravi Jagannathan. "The Public Market Equivalent and
Private Equity Performance." Financial Analysts Journal 71.4 (2015): 43-50.
Print.
This paper focuses on demonstrating that the public market equivalent (PME)
approach is equivalent to assessing the performance of private equity (PE) using
Rubinsteins dynamic version of the capital asset pricing model (1976). Rubinsteins
model supposes that markets are frictionless and that an investor is infinitely lived and
chooses lifetime consumption and investment plans, subject to budget constraints, all of
which functions to maximize lifetime expected utility. Two central discoveries are that:
(1) one need not compute betas of PE investments, and any changes in PE cash flow
betas due to changes in financial leverage, operating leverage, or the nature of the
business are automatically taken into account; (2) the public market index used in
evaluations should be the one that best approximates the wealth portfolio of the investor
considering the PE investment opportunity. The authors start by considering a funds
internal rate of return (IRR). However, they acknowledge that there are several inherent
problems with using this method. First, it is an absolute performance measure that does
not adjust for the market return or for the risk of the investment, even though these two
indicators are crucial to valuating performance. Second, the IRR implicitly assumes that
investors can reinvest cash flows at the IRR, which may not exist or may not be unique,
meaning that the reality of the market is truly ever-changing, and moreover, cannot be
simply represented by the IRR. All of these problems seem to stem from that the IRR is
not derived from valuation theory. The article provides its main basis in that when the
public market equivalent approach is used with a sufficiently large N (approaching
infinity), the average of the observed distributions converges to their expected value,
which equals the present value of the distributions under the Rubinstein CAPM1, thus
proving their initial thesis. The purpose of all of this deliberation is to do analytics on
data gleaned from investment portfolios in order to conclude that a PME greater than one
suggests that the investment has been profitable for the limited partnership (LP).
Although all of the information in the paper is vastly interesting and can certainly
be useful for my life and education in the future, I dont think it can be relevant to my
research project, simply because of how technical of a paper it is. The method it discusses
is commonplace in the financial industry, but it deals more with investments and their
respective rates of return, rather that financial modeling that a regular company (not in
the financial sector) would utilize. It goes through extensive proofs that only one with
significant prerequisite education would be able to truly comprehend and grasp. Vheda
Health isnt in the financial sector, and thus doesnt use any of these technical formulas
and models, translating into that I, too, will not find any necessity in using them in my
research.
1 All developed through a multi-step process that uses technical formula after
technical formula, all of which I would have to define through variables, a process
that wouldnt even really be useful for overall understanding.

Meghani, Ankita, and Sanjay Basu. "A Review Of Innovative International

Financing Mechanisms To Address Noncommunicable Diseases." Health Affairs
34.9 (2015): 1544-47. Print.
As medicine has progressed, many communicable diseases have been mitigated
and cures, or at least serious prevention techniques have been found, especially in
medium- to high-income countries. Despite this, in low- to medium-income countries,
non-communicable diseases have revealed themselves to be a serious, untreated threat.
The only viable chance at a solution is the development of systems to prevent and treat
these diseases. In an attempt at a resolution, several innovative international financing
models and mechanisms have been proposed. Since none of these are currently in place
for the treatment of non-communicable diseases, the only ones that can be referenced are
those that have been proposed or used in other disease control efforts. It seems as though
the greatest data available supports pooled funding models, where funding from multiple
groups is combined for a specific investment. Such models were previously deployed in
vaccine and infection disease funding areas. Another source of evidence strongly
supported is international transactions, taxes or levies placed on specific transactions to
fund investments in drug procurement and supply. In addition to these two, other options
included the front-loading of development aid procurement, diaspora bonds, and debt
reduction programs as mechanisms. The article goes on to elaborate on all of the
aforementioned possibilities and how they would be applied to non-communicable
diseases2. Pooled funding was frequently described as occurring through public-private
partnerships, such as product development partnerships for the research and development
of drugs, vaccines, and diagnostics, as well as through combined public and private
funding resources. An example of this is the Global Fund to Fight AIDS, Tuberculosis,
and Malaria. On the whole, this method seems to work, with just a few concerns, mainly
on the side of price negotiations. First, information asymmetry occurred such that
manufacturers benefited from precise information about manufacturing costs, giving
them an upper hand during price negotiations. Second, advance market commitments
were criticized for providing inadequate flexibility to spur innovation. This second
concern, though, is not overly relevant to the low- and middle-income countries, since
their problems centrally stemmed from pricing and access, not innovation. As such,
despite that these programs have not been put into action as of yet, pooled funding seems
to be the most promising avenue, should the global market embark to attempt aiding the
treatment of non-communicable diseases in foreign markets.
This source could truly prove itself useful in my research project, as it discusses
non-communicable diseases, the very diseases Vhedas intervention system targets.
Although it focused on other diseases, the same process could easily be applied to
diabetes and congestive heart failure. This could potentially be even more useful because
of its discussion of foreign markets, which I was thinking of researching for my project.
The potential of these methods is enormous, and their easy translation to virtually any
topic concerning healthcare could be inordinately useful in facilitating my research and
my project as a whole.
2 I will only focus on pooled funding, as this method showed the most promise and
the others would just be a waste of time to expand upon

Rub, Philip. Interview by Phillip Balakirsky. 28 Sept. 2015.

Philip Rub is the President and Chief Technical Officer of Vheda Health. He holds
both a Bachelor of Science in Information Systems from Mount St. Marys College and a
Masters in Business Administration from the Smith School of Business at the University
of MarylandCollege Park. He is responsible for overseeing most of the day-to-day
operations of the company and managing the Director of Information Technology.
Through past work experience, Rub has mastered big data analytics and analyzes claims
data to ensure that Vheda is experiencing positive outcomes and providing a positive
return on investment (ROI) for clients. Another of Rubs responsibilities is to attend all
demos for clients along with the CEO. He is an expert on the technical aspects of the
program and is the prospective clients resource on direct ROI figures, as well as margins
and pricing options. He is one of the three people to whom I report directly.
Luhar, Shameet. Interview by Phillip Balakirsky. 1 Oct. 2015.
Shameet Luhar is the CEO of Vheda Health. He holds both a Bachelor of Science in
Information Systems from the University of MarylandCollege Park and a Master of
Sciences in Medical Informatics from Northwestern University. Luhar is responsible for
overseeing everything that goes on in Vheda on both the technology and the sales sides.
His main focus is on promoting Vhedas vision and securing meetings with potential
clients. He writes contracts and terms of agreements and heads meetings with potential
clients. Additionally, he is the leader of the sales team and handles all follow-up
communication with clients. Through past work experience, Luhar knows how to manage
a big team and has learned the art of startup sales in stride. He is one of the three people
to whom I report directly.
Spurrier, Joe. Interview by Phillip Balakirsky. 1 Oct. 2015.
Joe Spurrier is the Director of IT of Vheda Health. He holds both a Bachelor of
Science in Computer Information Systems specializing in Computer Forensics and a
Master of Science in Business and Technology Management from Stevenson University.
Spurrier runs all of the helpdesk capabilities of Vheda and is the central point of contact
in dealing with all of the technical companies with whom Vheda partners. In addition, he
sets up the packages Vheda sends out to clients and walks Medicaid recipients through
the general setup process. Another of his responsibilities is manning Vhedas databases
and running MySQL queries through them whenever Vheda needs a certain data set or to
figure out trends in data. He reports to Philip Rub and offers technical insight when code
logic issues arise. Spurrier is one of the three people to whom I report directly.