In retrospect Randy Theken was right. Theken is the inventor of the eDISC™, the first artificial lumbar spinal disc with embedded microelectronics.
Theken’s disc sensors collected patient motion and load data and then transmitted it via a handheld PDA communicator to surgeons who used it to assess patient performance.
Today we would call Theken’s eDISC a biosensing, wearable technology. Theken developed his eDISC about a decade ago and it never did catch on.
In retrospect, if the size of the venture dollars flowing into digital data from all sources including biosensing, wearable technologies is any clue, he was on the right track. He was inventing an entirely new medical device category.
$3 Billion Invested in 2015
And that’s not counting the $2.7 billion paid for TriZetto.
The list of the top ten digital health care data tech companies is at the end of this article.
But, suffice it to say, biosensing data collection, integration and analytics is the latest bright shiny object grabbing the attention of big time venture capital.
According to Rock Health, the first venture fund dedicated to funding and researching the digital health market, digital health startups have raised more than $3 billion in 2015 which includes more than $700 million in funding in the third quarter alone. That’s a 100% increase year-over-year. The funding is going into firms which build digital medical devices, software for analytics and big data, tools for health care management, and administration tools for payers and providers.
Juniper Research is the most often quoted market research report on this emerging medical device category (Smart Health & Fitness Wearables: Device Strategies, Trends & Forecasts 2014-2019) and they are saying that biosensing wearables could “dominate the [health] market until at least 2018.”
Despite the underwhelming launch of the Apple Watch (which had its own biosensing abilities) Apple is pouring dollars into this area and its core digital health partnership is with Epic and Mayo Clinic around the comprehensive concept of the HealthKit.
The HealthKit is a FREE software interface with purports to connect everything patient and practice related including patient records, invoices, diary, bookings, finances, financial reports and Medicare claims.
In effect, the bet on HealthKit is an attempt to put all this data—whether derived from wearable devices or other sources—into a comprehensive database which moves wearable data beyond counting steps to something extraordinarily powerful.
Enter the FDA.
The FDA’s Take
So long as wearables don’t make claims about treating specific diseases or conditions or inherent risks to consumer safety, then, say the experts, the FDA won’t consider biosensing wearables to be medical devices.
But the line is getting fuzzy.
If a biosensing wearable is marketed as a way to treat obesity (which is considered by the FDA to be a medical condition) then it could come under FDA medical device oversight. Increasingly the power of biosensing wearables, particularly when they integrate with the patient’s other medical data, can play an essential role in managing, diagnosing and potentially treating patient’s conditions.
Consider the power of a wearable which monitors blood pressure and alerts the wearer to change behavior when blood pressure hits certain pre-defined levels.
Here is a copy of the FDA’s draft guidance document for wearables.
The FDA wrote that wearables which make the following general wellness claims are not subject to FDA oversight:
- Weight management
- Physical fitness
- Relaxation or stress management
- Mental acuity
- Self-esteem
- Sleep management
- Sexual function
Examples of claims which would NOT be exempt from FDA oversight include:
- A claim that a product will treat or diagnose obesity
- A claim that a product will treat an eating disorder, such as anorexia
- A claim that a product helps treat anxiety
- A claim that a computer game will diagnose or treat autism
- A claim that a product will treat muscle atrophy or erectile dysfunction
- A claim to restore a structure or function impaired due to a disease, e.g., a claim that a prosthetic device enables amputees to play basketball
Really, These New Systems Will Affect Patient Outcomes
Look at the infrastructure being created. There’s no question but that it will be used explicitly to manage and direct and affect patient outcomes—for a long list of diagnosis.
Apple has its iOS 8 app called Health which along with the HealthKit cloud API creates the basis for integrating data from multiple apps and monitoring devices.
In addition to Apple and Google, here are the other companies making bets in the medical data integration market:
Acer, Appirio, Basis, Cambridge Consultants, Clothing+, Cutecircuit, Fitbit, GOQii, Hexoskin, Humana, Jawbone, Microsoft, MyFitnessPal, Nike, Owlet, Polar, Proteus Digital Health, Qardio, Qualcomm, Ralph Lauren, Razer, RunKeeper, Samsung, TAG Heuer, Timex, Withings, Xiaomi.
Apple’s HealthKit cloud approach probably epitomizes where other companies are heading. The HealthKit service logs data that’s been recorded by apps or gathered from mobile sensors and retrieve the content of that health profile. Apple’s goal is to make the Health app an entry point to the broader HealthKit service and to also channel in other digital health data apps.
The basis for HealthKit is the Mayo Clinic’s patient portal and patient app. From Mayo’s perspective, the app is a data repository for wearable digital data and opens up the possibility of a patient and physician dashboard. Wearables which monitor patient blood pressure could alert the physician of abnormal readings in the Health app from which the physician (or, more likely, nurse) could follow-up. Real time.
Just reading the commentary from senior executives at Mayo, it is clear that this is heading into subspecialty use—orthopedics and cardiac are top of the list. Already the discussions are to pull all biosensing data into data aggregators like HealthKit, which not only aggregate the wearable data, but also the electronic medical record, the pharmaceutical record and data from comparable patients and then fully incorporate them into treatment plans.
How can these not affect patient outcomes and why would we not want that?
The Top Ten Digital Health Companies, So Far
Proteus Digital Health: This summer, Proteus Digital Health raised $52 million, bringing its Series G investment round to more than $172 million. Proteus is creating Digital Medicine. Digital Medicine therapy includes drugs that communicate when they’ve been taken, wearable sensors that capture physiologic response, applications that support patient self-care and physician decision making, and data analytics to serve the needs of doctors and health systems. Proteus received FDA market clearance in the United States and a CE mark in Europe for its wearable and Ingestible Sensor devices. Headquartered in Redwood City, Calif., Proteus is privately held and funded by leading institutional and corporate investors, including: Novartis, Otsuka, Oracle and Kaiser Permanente.
Teladoc:Â Teladoc raised a $50.3 million this year. Teladoc is a telephone (call the 1-800 number) medical hotline where patients can confer with a physician. For $35 per visit (plus a one-time fee of $18 and a monthly membership fee ranging from $4.25 for an individual to $7.00 for a family). Teladoc has grown to more than 10 million members in the past decade. According to the company, close to 300, 000 people all received medical care in under an hour in 2014. Teladoc is aiming for a share of the 1.2 billion ambulatory visits per year in the U.S.
Chunyu: Chunyu raised a $50 million Series C in August 2014. Chunyu offers an app which allows patients to chat and call real doctors. Asking questions on forums is free with registration, as are 90-second phone calls with physicians. But many of the value added services—longer private consultations by phone, scheduling appointments, and having a private doctor on call—come at a premium. The price depends on the doctor, and the revenue is split between the doctors and Chunyu. CNN reported that the app has 30 million users and 40, 000 doctors.
TriZetto:Â Cognizant, an IT consulting company bought TriZetto for $2.7 billion. TriZetto provides practice management/electronic medical records (EMR) systems to hospitals and clinics and is promoting integration software which allows payer systems and clinic systems to communicate and use analytics to monitor, catch and fix issues before they create downstream problems. TriZetto is attempting to more fully integrate all technology platforms including EMR, payer databases and web based, cloud data aggregators. TriZetto is currently working with about 200, 000 physicians across the country.
Lift Labs: Lift Labs, which was acquired by Google in 2014, makes Liftware—a spoon which tries to cancel the effects of tremors caused by such neurodegenerative diseases as Parkinson disease. Lift Labs also developed two apps—Lift Pulse and Lift Stride—to measure tremors and to help people with Parkinson’s disease prevent shuffling while walking.
PatientKeeper:Â PatientKeeper was acquired by HCA last year. PatientKeeper software integrates everything a physician needs (clinic notes, medication interactions, lab results, test orders, prescriptions and, soon, data from biosensors) from multiple systems across a hospital, computers and mobile devices into a single dashboard view. About 60, 000 physicians are using PatientKeeper.
NANTHEALTH:Â NANTHEALTH raised $135 million in 2014. NantHealth is trying to combine science and technology into a single integrated clinical platform which can provide actionable health information at the point of care, in the time of need, anywhere, anytime. More generally, NantHealth hopes to provide physicians with actionable, cloud based clinical intelligence at the moment of decision.
Flatiron Health: In 2014 Google led a $130 million Series B investment into Flatiron. Flatiron’s OncologyCloud™ integrates electronic medical records for oncology with advanced analytics, a patient portal, and an integrated billing management tool. Earlier this year Flatiron formed a strategic alliance with Guardant Health. Guardant is generating genomic data from its Guardant360™ liquid biopsy platform.
Alignment Healthcare: General Atlantic invested $125 million in Alignment Healthcare. Alignment partners with providers, health plans, and hospitals to create a seamless, fast and continuous end-to-end care program, including clinical care coordination, risk management capabilities, and IT enablement. In short, Alignment integrates disparate data systems. One of Alignment’s key partners is Humana.
MedHOK:Â In January 2014, MedHOK raised $77.5 million. MedHOK offers an integrated care management, quality, and compliance platform that uses web based cloud architecture to help physicians, ACOs, PCMHs, payers, TPAs, PBMs, and other entities to manage and measure care against national quality standards for optimal patient outcomes.
With this kind of money and smarts working in the medical data acquisition, integration and analytics field the future will be nothing like the present. More to come, for sure.
