23 July 2014
Healthcare technology innovators often fall victim to “pilotitis”, says Frazer Bennett. It is a distressing condition in which product ideas never make it past the pilot stage, reports Andrew Baxter.
“Two of the major causes are: one, not enough understanding of the economic value chain, and, two, not really understanding and identifying the patient need at the outset,” says the technology expert at PA Consulting Group.
Mr Bennett has been careful to avoid catching the disease over the past year, during which PA has developed a low-cost health patch the size of a UK 10p piece that can be used for remote monitoring in real time.
The health patch, claimed to be the world’s smallest and just 1mm thick, has a huge range of potential uses, says Mr Bennett. But a generic solution will not work in the “hairy” economics of healthcare, he says, because the rationale will vary from case to case. Instead, specific diseases, drugs or care pathways need to be targeted, so the patch can be kept as simple as possible.
PA’s initial customer has been a big pharmaceutical company with a blockbuster drug of which 200m doses are sold each year. The drug is very susceptible to adherence, meaning that it loses effectiveness if it is not taken strictly as prescribed. For the physician, it is important to know the patient has not forgotten to take the pill but the drug company needs to know this, too, as the drug’s performance and its reputation will suffer if the pill is not taken regularly.
That could be particularly important in the future, notes Mr Bennett, as drug companies are increasingly likely to have to wait for payments by results rather than be reimbursed upfront after the prescription is handed in at the pharmacist.
The patch, activated when taken from the packet and attached to the skin, has a sensor for the monitoring and a tiny transmitter whose signal is picked up by a watch or pendant with a cellular connection. From there the signal can be forwarded to the cloud, picked up by a service provider and passed on to the physician.
The big issue was to achieve a target price of 30p a patch, or 50 US cents, on a production run of 200m units a year. “There is no single product on earth today of which 200m are made each year that has a radio in it,” says Mr Bennett. “Mobile phone production is 1bn a year but there are different flavours, varieties and manufacturers.”
PA has now proved that such a price is possible and is looking at other applications that include monitoring lung conditions, where a similar patch could save elderly patients from arduous trips for a check-up and free up consultants to see more patients. Each type of patch would vary, says Mr Bennett – for example, some would need to last longer in use than the two days’ life of the drug adherence patch.
Although PA is focusing the patch principally on the regulated healthcare market, there could also be opportunities in the exploding market for wellness or fitness monitoring. That could have a big impact on manufacturing costs, says Mr Bennett.
Ultimately, the patch could be produced cheaply enough, maybe five cents apiece, to be put into sticking plasters, and used to monitor a patient from roadside injury to full recovery, he says.
Meanwhile, once the product for the drug company gets on to the market, after clinical trials that typically take two to three years, 200m extra devices will be on the internet every year, says Mr Bennett, and that is just for one drug treating a single condition.
“This is the ‘internet of things’ emerging by stealth almost, if you like,” he says. Never mind washing machines talking to fridges.