At Lexington Biosciences, we are passionate believers in medical technology (medtech) as a way of improving healthcare and quality of life for all. Similarly, well known consumer brand giants are also gravitating towards the medtech space. Just like us, they see a chance to help humanity and address a market that is nothing shy of enourmous in size. As with anything, estimates vary, but Statista currently values the global medtech space in excess of $400 billion, which is in line with analysts at Evaluate who forecast the industry to top $500 billion in 2021.
More broadly, the Centers for Medicare and Medicaid Services estimated that U.S. health expenditures rose 4.3% in 2016 from 2015 to $3.3 trillion, accounting for 17.9% of gross domestic product.
Innovation is not simply a tool for improving the way we live; it can actually make us live healthier and longer. Google is a great example of an innovative behemoth that is increasingly getting involved with medical technology. Five years ago, Google introduced its health-centric company Calico – a famously secretive firm backed reportedly by $1.5 billion in investment (if Calico and AbbVie exercise their investment options). Four years ago Google unveiled its “smart contact lens” to measure glucose levels in diabetics. Overall, Google has made large investments in medtech through its Google Venture arm, while fostering others through accelerator operations, such as its Launchpad Studio.
Fitbit recently announced its plans to use Google’s Cloud Healthcare API for its own wearables targeting healthcare for applications such as syncing user data with electronic medical records. This follows Fitbit in January investing $6 million in Sano, a company with a patch for monitoring blood glucose, and in February agreeing to pay an undisclosed amount to acquire startup Twine Health. Twine, which is focused on connecting patients to doctors and health coaches in order to meet goals, had raised about $10 million in equity funding since its inception in 2014. Much more than just a one-trick pony with hardware anymore, Fitbit is also working with DexCom and Medtronic on glucose monitoring and other initiatives that are squarely focused on medtech.
The list goes on and on. In recent years, Apple has developed one of the more broadly adopted health “wearables” in the Apple Watch, now selling over 20 million units a year. The tech giant’s HealthKit platform and Health app sync to a litany of fitness apps and wearable devices, while its ResearchKit and CareKit platforms cater to researchers in medical studies and developers, respectively. Apple has a growing portfolio of patents on wearable healthcare technologies and continues to deepen its roots in the space, including conducting a heart study in collaboration with Stanford University aimed at detecting irregular heart rhythms using the Apple Watch.
Point is, as we are amid a digital transformation for the healthcare sector, which sparked $2.7 billion in healthcare equity deals by ten of the biggest tech companies in the U.S. during the first 11 months of 2017.
Above is just a sampling of what we consider extremely exciting developments in the next generation of healthcare. The mobility and usability of healthcare products have substantial implications in reshaping standards of care and providing superior healthcare in the clinic, hospital and home settings, especially for chronic disease. Underscored by the fact that not everyone is trained to perform and interpret tests, the simplification of devices has long-term advantages in reducing strain on already overstretched healthcare systems as well, providing incentive for payers to incorporate new technologies.
With these things in mind, we think we’re in a sweet spot with HeartSentry as an easy-to-use, novel monitor of developing cardiovascular disease via endothelial function. By design, we’re checking the boxes of precision, area of need and user friendliness that companies like Apple, Google and Fitbit are also targeting. These are the qualities that increase the likelihood of user adoption (albeit a physician or consumer) and commercial success.