Eko Core, A Digital Upgrade For The Centuries-Old Stethoscope | TechCrunch

Eko Core Digital Stethoscope - product picture
Eko Core Digital Stethoscope

The Eko Core digital stethoscope is a “why didn’t I think of that?” invention.

In a few months, the stethoscope will celebrate its 200th birthday. A medical breakthrough in 1816, it’s still a part of nearly every doctor’s visit today and a symbol of medicine itself.…

Digital Stethoscope

Stripped to its essentials, the Eko Core digital stethoscope is a highly engineered Bluetooth microphone designed to fit medical stethoscopes. The device wirelessly transmits patients’ heart sounds (not EKG) to a smart phone or tablet app.

The Eko Core was invented and commercialized by a team of UC Berkeley engineering graduates (claimed to be the youngest team to secure FDA clearance for a Class II medical device).

What Eko Core did well

In developing and executing its strategy, the Eko Core team did a number of things right:

  • Targeted a huge existing market. Most doctors and many nurses carry and use stethoscopes every day.
  • Recognized and addressed a  nagging clinical problem: It can take years (even decades) to become adept at using a stethoscope to recognize heart sounds.
  • Improved the functionality of the stethoscope by enabling visualization and amplification. Benefit to the user is improved confidence in identification of heart sounds.
  • Made their device a simple, affordable ($199) add-on to the user’s existing stethoscope.
  • Employed a Bluetooth wireless connection to the user’s smart phone or tablet . Data  from the stethoscope is displayed in a custom app.
  • Enabled data sharing via “the cloud” so that users can share typical and atypical heart sounds and learn from each other.
  • Partnered with major EHR suppliers to enable the digital stethoscope data to be entered into the patient’s electronic medical record.
  • Identified the potential for use of the Eko Core to lower healthcare costs by reducing costly referrals to cardiologists for unusual heart sounds.

What Eko Core hasn’t done yet

  • Showed they can be financially successful over time. Medical device sales and marketing is expensive. Manufacturing under FDA, GMP, ISO, etc. regulations can increase costs. Maintaining healthy profit margins on low-priced medical devices can be a challenge.
  • Exhibited a competitive advantage over similar products, Thinklabs for example.
  • Fully protected their intellectual property, although the company did recently file a patent application.
  • Leveraged their technology beyond one-hit wonder status.

Takeaways

The number of medical stethoscope users in the developed world is on the order of several million. Growth rates are slow, with new graduates replacing retirees, etc.  That puts the potential market at around $500-600 million.

Not bad, but once you “pick the low-hanging fruit” and sell to the early adopters and early majority customers, selling more units gets progressively tougher and more costly. And given competition, it’s a race for market share to capture and keep customers.

I think this will be a fun and profitable business for a while. Longer term, I hope Eko Core has a big medical device company lined up as a distribution partner and has an encore product that leverages the same technology and customer base.

Source: The Eko Core Is A Digital Upgrade For The Centuries-Old Stethoscope | TechCrunch

Eko Devices website

Free Medical Device Launch Checklist – Protect Your Investment

free Medical Device Launch Checklist

So you (or your company) has developed a new medical device. You have invested millions of dollars and substantial time in engineering, obtained regulatory clearances, and set up manufacturing. It’s time to go to market, right? Turn it over to Marketing and Sales and wait for the orders to pour in. Are you sure that all relevant launch activities are being planned and accounted for? Perhaps you should protect your investment in your medical device product with this simple, easy to use, free Medical Device Launch Checklist.

Easy to use, downloadable PDF file: free Medical Device Launch Checklist

The Medical Device Launch Checklist from sanko::strategic consulting is free and easy to use. It contains 64 checkable launch items. Launch items include traditional marketing activities like pricing as well as easy to overlook issues such as expiration dating and localization. The Checklist gives you a brief description of the purpose of each item. It also shows you the department/corporate function with primary responsibility for the item. The file can be saved to monitor launch progress.

Anyone can use the Medical Device Launch Checklist. It is primarily intended for small and medium-size companies that may not have institutional systems and processes to control launch activities. It can also be used by anyone (Product Manager, Marketing Manager, Project Manager, startup CEO, et al) who wants to assure that nothing has been omitted from their launch plan.

You can use the Checklist to guide the development of a launch or marketing plan. The Checklist can also be used as a gateway document to assure that all activities are accounted for and either completed or in progress before authorizing product launch.

To obtain your personal copy of the free Medical Device Launch Checklist, click here and select the link for the free Medical Device Launch Checklist.

Think of it as cheap insurance to protect your multi-million dollar baby.

Image courtesy of arztsamui / FreeDigitalPhotos.net

Smaller, faster, lighter, cheaper medical devices

http://3278as3udzze1hdk0f2th5nf18c1.wpengine.netdna-cdn.com/wp-content/uploads/2013/11/drop-theranos.jpg
image via singularityhub.com

Is it just me or does it seem that most interesting medical device innovations are coming from startups and not from established companies? Here are a few medical devices being developed that are smaller, faster, lighter, and cheaper than established technologies and products.

The point of care diagnostic system being developed by startup Theranos relies heavily on microfluidic and automation technologies. The technology, while impressive, is not revolutionary. Theranos is using readily accessible technology to develop a point-of-care diagnostic test device that can be operated by virtually anyone. The test uses a pinprick to collect a drop of blood to perform all of its tests. No need for a nurse or technician. The test is completely automated so there is no need for a diagnostic technician.

Time is saved because the sample is processed onsite instead of being transported to a central lab and there is negligible wait time compared with large diagnostic equipment. One of the biggest drawbacks to present diagnostic testing is the wait: patients are anxious and physicians often can’t administer medicine or therapy until and unless an initial diagnosis is confirmed.

Tribogenics is developing the next generation of x-ray imaging technology. From the company website:

Tribogenics technology enables portable, compact X-ray solutions for applications in industrial testing, medical diagnosis, security screening and other industries. By miniaturizing X-ray sources and eliminating the need for high voltage, we can create products and solutions unattainable using existing X-ray technology.

While I’m not sure how big the opportunity is for pocket-sized x-ray machines in medicine, there are plenty of industrial and commercial uses. Plus, the potential for portability, low cost, and simplicity may make the Tribogenics device well-suited for deployment in developing countries with little or no medical infrastructure.

The third technology I’m writing about isn’t a product but a concept. The Smartphone Physical is being termed “the physician’s bag of the 21st century.” In a recent TED Talk, Shiv Gaglani showed that a complete physical exam could be conducted with a smartphone and what are essentially smart attachments. For example, companies have developed or are developing ECG leads, a stethoscope, otoscope, ultrasound wand, and even a spiromoter. Gaglani and his colleagues are creating a database of connected devices and apps and hope to start a company to commercialize the Smartphone Physical.

One concern about the Smartphone Physical is a condition that is described by a new word, cyberchondria. Yes, it means hypochondria that is facilitated (or exacerbated) by the ready availability of digital and connected devices and apps. Don’t think it could happen? Ask any doctor about how many patients self-diagnose on the Internet before their office visit. Cyberchondria is real.

Takeaways: If you can take an existing medical device or technology and improve it by making it smaller, faster, lighter, and/or cheaper, you have the makings of a company. Your new device doesn’t have to be better than what it replaces but it would make it easier to sell if it had the same quality, accuracy, etc.

There are plenty of examples of medical devices that are big, bulky, slow and costly. Give customers two or more benefits based on eliminating or minimizing these undesirable features and you will create a market niche for your products.

Read more:

Small, Fast and Cheap, Theranos Is the Poster Child of Med Tech — and It’s in Walgreen’s | Singularity Hub.

http://www.theranos.com/

California Startup, Tribogenics, Develops Smart Phone Sized Portable X-ray Machines | Singularity Hub.

http://tribogenics.com/

Smartphone Physicals Are Taking Off With Explosion of Apps, Attachments | Singularity Hub.

http://www.smartphonephysical.com/

 

Too good to be true…or just hype?

http://www.getairo.com/img/airoband.png
image via getairo.com

In a development many were expecting, Canadian mobile health startup Airo Health backed off on its launch of the world’s first wearable device that could track caloric intake. The bold initial product announcement and aggressive commercialization timing led many to think it was too good to be true. Others dismissed the story as just hype.

 

In a story on techvibes.com, the company announced today that it was cancelling pre-orders and issuing refunds to prospective customers.

“Our early testing of AIRO shows tremendous promise, but through conversations with others in the industry, we have come to realize that it requires further testing and calibration through more extensive trials before it will be ready for general market availability,” wrote founder Abhilash Jayakumar in an email to backers this week. “The additional validation required will take us some time and, unfortunately, we no longer expect to be able to ship the first AIRO wristbands by Fall 2014 as initially indicated.”

From the Airo Health website:

NUTRITION

We all know the importance of eating right, but keeping track of what we eat takes too much effort. AIRO is able to automatically track both the calories you consume and the quality of your meals. With a built in spectrometer, AIRO uses different wavelengths of light to detect nutrients released into the bloodstream as they are broken down during and after your meals.

STRESS

AIRO helps you become proactive about stress. It measures heart rate variability, the aggregate response of your autonomic nervous system, derived from heart rate, to measure the smallest fluctuations in your stress levels. AIRO can not only warn you as your stress levels rise but can also provide recommendations as to how best to deal with it. Over time, AIRO gets smarter by learning what calms you and what doesn’t.

SLEEP

We spend a third of our lives sleeping but we know very little about it. AIRO tracks your circadian rhythm and can see distinct sleep cycles. It’ll wake you up at the optimum time and will let you know how much of your night’s sleep was restorative.

EXERCISE

It’s no secret that living an active lifestyle can lead to a long and healthy life. The best way to keep track of your daily activity is to monitor your heart rate; everything else is just a proxy. By tracking your heart rate, AIRO calculates the number of calories your body burns throughout the day.

I wrote about Airo Health and my healthy skepticism of its commercialization timing here. So did MedCityNews and mobilehealthnews.

Takeaways: Developing new medical technology is difficult, much more so than envisioning it. What works in the lab seldom works as well in humans. Unfortunately, it’s easy to get free PR for new and interesting technology without much proof. You can even generate orders without having a functional prototype.

It’s too soon to know if Airo Health actually has unique and innovative mobile health technology. It’s also too soon to know if the company has forever tarnished its reputation. I’m guessing they have “one more chance to make it right”. If they go away and perfect their technology and then try to promote it, the media will grab the story because of the company’s previous sins. If they fail again, I believe it will be virtually impossible to get press or investor attention.

Good luck, Airo.

Read more:

http://www.techvibes.com/blog/airo-health-cancels-preorders-2013-11-21

Startup unveils a wearable device it says can count calories — but it doesn’t actually exist yet – MedCity News.

Question marks, incredulity meet the announcement of Airo | mobihealthnews.

Prescription drug prices increasing wildly

Mainstream media stories about prescription drug pricing are common. A simple Google search for “prescription drug price increases” yields 37.7 million results. A recent story highlighted that Americans, despite representing only 5% of the world’s population, manage to consume 50% of the world’s prescription drug supply. What’s going on?

The New York Times recently published a story about asthma inhalers. Drug companies have sharply increased prices in the U.S. for inhalers and drugs that have been on the market for years. A key driver was an EPA requirement that manufacturers reformulate their inhalers to eliminate particularly dangerous chlorofluorocarbons, even though the amounts used are quite small. Reformulation required new FDA approvals and in some cases resulted in new patents. Because the U.S., in contrast with most other developed countries, relies on market competition for price regulation, the drug companies were able to achieve massive price increases for drugs that often have no direct competition or equivalents.

In other instances, drug companies with drugs coming off patent were able to keep their products as prescription medications and avoid moving to over the counter (OTC) status by paying off generic competitors. This practice has recently been the subject of much litigation but has not been settled by the U.S. Supreme Court.

Additionally, pricing for new drugs, particularly cancer treatments, are breathtakingly high. Here’s an excerpt from an article in the Washington Post:

The average monthly price of cancer drugs has doubled over the past 10 years, from about $5,000 to more than $10,000. Of the 12 new cancer drugs approved by the Food and Drug Administration last year, 11 were priced above $100,000 annually. Yet only three were found to improve patient survival rates and, of these, two increased survival by less than two months.

The drug prices and increases are out of reach to anyone without very good medical insurance. In fact, medical bankruptcy is the most common form of bankruptcy in the U.S. The prices for the same drugs are much lower in other countries, meaning that we in the U.S. are effectively subsidizing the rest of the world’s pharmaceutical prices.

So we have reformulation of existing products with a huge price increase, avoidance of transition to generic status and price reductions by paying off generics manufacturers, and cancer drugs that cost well into six figures for a year’s worth of treatment but haven’t been proven to extend life (or extend it insignificantly). Not to mention successfully lobbying the federal government to prevent Medicare from being able to negotiate volume-based price reductions. There’s innovation here, but not much on the clinical side. The innovation is in working every angle to keep prices high and raise them even higher.

And we wonder why our healthcare costs are the highest in the world.

Read more:

The Soaring Cost of a Simple Breath | The New York Times

Chart: Cost of cancer drugs | The Incidental Economist.

The Rising Costs of Cancer Drugs | New York Magazine.

Making cancer drugs less expensive | The Washington Post

Hyping a digital health startup

http://graphics8.nytimes.com/images/2013/10/03/technology/bits03-healthtap/bits03-healthtap-tmagArticle.jpg
image via NY Times digital blog

HealthTap is a digital health app and website. It’s a useful way to get health and fitness information that is tailored to your interests. You can even get your specific questions answered by medical experts. I use it myself. In an effort to attract attention and even more users, however, HealthTap appears to have hyped or at least exaggerated its success.

HealthTap works by recruiting physicians (more than 50,000 participate) to answer questions posed by subscribers for free. The subscribers do not pay for the service. I’m not quite sure what their business model is, actually. The rationale for doctors to participate is that the physicians will be recognized (“thanked” in HealthTap parlance), their online reputation will be enhanced, and real life patients will come to them as a result.

After an interaction where a user asks a question and receives a response from a doctor, HealthTap asks the user to thank the doctor or HealthTap and prompts the user for more information. The extra information apparently includes responding with a click to a question like, “This answer saved my life.”

HealthTap keeps a record of all of the positive responses to the “saved my life” prompt and issued a press release when the tally got to 10,000. Nothing wrong with any of that, except there is no way to prove if the app/website/reply really did save a particular life.

As one physician commenter in the New York times article said, “after my third “This saved my life,” I investigated. It was for recommending antifungals for jock itch. Nice pat on the back, but lifesaving? Not!”

Although some of the the lifesaving claims may be legitimate, the touting of “10,000 lives saved so far” on HealthTap’s website seems vaguely desperate and hyped – not what I expect from a serious medical app.

HealthTap also provides a disclaimer on its website and app: “HealthTap does not provide medical advice, diagnosis or treatment.” The disclaimer is obviously there to avoid being treated as an FDA-regulated medical application. Of course, the FDA (and malpractice attorneys) will have the final say on that status. I don’t know how asking a specific medical question and having an answer provided by a physician avoids becoming medical advice.

HealthTap is competing with big players in the health information field. WebMD is the 800 pound gorilla and granddaddy of health information sites. I suppose the executives at HealthTap feel they have to be aggressive in order to create awareness and get users and doctors to take notice. Unfortunately, their real utility and service has been tainted by excessive marketing, in my opinion.

HealthTap appears to be a well-funded Silicon Valley startup. Its investors include luminaries like Eric Schmidt, Chairman of Google, Vinod Khosla, Esther Dyson, and more.

Postscript:  I removed the HealthTap app from my mobile phone because I thought the notifications it provided were too frequent and intrusive. I still receive an email every few days on the subjects I told HealthTap were important to me.

Takeaways: Yes, you need to be aggressive in marketing your startup. There is a lot of competition for mind share among similar startups all over the world, no matter how unique you believe your company/product/service to be.

No, you should not make up or exaggerate claims about your product. Perhaps it can be excused as puffery or marketing hype but healthcare companies are held to a higher standard than consumer products like beer or body wash.

Read more:

An App That Saved 10,000 Lives – NYTimes.com.

HealthTap.com

High tech medical device maker focuses on…China?

http://axialexchange.com/images/articles/Hypertension-Nutrition-Counseling.jpg
image via axialexchange.com

High blood pressure is a significant societal health problem all over the world. Kona Medical is trying to address the huge hypertension population with a noninvasive ultrasound device that might eliminate the need to take daily blood pressure medication. In a somewhat unorthodox move, the company is focusing initially on China.

 

Last year, Medtronic acquired Ardian, another startup that is focused on the same clinical condition. Ardian, based in the San Francisco Bay Area, was purchased for $800 million.

From axialexchange.com:

The statistics for hypertension are stunning. 30% of US adults have hypertension (high blood pressure). Another 30% of Americans are pre-hypertensive. Less than half of those people with hypertension have their condition under control.  A fifth don’t know they have it. The annual price tag for direct medical expenses related to high blood pressure is $131 billion. This is driven in part by the 55 million doctor visits that are prompted by high blood pressure. High blood pressure is present in most first heart attacks (69%), first strokes (77%), and in people with congestive heart failure (74%). High blood pressure was listed as a primary or contributing cause of death for about 348,000 Americans in 2008.

Recent medical research has shown that ablation (destruction) of the nerves around the renal arteries can reduce blood pressure in patients with hypertension. A number of medical device companies are racing to commercialize products based on their proprietary technologies in order to take a lead in this evolving market.

Ardian uses radio frequency ablation delivered via catheter to the area of the renal arteries. Kona is using focused external ultrasound to deliver the therapeutic energy – they are calling it “surround sound.” In a superficial assessment, it appears that Kona has the edge since their technology is completely noninvasive while the Ardian technology could at best be described as minimally invasive.

Of course, what should really matter is which technology works best with the fewest side effect, not how the therapy is delivered. The “best” technology doesn’t always prevail in the medical device industry, however. Sometimes first to market gets and keeps the largest share while in other situations the best marketing prevails.

Kona has previously raised $40 million in venture capital earlier this year and in 2012.

Kona’s latest announcement, to use a new investment of $10 million to launch their product in China, is somewhat confusing. Yes, there are vast numbers of people in China and untold numbers with hypertension. Most, however, probably do not have the type of health insurance that would pay for a high tech solution. In its press release, the company said that their therapy has the promise of being delivered in an outpatient setting. Outpatient hypertension therapy clinics – now that’s a disruptive concept!

China is not a traditional launch market for new medical devices. The company says that the latest investment, from a fund with deep ties to China, will be used exclusively to address the many clinical, regulatory, and intellectual property issues unique to China as a medical device market for Kona’s new therapy.

It will be interesting to see if Kona can successfully launch their product into the Chinese market while simultaneously commercializing for the traditional U.S. or E.U. markets without losing focus or depleting key resources.

Takeaways: Most companies commercializing novel medical devices pick a launch market and stick with it. There are any number of reasons to launch in the U.S. first. Other companies pick the European Union countries and some look to large, less regulated countries in South America.

While many development and commercialization tasks are the same no matter which initial market is selected, there are important differences. It’s usually best to choose the first, second, and perhaps third initial markets so that the launch components are not uniquely different and the company can use scarce resources for other commercialization tasks.

 Read more: Kona Medical raises $10M to reduce high blood pressure for people in China – GeekWire.

Kona Medical

Medical Device Startup Fundraising: 5 keys for your pitch

Woman presentingIf you are leading a medical device startup, fundraising is your top priority. Here are five key points that you must address in every pitch that you make, no matter if it’s for a grant, seed investment from friends and family, angel investment, venture capital funding, or strategic partnerships with multinational medical device companies.

From the article:

  • Be clear on what your product is, right up front
  • Articulate the important problem you are solving
  • Define your customers
  • Spell out how you will create value with the $$ you are raising
  • Instill confidence in you and your team

Another way to look at the pitch is to think of it in terms of risk reduction. Most experienced investors talk about three main areas of risk in startup investing:

  • Technical Risk
  • Market Risk
  • Execution Risk

Investors will not move forward with an opportunity unless they believe that these key risks have been addressed and are below their personal threshold. Of course, you will never know that threshold so you must work to convince the investor that you have mitigated the three risks to the maximum extent possible.

Technical risk is all about the product or solution. Does your product solve the customer’s problem? Have you built a working prototype? Do you have an animal model? Have you performed animal testing? Are there important technical issues yet to be resolved? Do you have any intellectual property protection? Have you conducted a freedom to operate analysis? Does your product or solution depend on products or IP owned by other companies? Have you conducted beta testing? What’s your regulatory classification and plan? Are there more products in the pipeline?

Market risk is about the customer(s). Have you identified the problem? Is the problem a large one? Is the market opportunity big enough to justify the investment? Who are the customers? Why will they buy from you? What’s the competition (and don’t make the rookie mistake of saying that there is no competition)? Do you have evidence of demand? Do you have testimonials or at least interest from Key Opinion Leader customers? How do you plan to distribute and sell your product? How does your product or solution fit in today’s environment of managed care, healthcare reform, and evidence-based medicine? What’s your reimbursement strategy and plan?

Execution risk is about you and your team’s ability to convince investors that you can use their money to execute your plan. Does your team have the talent and experience to successfully commercialize your product? Do you have experienced and knowledgeable advisors, both business and clinical? Do you have a credible business model? What are your key milestones? What’s your exit strategy? Do you have a detailed pro forma income statement, especially for the period up to launch and for the two years after launch? Will you execute it exactly as conceived? Of course not, but you should be confident in your plan and your ability to execute. You should also have detailed contingency plans for the inevitable crisis when things go awry. 

Takeaways: Like many things, being successful at medical device fundraising requires being a great salesperson. Whether it’s a surgeon or an investor you’re selling to, put yourself in the place of that person. Be sure to address the five key points with details, evidence, and background information: product, problem, customer, milestones, team. Also keep in mind the risk tolerance of the investor. Your ability to communicate mitigation of technical risk, market risk, and execution risk will determine your success in fundraising.

Read more: Medical Device Startups: 5 essentials for your pitch deck | MassDevice.

Digital health: what’s the business model?

image via svtechtalk.com

Connecting patients with each other, with clinicians and other providers, with insurers, and with healthcare companies via mobile apps on tablets and smartphones and on the web seems like a great idea. The unanswered question is can you make money doing it?

Articles have been written about how the Internet has enabled patients with chronic diseases and their families to connect with others with the same condition. The patients share stories about symptoms, treatment successes and failures, and try to support each other in what can be emotionally draining circumstances. That ability to connect with a vast community all over the country, perhaps even the world, was virtually impossible before the advent of the World Wide Web.

Other companies are trying to connect healthcare providers with their patients. Some are offering to connect patients with providers for online visits for a fee, effectively commoditizing the doctor-patient relationship.

Google famously shut its attempt at a personal health record site, Google Health, last year. Google Health required a lot of effort to use as it didn’t automatically connect with consumers’ Electronic Medical Records. That shortcoming left a small market of people who were OK with manually entering all of their health data. And that wasn’t a big enough user base for Google.

Healthcare companies, especially those with a B2C business model, are desperate to maintain relationships with consumers.

Providing apps and cloud storage can be costly. It’s not clear who will pay for the digital services.

Doctors and other providers have been incentivized into adopting EMR technology. It’s unlikely that they will invest in additional information technology for their patients.

It seems that consumers and patients love the free stuff. A few may be willing to pay for some services but many have grown to expect that someone else will foot the bill. And most non-healthcare smartphone and tablet apps are either free or at most a few dollars. That sets a low ceiling for any new health-related apps. It’s a tough way to grow a sizable healthcare or medical device company.

People have grown accustomed to paying almost nothing for their healthcare. Sure, there are co-pays and deductibles that have increased significantly in recent years but those are a small fraction of the cost of care. It will be a challenge to change this expectation for health-related apps and services.

In-app ads are probably not the way to go. If the ads are for healthcare-related items like prescription drugs, the patients will lose trust in the service. If the ads are specifically targeted to the patient’s medical condition, the service will be accused of spying on the patient.

Perhaps healthcare companies will regard the cost of developing and providing apps as a marketing expense.

It’s an interesting dilemma. Free apps and services will draw large numbers of users. But monetizing the app via ads turns off many people. Charging for the services drastically reduces the potential market. Absorbing the expense internally places the app/service on the list of things to be cut when the company’s overall business stagnates or declines.

Takeaways: There is enormous interest in apps and services for mobile health. If you are developing products or services in this space, be sure you know how you are going to make money. It’s not a market if you can’t monetize it.

The traditional medical device business model doesn’t seem to apply here. If you procure funding, develop a product, then show economic or health benefits, who do you sell to?

Perhaps partnering with noncompeting companies interested in the same population is a creative way around the problem. If you can deliver large numbers of consumers/patients via a sponsored app to a partner like a big pharmaceutical company, you may be able to avoid some of the pitfalls and objections.

It’s prudent to put a lot of effort now into developing a viable business model. After all, when you start pitching to investors, one of the first questions asked will be, “how do you plan to make money?”

Read more:

Will Any Health App Ever Really Succeed? | MIT Technology Review

Patients share tips online for managing diseases | SFGate.

Improving Patient Engagement Equal Parts Technology, Empathy | Computerworld

Patients Eager To Access Data Including Medical Imaging Through Online Portals (infographic) | MDDI Medical Device and Diagnostic Industry News Products and Suppliers.

A Cautionary Tale: Biotech firm Atossa recalls its only product | The Seattle Times

Atossa Genetics is an early stage biotechnology company in Seattle developing breast cancer diagnostic tests and medical devices using molecular diagnostic technology. The publicly traded company ran afoul of FDA regulations earlier this year and last week announced a voluntary recall of its products, causing its stock to tank.

The company bills itself as “the breast health company (TM).” Atossa is small, with only ten full-time employees (at least five of whom are senior management executives) according to Yahoo Finance.

Here’s a timeline of company events:

  • November 8, 2012 Atossa Genetics, Inc. Announces Initial Public Offering (NASDAQ exchange, IPO value $4 million). That’s not a typo. It really was $4 million, 800,000 shares at $5 per share.
  • February 21, 2013 Atossa Genetics, Inc. received a Warning Letter from the FDA regarding its Mammary Aspirate Specimen Cytology Test (MASCT) System and MASCT System Collection Test. From the company’s press release:

“The FDA alleges in the Letter that following 510(k) clearance the Company changed the System in a manner that requires submission of an additional 510(k) notification to the FDA.”

  • March – September 2013 Atossa Genetics Inc. continues marketing its products, announcing numerous distribution and partnering agreements as well as supporting women’s health events.
  • September 18, 2013 The company’s stock closes up almost 21% in one day at $6.00 on volume of more than 8.4 million shares traded when it announces a distribution agreement with medical distributor McKesson.
  • October 4, 2013 Atossa Genetics Inc. initiated a voluntary recall to remove the ForeCYTE Breast Health Test and the Mammary Aspiration Specimen Cytology Test (MASCT) device from the market. This voluntary recall includes the MASCT System Kit and Patient Sample Kit.
  • October 7, 2013 Atossa Genetics Inc. stock opens at $5.32 and quickly drops to $2.66 (down 50%) on the news of the voluntary recall. The stock closed today at $2.45, an all-time low.
  • October 7-8, 2013 At least six law firms have announced initiation of shareholder lawsuits in the aftermath of the recall.

Apparently, the company and the FDA disagreed on whether a new 510(k) was required after the company changed the Instructions for Use (IFU) on its product. The company seems to have decided to continue marketing without submitting a new 510(k). What happened next is unclear but the “voluntary” recall ensued.

The company told The Seattle Times that it currently has “sufficient cash for the next 8-12 months of operations without raising additional capital,” though it cautioned that the cost of the recall and other associated expenses is not yet known. Sales revenues were about half a million dollars for the first half of 2013. Atossa reported a $2.2 million loss for the same period.

According to The Seattle Times, Atossa is continuing to develop other diagnostic tests but “will be reassessing the regulatory status of these products … in light of our recent experience,” said CEO Quay. Seems like a prudent action given their recent history…

Takeaways: Do not disregard the FDA. They have the power to shut down your company. If you have a fundamental disagreement with FDA, hire a regulatory consultant and attorney and take their advice.

Make sure you have people with experience in commercializing medical devices, especially regulatory affairs, on your executive team and board of directors.

Think carefully before deciding that an IPO is your best financing option. There are very large fees to be paid and the reporting requirements (Sarbanes-Oxley, etc.) are much more revealing – and onerous – than anything required if you remain private and use VCs or angel investors as your sources of capital.

As the article points out, there are plenty of attorneys waiting to represent disgruntled shareholders. Perhaps you can prevail against all of this adversity but think of the opportunity costs in lost time and cash spent on lawyers and regulatory revisions instead of product development or marketing.

Read more: Biotech firm Atossa recalls its only product | Business & Technology | The Seattle Times.

Robotic surgery and Intuitive Surgical – justifiable targets or targets of envy?

http://mobile.bloomberg.com/image/index/pKISbwVuPwu-CpydsHPB-_ZzUeF8YNn3pSP_hdYcB-jmbFsMemtmA2YRxe7mpv9Ysm4SPHQUfdFCOkPclMKfZ9CUybeuQ86QqPvbWMC5B-eh3lqkPqkgukhgoIa-eGsGCD4Qr_KDqIxEgIvT52jCFi-wMjcy7J1OELQFhliwvoYa7eu81HQi3QHgaQ**Media attention on Intuitive Surgical is increasing. The Sunnyvale, California company is attracting much attention for its aggressive marketing and sales tactics. It’s also being scrutinized for what some critics say is an increased incidence of patient injuries during surgical use of the da Vinci System.

I’ve written about Intuitive Surgical in a previous blog post. Their products are very good and their marketing is stellar, perhaps too good if that’s possible. The ongoing controversies are whether the healthcare market needs as much robotic surgery as it is getting right now and whether inexperienced users and inappropriate use of the technology are responsible for increasing patient injuries or even death.

Intuitive has played the market situation perfectly as noted in the Bloomberg article. Their sales reps use da Vinci Systems to instill greed in hospital administrators by asserting that the hospital can increase market share by offering robotic surgery. Worse, they create fear by saying that other hospitals will increase their market share at the expense of the robot-deficient medical center.

Intuitive even heightens competition among surgeons in an effort to justify demand for additional installations. The surgeons are powerless to stop the marketing machine. One surgeon admitted that if he does not offer robotic surgery, his colleagues will, and he will lose patients to them.

One interesting, even frightening, item from the Bloomberg article is that many consumers, i.e. prospective patients, believe that the system is controlled by robots. In their minds, that’s what gives da Vinci a competitive advantage. So…low information consumers are heavily influencing  a market situation that affects everyone.

The MassDevice article highlights an ongoing dispute between Intuitive Surgical and analysts at hedge fund Citron Research. Citron alleges that adverse surgical events associated with the da Vinci System and reported through the FDA adverse event reporting system indicate a growing problem with injuries caused by the da Vinci System. Intuitive counters with its own analysis, saying that FDA reporting is unreliable and not suitable for time-based analysis. It further states that surgeons should rely on peer-based reviews before making decisions about the technology. From the article:

“”In the 1st 8 months of 2013, 2332 Adverse Event records were posted – compare to 4603 records posted in the entire 12 year period since the 1st Adverse Event tracking for da Vinci  appeared in MAUDE in 2000,” Citron wrote. “It is the opinion of Citron that the only reason there is not a national outcry is because the da Vinci robot has yet to kill or injure ‘the right person’ – like the next of kin of a congress member or a celebrity.”

Intuitive stock closed at $389.16 today, off 33.5% from its 52 week high.

Takeaways: If you plan to be a disruptive or hyper-aggressive medical device company, you need to have thick skin. There will always be plenty of critics and competitors taking potshots at you.

The extra risk with healthcare companies, of course, is that patients can get hurt and die as a result of action or inaction by the company.

You need to decide just how aggressive to be, and whether to define an ethical line over which the company and its employees will not cross. Of course shareholders and Board members may react negatively at any effort to put a damper on the money-making machine. Being responsible for installing that damper could cost a CEO, marketing, or sales executive his/her job.

As we move further into the era of outcomes-based decision-making, opportunities like robotic surgery for anything other than clinically justified reasons will diminish. Robotic surgery could be one of the few remaining “land grab” chances to make a lot of money with little competition. Let’s hope that patients and the rest of the healthcare system aren’t stuck with the bill.

Read more:

http://mobile.bloomberg.com/news/2013-10-08/robot-surgery-damaging-patients-rises-with-marketing.html

Citron puts Intuitive Surgical on blast over adverse events | MassDevice.

8 healthcare applications for Microsoft Kinect, 6 reasons not to pursue them

Microhttp://dri2.img.digitalrivercontent.net/Storefront/Company/msintl/images/English/en-INTL_Kinect_for_Windows_L6M-00001/en-INTL_L_Kinect_for_Windows_L6M-00001_mnco.jpgsoft’s Kinect is absolutely amazing technology. And Microsoft keeps improving it. Did you know that Kinect has multiple potential healthcare applications?

If you have an early teenage or “tween” kid, you probably have an Xbox gaming system. The Kinect sensor technology is perfect for all sorts of innovative interfaces for dance, exercise, and role-playing games.

The Kinect sensors and software have the ability to perform skeletal mapping on multiple people simultaneously, to detect 3D gestures and motions and facial and voice recognition. Kinect can even determine users’ heart rates! The device also has the ability to “see” in the dark with infrared camera technology.

The Microsoft Kinect is an amazing amalgam of sensor technology. I’m sure it has many useful and possibly disruptive applications in healthcare and other industries.

Here’s why you should not base your healthcare product or application on Microsoft’s Kinect:

  1. Single sourcing is risky for any startup business or new product development organization. You have no alternative way to duplicate  or replicate the Kinect functions if Kinect or its key functions are unavailable for any reason.
  2. Healthcare is not Microsoft’s core business – it could remove access at any time and/or de-emphasize it in any number of ways. In fact, Microsoft is in strategic transition right now and its long-time CEO, Steve Ballmer, announced recently that he will be retiring in 2014.
  3. You have no access to the device’s source code – access to that code might be necessary if you are developing an FDA Class II or Class III device.
  4. The Microsoft Kinect is based on a console or PC-centric world view. What about tablets and smartphones? Oh, and don’t expect to ever see an Android or iOS device with Kinect capability.
  5. Although Microsoft has made an SDK available for Kinect development on Windows operating systems, the installed base of 24 million Kinects is almost all in Xbox gaming systems. Microsoft is not interested in giving up valuable real estate on its premier gaming platform to comparatively low volume and low margin healthcare apps. If you develop a Kinect-dependent windows app, you will a). have to wait for an installed base to develop or b). take on the added risk of marketing Kinect hardware to create your own installed base.
  6. You will have little technical support from Microsoft simply because your business potential is small compared to their other ventures.

If those six reasons aren’t enough to give you pause, here are the healthcare market areas identified by MobiHealthNews that are particularly suited for Kinect-enabled applications.

  1. Fitness and Exergaming – games and exercises to get people off the couch and on their feet
  2. Physical Therapy  – conduct PT sessions, monitor recovery
  3. Surgery Support  – hands-free image manipulation
  4. Autism Screening and Therapy – not quite sure what the advantage is here. Perhaps some on the spectrum can’t relate as well to people?
  5. Virtual Visits and Virtual Nurses – automated nursing visits. I think this is a bad idea, as senior shut-ins crave human contact.
  6. Virtual Group Therapy – avatar-based online group talk sessions (I believe you can do this with Google Hangouts as well)
  7. Aging in Place and Fall Prevention – gait analysis and fall prediction
  8. Helping the Blind to Navigate and the Deaf to Communicate – using machine vision and text to speech

Takeaways: It’s incredibly risky to develop new technology that’s based on someone else’s proprietary technology. It’s even more risky if that proprietary technology is primarily focused on non-healthcare applications.

You should consider open source projects as an alternative. There are many open source projects all over the world. If it’s critically important to you, try organizing and starting an open source project to support your development work.

If you must use the proprietary technology, try to negotiate a development agreement that places key parts of the technology in escrow so it is still available to you in the event of a default to the agreement. This tactic doesn’t work with gigantic corporations like Microsoft but it may be effective with smaller partners.

Read more: Eight ways the Microsoft Kinect will change healthcare | mobihealthnews.

For Med Students, Love From the Drug Rep | NYTimes.com

No drug reps signDrug companies and medical device companies focus sales efforts on residents for one reason: because it works. The career-long profit from an eventual loyal physician could be tens or even hundreds of thousands of dollars for a medical device company. It’s also a “bottom-up” way to capture and defend market share.

Often done under the guide of education, healthcare companies’ marketing efforts are creative and relentless.  As the article indicates, many successful sales reps position themselves more as friends than as company representatives.

Inevitably, there have been abuses to the practice. In reaction, many hospitals have severely restricted or even banned contacts with medical students and residents. Some hospitals and medical practices no longer allow sales reps free access to facilities and staff. Some prohibit employees from accepting anything free from industry representatives.

A number of influential and outspoken physicians have written and spoken publicly about the issue, stating that they do not accept any freebies from industry, not even a pen. Their position is that any relationship with industry creates an uncomfortable conflict of interest, actual or perceived.

Of course, attempts to influence physicians and others under the guise of educational programs have been ongoing for many years. There are seminars, dinner meetings and conferences where doctors can earn continuing education credits. I know several physicians who significantly supplemented their professional practice income by speaking about specific drugs at dinner meetings.

Takeaways: Billions of dollars are spent annually on efforts to influence medical professionals. That’s a reasonable (but not necessarily ethical) business decision because many billions more are at stake in drug and medical device revenues and profits. If you are a pharma or medical device sales rep or marketing executive, your job and career are always on the line. Banning these practices just seems to drive them underground.

Perhaps a more rational approach would be to require full disclosure of any transactions (including lunchtime pizzas and the like) with a draconian penalty for concealment.

Read more: For Med Students, Love From the Drug Rep – NYTimes.com.

Experts apparently agree: Fitness wearables are now a fashion statement | mobihealthnews

I was walking through the South Lake Union area of Seattle this morning and was struck by how many people had their trusty smartphone in their hands and were reading or interacting with it as they were walking. That was not the case as recently as ten years ago, perhaps even more recently.

So smartphones have become fashion accessories as well as constant companions . You can quickly tell the iPhone devotees from the Android “big screen” fans from the Windows Phone diehards who keep insisting that their phones’ technical specs are better. And it’s almost too easy to get into an argument about which company makes the “best” mobile operating system or phone.

Nike FuelBand

Here’s one of the Next Big Things in consumer technology: fitness wearables as fashion statement. The devices themselves are distinctive in appearance and they are fairly expensive. They monitor activity and exercise levels and provide useful information to the user.

For example, a device may count your footsteps (remember, 10,000 steps a day is The Goal!), measure the distance you run or bike, monitor your sleep patterns, keep track of the number of calories you ingest and expend, and generally automate and simplify tasks that were difficult if not impossible to perform before we all had these amazing devices at our fingertips every waking hour of our day.

Every device is different in its features and functions. The manufacturers take great care in developing the look and feel of the devices since each device is a walking advertisement for the product.

I have a hunch, however, that the people who least need fitness monitoring devices are the ones who use them the most. Of course, no one really needs these devices. But trendy people like to show off their trendy toys, like the Nike Fuelband, FitBit Flex, and Jawbone Up.

One development I’m waiting for is to see if ordinary people, overweight couch potatoes and the like, start wearing and using the same devices. Perhaps they will start by emulating their favorite celebrity and then discover the utility in these devices. Perhaps people will use the devices to monitor their health and improve their fitness.

As the devices get more sophisticated and adopted by more people, I hope the manufacturers will include more ways for people to monitor and improve their health. For example, I read an article In a recent edition of Runner’s World about sitting and why it’s one of the biggest health hazards most people do voluntarily. Not even elite runners are immune from the ill effects of being a couch potato when they are not running. Just think of how beneficial a sitting monitor app would be to our increasingly sedentary population!

I expect the next generation of fitness wearables to include Smart Watches that will have a limited ability to run apps and receive input from body sensors. When you see A-list celebrities sporting those and other devices on TV shows and movies, you’ll know the next big fad is being born.

Takeaways: Popular culture is infatuated with mobile technology. Mobile device adoption is well into the 90% range in a number of demographic segments. Fitness wearables could experience the same sort of growth and adoption, especially if led by celebrities. Apps and sensors for these devices could be good businesses in which to invest. Another huge benefit could be a positive effect on public health.

Read more: Experts apparently agree: Fitness wearables are now a fashion statement | mobihealthnews.

What’s in a name? Naming and branding medical device products and companies

rose

We’ve all been there – needing a name for a new product or even more importantly, a new company. There are a number of schools of thought about naming. For example:

 

 

  • Name it for the doctor who invented/founded it. (covert endorsement or the medtech equivalent of vanity plates)
  • Just pick something generic and get it out there (Wile E. Coyote’s Acme Products company)
  • Smash two words together with a capital or two in the middle. (“CamelType”)
  • Make an implied promise with the name. (Intuitive Surgical, da Vinci)
  • Make up a serious sounding, semi-scientific name. Make sure it has a trendy consonant in it or is loosely based on some obscure Latin word. (the Immunex factor)
  • Let the engineers name it. (any number of unmemorable names)
  • Pay a naming/branding consultant a lot of money only to find out the .com URL is taken.
  • Convene a cross-functional branding brainstorming team to identify alternatives, then: a) have an all-employee company vote or (less likely to have long-term negative repercussions) b) let the CEO pick his/her favorite.
  • Use the code name of the development project. (more often than you would think)

It’s extra difficult in the medical device space, especially if you are in a “hot” segment like digital health. There are lots of other companies casting about in the same pool of potential names and with the same requirements that you have. And, ours being a Serious Industry, I doubt that we will see the medical device equivalent of “Cheezburger Network” in the near future.

Takeaways: Naming and branding is a lot like coming up with the perfect name for your first child. You put enormous thought and effort into finding the perfect name, perhaps even creating a unique name just for your offspring. You obsess over what message the name will send and how your child will be perceived, perhaps for the next century. Big stakes, I know.

The reality is that most kids make their names fit them. Most people use the name as an association to the child and the child’s personality rather than the other way around.

The same  holds true for product and company names (as long as you stay away from the really outlandish stuff). Pick a name without endless consideration of the implications. Then, spend your time and effort making the company and product fill the promise of the name to reinforce positive experiences with the brand by customers and other stakeholders. Soon, the actual meaning of the brand or product name will fade and be replaced by the (it is to be hoped) positive attitudes toward the product/brand.

It’s also helpful if, in addition to not being similar to another company or product in the same segment, the name or brand doesn’t require a lengthy explanation about what it means or how it came to be. Just think back to an acquaintance who insisted on telling you the derivation of the name of their son or daughter.

Here are a few examples about names of companies in digital health. I’m sure all of the people responsible for naming these companies had great intentions and thought their names would stand out. Unfortunately, at least one other person in another company had the same expectation and created a confusingly similar name:

Read more: The apparent shortage of digital health names | mobihealthnews.

Presence of sales reps influences coronary stent selection, price | MassDevice

As the saying goes, “that’s why they get paid the big bucks.” All kidding aside, a recent study published in the American Heart Journal confirms and quantifies what most industry insiders know intuitively: there is no substitute for a live salesperson at the point of use.

sales repMany cardiac catheterization (“cath”) labs either stock or make available more than one brand and more than one type of coronary stent. Since there are many different indications and technical features among the various offerings, it’s difficult for hospitals to standardize on just one brand. So instead of “converting” a physician or a hospital to permanent purchase of the company’s products, the sales rep gets to convert each case she or he attends.

Hospitals and physicians are aware of the influence a rep can have over the selection process. Many limit rep visit frequency in an attempt to be “fair.” Another factor is that some reps are technically and clinically more competent than others. They perform a genuinely valuable service for the physician by reviewing diagnostic information and making informed recommendations about the ideal product for the clinical situation.

On a darker note, some reps (and some companies reinforce these behaviors) have personal relationships with physicians, complicating the goal of unbiased product selection.

Some hospitals have even banned certain sales reps or even instituted blanket bans of every sales person from point of use contacts.

The study reported that the presence of a sales rep increased the per-case price of stenting by up to $230. One investigator also said that the company’s market share was increased by the rep’s presence, meaning that the physician used that rep’s company’s products over the equivalent competitive product. This choice occurred apparently because the rep was present and able to inform and/or persuade the cardiologist to use the rep’s products.

Some cocktail napkin math: say a typical rep makes $150k per year in cash compensation. That’s about $3,000 per week or $600 per day.  It doesn’t take many cases per day selling high margin stents to pay the rep’s salary and make a tidy profit for the company. And that’s why successful reps will do everything they can to spend the day in scrubs instead of a business suit.

Takeaways: While good sales reps are costly and rare, and a direct sales force is insanely expensive, you get what you pay for. Of course there are other options such as manufacturers’ reps, distributors, telesales, and partnering/sales force sharing. In all of those alternative approaches, you give up control and access compared with the direct sales rep model.

The key in marketing and selling high value, high price, high margin products is to recruit, hire, and maintain the highest quality sales force possible and to design an incentive compensation program that encourages desired behavior while dissuading undesirable behavior. Easier said than done, and probably merits the hiring of an experienced sales executive to create and manage the sale team.

Keep in mind that sales reps pay for themselves more directly than any other employee. Budget appropriately if you decide that a direct sales force is right for your venture. Plan for longer sales cycles and reduced market share if you decide that direct sales is a luxury your company or startup cannot afford.

Read more: Study: Presence of sales reps influences coronary stent selection, price | MassDevice.

Robotic Surgery: Too Much, Too Soon? | medscape.com

With a market capitalization of more than $15 billion, Intuitive Surgical is a major player in the medical device industry. It is also the only source in the world for robotic-assisted surgery products. An evolving controversy is whether the patient benefit from a robot-assisted procedure is equal or greater than the additional cost to the healthcare system.

Robot

In recent articles, the editors at Medscape (a physician-oriented professional website owned by WebMD) have raised the issue of whether robotic-assisted surgery is being adopted too fast and being promoted too aggressively.

 

Some facts:

  • The number of procedures performed worldwide with Intuitive Surgical’s da Vinci Surgical System increased 25% from 2011 to 2012, to 450,000. 
  • The da Vinci Surgical System has been installed at more than 2,000 hospitals around the world at a cost per installation of $1.5-2.2 million plus annual service fees of about $160,000.
  • Intuitive Surgical has about 2,400 employees and had 2012 revenues of $2.18 billion, $908k per employee. That’s getting close to the almost mythical $1 million per employee revenue level and in the same neighborhood as Google ($931k).
  • The price for proprietary disposable instruments for the da Vinci System is $600-1,000. Each procedure uses 3-8 instruments.
  • A recent analysis reported that da Vinci surgeries add costs of 20% per procedure on average. The incremental costs are currently absorbed by hospitals because reimbursement rates are set by procedure, not surgical technique or technology. It is not yet clear if the extra costs will eventually be reimbursed by insurers.
  • Earlier this year, the president of the American Congress of Obstetrics and Gynecology (ACOG), issued a statement recommending against using robotic devices in routine gynecologic procedures – perhaps motivated by a 2013 JAMA study reporting that the percentage of robotically assisted hysterectomies increased from 0.5% in 2007 to 9.5% in 2010. Studies have shown that use of robotics has no clear clinical benefit over laparoscopy (the gold standard). Additionally, costs for robotically assisted hysterectomy were reported in the JAMA study to be $2189 more per case than for laparoscopic hysterectomy.
  • Some hospitals appear to be hyping and/or aggressively marketing their robotic capabilities. Investigators reported In a 2011 study that 41% of hospital websites promoted their robotic surgery capabilities and that clinical superiority was claimed on 86% of these sites, while none mentioned risks.
  • Just as with any new technology, there is a learning curve when adopting robotic-assisted surgery technology. During the learning curve, risks are higher.

Some opinions:

  • Intuitive Surgical has done a brilliant job in developing and marketing its da Vinci System, perhaps too good. The company shipped its first commercial system in 2000 and has averaged 25% annual growth ever since. The low-hanging fruit may be gone.
  • Whether deliberate or accidental, Intuitive has created the perception among the public that robotic-assisted surgery is “better” than alternative approaches. This creates demand for the procedures and indirectly, demand for Intuitive’s products.
  • There are few, if any, randomized clinical studies demonstrating a significant clinical benefit of robotic-assisted surgery over the gold standard technique, either open surgery or laparoscopic surgery. There are a few studies indicating limited advantages in outcomes in very specialized indications and a few others that show perioperative benefits such as reduced need for transfusion.
  • Some hospitals have irresponsibly hyped the benefits of robotic-assisted surgery to patients. Perhaps this is in response to competition and perhaps partly to attract patients in order to justify the large investments in robotic equipment and training.
  • Some surgeons are aggressively adopting the new technology even where there is no clinical advantage or indication. Perhaps they fear losing the revenue stream from patients or the patient stream from referring physicians.
  • The winds of change (healthcare reform in Obamacare, negative publicity about complications and costs) are starting to blow. Intuitive’s share price is down more than 34% from its peak value reached in February 2013.

Takeaways: There is a fine line between aggressive promotion and hype. In this case, the urgency and greed triggered by the “robotic gold rush” may have caused the hype line to be crossed by more than one party. Few healthcare companies conduct randomized clinical trials unless required by regulatory bodies or customers. Given the changes occurring in healthcare today, it is prudent to include outcomes and clinical studies in your commercialization plans. If your technology or product is radically different from the gold standard, you must seriously consider learning curve effects as part of market adoption. Basic training, advanced training, certification, proctoring, and partnering with professional organizations are all options when introducing new technologies.

Read more: Robotic Surgery: Too Much, Too Soon?.

This startup wants to help you save on medical bills by taking control of your health | GeekWire

Health 2.0“, also known as digital health – focusing on improving people’s health through a constantly evolving mix of web or mobile device apps and educational software and websites, social media, personal health records, and various forms of connected sensors – is growing and attracting much attention, from entrepreneurs, investors, the media, and public health officials.

The basic idea is that people can take charge of and improve their own health – and reduce their healthcare expenses – if they have data about what’s going on with their bodies and some basic information about what to do about it. Sometimes the data is shared with a healthcare provider.

The organization Health 2.0 estimates that there are 2540 companies in the Health 2.0 segment as of June 2013. A majority of the companies, 1465, are consumer-focused while the next largest category, professional facing, has 643 participants. There are 203 companies involved with patient-provider communications and 229 companies working on data and analytics. I’m sure the overall count increases every day.

Why is Health 2.0 such a hot segment in healthcare? For one thing, the barriers to entry are lower than in other segments like medical devices or biotech. Many of the apps are unregulated or require a 510(k) marketing clearance at most. The cost to develop and deploy an app is a fraction of what it costs to commercialize a Class II medical device.

How do these companies plan to make money? That, as the (updated) saying goes, is the $64 million question. Many of the apps and web services are free. Some use the familiar freemium model where a basic version is provided free of charge and the fully-featured version is sold for a few dollars or so. What’s lacking is a recurring revenue model, or is it?

Just as Google and other companies with large user bases do, many Health 2.0 companies aggregate and sell the data generated by their apps. It’s appropriately anonymized but it’s probably worth much more in terms of lifetime revenue per user (LRPU) than the nominal charge paid by the consumer. Plenty of researchers and marketers in Big Pharma and insurance companies as well as government would love to have large data sets with behavioral data from a target population from one of their drugs, pipeline or on the market.

The company referenced in the article, Health123, was started by ex-Microsoft and Seattle tech veterans. They plan to approach employers with the prospect of reducing their health insurance expenses by improving employee health through deployment and use of their app. It’s another revenue model. It also raises serious privacy concerns as seen in a lively discussion in the article comments.

It’s tempting to think that your company could be the one to demonstrate positive outcomes. It seems to me that there is much anticipation regarding effective health apps that can improve public health and/or “bend the cost curve” as the healthcare policy wonks like to say. Looks like there are a couple of thousand startups that are in agreement.

Takeaways: Health 2.0 presents many opportunities for medical device and healthcare IT entrepreneurs. Even hardware companies can get in on the action via development and integration of all sorts of physiologic sensors. This could turn into a “land grab” where small and nimble startups do all of the innovation and are then snapped up for outlandish valuations by big medical device and healthcare IT companies who can’t afford to miss the market opportunity.

Read more: This startup wants to help you save on medical bills by taking control of your health – GeekWire.

How Doctors Think About New Technologies | The Health Care Blog

Valuable insights into the mind of a physician – written by Leslie Kernisan, MD, a physician! Let’s face it, most of the time when we’re talking with doctors, we’re trying to get feedback about our product or idea or we’re trying to sell our product or idea. That doesn’t leave a lot of time to ask about how doctors think about new technologies or what their decision-making processes/criteria are for new technologies.

Here are a couple of observations from the blog post:

  • Vague, disorganized, or poorly designed websites drive visitors away, especially busy physicians.
  • Doctors prefer to consume information offline as mentioned in this blog post.
  • Don’t expect a busy clinician to call or email for more information. The information you provide must be sufficient the first time around.

And here are her questions about the new technology:

  • Does it solve a clinical problem she is experiencing?
  • What evidence exists that the technology will solve a problem, improve outcomes, or improve patient health?
  • How does it compare to the gold standard in terms of method, outcomes, complications, etc.?
  • How exactly does it work – be general and specific here. The physician may want to know how your technology works but they must know how it works in the context of the other devices and systems they use daily.
  • How easy is it to use? What’s the learning curve? Can you show a video of the device in use? Can you provide sample screens of a software application including drop-down menus?
  • How easy would it be to try the technology? Does it require significant financial investment, integration, or time investment, i.e., training, learning curve cases. Who bears the risk if the trial is unsuccessful?
  • Is it cost-effective? Show some financial examples and compare with popular alternatives.
  • What are the benefits to the patient and to the physician? Don’t just focus on features.
  • Who is the “ideal” patient for your technology? What about fit for the patients at the extremes of complexity, both simple and hopelessly complicated? Will it work for them?

And here are some suggestions from the doctor about how to optimize your company/product website to make it easier to use and navigate and also to get the information to the user:

  • Create a page or section for clinicians. Don’t exclude the general public but use proper medical, scientific, and technical terminology and keep the marketing-speak to a minimum.
  • Consider having more than one “how it works” section. Some people like a general explanation while others prefer detail. Also, provide the information in multiple formats. Some prefer print, others pictures and diagrams, and others like to watch video.
  • Offer downloadable brochures in PDF format, again in different levels of complexity.
  • Provide evidence of efficacy. This is especially important for physicians considering the trial of a new technology. If it’s insufficient, they will let you know. If it’s inaccessible, however, you may never know why they refused your offer.
  • Be sure to compare your product against the gold standard or traditional clinical practice along whatever dimensions are important to users. Either think like the user or ask them what data they would like to see in order to make a decision.
  • Offer a free trial or some equivalent risk mitigation. Do not expect the doctor to bear all of the risk in evaluating your product. They won’t.
  • Identify your benefits and advantages vs. the competition. Don’t exaggerate – your product does not need to be better in every category to be considered for a trial.

Takeaways: If you are a startup CEO or medical device product manager, make sure the information you are providing is tailored to your target customer. Keep in mind that evaluation is part of the sales process. Your goal is to get to the next stage in the process, evaluation/trial. You do not need to win the sale at this point. Prematurely trying to close a sale often kills it. Finally, think in terms of the big picture when providing information for evaluation. Put yourself in the place of the doctor and/or patient and ask yourself what information you need to make a decision. Consider the other systems and processes that your device or technology must integrate with. And above all, be fair about allocating the risk when asking doctors for evaluations and trials.

Read more: How Doctors Think About New Technologies | The Health Care Blog.

Healthcare’s interoperability problem isn’t about technology | MedCity News

So the crux of this problem is that hospitals/institutions/clinicians think they “own” patient data. If we in America ever want to achieve the significant potential savings that could be realized through application of various forms of information technology to the healthcare system, the mindset will have to change. The patient owns his/her patient data.

Big Data, the catchphrase to indicate that every click on the Internet is captured, aggregated, and analyzed, is already in wide use by all sorts of consumer companies, large and small. It works – to reduce costs, to fine tune marketing messages, and to enable highly specific targeting of a company’s best prospects. It works because – except for “walled gardens” like Facebook – the data generated by Internet users is freely available for anyone to use.

There is no reason to think that Big Data won’t work equally well in healthcare. The problem is that healthcare data resides in an enormous number of well-insulated silos. Very few of the silos share anything, even sometimes within an institution.

Consider a patient with several doctors – a primary care physician, a cardiologist, and an endocrinologist. It’s very possible that the three doctors cannot access their patient’s records from their colleagues without special requests and permissions. Sure, they may get test results and written summaries of procedures but the minutiae where much actionable data is hidden is kept locked up in proprietary systems.

Consider a healthcare IT startup that needs (anonymized) patient data to validate its offering and to demonstrate its claimed benefits. It must cut deals with a number of providers to access the data. This takes time and costs money, two things not in abundance at most startups. And yet investors and customers demand proof of beneficial economic outcomes before investing or buying. A classic catch-22 situation.

Yet another example is a medical software startup (now defunct) where I once worked. They developed a terrific 3D image viewer that could run on low-end PCs, tablets, and laptops. At the time, 3D image viewing and manipulation was limited to high end workstations costing tens of thousands of dollars. The company had to negotiate deals with every hospital’s PACS administrator and vendor (there were many) and then write specific software to access the PACS servers. This was not a sustainable business model and the company went broke.

The CEO of HIMSS (Healthcare Information and Management Systems Society) acknowledges the problem. He doesn’t have a ready solution, however but he admits that part of the problem is the way our system reimburses providers for tests and procedures and not for health improvements. He does hint that Medicare will be changing its reimbursement structure over time and that private insurers are sure to follow.

Takeaways: The two buzzwords in this segment are interoperability and portability. It seems to me that an industry standard could be written enabling two-way access to any appropriately anonymized data. In addition, electronic medical records need standards so that users wanting to switch to a different vendor are not held hostage by high switching costs caused by the need to remap data fields, etc. In the modern day Gold Rush of companies looking to make fortunes in healthcare IT, perhaps there is another Levi’s looking to profit by selling shovels and overalls to the miners.

Read more: Healthcare’s interoperability problem isn’t about technology: A Q&A with HIMSS CEO | MedCity News.

Verizon gets its first FDA clearance for remote monitoring tool for chronic conditions | MedCity News

It’s big news when one of the world’s largest telecommunications companies obtains a 510(k) marketing clearance for a mobile health application. Verizon is developing a cloud-based Converged Health Management software application. The device collects data from in-home monitoring devices such as blood pressure monitors, pulse oximeters, etc. and is perhaps planned to feed into a patient’s electronic medical record. The application seems to be primarily intended for clinicians to access and monitor patient data but patients can view their own data as well.

Verizon partnered with a small Canadian company, IDEAL Life, which will provide the remote devices. Apparently, Verizon will provide the wireless network, application(s), and cloud storage.

Other telecom companies have pursued this mobile health market, which is projected to be worth close to $300 million by 2019. AT&T, Qualcomm, and Sprint have invested in the space. AT&T is partnered with Intuitive Health for their market entry.

All of these companies see the low-hanging fruit: managing chronic medical conditions can reduce costs and improve health while providing a hefty return on investment to any company that can establish a significant market presence. The strategic benefits to the telecommunications companies include locking customers to their networks and garnering high margin data traffic just as the consumer mobile telecom market is starting to commoditize.

Takeaways: Partnering with a gigantic multinational can be terrifying but if you can tolerate the risk, leveraging their massive assets can scale up your technology or solution quickly and with minimal investment on your part. Perhaps you can even avoid angel or venture investment. If you are a startup CEO or product manager developing mobile health technology, make sure you contact every obvious and non-obvious (Intel, Qualcomm) target partner. The telecom companies need medical device expertise and technology. They have the infrastructure and cash to build an end-to-end solution.

Read more: Verizon gets its first FDA clearance for remote monitoring tool for chronic conditions | MedCity News.

Wireless Power For Medical Devices | MDDI Medical Device and Diagnostic Industry News

A breakthrough in wireless power delivery invented by physicists at MIT and being commercialized by their startup, Witricity, has the potential to dramatically change the medical device and healthcare industries.

The new technology, called highly resonant wireless power transfer, is more powerful and more efficient than current methods of wireless power delivery such as inductive coupling, used in devices like electric toothbrushes. The new technology can operate over “tens of centimeters” compared to a millimeter or two for the old and fussy inductive technology.

What does this mean? Think of electrically powered devices like ventricular assist devices, pacemakers, defibrillators, cochlear, and ophthalmic implants powered externally without wires or battery powered with easy and convenient recharging through the air. No need for skin contact or transdermal leads with high risk of infection (not to mention irritating to the patient and just not nice to look at).

As the article points out, implantable devices could be designed to be hermetically sealed with smooth surfaces, eliminating the potential for leaks in both directions. Cochlear implants could be powered via a wireless charger built into an eyeglass frame. And the ultimate modality for augmented reality (as well as dynamic vision correction), smart contact lenses or intraocular lenses, could be powered in the same manner. Take that, Google Glass!

The article goes on to identify other beneficial uses of wireless power delivery in the healthcare environment. Power surgical tools could lose their electrical cord as could carts of medical equipment, reducing clutter, trip hazard, and infection risk.

I’m sure the same technology will ultimately make its way to consumer products. I’m envisioning an airport lounge where a gaggle of road warriors is clustered around a wireless charging station instead of fighting for a scarce electrical outlet. There are no doubt lots of other applications in vertical markets. The company is savvy to start with medical devices where margins are large, patient demand could drive adoption, and the benefits are quantifiable.

Witricity is already working with Thoratec, makers of an implantable ventricular assist device. While the technology itself may not be disruptive, adding it as a feature to existing product categories is a game changer. Wireless power delivery has the potential to energize (no pun intended) patients and physicians to demand the feature in their products.

Takeaways: Medical device product managers and design engineers as well as startup CEOs should be constantly on the lookout for feature-level innovations that can be added to their products. It’s even better if an exclusive can be negotiated for some period of time. Of course the risk to cost, schedule, and reliability must always be considered but in a crowded market segment where differentiation is tough to come by, a feature like wireless power delivery can provide real competitive advantage.

Read more: Wireless Power For Medical Devices | MDDI Medical Device and Diagnostic Industry News Products and Suppliers.

The 4 types of buyers for your medical device (and you need a “yes” from all of them) | Medical Device Commercialization 101

Marketing and selling medical devices is complicated. They are highly regulated, competition is intense, and the stakes are high. There are a number of stakeholders and constituents who must say yes – or at least not say no – before you can sell your device.

If you are a startup CEO, medical device sales representative, product manager, or marketing manager, use this general list and description as a place to start to develop a plan. As you get more granular, i.e., at the hospital level, the buyer types and the purchasing process will become very specific. You need a plan to address the needs and overcome the objections of every one of the buyer types and often, more than one buyer in a given category. What I’ve learned in marketing medical devices is that only a few people can say yes to a medical device purchase but many can say no.

I’ve identified four categories of buyers. There are often multiple buyers within each category.

  1. User buyer
  2. Economic buyer
  3. Technical buyer
  4. Paying buyer

Let’s examine each category in more detail:

The user buyer is typically the physician or surgeon. A user buyer can also be a physician’s assistant, nurse, surgical technician or other healthcare professional – literally, anyone who might touch the product. The caveat here is to make sure you address all of the user buyers and satisfy their needs or at least neutralize their objections. I have seen large sales get derailed because a circulating nurse in the O.R. did not like a product’s packaging and was influential enough to use her veto power.

Physician user buyers may have less power than you think to influence a purchase. While they usually have some clout to request specific items for their likes/dislikes, economics and standardization are often invoked to deny requests from less influential doctors. And doctors, just like the rest of us, like to keep some influence in reserve for a time when they might really need it. Just another way of separating “must have” from “nice to have.”

The real challenge is in trying to convert an entire department or practice to a new product. Not only do you have to “sell” all of the user buyers but you have to convince a key decision-maker like a department head to use his/her authority to finalize the decision. This is an area where your marketing staff needs to craft highly specific comparison materials detailing the beneficial features, benefits, and advantages of your product/service. Your sales representative will need to use his/her relationships with all of these people and invest considerable time within the facility to keep the sale/conversion going.

You also need to carefully consider all user requirements before finalizing your product’s features and functions. The old cliche is that you sell the benefits, not the features, but this is an exception. If you omit or include the wrong feature, someone you will never meet may kill your product’s deployment at one or more sites. Market research is extremely important at this phase – well before product design commences.

The key is to identify a need among the user buyers, then establish a value for your product by emphasizing and quantifying your product’s unique benefits, and thus justify a premium price. Easier said than done.

The economic buyer can be a purchasing agent or executive, a department head with budgetary authority such as the O.R. Director (often a nurse) or head of the Emergency Department or ICU, an accountant or even the hospital’s CFO or CEO.

For capital items and capital leases and for purchases that affect a number of people, e.g., physicians, nurses, techs, a purchasing committee (may have a number of different names) often makes purchase decisions. It will be important to know who is on the committee and how to access the committee in order to supply information. At a tactical level, the sales representative or account manager for a given hospital or other site must map out the economic buyers. This requires real diplomacy and smooth interactions, as often the information is not given freely.

The trick with economic buyers is to spend as little time and effort with them as possible. The investment should be in creating demand from the user buyers and in giving the user buyers a business case to justify the purchase. You must avoid inadvertently having your product categorized as a commodity. In that case, your product will be viewed as interchangeable with other products and the (premature) negotiations over pricing will begin.

The technical buyer can be someone in the Biomedical Engineering Department if the facility is large enough to have that resource or it could be another technical person in a completely different area who performs biomedical engineering functions in his/her spare time. In rare cases, the technical buyer could be a healthcare professional such as a physician.

In any event, get your compliance engineer in touch with this person ASAP to determine if there are unusual or extraordinary requirements. Also make sure the biomedical engineer understands all of the features and functions of your device, including IEC 60601, UL, etc. If you have a software product or a physical product with software functions, you may need to get the blessing of the CIO, CTO, or other technology executive or one of their reports. Obviously, HIPAA compliance is a hot topic with everyone so it will be helpful to demonstrate compliance in advance.

The paying buyer is usually an insurance company or Medicare. For procedures that aren’t reimbursed such as elective plastic surgery, the paying buyer can be the patient or it can be the physician for minor products that are consumed or implanted as part of a procedure.

Making sure your device has the proper reimbursement codes is beyond the scope of this article but I strongly recommend engaging a reimbursement consultant and following their recommendations before completing your plan and long before planning your market launch. That step is critical for maximizing your revenue and proving to investors that you have a sound business model and know how you are going to make money.

Whether conducting primary market research to plan a launch and understand the purchasing process for your device or moving through the sales process at a target healthcare facility, always ask two questions to whomever you are selling: First, can you make the decision to purchase this product/service on your own? If the answer is no, ask who does have that authority and then target that person. If the answer is yes, then ask if the person has a budget with which to purchase the product/service. If the answer is no, they are no longer a serious prospect.

Takeaways: Use market research, competitive analysis, and field representative input to develop a plan to address all four of the medical device buyer types: user buyers, economic buyers, technical buyers, and payer buyers. Keep in mind that anyone could have veto power over your sale. Avoid commoditization of your product by emphasizing benefits over features and by relating benefits to value.

Sales reps not included: On e-commerce site, device firms discount routinely used implants | MedCity News

This story is another good example of how the Internet helps create a new business model and saves money. I call it the selective democratization of information along with decoupling products and services.

The basic premise is that commodity products, e.g., screws, anchors, etc. should not require much, if any, sales/technical support. And sales support can be very costly in medical devices. Think of a rep making mid-six figures and spending a half day in a hospital surgery suite.

For those customers that do want that support and are willing to pay for it, the device company charges list price. For everyone else, MedPassage provides a virtual market for a cut of the action. The device companies can also control which customers have access to the MedPassage marketplace. Device companies cannot see each others’ prices or transactions.

Everyone wins. The device companies sell more products, the hospitals save money, and MedPassage sells an innovative, profitable service.

Takeaway: If you are on the commercial side of a medical device business, don’t accept the status quo when it comes to distribution and sales. You can differentiate your offering with value-added or value-subtracted services.

Read more: Sales reps not included: On e-commerce site, device firms discount routinely used implants | MedCity News.

Healthcare Social Media Efforts of Medtech Firms Deserve an “F” [? No!] | MDDI Medical Device and Diagnostic Industry News

I disagree with the basic premise of this article. The medical device marketers I know and have managed are extremely media-savvy. They “get” social media and use it personally. What they don’t see or get is any return on investment in social media for their hard-won device marketing budgets.

And these days, if you can’t measure it, it isn’t worth doing.

Yes, there are a few examples like Biomet Orthopedics where a direct-to-consumer (DTC) advertising model was innovative and made some sense. Unfortunately, even Mary Lou Retton’s endorsement could not prevent the recalls, class-action lawsuits, and negative publicity that followed deployment of a flawed product. In most cases, however, the typical patient/consumer doesn’t know and doesn’t care much about the brand of device being employed or implanted, etc. Further, in my experience, the physician or surgeon would not be amused or grateful to get this sort of “assistance”. The docs have their preferences and are reluctant to change, to put it mildly.

Yes, the pharmaceutical industry has had a disruptive effect over the past twenty years with direct-to-consumer marketing. Drugs are very different from medical devices, however. Patients can learn about their medical condition online and compare drugs for effects and side effects and then make a “request” to their doctor. The doctor can then grant the request, deny it (perhaps driving the patient to a different physician), or agree to a trial of the new medication.

Because drugs work (or don’t) over a period of time, there is an opportunity to evaluate one or more brands. The acute nature of device use/therapy means that there is typically only one chance for evaluation, raising the stakes and minimizing the incremental benefits of one brand over another.

I think it’s absurd that a typical patient can self-educate using online resources and become more knowledgeable than his/her physician or surgeon about a highly specialized piece of medical equipment and the procedure in which the device is used. And just because a pacemaker gets 1,000 likes on Facebook or 10,000 retweets doesn’t mean it’s right for you.

Is there a place for DTC in medical devices? Certainly, if it is used for education, as in informing patients about new procedures, directing them to patient-oriented consumer web resources, referring them to physicians experienced with the new procedure, and only indirectly reinforcing the device brand.

Takeaway: Medical device marketers have limited budgets, especially compared to drug marketers. They need to focus with laser-like precision on creating awareness and leads among their target market, healthcare professionals.

Read more: Healthcare Social Media Efforts of Medtech Firms Deserve an “F” | MDDI Medical Device and Diagnostic Industry News Products and Suppliers.

Marketing a product to physicians? Think education and email | MedCity News

This survey is validation of what most of us realize intuitively. Many (most?) physicians don’t want (or can’t afford) to spend precious time during the day in a one-on-one interaction with a sales rep or telemarketer. While they say they want to be kept informed about new products and market developments, they prefer to receive that information offline, via email or actual mail.

Of course, receiving the information, reading it, and acting upon it are very different things. As a medical device marketer, how do you break through all of the clutter? As a medical device sales rep, how do you keep your interactions welcome (= infrequent) and still get what you need (= orders)?

For marketers, this is a perfect opportunity for testing. You should be trying different approaches in small tests and then scaling up the one or two approaches that work the best.

For sales people, it’s all about positioning yourself as a problem-solver and a person with recognizable expertise in your market category. Those sorts of relationships and reputations take time to build, so think twice about going for the quick and easy sale if it might cause a negative reaction.

Interestingly, the type of information physicians wanted least was panel and study recruitment and invitations to events and webcasts while the information they wanted the most was sponsored CME credits and also disease information and patient education materials.

The digital information revolution hasn’t reached the doctor-patient relationship quite yet. Marketers must keep this in mind as they develop and deploy more online resources.

“[The] content must be flexible though, as most said they communicate with patients mostly in traditional ways rather than through email. A white paper put together by PharmaLeaders using the data suggests that the best marketing materials will be sent to a physician in a way that’s easy to translate to the patient in person or over the phone.”

Read more: Marketing a product to physicians? Think education and email | MedCity News.

Health IT startups, “physicians” shouldn’t be a target market. Get more specific. | MedCity News

This is good advice and good practice for all medical device companies, not just startups. Market segmentation is difficult but, properly done, leads to successful launches.

Here are a few other ways to categorize and target physicians beyond medical specialty:

Career status: Resident, senior resident/fellow, young attending, mid-career attending, late career attending, emeritus.
Decision-maker status: Department head, Chief of practice, second-in-command, member of purchasing committee or similar group, “worker bee.”
Case load: low, medium, high, unbelievable.
Geographic region: There are clear differences around the USA in medical practice as well as from country to country.
Corporate affiliations: You may or may not want to target physicians with strong ties to your competitors. And the ties can be VERY strong!
Primary type of practice: Hospital, research/academic/teaching, private practice, VA/military, standalone surgery centers. There is a lot of overlap in this category with physicians working in multiple settings so it can be a bit fuzzy.
Technology adopter status: Innovator, Early Adopter, Early Majority, Late Majority, Laggard
Influencer/Key Opinion Leader/Notoriety Status: Prolific article author, leads or participates in numerous clinical trials, frequent speaker at medical conferences, frequently interviewed and/or quoted in news and media.

You can purchase lists of physicians with some demographic data relatively inexpensively. You should then create a database and augment that data regularly with information you or your commercial team finds. Before you make final decisions about targeting, be sure to talk with actual prospects and test your model!

As for what happens after a company has decided its target specialties, Kim offers this advice: “If we could do it over again, we would have spent at least six months to one year working on site or near-site with a handful of actual customers.”

Read more: Health IT startups, “physicians” shouldn’t be a target market. Get more specific. | MedCity News.

Scanadu Builds a $149 Personal Tricorder for Non-Trekkies | Wired Design | Wired.com

It must be incredible fun to be a biomedical engineer these days. I would be like a kid in a candy store with all of the incredible tools and components that one can use to make just about anything.

“Scanadu is making fast progress in building one of the most mythical pieces of tech known to geekery. As an entrant in the Qualcomm Tricorder XPRIZE, the health-tracking device is designed to read your temperature, blood pressure, respiration, and other vital signs, just by holding it to your temple. Last week, the Scanadu Scout finally launched on Indiegogo, and already has raised nearly $700,000–seven times its stated goal, with two weeks left to go. [update – now at $1.3 million! TES]

The XPRIZE originally used the omni-informative tool as inspiration for a $10 million prize founded to make health analysis available to consumers at home. “Somebody will have to build the Tricorder one day,” says Walter De Brouwer, Scanadu’s co-founder.”

“We are in the biggest tsunami of personalization in the world but for medicine we are still waiting in line in an emergency room.” De Brouwer

Scanadu seems to have adopted the iRobot strategy that produced the Roomba and a number of line extensions including products for military and aerospace use: Use science fiction for ideas and adapt current technology to make something useful. Not a bad plan.

Read more: Scanadu Builds a $149 Personal Tricorder for Non-Trekkies | Wired Design |Wired.com.

They must be well-financed. The video embedded in the Wired article is very slick, even a bit too promotional (in my opinion).

As for the Star Trek connection, it probably won’t be long until another company markets a phaser for home use. Maybe that Taser company that’s always getting sued?

The value of curmudgeons and why health systems and startups should engage them | MedCity News

We all tend to seek people who agree with our brilliant ideas. It’s human nature to avoid the naysayers and skeptics. There is a significant danger of group think if you apply this filter too energetically, however.

I’ve found that the best tactic for engaging physicians or nurses as advisory board members or informal advisors is to have a mix of ages and experience levels. Too often, the key opinion leaders are too busy to give practical advice – but they are needed for their names and tacit endorsements. And they will point out obvious blunders.

The younger physicians and residents are often extremely energetic and idealistic but can be naive about what it takes to bring about change in an often byzantine hospital or healthcare system. Sometimes they just don’t have enough practical experience to offer meaningful advice about adoption of a new technology, although they are extremely sharp about technology and the latest research.

It helps to engage one or two mid to late-career curmudgeons as the article suggests. These people have seen more than one battle and in many cases, more than one war, metaphorically speaking. If you can gain their trust, they will tell you the flaws in your go to market plan and what needs to change. Of course, it helps to develop a tougher hide before asking for feedback from “grizzled veterans” as you will quickly learn that your “brilliant ideas” are anything but!

“…anyone who wants to make changes from a hospital system to a scrappy startup would do well to bend the ear of a curmudgeon, be they a nurse, provider or health care professional affected by a proposed change or innovation they want to make. They may be surprised by the results.

Why? Because curmudgeons are more likely to express their opinion about whether a new system or initiative will or won’t work and why. If a new interface would interfere with workflows, for example, they will often be the first to speak up. They are frequently the toughest critics. You may not get showered with praise from them but if you engage them early on and make it clear their opinions are valued you may end up making your app, EHR, etc. much better than it might otherwise be.”

Read more: The value of curmudgeons and why health systems and startups should engage them | MedCity News.

What’s Your Value Proposition? Medical Device Commercialization 101

PurchaseFirst of all, do you know what I mean by value proposition? It’s a pretty straightforward concept. Essentially, it’s why people or companies buy from you. They give you money, you give them…something in return.

That’s where some people go astray. You must think like a customer and put yourself in the mind of your customer now. As the old cliche goes, guys at Home Depot aren’t really buying drills, they are buying the ability to put a hole in something. I’d also argue that they’re buying a few moments of peace and quiet in “guy land.”

So it’s more than just the laundry list of features you or your product manager or your product engineer say comprises your product or software or (heaven forbid) “solution.” To keep things simple, I’ll be referring to all of these categories as “products.”

Customers buy products because their perceived value of the product equals or exceeds the sum of the investment required to acquire it plus all of the risks associated with purchase and use of the products. This formula is highly individualized and probably not very useful except in the abstract.

We can break it down to simplify. First of all, value is the sum of all of the benefits a customer gets from buying and using your product. Those may include:

  • Solving a problem 
  • Preventing a problem 
  • Saving money 
  • Avoiding loss (not quite the same as saving money) 
  • Reputation/ego enhancement (think iPhone) 
  • Meeting a standard, requirement, or law 
  • Assurance of risk reduction – guarantee, warranty, trade-in value, etc.

Next, the investment required for acquisition might include:

  • Cash price
  • Lease, loan, or other financing terms
  • Opportunity cost of the money being spent
  • Installation cost
  • Training cost
  • Write-off cost of product being replaced
  • Cost to research the acquisition (can be substantial for capital purchases)
  • Ongoing support and maintenance costs

Finally, the risks of buying a product from you could include, among other things:

  • Incompatibility with existing systems or processes
  • Failure to perform to requirements (poor quality)
  • Failure to perform consistently (poor reliability)
  • Support (training, repair, maintenance, updates) not available or not to expectations

Now you can see all of the factors that make up a decision to purchase.

The value proposition is that the Purchase only occurs when Benefits are equal to or greater than the Costs plus the Risks of acquisition.

Your job then, as a startup CEO, Product Manager, or Business Unit Head, is to identify the benefits that your target customers need, then turn them into physical features, then price the product attractively while still making a fair profit, and also design programs and safeguards to mitigate the customer’s risk.

Seems simple? I don’t think so, either.

By the way, these concepts apply just as well to businesses as to individual consumers. After all, businesses are nothing but individuals working together.

Think of a medical practice considering the purchase of a new Electronic Medical Record system. They probably have an existing system with which they are not happy. Price is a factor but there are many, many other factors that will influence their decision.

Takeaways:

  1. Put yourself in the mind of your customer.
  2. Never forget that customers buy benefits.
  3. A purchase doesn’t occur until perceived value equals or exceeds perceived costs plus perceived risks.
  4. As the saying goes, perception is everything.

Next time, I’ll take a look at the different types of buyers involved in a medical device purchase.

 

 

Invisible Bike Helmet Inflates On Impact VIDEO – YouTube

OK, so this is not medical technology but it should prevent the need for physicians and hospitals. Also eliminates the dreaded “helmet head hair.” I would probably buy one when the price comes down. Nothing like cycling without a helmet – except for the fear of a concussion, of course!

Smart entrepreneurs – they started with a need and a market. Europeans famously do not wear helmets and they are just as vulnerable in crashes as the rest of us. They have plans for line and market extensions – horse riding, downhill skiing, hip protection for the elderly, and epilepsy seizure protection. Maybe the NFL should look into this…

Would be huge if they could get product placement during the Tour de France.

I would lose the Hövding name before expanding beyond Sweden – sounds like something from Ikea!

See the video: Hövding Invisible Bike Helmet Inflates On Impact VIDEO – YouTube.

The Market – Medical Device Commercialization 101

OK, so you know that you need a customer in order to have a business. In fact, you usually need lots of customers to have a successful business. In this post, I’ll discuss that vague abstraction known as the market.

market

A market is a group of entities, sometimes people, sometimes organizations, sometimes both. In its simplest form, some of the entities in the market sell things and other entities buy things. Or you could say that some entities have problems they are trying to solve and they buy solutions from other entities.

There are an infinite – or at least an uncountable – number of markets in our economy.Think of your own personal life. You participate in many different markets, for example, music (and that could include CDs, digital downloads, streaming, concerts, and lessons among other things), food (including fresh, frozen, farmers’ markets, food trucks, fast food, restaurant dining, snacks, beer, wine, soda, and bottled water, etc.), and transportation (cars, bicycles, pedicabs, trains, airlines, hot air balloons, buses, taxis, limos, and so on).

There are probably thousands or even tens of thousands of markets for medical devices. Hospitals and physicians purchase and prescribe many different products, services, and solutions to diagnose, treat, and maintain their patients.

Markets have competition. The entities selling solutions compete for buyers. Sometimes the competition is direct but it need not be. Innovative solutions and products often do not have direct competition, at least not initially. There is almost always, however, indirect competition or at least the status quo – what buyers are doing right now without the innovation. Never make the mistake of thinking or stating that your new widget or app “has no competition.” It diminishes your credibility and usually results in someone proving you wrong.

There are concentrated markets in which a handful of sellers control almost all sales. Think of the cable TV market in your town. If you are fortunate, there are two competitors. On the flip side, there are some highly competitive markets with many sellers. For example, consider the fairly new and still evolving market for “cloud” based archiving of your digital files. This is a highly competitive market with new entrants emerging almost daily with prices falling and offerings improving rapidly. It’s pretty obvious which type of market is better for buyers. Unless you have a significantly disruptive product and lots of financial resources, the competitive market is probably more attractive for you as a seller as well.

One more thing about markets – they are almost never homogeneous. There can be geographic differences among buyers as well as language, culture, economic (price stratification as well as terms of payment), demographics  (for example, gender, age, political leaning/affiliation, income level, socioeconomic status, technology adopter status, etc.), and many, many more. Any of these differences can be used to identify consumer market segments. There are other attributes in medical device markets such as hospital size, number of procedures performed per year, hospital market share, physician experience level, and so on.

Market segments are groups of buyers with at least one attribute in common so that your offering should have value or appeal to all members of the group, for example, “household decision-makers considering purchase or lease of an electric vehicle in the next three month”s or “family practice physicians in small to medium group practices interested in purchasing an electronic medical record system in 2013”. Further, the segment must be economically reachable via the same form of marketing communications or media promotion, e.g., direct mail, webinars, radio or TV advertising, or one of the various forms of Internet advertising.

Identifying your market is fairly easy. It’s almost always dictated by the indications for use of your product. Segmentation is tougher. There may be multiple segments for your offering. The challenge is selecting the segment(s) that are most competitive (and therefore open to new offerings) and reachable (so you don’t have to break the bank with marketing programs to reach the segment members).

The objective is to create awareness and interest in your solution/product, thereby generating sales leads. A portion of the leads will convert to actual sales, creating revenue to expand marketing and sales efforts and leading to profitability.

As part of your launch plan, you should talk to market participants in person, at conferences, and in surveys. Identify as many segmentation attributes as you can.

Takeaways:

  1. Try to select a competitive market unless you are launching something truly disruptive.
  2. Identify as many segments as possible.
  3. Pick segments based on their attractiveness for your business and your ability to reach segment members economically with marketing programs.

Next time, I’ll talk about identifying the different types of buyers in your segments. It’s much more complicated in B2B (business-to-business) markets like medical devices than in B2C (business-to-consumer) markets.

 

“The one thing” – Medical Device Commercialization 101

This is the first in a series of posts in which I’ll discuss the many factors that go into a successful product development / commercialization / launch project.

I’ve given many lectures and presentations on product launches and marketing. When I ask this question at the beginning of the talk, I get a variety of answers. Keep in mind there are many things  businesses need but only one thing that is like oxygen to a living organism – that “every” business needs.

What’s the one thing every business needs? [scroll down]

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Customers!

Yes, you may have unique products, superior intellectual property, a great development team, world-class executives, perhaps even a NASDAQ stock listing. You may have efficient manufacturing, excellent internal communications, terrific PR, a slick website, and a green headquarters building. You may have ISO and cGMP-compliant processes, strategic partnerships, and cash in the bank.

Until and unless you have identified who will buy your product and why, you do not have a business.

Medical device VP: What healthcare customers ask us for before buying a new technology | MedCity News

These seem to be reasonable requests from customers when considering purchase of a new technology: provide objective, third party evidence of efficacy, show where and for how long a product has been beta-tested prior to launch, and give the customer some form of financial assurance that failed adoption won’t be 100% their risk.

Of course, given demands in most companies to realize a quick (and large) return on their investment, corners can be cut in all of these areas. My recommendation is that you build these sorts of customer-focused features, programs, and initiatives into your launch/product development plan and defend them as vigorously as possible during the commercialization process. You customers will thank you and your market share will reflect the goodwill.

Medical device VP: What healthcare customers ask us for before buying a new technology | MedCity News.

UChek’s Bizarre Response to an FDA Letter: An Unfolding Saga | MDDI Medical Device and Diagnostic Industry News Products and Suppliers

This is a still-evolving story but a great read and a valuable lesson to novice medical device marketers and entrepreneurs: ignore the FDA at your peril. As the author points out, FDA regulations are laws. People do go to jail and companies can be shut down for violating them.

The company developed a mobile app that “reads” urinalysis test strips. In what seems to be an ill-considered decision, the company apparently decided to ignore FDA regulations regarding classification of mobile apps and diagnostic software. It also did not react well to an initial warning letter advising that the app was a Class II device. I wonder what will happen next?

UChek’s Bizarre Response to an FDA Letter: An Unfolding Saga | MDDI Medical Device and Diagnostic Industry News Products and Suppliers.

What’s with the double::colon?

I was looking for a new name for my consulting practice. All of the branding gurus say (and I agree) that if you are a sole proprietor you should use your name as part of your company brand so people recognize you.

I also want to use the word “strategic” because I add strategic value when I provide consulting services. Linking the two words together made sense.

I did some searching and discovered that the double colon is a mathematical/logical/programming symbol sort of meaning, “is a part of”, or “relates to.” So “sanko” relates to and is a part of “strategic.”

Anyway, it’s different and a conversation-starter. And I like it.