In-Depth Healthcare

industry Trends & Metrics Report Covers annual period Q2 2014

Mr Kevin Clayton, BSN 8/19/14 State of TeleHealth & mHealth, 2014

Table of Contents

Table of Contents

Annual Report: Table of Contents

To Companies in The MHealth Industries __________________________________________ 1

Healthcare Quarter 2 of 2014, Highlights ________________________________________ 1

Digital health M&A on track to double year-over-year _____________________________ 1

Digital Health Metrics Round-Up By Aditi Pai ______________________________________ 3

Patient and consumer metrics _______________________________________________ 4

M _______________________________________________________________________ 5

arket Sizing Predictions and Metrics ____________________________________________ 5

H _______________________________________________________________________ 6

ealthcare Provider News & Trends from Q2 2014 By Jonah Comstock _______________ 6

S _______________________________________________________________________ 8

martphones and tablets still reign (providers cont’d) _______________________________ 8

M ______________________________________________________________________ 10

obile technologies make strides for heart health, diabetes, and more _________________ 10

P ______________________________________________________________________ 12

harma Trends Digital Health during Q2 2014 By Jonah Comstock _________________ 12

Pharma digital health news announcements in Q2 ______________________________ 13

P ______________________________________________________________________ 15

ayor News and Trends f/Q2 2014 By Jonah Comstock ___________________________ 15

D ______________________________________________________________________ 18

igital Health Regulation & Government Policy News, Q2 2014 By Brian Dolan _______ 18

FDA begins deregulation of digital health software ______________________________ 18

FDA makes clear it won’t regulate platforms like Apple’s HealthKit _________________ 19

FDA offers up a long-awaited draft guidance on pharma social media use ___________ 19

FDASIA report from FDA-ONC-FCC sent to Congress ___________________________ 20

D ______________________________________________________________________ 21

igital Health proponents ask Incoming HHS Secretary to De-Restricts TeleHealth (policy

cont) ____________________________________________________________________ 21

Meanwhile, the Senate asked the industry for help improving healthcare transparency _ 21

Table of Contents

NIH: Relatively few apply for mobile health research grants _______________________ 22

EU looks to better regulate mobile health _____________________________________ 22

A dozen Q2 FDA clearances for apps and digital health devices ___________________ 22

Mobile operators make few digital health announcements in Q2 _______________________ 24

V ______________________________________________________________________ 24

enture capital investments f/Q2 2014 By Aditi Pai _______________________________ 24

Contact Information __________________________________________________________ 34

Company Information ________________________________________________________ 34

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To Companies in The MHealth Industries

Healthcare Quarter 2 of 2014, Highlights

The second quarter of the year is oftentimes a slow one as the summer months approach,

but Q2 2014 was surprisingly busy for digital health on all fronts. Investment dollars are up.

FDA clearances averaged two per month and a surprising FDA deregulation proposal

dropped during the quarter, too.

M&A was even stronger than it was in Q1,

which was already a record quarter for such deals.

Consumer health perhaps received the biggest boost during Q2 as Apple, Google,

and Samsung – three of the largest companies in consumer tech — each announced plans

to launch health and fitness tracking platforms in the coming months. While details are still

scarce for these three initiatives, their launches are sure to boost consumer interest health

tracking and management tools — at least to some degree.

Digital health M&A on track to double year-over-year

As noted above the quarter had a record number of acquisitions — MobiHealthNews tracked

nine such deals — one more than we did in the first quarter of the year.

That brings the total for H1 2014 — 17 — even with total disclosed acquisitions from all of

2013. Could this year end up yielding twice as many as 2013?

April 2014 — Nuance acquires Accelerad Nuance Communications acquired cloud-based

medical image sharing company Accelarad for an undisclosed amount at some point in the

past. In April, it announced it was launching Accelerad’s technology, combined with

Nuance’s existing networks, under the new name PowerShare Network.

April 2014 — Opko buys Inspiro Medical Biopharmaceutical company Opko Health has

acquired Israeli smart inhaler company Inspiro Medical for a sum in “the low eight figures”,

according to Opko’s Director of Strategic Investment Les Funtleyder. The company will be

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using Inspiro’s Inspiromatic technology to develop an app-connected inhaler that will be

bundled with a forthcoming new drug for asthma, COPD, and cystic fibrosis.

April 2014 — Facebook buys ProtoGeo In what might be the biggest mobile health

acquisition of the year, social networking giant Facebook acquired Finland-based fitness app

maker Protogeo for an undisclosed sum. The deal signals Facebook’s interest in mobile

and fitness, but much of the media coverage has focused on dubious changes to Moves’

privacy policy post-acquisition.

April 2014 — Hearst Health acquires CareInSync Hearst Health Network acquired

Santa Clara, California-based CareInSync for an undisclosed amount. CareInSync will

become part of Zynx Health, an evidence- and experience-based clinical improvement

company within the Hearst Health Network, which is itself a recently formed division of the

Hearst Corporation.

May 2014 — Covidien acquires Zephyr Technology In the first of two acquisitions

broken by MobiHealthNews in May, medical device giant Covidien acquired sports and

medical wearables company Zephyr Technology. Although the terms are still unknown,

Zephyr has raised more than $13 million since its founding in 2003 — back when health-

sensing wearables were a relative rarity. Zephyr’s investors included 3M New Ventures,

Alsop Louie Partners and Motorola Solutions Venture Capital.

May 2014 — Weight Watchers acquires Wello During its quarterly conference call with

analysts, Weight Watchers confirmed rumors that had been circulated for a few months that

it has acquired Silicon Valley-based weight loss startup Wello for an undisclosed sum. As

Weight Watchers CEO Jim Chambers and CTO Dan Crowe explained on the call, the Wello

acquisition is an important component of the company’s strategy to compete in an

increasingly digital weight loss market.

May 2014 — Medtronic buys Corventis In another major deal broken by

MobiHealthNews, medical device giant Medtronic acquired peel-and-stick medical sensor

company Corventis. While neither company has publicly commented on the deal, it is

expected to be officially announced some time in the next few weeks. Initial reports put the

deal at $150 million.

May 2014 — St. Jude to acquire CardioMEMS In 2010, St. Jude invested $60 million

in CardioMEMS for 19 percent of the company. They also had an option to purchase the

remaining 81 percent of the company for $375 million. When CardioMEMS secured FDA

clearance last month, St. Jude Medical said that it now intends to exercise its option to

acquire CardioMEMS, and plans on completing the acquisition in the second quarter of 2014.

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June 2014 — Physicians Interactive buys MedHelp The digital health marketing

company, which offers medical reference apps and resources like Skyscape and Omnio to

physicians, acquired one of the oldest, online consumer health brands, MedHelp, for an

undisclosed sum. The acquisition marked one of the first forays into consumer health for

Physicians Interactive, which apart from some consumer-facing health advertising through

its mobile ad network Tomorrow Networks, had been largely focused on providers.

Digital Health Metrics Round-Up

By Aditi Pai

This quarter, Manhattan Research’s Taking the Pulse survey found more than a third of

US physicians recommended that a patient use a health app. The research group released

data that suggested physicians’ awareness and engagement with mobile and digital tools is

on the rise, and that this is motivated in some part by the trend toward outcomes-based

care models.

According to the survey, more than a third of doctors said they had been evaluated or

rewarded based on metrics measuring cost of treatment, patient outcomes or referrals in

the past year. Manhattan also found that 47 percent of physicians who owned smartphones

had used them to show patients videos or images. Forty percent said they had increased

their use of digital tools for patient communication over the past year.

These smartphone engagement percentages could be even higher in other countries.

Another Manhattan Research study found 80 percent of physicians in China now own or

use smartphones for professional purposes.

While physicians have been using smartphones increasingly for professional reasons, they

have also been using them more outside of work.

Sixty percent of physicians in the US sent work-related text messages on their personal

phones and 61 percent received them, according to a study of 97 pediatric

hospitalists published in Telemedicine and e-Health.

Only 11 percent of these hospitalists said their organization offered a secure texting service,

but 58 percent weren’t sure. Only 12 percent of physicians sent and received work-related

text messages more than 10 times per shift, but 53 percent of physicians texted about

work-related matters while not on duty.

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Patient and consumer metrics

Patients also appreciate when doctors offer digital communication tools. Ninety-three

percent of adults would prefer to go to a doctor that offers email communication, according

to a survey of 433 Americans aged 21 and over from Catalyst Healthcare Research. Of this

93 percent, 25 percent said they would still prefer a doctor that uses email communication

even if there was a $25 fee per episode.

Patients showed that they are more willing to share their health data online as well.

A survey from research firm Kelton and healthcare communications firm Makovsky Heath

found almost 90 percent of Americans say they would make their personal health data

available to researchers to help them better understand a disease or to improve care and

treatment options. Within this group, 26 percent of consumers would share regardless of

whether data were anonymous, 23 percent would share if they could control which data

were anonymous, and 40 percent would share if promised that all data would remain

anonymous.

Consumer interest in wearable technology is also high. Almost 75 percent of Americans

believe wearable technology will have a positive impact on the health, sports, and fitness

industries, according to a couple of surveys conducted by ON World that included

responses from 2,000 consumers. ON World estimates that by sometime next year, 19

percent of Americans will own a wearable technology product.

Already, 15 percent of consumers use a nutrition-tracking website or mobile app to stay

healthy, according to a Nielsen survey of 471 respondents called the Health and

Wellness survey conducted in February 2014. According to Nielsen, 13 percent of consumers

use a fitness game on a mobile devices or game console to stay in shape. Social interaction

is a big motivator for consumers who want to get healthy — 49 percent of respondents said

their family and friends were the most helpful for staying motivated.

Another Nielsen survey found almost one-third of US smartphone owners, which is about

46 million unique people, used apps from the fitness and health category in January 2014.

The data was collected from Nielsen’s Mobile NetView 3.0 software, which is on-device

software installed onto iOS and Android smartphones with permission from survey

participants.

The number of smartphone users that accessed fitness apps in January 2014 jumped 18

percent year over year. Nielsen said popular apps that connect to wearable devices include

Fitbit’s app, which has 3.3 million users, and Nike+Running, which has 0.8 million users.

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Nielsen also included Samsung’s S Health app, which has 3 million users, in this category

although when the survey was conducted in January, before Gear Fit launched, there were

no wearable devices that connected with the S Health app in the US.

A study from Flurry found that the most frequent users of health and fitness apps for

iPhones are mostly mothers between the ages of 25 and 54 who are sports fans and who

generally lead healthy lifestyles.

arket Sizing Predictions and

Metrics

Worldwide revenues from sports, fitness, and activity tracking devices will grow

by 46 percent between 2013 and 2019, according to a report from analyst group IHS

Technology. The firm attributes growth to the increasing number of health-conscious

consumers willing to buy heart rate monitors and other wearable devices. IHS pegs global

OEM revenue at $1.9 billion in 2013, which will rise to $2.8 billion in 2019. In 2014

revenues will grow 22 percent to $2.2 billion. IHS estimates that there were 84 million of

these devices in the market last year, and the total number will top 120 million by 2019.

Another report, this one from ABI Research, found that in the first quarter of 2014

activity tracker shipments reached 2.35 million and outsold smartwatches four to one. ABI

added that smartwatch sales dropped significantly in Q1 2014 compared to Q4 2013, and

only a small part of this drop is a result of the holiday season. The firm predicts 10 million

activity trackers will ship in 2014 and 7 million smartwatches will ship.

While there’s growth right now, NPD predicts there may be a drop in wearable device

shipments. The wearables market, including activity trackers, smart watches, and head-

worn displays, is expected to ship 48 million units in 2014 and 91 million in 2015, but after

that, the market is expected to slow down for one or two years “as consumers rebound from

the initial hype”.

Several research firms have predictions for the future of the digital health market.

A report from IHS Technology found global revenue for home healthcare devices and

services will rise to $12.6 billion in 2018, up from $5.7 billion in 2013 while research firm

Berg Insight found remote patient monitoring revenues reached $5.8 billion (4.3 billion

euros) in 2013 and are expected to grow to $26.4 billion (19.4 billion euros) by 2018. Berg

added that three million patients around the world were using connected home medical

monitoring devices in late 2013, but this number will jump to 19.1 million by 2018.

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According to a recent report from ON World, in the next fives years, an estimated 700

million wearable technology devices will ship worldwide, which will make for a $47.4 billion

market. The research firm predicts that hardware sales will continue to dominate revenues

for the next five years but monitoring services, apps, and subscriptions will have faster

growth rates.

And research from Transparency Market Research found the market for mobile health

monitoring and diagnostics was worth $650 million in 2012. The firm projects that the

market will grow at a compound annual growth rate of 43.3 percent from 2013 to 2019.

That will put the market at $8 billion in 2019.

Finally, when analyzing activity tracker shipments, Canalys found in the first quarter of

2014, Fitbit held the majority of the market share. Fifty percent of the 2.7 million wearable

shipments belonged to Fitbit. The report added that the recall of Fitbit Force devices

because of skin rashes apparently did not slow Fitbit’s sale momentum and only affected the

US and Canada.

ealthcare Provider News & Trends from Q2 2014

By Jonah Comstock

The second quarter of 2014 was flush with healthcare provider news, including some big

partnerships, exciting deployments, and major updates to the apps and devices physicians use

on a day to day basis.

Perhaps the most high-profile partnership was Apple’s surprise announcement from the

WWDC stage that it was already partnering with the Mayo Clinic and Epic to integrate with

its new HealthKit development kit and Health iOS app.

“We’re also working with the Mayo Clinic, innovators in healthcare,” Apple senior vice

president of Software Engineering Craig Federighi said at the event. “And with their

integration with HealthKit, they’re going to be able to — when a patient takes a blood

pressure reading, HealthKit automatically notifies their app. And their app is automatically

able to check whether that reading is in that patients’ personalized healthcare parameters

threshold. And if not, it can contact the hospital proactively, notify a doctor, and that doctor

can reach back to that patient, providing more timely care.”

Since then, it’s been reported that Apple is working with a number of other providers

including the Cleveland Clinic and Mt. Sinai Medical Center, as well as one of Epic’s rival EHR

providers, Allscripts.

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But while Apple presaged some big moves in healthcare, Google’s wearable computer

Google Glass was actually finding its way into hospitals this quarter, with surprising

frequency. Beth Israel Deaconess CIO and practicing ER physician John Halamka told

MobiHealthNews he thought Glass had the potential to be the next iPad, especially for

certain kinds of specialists.

“The iPad is good, but a little large,” he said. “The iPad mini fits in a lab coat pocket, so

really close. For procedure oriented specialists though, having something you wear is even

better than something in a lab coat pocket, because it’s awkward to say ‘I see you’re having

a heart attack, let me just go look at my mobile device and I’ll get back to you.’ It just

doesn’t work to reach into a pocket or turn away from the patient to go get that data.”

As of mid-April, we reported that at least four startups were already focused on building

HIPAA-compliant Glass apps for doctors. A startup called Wearable Intelligence has

developed multiple apps for Glass that will help providers in an doctor’s office setting —

that’s the company Halamka works with at Beth Israel.

Another company, Pristine, advertises the fact that it offers a stripped-down version of

Glass in order to keep it HIPAA compliant. So far, the company has launched two products,

EyeSight and CheckLists. EyeSight streams near-real time audio and video from Glass to

authorized iOS devices, Android devices, Macs, and PCs so that, among other uses, wound

care nurses can transmit point-of-view video to a physician, emergency responders can

send relevant video and information to hospital staff who are preparing to treat the patient,

and surgeons can send a livestream of a surgery from their point of view to residents,

fellows, and surgeons at other medical centers.

CheckLists helps physicians reduce errors by allowing them to launch any list they want to

refer to, for example a surgical timeout checklist, asystole checklist, and cardiac arrest

checklist. Voice activation launches any checklist.

Augmedix, which offers a Google Glass clinical documentation program for physicians, has

already graduated out of an accelerator, Rock Health, with funding and early data from

doctors who have used the program. Augmedix now has 36 employees, is venture-backed,

and is “hiring across the board”, according to Co-founder Ian Shakil. The company did a

study in the fall of 2013 to see if 300 patients at three different pilot sites would be

comfortable with their doctors using Google Glass, they found 99 percent were comfortable

with it.

The fourth startup, Remedy, launched a pilot in May at three Harvard hospitals in which

they provided physicians assistants who were handling night coverage in hospitals with

Google Glass, so that they could send their point-of-view videos to supervising doctors.

Pg. 08 Q2 2014 Digital Health State of the Industry

From this pilot, Remedy will measure how much the Google Glass system changes the

status quo for how healthcare providers manage the workflow of cases. The company also

wants to measure patient perception and adoption rates on the surgeon side and the

physician’s assistant side.

In June, a fifth startup joined the ranks of entrepreneurs focused on the point-of-care

opportunities for class. Yosko, a hospital software startup that is now a veteran of three

digital health accelerators, geared up to launch pilots with as many as five hospitals this

year. The Cambridge, Massachusetts-based company just graduated from the Sprint-

TechStars accelerator and is developing its software for two platforms — the iPad and

Google Glass.

The iPad app is designed to be a comprehensive, single login app for doctors who work in

hospital settings. As such, it includes EHR access, communication with other members of

the care team, and care coordination to improve patient hand-offs. The Glass app will

eventually have the same features as the iPad app, and be activated with voice commands,

iBeacon technology, or QR codes.

And that wasn’t the end of the Glass news for the quarter. Historically forward-thinking

medical school UC Irvine, which was one of the first to equip its medical students with

iPads, obtained a large number of Glass devices in May. The program will have a total of 30

to 40 Glass units on hand, 10 for third and fourth-year students to use in the operating

room and emergency department and the rest for first and second-year students to use in

the classroom.

martphones and tablets still reign

(providers cont’d)

Of course, while Glass starts to develop a foothold, most mobile-enabled doctors

are still using smartphones and tablets. And some of the biggest players developing

software for those devices made big moves this quarter also.

In the culmination of a long plan, Merck GHI-owned digital health marketing firm Physicians

Interactive launched free iPhone and Android versions of its medical content reader and

physician toolkit iPad app Omnio, and announced it would be sunsetting legacy app

Skyscape Medical Resources once those apps are established. The Skyscape app, which

was bought by Physicians Interactive in 2009, has been around — running on BlackBerrys

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Pg. 09 Q2 2014 Digital Health State of the Industry

and Palm Pilots, among other things — since 1998. It will be relaunched as Skyscape

Medical Library, a new app focused on medical education.

Physicians Interactive also tipped its hand toward the next direction for the company when

it acquired one of the oldest, online consumer health brands, MedHelp, for an

undisclosed sum. The acquisition marks one of the first forays into consumer health for

Physicians Interactive, which apart from some consumer-facing health advertising through

its mobile ad network Tomorrow Networks, has been largely focused on providers.

In addition, in its Q1 earnings call, WebMD emphasized a focus on physicians and

mobile, and even launched a new app for doctors around the same time of the call. The

new provider app, Medscape MedPulse, is a news reader app designed to give physicians

quick and easy access to the latest medical news. It includes original content from

Medscape including business, legal, and ethical news and commentary, as well as breaking

drug and device news from the FDA along with the latest notable clinical trials. Doctors can

personalize the content delivered to them by specialty.

On the consumer side, WebMD CEO David Schlanger discussed an upcoming feature for a

revamped version of WebMD’s flagship mobile app. The feature, called Healthy Targets, will

be aimed at helping patients, especially those with diabetes, manage their weight. It will

connect the app to the user’s glucometers, connected weight scales, and other wearable

sensors.

Other patient engagement news: Kaiser Permanente told the world that its own mobile

initiative was going strong, with its flagship app, also called Kaiser Permanente, surpassing

1 million downloads. Meanwhile, Partners HealthCare in Boston announced a partnership

with VidScrip to help doctors create bespoke educational videos for their patients to view

on computers or mobile devices.

The end of the quarter saw The University of Pittsburgh Medical Center committing to

deploy at least 2,000 Microsoft Surface Pro 3 tablets throughout its healthcare

system. The system’s clinicians will use the tablets as laptop replacements. The devices will

be equipped with the healthcare facility’s Convergence app, which sits atop its Cerner and

Epic deployments and and also knits together many of its legacy hospital IT systems.

Also this quarter, a few different hospital use cases for iPads emerged. At the University of

Minnesota, hospital IT staff set up a system using iPads, one in the parents’ rooms and

one in the babies’ rooms so that the families can stay connected to newborn children in the

NICU. And two studies — one published in Oncology Nursing Forum and one

in Pediatrics – showed smartphones and iPads could have potential for helping nurses

screen drug, alcohol, and tobacco use and potentially offer counseling.

Pg. 10 Q2 2014 Digital Health State of the Industry

obile technologies make strides for heart health, diabetes, and more

A number of studies, pilots and newly developed apps this quarter showed the

potential for mobile and digital health to help physicians treat different conditions. Two of

the biggest were in the area of cardiovascular health, while the quarter also saw a lot of

high profile partnerships around diabetes.

In cardiac health news, in a so far unpublished study, the Mayo Clinic found

that incorporating a smartphone app into cardiac rehabilitation can reduce

emergency room visits and hospital readmissions by 40 percent.

In the study, which was funded by the BIRD Foundation and presented at the American

College of Cardiology’s 63rd Annual Scientific Session in Washington, D.C., the Mayo Clinic

designed an online and smartphone-based program for patients recovering from stent

placement for a heart attack. Forty-four patients participated in the study — 25 used the

application and a control group of 19 had regular cardiac rehabilitation without the app.

Patients used the app for three months, and it had two functions: tracking patient vital signs

and providing educational content. For the former, patients tracked weight, blood pressure,

blood sugar, physical activity and dietary levels. The educational content was aimed at

showing patients things they could do to help them avoid a secondary heart event, such as

eating more fish or adding exercise into their daily routine.

Around 60 percent of the control group was either readmitted to the hospital or admitted to

an emergency room within 90 days. In the group that used the app, that number was just

over 20 percent. In addition, the average weight for the app group was about 9 pounds (4.1

kg) lighter than the control group and the average blood pressure was about 8 mmHg

lower.

Additionally, a feasibility study published in the journal Thrombosis and Haemostasis

showed that the AliveCor Heart Monitor can be a cost-effective method to identify high

risk of stroke in adults over 65 years old. Pharmacists screened 1,000 adults at 10 local

pharmacies in Sydney, Australia. Pharmacists used the heart monitor to conduct ECG

readings that lasted 30 seconds to a minute. These recordings were transmitted through a

smartphone to a secure portal where a remote cardiologist interpreted the readings.

Cardiologists were able to diagnose new atrial fibrillation (AF) in 1.5 percent of the

participants. Those diagnosed were at high risk of stroke even though most had no

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Pg. 11 Q2 2014 Digital Health State of the Industry

symptoms, which suggests they were unlikely to have sought out medical advice

independently.

The Joslin Diabetes Center was busy this quarter, partnering with both connected health

glucometer startup Glooko and Dexcom, a medical device company working on continuous

glucose monitoring. Joslin also created a new non-profit division, called Joslin Institute for

Technology Translation (JITT), so that the healthcare organization can collaborate with

more companies currently developing tools for people with diabetes.

Joslin and Glooko partnered to launch HypoMap, a new patient-facing platform to help

increase patients’ awareness of hypoglycemic events. The platform will include an app for

patients with diabetes that will prompt them, after a hypoglycemic event, to record

symptoms, perceived causes, and self-treatments. The platform will track logged data over

time and present dynamic reports that will be viewable by the patient’s care team. By

tracking symptoms and causes, the system is designed to help patients avoid hypoglycemic

events in the future. It can help patients and providers identify cyclical patterns or red flags

that can indicate an impending event.

Not much information was announced about the Dexcom partnership, but it is part of the

JITT initiative, which is meant to work with physicians to design decision support tools for

managing insulin and glucose tracking, partner with medical device and technology

companies so that Joslin can push for the creation of digital health tools focused on

diabetes, and develop educational programs that help healthcare professionals and patients

adopt the new tools. While Joslin already has a division dedicated to educating physicians

and patients about tools for diabetes, called Joslin Health Solutions, the new initiative will

provide an emphasis on educating patients and physicians specifically about digital health

tools.

A few other diabetes-related initiatives also came to light this quarter. A promising

aritificial pancreas study was published in the New England Journal of

Medicine. The artificial pancreas system — consisting of a Dexcom continuous glucose

monitor, and insulin pump, and an iPhone 4s — was shown to improve glucose regulation in

a simulated outpatient setting in both adults and adolescents with Type 1 diabetes. The

adult patients had their glucose in an acceptable range (between 70 and 180 mg per

deciliter) 79 percent of the time when using the system, compared to 58 percent during the

control period. For the adolescents, the change was smaller but still improved — 76 percent

versus 65 percent.

Additionally, a pilot study at UCLA showed that patients with diabetes were adherent to —

and even enthusiastic about — self-monitoring their vision with a mobile app, but the study

was not able to quantitatively demonstrate a health effect from the intervention. Diabetic

Pg. 12 Q2 2014 Digital Health State of the Industry

retinopathy, a degradation of vision that can lead to blindness, is one of the most common

complications of diabetes.

A couple of smartphone apps were developed over the quarter that could help with the

detection of cancer. Stanford researchers developed a smartphone peripheral to diagnose

oral cancer, called Oscan. The peripheral device has a mouthpiece and a camera mount.

Users follow the upper and lower bite guides to help them take the desired shots of the

inside of their mouth. According to the researchers, screenings of the oral cavity can identify

a number of diseases, including submucus fibrosis, gingivitis, and oral cancer. And at the

University of Houston, a professor developed an iPhone app, called DermoScreen, that in

early testing was able to detect melanoma 85 percent of the time. The smartphone must be

attached to a $500 dermoscope, which further magnifies the area of the patient’s skin that

will be tested.

Finally, Philips Respironics published a study showing that users of their SleepMapper app

were 22 percent more adherent to continuous positive airway pressure (CPAP) therapy

than non-users.

harma Trends Digital Health during Q2 2014

By Jonah Comstock

This quarter saw some limited moves from pharmaceutical companies, but some

long-awaited regulatory clarity for pharma could pave the way for more action in the second

half of 2014, and some studies illustrated the value digital health could have for pharma

companies.

The big regulatory news was the publication of the FDA’s long awaited draft guidance on

social media usage, addressing a lack of clarity industry analysts had previously said was

one factor holding pharma back from interacting online with its customers.

Earlier in the quarter, a study conducted by Boston University, Boston Children’s Hospital,

Harvard Medical School, and Georgetown University researchers concluded that even though

pharma companies might not be tweeting much, drugs were certainly being discussed on

Twitter. They found that, for 23 commonly used drugs, well over three times as many

adverse drug reactions were reported on Twitter in a given time period than were reported

to the FDA. Of course, the study also notes that the tweeted reports, referred to as “Proto

AEs” (adverse events) weren’t necessarily as specific or useful as FDA adverse event

reports.

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The other pharma-related study that came out this quarter was a survey from Accenture

about what consumers wanted from their pharmaceutical companies. In general, consumers

still weren’t that interested in hearing from their pharma company via the

internet. Accenture found that those surveyed still most want to receive medication

information by mail and email — 66 percent wanted information from their pharma

company in printed form and 69 wanted it via email. For pharmacists, 72 percent wanted

printed information and 73 percent wanted email. But demand was still reasonably high for

mobile and web outreach — for pharma company information, 48 percent wanted to be

reached via websites, 44 percent via mobile devices, and 38 percent via social media. For

information from pharmacists, 64 percent wanted website outreach and 38 percent wanted

an app, but only 15 percent were interested in hearing from their pharmacist on social

media.

The survey also asked patients about specific “beyond the pill” services from pharmaceutical

companies — what they wanted to receive and what they were receiving. The biggest

disconnect was rewards programs — 63 percent wanted them but only 10 percent were

receiving. The second most wanted service was product information at 53 percent, although

48 percent of respondents received it. The second biggest disconnect was financial

assistance, which 51 percent wanted and only 10 percent received.

With one exception, the demand for every service exceeded the supply. Only physician

referrals were provided more often than desired — with only 28 percent wanting them and

42 percent receiving them. Other services Accenture asked about were measurement

tracking and alert (35 percent wanted, 20 percent received), access to patient support

forums (29 percent wanted, 16 percent received), and access to clinical trials (28 percent

wanted, 7 percent received).

Pharma digital health news announcements in Q2

In terms of actual moves by pharma companies, the quarter saw Genentech, Opko, Johnson

and Johnson, Novartis, and AstraZeneca making moves in the space, either through

launches or new partnerships.

Genentech, a division of Roche, partnered with PatientsLikeMe in April. The company

signed a five-year deal for access to all of the online community’s de-identified data, the

most wide-reaching data access partnership PatientsLikeMe has entered into yet. The

partnership will allow PatientsLikeMe to move more into oncology, an area of focus for

Genentech, than they have been in the past. Genentech will have access to to

PatientsLikeMe’s network “to enable cross-sectional research and broader discovery of

patient insights,” according to the press release. The company will also be able to search

the data set more effectively and start their own research projects on the platform. They

Pg. 14 Q2 2014 Digital Health State of the Industry

will also be able to use PatientsLikeMe’s network to both inform patients about clinical trials

and iterate clinical trial design with patient input.

Also in April, biopharmaceutical company Opko Health acquired Israeli smart inhaler

company Inspiro Medical for a sum in “the low eight figures”, according to Opko’s

Director of Strategic Investment Les Funtleyder. The company will be using Inspiro’s

Inspiromatic technology to develop an app-connected inhaler that will be bundled with a

forthcoming new drug for asthma, COPD, and cystic fibrosis. Funtleyder said the company is

not opposed, in the future, to licensing the technology out to other pharmaceutical

companies to use with their drugs as well.

Wellness & Prevention, a division of Johnson & Johnson that works with health plans on

behavior change coaching, launched a mobile app called Track Your Health toward the

end of May. The app is not available to the general public but rather through health plans to

the 30 million covered lives that have access to Wellness & Prevention products. Track Your

Health can incorporate data from a number of third party health trackers and sensors,

allowing users to track and aggregate data, set goals, and visualize their weight, movement

and nutrition progress in the form of charts. Additionally, it will send anonymized data back

to the health plan that users belong to. If users don’t have connected devices, they can

enter some information manually or use the iPhone 5s’s built-in M7 motion co-processor.

Prior to its Q3 partnership with Google, Novartis was active in the second

quarter partnering with health tracking and analytics platform Tictrac to launch an

awareness campaign, called The 7-Day Challenge to Live Like You, for multiple sclerosis

(MS). The campaign prompts participants to track different aspects of their lifestyle

including weight, activity, mood, and workload. This data is used to create visualizations of

their day-to-day life. Participants can sync various platforms and devices with Tictrac’s

platform including Fitbit, Jawbone UP, Withings, Gmail, Facebook, and Runkeeper. Tictrac

also encourages users to visit a Novartis online resource, called Living Like You, which

publishes stories and content from those who live with MS.

After the seven days, the challenge will send users an email with customized insights about

their lives. Some of these insights could be that users burn more calories when they get a

good night’s sleep or that their weight decreases when they are stressed. The program will

not provide medical insights.

Finally, a little over a year after completing a pilot study, pharmaceutical

company AstraZeneca and Exco InTouch launched a mobile-enabled program in the UK

to help patients manage their chronic obstructive pulmonary disease (COPD). The program,

called Me&MyCOPD, has three components — a portal in which patients can connect with

providers, a server on which information is saved and messages are schedules, and an app

Pg. 15 Q2 2014 Digital Health State of the Industry

that the patient can use. Patients can use the program to track their condition, add data

from medical devices, manage clinic visits, and view information on how to deal with

different lifestyle issues. AstraZeneca will use this data to better understand what patients

need and to give them personal goals and management tools to better handle their

condition. Because physicians will have real-time access to patients’ data, they will also be

able to monitor the patient’s adherence to treatment regimens and reach out to the patient

if their condition worsens.

ayor News and Trends f/Q2 2014

By Jonah Comstock

This quarter was a relatively quiet one for payors and employers. The quarter saw

small pockets of news for Aetna, Cigna, Amerigroup, and UnitedHealthcare, but nothing too

major. News for employer-serving vendors like ZocDoc and Castlight Health was a little

more significant, and the quarter saw some payers and employee wellness companies,

including Humana, publish efficacy data on their platforms.

Aetna certainly made the decision to shut down CarePass in the second quarter, judging by

the June and July departure dates of executives Martha Wofford and Dan Conroy from the

company. Nonetheless, as of May, Conroy was presenting at HX Refactored in

Brooklyn, reporting that Aetna had embarked on some pilots of CarePass with employers.

Aetna has since shared that those pilots have been cancelled.

The other big Aetna news of the quarter was the departure of iTriage cofounders Peter

Hudson and Wayne Guerra from the health insurance company. A departure after a two-

year earnout is a fairly common length of time for a startup founder to remain with their

company’s buyer, and while Hudson didn’t divulge any details about the acquisition

agreement, he told MobiHealthNews that he and Guerra stayed until they hit certain growth

goals rather than until a particular length of stay. Hudson said he was leaving iTriage in

“very, very good hands”.

Cigna’s big news for the quarter was the first product to come out of the insurer’s

partnership with Samsung, a feature on Samsung’s S Health app called Coach by Cigna,

which launched exclusively on the Galaxy S5, in 36 countries and 26 languages. The

software, which Cigna describes as a “digital health guidance system,” incorporates health

information collected either manually through the smartphone or via sensors in the Galaxy

Gear or Gear Fit. It uses that information to generate a personal health coaching regimen

for users.

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Pg. 16 Q2 2014 Digital Health State of the Industry

Cigna also release results from its eighth annual comparative study of its consumer-

driven health plan (CDHP) members to its other members enrolled in traditional PPOs

and HMOs. The actual claims data from more than 3.6 million Cigna members were used in

the study, and Cigna concluded — as it has in years past — that members enrolled in CDHPs

were more engaged in their own health and lowered their total medical expenses. Cigna

currently counts about 2.6 million CDHP members.

The insurer’s CHDP members were 50 percent more likely to complete a health risk

assessment and 41 percent of those with a chronic condition were 41 percent more likely to

take advantage of disease management programs if they were enrolled in a CDHP. That’s up

from Cigna’s 2013 version of the survey, which found CDHP members with chronic

conditions were 25 percent more likely to take advantage of those programs.

Both Amerigroup and UnitedHelathcare joined forces with Voxiva this quarter. In April,

Voxiva announced that 100,000 members have enrolled in its Txt4Health program

through Medicare and Medicaid insurance provider Amerigroup. The payor has offered the

program to its members since December 2012. The Txt4health program aims to provide

patients with reminders for health exams, deliver health information, encourage users to

improve their health, and help track weight as well as physical activity. Then in

May, UnitedHealthcare Community Plan of Pennsylvania partnered with Voxiva to

launch two text message-based services for their Medicaid benefit plan members —

Txt4health and Text4kids. Both are available to people enrolled in York, Allegheny and

Philadelphia counties.

Another insurance company, Wellpoint, began marketing an American Well-powered video

visits service called LiveHealth Online to its members and other consumers across the

US. The service is available to anyone living in the 44 states where telehealth is legal and in

Washington DC for $49 per session. Each session lasts about 10 minutes and physicians are

able to prescribe some medications if appropriate, but about a half dozen states do not

allow physicians to prescribe medications to patients as part of an online video visit yet.

The service is also now a covered benefit to some members with Anthem Blue Cross,

Anthem Blue Cross and Blue Shield and Empire Blue Cross and Blue Shield health plan

members. The insurance company aims to provide the service in all the states where it has

health plans available over the next few years, but the remaining states would have to

make such a service legal before it could roll it out.

In the world of employee wellness, recently IPO’d Castlight Health, which offers employees

a personalized platform, online and on iOS or Android, to compare prices of healthcare

services and keep track of healthcare spending so that employers can reduce that spending

over time, made its first public earnings call. The company announced that it had added

Pg. 17 Q2 2014 Digital Health State of the Industry

29 new customers this quarter, three times as many as any previous quarter, and revenues

were higher than expected.

ZocDoc, the appointment-booking company that’s occasionally been pegged as one of the

next digital health companies to go public, moved into employee wellness with ZocDoc for

Business. ZocDoc for Business launched with a handful of employer customers, including

Foursquare, Gilt, IAC, Jefferies, NASDAQ OMX, and Quirky.

Employees who use ZocDoc for Business receive the same features that ZocDoc has always

offered, but ZocDoc has also added extra features to their employee accounts, including a

comprehensive US doctor directory, priority access to weekend and evening appointment

times, and appointment-scheduling for wellness events in the employee’s office. Those

might include flu shots, biometric screenings, yoga classes, and nutrition counseling.

Employees will also receive personalized messages and wellness reminders based on their

gender, age, and medical history.

Another company to improve its employee wellness offering was hubbub health, which

made its gamified fitness platform available to any number of friends and family

members of employees in April. Then, in June, an HHS-backed employee wellness

platform called Project Boundary started experimenting with proximity sensors as a

behavior change motivation tool.

Finally, the quarter saw some data from both HumanaVitality and the Vitality Group, the

Discovery Health subsidiary that worked with Humana to create HumanaVitality.

Humana looked at data from individuals who were users of HumanaVitality, and compared

their claims data to their engagement with the program. They found that users who were

unengaged with the program both years spent an average of $53 per month more in

claims costs and had a 56.3 percent higher unexplained absence rate from work than

engaged users.

Users who were unengaged the first year but became engaged the second year, on the

other hand, spent an average of $28 per month more in claims costs and had a 29 percent

higher unexplained absence rate from work than engaged users.

The Vitality Group study found that involvement in an incentive-based program reduced

health risk factors like high BMI, high blood pressure, poor fasting glucose levels, tobacco

use, low physical activity, poor nutrition, and stress.

For users who logged fitness activities and participated in the program, their participation

reduced the size of the high-risk group, based on these factors, from 27 percent of the

Pg. 18 Q2 2014 Digital Health State of the Industry

population to 21 percent, a 22 percent reduction in the size of the group. For participants in

the program who didn’t log activities, the high risk group went from 38 percent to 33

percent — a 13 percent reduction.

The Vitality Group said the findings of this study were consistent with a published study

based on 300,000 adults, 192,000 of whom were in the program, which found that active

users of fitness programs had hospital costs 16 percent lower than those of inactive people.

igital Health Regulation & Government

Policy News, Q2 2014 By Brian Dolan

The second quarter was a busy one for digital health policy debates and regulations. In

addition to about a dozen FDA clearances for digital health companies, the FDA issued a

handful of important guidance documents and lobbyists pushed other branches of the

federal government to better recognize the potential of telehealth services.

FDA begins deregulation of digital health software

In June the FDA issued a draft guidance document that revealed the agency intends to

further deregulate medical device data systems (MDDS) and some medical image transfer

systems. The FDA wrote that these types of devices are so low risk that they won’t be

regulating them at all.

Examples of health software platforms that have class 1 medical device clearance as an

MDDS includes Validic’s healthcare data integration platform and Qualcomm’s 2net platform

for home health data. Other digital health products like Glooko’s MeterSync cable and

companion logbook app originally started out as a class I MDDS device, but bumped up to a

class II 510(k) clearance to allow it to begin offering more analysis of the collected health

data.

In its new draft guidance document on the deregulation of MDDS, the FDA stated that the

success of digital health “requires that many medical devices be interoperable with other

types of medical devices and with various types of health information technology. The

foundation for such inter-communication is hardware and software that transfer, store,

convert formats, and display medical device data or medical imaging data.”

FDA senior policy advisor Bakul Patel explained the move in a blog post: “We’ve been

working with two other federal agencies that oversee health IT – The Office of the National

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Pg. 19 Q2 2014 Digital Health State of the Industry

Coordinator for Health IT (ONC) and the Department of Health and Human Services, and

the Federal Communications Commission (FCC) on a proposed risk-based regulatory

framework for health IT that promotes innovation, protects patient safety, and avoids

regulatory duplication. In the course of our work on the proposed framework, we sought

extensive public feedback. And we listened.”

FDA makes clear it won’t regulate platforms like Apple’s

HealthKit

Early in June a few unusual stories about FDA regulation of mobile health surfaced. Thanks

to a Freedom of Information Act request, the FDA shared a memo about its meeting

with Apple executives late last year. While the memo had a number of cryptic details

from the meeting, at one point Apple told the FDA that “industry is always going to be

pushing the boundaries”, indicating that it would be positioning its rumored device and its

already announced health tracking platform right at the edge of what the FDA considers a

regulated medical device.

The day after the memo came to light, however, the FDA made a rare move and added a

new description for a type of mobile medical app that it would not regulate as a medical

device. The FDA has actually added a total of four such new descriptions to its list in 2014.

It just so happened that the latest app description to make it on the list is a fairly close

match to what Apple’s Health app is.

Here’s the app description the FDA added on June 11th: “Mobile apps that allows a user to

collect, log, track and trend data such as blood glucose, blood pressure, heart rate, weight

or other data from a device to eventually share with a heath care provider, or upload it to

an online (cloud) database, personal or electronic health record. [Added June 11, 2014].”

The description also tracked with the FDA’s move a few days later to announce the de-

regulation of MDDS, as described in the section above.

FDA offers up a long-awaited draft guidance on pharma social

media use

The FDA, at long last, released draft guidance for how pharmaceutical companies should

behave on limited-character social media platforms like Twitter and when correcting

misinformation on third-party sites.

Pg. 20 Q2 2014 Digital Health State of the Industry

The FDA carefully controls labeling, advertisement, and promotion for drugs and devices

requiring FDA clearance. It makes sure that companies never list the benefits of a drug

without also disclosing its side effects and that drugs are advertised only for uses for which

they have been approved. The internet has complicated those regulations.

For instance, in cases where pharma companies wish to use Twitter, it has been unclear

whether they can string the required information about a drug over several tweets, or

whether each tweet constitutes a separate communication from the company. Additionally,

when drug companies encounter misinformation posted on the internet and want to correct

it, is that correction bound by all the same requirements as an advertisement or an official

company statement?

The draft guidance, presented in the form of two documents posted to the FDA website,

attempts to address these concerns. Although the guidelines are non-binding guidance

documents, they should go a long way toward clarifying for drug manufacturers exactly how

much care they have to take in online communication. MobiHealthNews rounded up a

number of takeaways from the draft guidance here.

FDASIA report from FDA-ONC-FCC sent to Congress

The FDA, along with the FCC and ONC has finally released the report to

Congress required by the FDA Safety and Innovation Act (FDASIA) of 2012. This FDASIA

report, called “Proposed Strategy and Recommendations for a Risk-Based Framework,”

reiterates previously articulated FDA positions on regulatory discretion and avoiding

regulatory redundancy between the FDA, ONC, and FDA. It’s based on the work done by the

FDASIA work group that began meeting nearly a year ago. According to the FDASIA

legislation, the agencies were required to submit the report 18 months after the law’s

passage. They were about five months late on delivery.

Specifically, the report breaks medical software down into three buckets: health

administration software, health management software (which includes clinical decision

support), and medical device software directly involved in the diagnosis or treatment of

patients. The FDASIA report says that the first area does not fall under the FDA’s

jurisdiction and the second area technically does fall under the FDA’s jurisdiction but the

agency will choose not to regulate those devices, instead leaving oversight of them up to

the ONC and the private sector. The FDA will focus only on the third category. If a device

straddles the two categories — like an EHR with built-in radiological image viewing — the

FDA will regulate the medical device components without needing to evaluate the complete

system. Additionally, the report contains plans to create the Health IT Safety Center, an

additional entity that will help create standards and evaluate efficacy of new technologies.

Pg. 21 Q2 2014 Digital Health State of the Industry

The framework led to the FDA backing off on regulating certain lower-risk health software,

as described above. It led to even more such de-regulatory announcements in Q3.

igital Health proponents ask Incoming HHS

Secretary to De-Restricts TeleHealth (policy cont)

After effort s to remove restrictions from CMS coverage of telehealth through

legislative channels have stalled, telehealth stakeholders have sent a barrage of open

letters to incoming US Secretary of Health and Human Services Sylvia Burwell,

urging her to use her newfound executive powers to waive the offending restrictions.

One letter was sent by the Alliance for Connected Care, a lobbyist group which includes

such telehealth vendors as WellPoint, Teladoc, CVS, Walgreens, Verizon, HealthSpot and

Welch Allyn as well as a number of disease and healthcare advocacy organizations. Another

came from the American Telemedicine Association, HIMSS, Qualcomm, Intel, the

Telecommunications Industry Association and a number of other businesses and interest

groups. The third letter was signed by the CEOs and presidents of 29 health systems and

ACOs.

Meanwhile, the Senate asked the industry for help

improving healthcare transparency

Not too long after healthcare transparency company Castlight Health went public, the

Senate Finance Committee sent letters to a wide assortment of healthcare stakeholders

to source input on how the federal government could improve “the availability and utility of

health care data” so that patients could more easily shop for doctors that suit their needs,

providers could deliver higher quality care, and payers could design more effective care

delivery models.

The letter specifically asked: What data sources should be made more broadly available?

How, in what form, and for what purposes should this data be conveyed? What reforms

would help reduce the unnecessary fragmentation of health care data? What reforms would

help improve the accessibility and usability of health care data for consumers, payers, and

providers? What barriers stand in the way of stakeholders using existing data sources more

effectively and what reforms should be made to overcome these barriers?

D

Pg. 22 Q2 2014 Digital Health State of the Industry

NIH: Relatively few apply for mobile health research grants

In May the National Institutes of Health (NIH) re-issued two grant opportunities from

September 2011, to encourage mobile health developers to apply for grants that aim to

generate efficacy data.

Dr. Bill Heetderks, Director of Extramural Science Programs at NIBIB, said his

organization is basically the technology institute in NIH, and they’ve lately come to realize

that mobile technology, with its propensity to address chronic conditions, is an area of a lot

of promise — and one in which relatively few researchers are applying for NIH grants.

EU looks to better regulate mobile health

In April the European Commission announced a consultation — similar to a public

notice from the FDA here in the US — that asked digital health companies and others for

help in identifying ways to encourage and regulate mobile health, which the Commission

defines as “ways to enhance the health and wellbeing of Europeans with the use of mobile

devices, such as mobile phones, tablets, patient monitoring devices and other wireless

devices.”

The EU is looking to move the needle on a number of issues related to mobile health in

Europe, including: the safety of health apps, concerns over data misuse, lack of

interoperability, and lack of understanding of legal requirements for wellness apps.

A dozen Q2 FDA clearances for apps and digital health devices

The FDA disclosed 510(k) clearances for about a dozen digital health apps and devices

during the second quarter.

Propeller Health, formerly Asthmapolis, received FDA clearance for a platform that

includes a new smart inhaler and is geared for patients with either asthma or COPD.

In June San Francisco-based Qardio received FDA 510(k) clearance for its connected

blood pressure monitor, called QardioArm. The device went on sales for $99 on Qardio’s

website and in select stores the following week.

New Zealand-based medical device company Nexus6 received FDA clearance for its

smartphone-connected inhaler, SmartTouch, as a class II medical device. The new

SmartTouch device has been cleared as a prescribable Metered Dose Inhaler (MDI) with a

Pg. 23 Q2 2014 Digital Health State of the Industry

handful of intended uses: in clinical trials; in clinical practice, and for patient self-

management.

Atlanta, Georgia-based health device maker CardioMEMS received FDA clearance for its

CardioMEMS HF System, which monitors pulmonary artery pressure. The clearance was only

for patients who have experienced New York Heart Association (NYHA) Class III heart failure

and have been hospitalized for heart failure in the previous year.

Alberta, Canada-based Calgary Scientific announced that it received a new FDA clearance

for its diagnostic medical imaging software, called ResolutionMD, that enables

providers to use the mobile software for all imaging modalities, except mammography.

McKesson secured clearance for a mobile medical app called McKesson Cardiology ECG

Mobile. The web-based version of McKesson Cardiology ECG has been around for a few

years and it enables clinicians to analyze and review ECG waveforms captured by a variety

of vendors’ ECG devices.

InTouch Health received clearance for an app that would allow auscultation from digital

stethoscopes in near-realtime. InTouch says that up until now digital stethoscopes have

relied on store and forward technology, but InTouch’s CS App transmits live from a patient

to a doctor at a remote location.

Reflectance Medical secured a 510(k) clearance for a tablet-based version of its Multi-

Parameter Mobile CareGuide 3100 Oximeter system. The original device offers a “non-

invasive assessment of hemoglobin oxygen saturation and pH in a region of skeletal muscle

tissues beneath the oximeter sensor,” according to the company.

Vital Connect received FDA clearance for its Vital Connect Platform, which is the system

that supports the company’s peel-and-stick, Bandaid-like vital signs monitor HealthPatch.

The wearable device captures single lead ECG, heart rate, HRV, respiratory rate, skin

temperature, body posturing (fall detection), steps, stress, and sleep staging.

Gauss Surgical announced that it has received de novo FDA clearance for an app that

uses the iPad’s camera to estimate the amount of blood lost during a surgery and captured

with surgical sponges. The system is called the Triton Fluid Management System.

Entra Health Systems, one of the earliest entrants into the smartphone-connected

glucometer space, received clearance for the MyHealthPoint telemedicine manager, an

online and mobile software offering that would collect and store biometric data from a

variety of sources. It measures vitals including glucose, blood pressure, weight, body

composition, activity, body temperature, ECG, and pulse oximetry.

Pg. 24 Q2 2014 Digital Health State of the Industry

Mobile operators make few digital health announcements in Q2

There wasn’t a lot of action from mobile operators this quarter, but Sprint and Verizon made announcements in late Q2.

Samsung announced a new version of its latest smartphone, called the Samsung Galaxy

S5 Sport. The new phone was developed in partnership with Sprint and

MapMyFitness. Through this partnership with Sprint, users of the S5 Sport get access to 12

months of a MapMyFitness MVP membership. The MVP membership offers extra features on

top of tracking fitness including customized audio coaching, training plans, and live tracking.

Customers who are on Sprint Family plans also get six months of Spotify premium, while

other Sprint customers get three months of Spotify premium. Even after this period of time,

through this partnership, those using Sprint Fit Live can access Spotify’s workout playlists.

A few weeks after Sprint’s announcement, Verizon launched a mobile-centric video

visits product that physician groups and others can use to provide real-time, remote care

to patients. Virtual Visits had been 18 months in the making, Verizon’s Director of Mobile

Health Julie Kling told MobiHealthNews in an interview at the time, and while it could see

integration with Verizon’s FDA cleared remote patient monitoring platform in the future, the

company shared no immediate plans to do so.

Verizon’s Virtual Visits can be white-labeled or co-branded by providers and other

customers. Kling said that some have requested that Verizon’s brand stay attached to the

offering since so many consumers are familiar with it. Providers may work with a remote

care physicians network that Verizon has a partnership with to provide an after-hours safety

net to patients, while using the Virtual Visits offering with their own provider team during

normal business hours.

enture capital investments f/Q2 2014

By Aditi Pai

Proteus Digital Health raises $172 million: Redwood City, California-based

Proteus Digital Health raised an additional $52 million from undisclosed investors following a

whopping $120 million raise the company announced a month prior. That brings Proteus’

latest round of funding — its seventh — to $172 million. By our count the company’s total

known funding is now close to $400 million, which makes it one of the most-funded, private

companies in digital health. When it announced the first part of this round of funding in

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Pg. 25 Q2 2014 Digital Health State of the Industry

June, the company attributed the funds to “major new institutional investors based in the

United States, Europe and Asia” and said the money would help it continue to commercialize

its ingestible sensor system at scale, as well as to continue demonstrating the value of the

technology on health outcomes and costs. Read More

NantHealth raises $135 million: NantHealth raised $135 million from three investors.

The amount almost certainly includes the $100 million NantHealth raised last quarter from

the Kuwait Investment Authority (KIA), that country’s sovereign investment fund, as well as

the investment Blackberry contributed in April. This latest round brings NantHealth’s total

announced funding to about $166 million. NantHealth offers a cloud-based, clinical decision

support platform used by at least 250 hospitals, according to the company. Read More

Doximity raises $54 million: San Mateo-based medical communications platform and

physician referral engine Doximity raised $54 million in a round co-led by DFJ and T. Rowe

Price Associates. Morgan Stanley Investment Management as well as returning investors

Emergence Capital Partners, Morgenthaler Ventures, and InterWest Partners also

participated in the round. This brings the company’s total funding to $81 million. CEO Jeff

Tangney told MobiHealthNews in an email that he believes this funding puts Doximity in a

position to reach every doctor in the United States. Read More

Chrono Theraputics raises $32 million: Chrono Therapeutics, a Hayward, California-

based company working on a new wearable for smoking cessation and drug delivery, raised

$32 million in its first round of funding. The round was led by Canaan Partners and 5 am

Ventures. Additional contributors included Fountain Healthcare Partners, and two strategic

investors: GE Ventures and the Mayo Clinic. The company’s flagship product SmartStop,

which has been in development since 2004 and has been funded so far by a combination of

NIH grants and the founders’ personal income, is a wearable device that would smartly

deliver nicotine to the wearer at strategic times. The objective of the wearable is to not just

alleviate cravings, but actually prevent them. Read More

Voluntis raises $29 million: Paris, France-based Voluntis, a developer of companion apps

for medical devices, has raised $29 million in its fourth round of funding. The round was led

by Bpifrance Large Venture and international venture capital firm Innovation Capital. Other

contributors included Luxembourg-based Vesalius Biocapital and US-based Qualcomm

Incorporated, through its venture capital arm, Qualcomm Ventures, as well as existing

investors, CapDecisif Management, CM-CIC Capital Innovation, and Sham. Voluntis is

mostly focused on diabetes management software, but it doesn’t sell its apps directly to

consumers. Instead it works with pharmaceutical and medical device companies. Read

More

Pg. 26 Q2 2014 Digital Health State of the Industry

Omada Health raises $23 million: San Francisco-based Omada Health, an online and

mobile diabetes prevention program, raised $23 million in a round led by Andreessen

Horowitz, with participation from Kaiser Permanente Ventures and return backers U.S.

Venture Partners and The Vertical Group. This brings Omada Health’s total funding to $28.5

million. Omada Health’s program, Prevent, lasts 16 weeks and aims to help those that are

at-risk for Type 2 diabetes make positive health behavior changes. The program was based

on a 2002 NIH Diabetes Prevention Program (DPP) intervention that produced significant

results for prediabetics. Read More

Senseonics raises $20 million: Germantown, Maryland-based continuous glucose monitor

developer Senseonics raised $20 million from existing investors Anthem Capital, Delphi

Ventures, Greenspring Associates, Healthcare Ventures, and New Enterprise Associates. This

brings the company’s total funding to at least $84 million to date. Senseonics will use the

funds to obtain a CE mark and start investigational device exemption (IDE) trials in the US.

Completing an IDE trial allows the company to use the device in a clinical study to collect

safety and effectiveness data, according to the FDA. Read More

Sotera Wireless raises $20 million: Medical device maker Sotera Wireless raised $20

million in equity, securities, and options. This brings their total announced funding to almost

$50 million. The SEC filing also showed that Sotera hopes to raise another $33 million.

Existing Sotera investors include Safeguard Scientifics, Delphi Ventures, Sanderling

Ventures, Qualcomm Ventures, EDBI, Intel Capital, Cerner Capital, and the West Health

Investment Fund. Sotera’s main product, called ViSi Mobile, monitors blood pressure, heart

rate or pulse rate, electrocardiogram (ECG) or heart rhythm, blood oxygenation level,

respiration rate and skin temperature from a wearable sensor system with a wristworn

screen. Read More

eVariant raises $18.3 million: Farmington, Connecticut-based physician communication

platform and CRM company eVariant raised $18.3 million in a round led by Lightspeed

Venture Partners with additional funding from Dignity Health, salesforce.com and existing

investor Health Enterprise Partners. This brings the company’s total funding to at least $26

million to date. eVariant offers healthcare organizations a platform to analyze the data they

collect, execute marketing campaigns, and improve patient engagement. The platform is

built on salesforce.com. Read More

iRhythm raises $17 million: iRhythm Technologies, maker of the Zio patch peel-and-stick

heart monitor, raised $17 million in a round led by Novo A/S, a Danish life sciences

investment firm. Previous investor Norwest Venture Partners also participated in the round.

This brings the company’s total disclosed funding to about $85 million, based on SEC filings

and company announcements. The Zio patch is a small wearable sensor, used for multi-day

monitoring of arrhythmias in cardiac patients (up to a fortnight). Read More

Pg. 27 Q2 2014 Digital Health State of the Industry

HealthSpot raises $8 million: HealthSpot, a Dublin, Ohio-based company building

telemedicine kiosks for workplace and retail locations, has raised $8 million from

undisclosed investors, bringing the current raise, which began in March 2013, to $18 million

total. This is the company’s first round since 2012 and brings their total known funding to

$23 million. HealthSpot kiosks are designed for supermarkets, pharmacies, and healthcare

facility waiting rooms. Read More

RedBrick Health raises $7.5 million: Patient engagement platform maker RedBrick

Health raised $7.5 million, according to an SEC filing. This brings the company’s total

disclosed funding to at least $46 million. The Minneapolis-based company, which was

founded in 2006, provides a platform for health plans on which members can take a health

assessment, track their fitness through app and device integration, and complete challenges

that motivate users to stay fit. Read More

Healthbox raises $7 million: Chicago-based digital health accelerator Healthbox Global

Partners, Healthbox’s parent company since 2013, raised $7 million. The round was led by

Intermountain Healthcare, Health Care Service Corporation, and Chicago Pacific Founders.

Healthbox will use the funds to launch three new business units. Since its founding, this is

the first time strategic investors have invested in Healthbox’s parent company. Typically

companies invest in the individual accelerator programs that Healthbox launches in various

cities. Read More

Valencell raises $7 million: Valencell, a Raleigh, North Carolina-based company that

powers health and medical sensors in some wearable devices, most notably in sensor-

equipped headphones, raised $7 million in its third round of funding. The new round brings

the company’s total funding to $13 million, excluding an additional $3 million in grants. The

round was lead by new investor WSJ Joshua Fund, a recently founded Texas-based investor

group. Existing investors TDF Ventures, True Ventures and Best Buy Capital also

contributed. Valencell also announced the hiring of a new CEO, Michael Dering, who most

recently served as CEO of service management company ServiceBench. Read More

Lifesum raises $6.7 million: Stockholm, Sweden-based calorie counting app company

Lifesum (formerly known as ShapeUp Club) has raised $6.7 million in its first round of

funding led by Germany’s Bauer Media Group and SparkLabs Global Ventures. The company

has 4.5 million members and 6.5 million downloads in Europe for its Android and iOS apps.

At the end of last year it reported having about half a million monthly active users. The app

aims to make it easier for users to track what they eat and how they exercise. It offers

barcode scanning for food tracking, food and exercise charts, quicker entry for often-

consumed foods, and a database of millions of food items. Read More

Pg. 28 Q2 2014 Digital Health State of the Industry

Whoop raises $6 million: Boston-based startup Whoop raised $6 million to build out its

continuous heartrate-sensing wristworn activity tracker, according to an SEC filing. This

brings the company’s total announced funding to $9.6 million to date. In the most recent

filing, Atlas Venture Partner Jeff Fagnan was listed as an investor. Whoop plans to create a

device that continuously monitors the wearer’s heart rate, quantifies the intensity of their

workouts, and monitors how much recovery time the user needs. The device is not designed

for casual users but rather for athletes. Read More

Mango Health raises $5.25 million: Mango Health, a startup using gamification principals

to work on medication adherence, has raised $5.25 million in first round funding from

Kleiner Perkins Caufield & Byers. The company, which participated in the Rock Health digital

health accelerator in 2012, had previously raised at least $3 million in a seed round from

Floodgate Fund, First Round Capital, Baseline Ventures, Bullpen Capital and individual

investors. CEO Jason Oberfest told MobiHealthNews that the money raised will go toward

scaling and developing the company’s enterprise business. Read More

Pear Sports raises $5 million: Irvine, California-based activity tracking and coaching

company Pear Sports raised $5 million in a round led by existing investors Innovate

Partners and Nordic Ventures. Smart TV company VIZIO also joined the round as a strategic

investor. Pear will use the funds to expand sales and marketing for its app as well as white-

label product, which was announced in November and is called ‘Powered by Pear’. The

company leverages well known coaches’ and celebrity athletes’ brands to recruit users to

the platform. Read More

Weave raises $5 million: Lehi, Utah-based VoIP communications service for dentists,

Weave, has raised $5 million led by A Capital, with participation from Homebrew, Fuel

Capital, SV Angel, Initialized Capital, and Y Combinator. Weave has focused on dentist

offices in North America as its first target market. Weave plans to use the funds to build out

its product’s features, expand marketing, and move beyond dentistry. The company is also

planning to build out its mobile offerings in the near future. Read More

Bellabeat raises $4.5 million: Mountain View, California-based pregnancy tracking

company Bellabeat raised $4.5 million from SVAngel, CrunchFund, Universal Music Group

and angel investors. With the Bellabeat device, pregnant women can listen to and record

their babies’ heartbeat and track other aspects of their pregnancy from the companion app,

including movement, kicks, and prenatal care. Read More

Aledade raises $4.5 million: Former National Coordinator for Health Information

Technology at the U.S. Department of Health and Human Services, Dr. Farzad Mostashari,

launched a startup, called Aledade, that will partner with independent primary care

Pg. 29 Q2 2014 Digital Health State of the Industry

physicians to help them join or form accountable care organizations. Aledade offers primary

care doctors with the tools to create their own ACO. Read More

Augmedix raises $4.1 million: San Francisco-based Augmedix, one of several startups

developing Google Glass software and modifications for hospital use cases, has raised $7.3

million in a round led by DCM and Emergence Capital Partners. This includes the $3.2

million the company announced in March, and $4.1 million in additional new funding. The

company also announced two other milestones: it has been named a certified Glass partner

by Google, and it has announced a partnership with Dignity Health, the culmination of a

pilot that’s been under way since January. Read More

Sherpaa raises $4 million: New York City-based digital healthcare service, called

Sherpaa, raised $4 million, according to an SEC filing. According to a report in March from

the Wall Street Journal, Tumblr Funder David Karp invested at least $500,000 in the round.

This brings Sherpaa’s total announced funding to $5.85 million. Existing investors include

O’Reilly Alpha Tech Ventures, First Round Capital, Collaborative Fund, and angels including,

ex-president of Tumblr John Maloney, and OpenX and Jirafe founder Scott Switzer. Sherpaa

aims to help employers cut their healthcare costs by making physicians virtually available to

their clients’ employees. Read More

Big Health raises $3.3 million: London-based digital health tool maker Big Health raised

$3.3 million from Index Ventures and Forward Partners to expand into the United States.

The company planed to open an office on the west coast. The company’s first tool, Sleepio,

aims to help users fix their sleeping issues. Read More

Vivify Health raises $3 million: Plano, Texas-based remote monitoring startup Vivify

Health (formerly Intuitive Health) raised $3 million, according to an SEC filing. This brings

Vivify Health’s total announced funding to at least $6.4 million to date. Existing Vivify Health

investors include Ascension Health Ventures and Heritage Group. The latest round included

two investors who contributed $1.5 million each. Vivify Health offers a patient engagement

platform targeted at hospitals, health plans, home health caregivers, and pharmaceutical

companies. Read More

Iagnosis raises $2.8 million: Iagnosis, parent company of virtual visit skin care company

DermatologistOnCall, raised $2.8 million from undisclosed angel investors. This brings

Iagnosis’ total funding to date to $8.8 million. Chief Strategy Officer and cofounder Larry

Eakin told MobiHealthNews that he plans to use the funds for marketing efforts at

DermatologistOnCall. Read More

Independa raises $2.8 million: San Diego-based Independa, which has developed a

telehealth platform for seniors, raised about $2.8 million in its second round of funding,

Pg. 30 Q2 2014 Digital Health State of the Industry

according an SEC filing. The company announced part of the round in October 2103 when it

had raised $1.85 million of the round, which it said was led by longtime backer City Hill

Ventures. Previous investors in the company include LG Electronics USA, which has

partnered with Independa to pre-load its home health platform on some of internet-

connected TVs for use in senior care facilities. Independa’s flagship offering is called Angela,

a tablet-based application that helps manage the lives and care of elderly patients who

choose to stay in their homes rather than move to assisted living or nursing homes. Read

More

Segterra raises $2.5 million: Cambridge, Massachusetts-based Segterra, developer of

the InsideTracker platform, raised $2.5 million in funding led by strategic investor Henry

Kauftheil, who is chairman of real estate investment firm ACG Equities and CSO and co-

founder of stealthy consumer health startup SelfHealth.me. The funding raise, which was

first reported by Xconomy, brings the company’s total up to $4 million since its founding in

2009. InsideTracker is a direct-to-consumer health analytics platform that starts with a

blood test to identify certain biomarkers, and then uses to results to help users make

healthier decisions about diet, exercise, and other lifestyle choices. Read More

Talkspace raises $2.5 million: Talkspace, a New York City-based startup offering therapy

sessions via the web and mobile devices, has raised $2.5 million. Spark Capital and Soft

Bank Capital participated in the round, which was the company’s first. In addition, AOL

President of Video Ran Harnevo will join the company’s board. The startup is trying to

address a perceived problem in the mental health field: because of various factors including

time, expense, and social stigma, many people (between 60 and 70 percent) who could

benefit from therapy don’t get help. Read More

CrowdMed raises $2.4 million: Crowdsourcing diagnosis platform CrowdMed raised $2.4

million from actor Patrick Dempsey, NEA, Andreessen Horowitz, Greylock Partners, SV

Angel, Khosla Ventures and Y Combinator. Grey’s Anatomy actor Dempsey will also help to

expand the company’s platform by developing new partnerships with insurance companies

so that patients are incentivized to use the platform. This recent funding is a continuation of

the round CrowdMed started in April 2013. CrowdMed applies the theory of a prediction

market — that when a large enough population bets real or fake money on predictions in a

system similar to a stock exchange, their bets will reflect their confidence and, in aggregate,

will create a robust predictive model — to healthcare. Read More

HeiaHeia raises $2 million: Finland-based H2 Wellbeing, maker of employee wellness

platform HeiaHeia, raised just over $2 million (1.5 million euros) in a round led by Finland’s

Wallstreet Financial Services. Additional backers included unnamed angels and a Finnish

funding agency called Tekes. Until now, H2 has run on its own revenues, which the

company started generating just two months into its launch, and government grants. CEO

Pg. 31 Q2 2014 Digital Health State of the Industry

and co-founder Jussi Raisanen told MobiHealthNews the company was waiting until it had a

scalable business model before seeking funding. Read More

Consumer Physics raises $4 million: A new smartphone-connected device for measuring

the nutritional content of food has raised $2.2 million on Kickstarter, on top of $4 million to

$5 million in funding from venture capitalists including Khosla Ventures. SCiO is a tiny

spectrometer that promises to send information about food, nutrition, and medication to a

user’s smartphone via Bluetooth Low Energy. Tel Aviv, Israel-based Consumer Physics, the

company behind SCiO says it has built two prototypes and is raising money on Kickstarter to

manufacture the final version, which it plans to ship to backers in January of this

year. Read More

Owlet raises $1.85 million: Provo-based newborn wearable device maker Owlet raised

$1.85 million in funding from a mix of investors that included R/GA, Techstars, Azimuth

Ventures, Life Sciences Angel Network, Utah-based Peak Ventures, Eniac Ventures, ff

Ventures, Brand Band Project and John Ason, an early investor in Diapers.com. Owlet

crowdfunded its ankle-worn, health sensing sock for babies last year. It raised about

$300,000 from supporters to build the device, which will connect to parent’s smartphones

via Bluetooth 4.0 (low energy). Read More

SwipeSense raises $1.7 million: Evanston, Illinois-based SwipeSense, which is

developing a smart hand hygiene sensor, raised $1.7 million, according to an SEC filing.

This brings the company’s total funding to at least $2.5 million to date. SwipeSense is a

graduate of the accelerator Healthbox’s first class, which was announced in December 2011.

Healthbox helped fund SwipeSense’s first round. The company aims to eliminate

dependency on hand hygiene campaigns that healthcare providers use to stay compliant

with Joint Commission requirements. Read More

Wellframe raises $1.5 million: Wellframe, a Boston-based patient engagement and care

management technology company, raised $1.5 million in seed funding from a bevy of high

profile investors and entrepreneurs, such as athenahealth CEO Jonathan Bush. Other

investors in the round include Tim Draper, founder and managing director of Draper Fisher

Jurvetson; Sir Sabaratnam Arulkumaran, president of the British Medical Association; Russ

Nash, former global managing director at Accenture; Carl Byers, a venture partner at

Fidelity Biosciences; and James Nahirny, founder and managing partner at Leerink Capital

Partners. Wellframe’s platform combines a patient-facing engagement app, which includes

educational components, exercises, and tracking features, with a clinician-facing dashboard

for data access and HIPAA-compliant two way messaging. Read More

Fitnet raises $1.4 million: Instructional video fitness app maker Fitnet raised $1.4 million

from Valleys’ Ventures and CIT Gap Funds for its fitness app, Fitnet. Before this funding

Pg. 32 Q2 2014 Digital Health State of the Industry

round, Fitnet was awarded a $300,000 grant from the National Science Foundation and with

some startup capital from the founder, the company’s total funding to date is just under $2

million. Fitnet’s iOS apps offers users guided workouts that range from cardio and strength

training to yoga classes. All classes are five minutes. Read More

KelDoc raises $1.4 million: Paris-based KelDoc, an doctor appointment booking app,

raised $1.4 million (1 million euros) from existing investor Alven Capital and other angel

investors. This brings the company’s total funding to about $2 million. Keldoc plans to use

these funds to expand across major cities in Europe. Currently, the service is only offered in

France. Read More

Jointly raises $1.3 million: San Juan Capistrano, California-based remote monitoring

analytics company Jointly Health raised $1.3 million from investors including Frost Venture

Partners and Reed Elsevier Ventures. This brings the company’s total funding to date to

$3.8 million. According to CEO Dean Sawyer, the company’s first product is still awaiting

FDA 510(k) clearance, but they have their first few health plan customers lined up once that

clearance is secured. The funding will be used to hire additional team members and

otherwise prepare for those implementations. Read More

TruVitals raises $1 million: Gainesville, Florida-based TruVitals has received an

undisclosed investment from the Florida Institute. However, the company has told

MobiHealthNews that the funding, combined with angel investments and grants, will bring

the company’s total funding to a little under $1 million. TruVitals is developing a non-

contact heart rate, respiration, and motion sensor that uses radar technology. It will soon

measure temperature as well. Read More

Filament Labs raises $1 million: Austin, Texas-based Filament Labs raised $1 million in a

round led by Mercury Fund with additional funding from Corinthian Health Services and

Arcadia Home Care. The company plans to use the funds to grow its digital care plan

delivery tool, Patient IO. The product, available on iOS and Android devices, turns the care

plan into a list of daily tasks complete with reminders and health tracking. Read More

First Warning Systems raises $560,000: First Warning Systems, the Reno, Nevada-

based company that’s working on wearable sensors for early detection of breast cancer, has

raised $560,000, according to CEO Rob Royea. Steven Welch, a private investor and former

COO of BP (not to be confused with DreamIt Health founder Steve Welch) led the round

with a $300,000 contribution. The rest came from a syndicate of investors in Singapore,

where First Warning intends to launch its product in early 2015. Read More

RxRevu raises $540,000: Denver, Colorado-based RxRevu, which offers a medication

transparency tool, has raised $540,000, according to a recent SEC filing that also notes the

Pg. 33 Q2 2014 Digital Health State of the Industry

company hopes to raise another $210,000. RxRevu founder Carm Huntress told

MobiHealthNews that the seed round’s exact total is undisclosed but that it is “well over”

$500,000. Investors in the round include a Denver, Colorado-based incubator Galvanize and

other unnamed angels. RxRevu also recently announced that they will be a part of Startup

Health’s next class. Read More

G-Tech Medical raises $350,000: Palo Alto, California-based G-Tech Medical, which is

developing a wearable, disposable sensor patch for patients with gastrointestinal problems,

received funding from Peter Thiel’s nonprofit fund, Breakout Labs. The grant was for

$350,000. G-Tech is also looking to raise additional money to fund its next phase of

development. G-Tech’s patches measure the electrical activity from the stomach, small

intestine and colon — which the company says is similar to capturing an “EKG for the

gut”. Read More

Sportsetter raises $276,000: Sportsetter, maker of an app that helps people stick to a

workout routine, raised $276,540 (200,000 euros) and launched an iOS version of its app.

The company has been around since at least 2012. The app helps users find variety in their

day-to-day workout routines so that on any given day they could play golf, work out on a

machine at the gym, participate in a yoga class, or try out a new rock gym. Read More

DocSpera raises undisclosed sum: Sunyvale, California-based Compliant Innovations

raised an undisclosed sum from Lifeforce Ventures and Attractor Ventures for its online

doctor communication platform, called DocSpera. The platform allows surgeons to

collaborate with their care teams as well as other physicians before operations and

treatments. Providers can use the platform to send messages that contain text, photos, or

videos in private groups or private messages. Images and text that might be shared include

x-rays and surgery schedules. Read More

By Mr. Kevin Clayton

CEO & Co-Founder of Be Bold Technologies, LLC

September 17, 2014

Pg. 34 Q2 2014 Digital Health State of the Industry

Contact Information

KEVIN CLAYTON

CEO

Tel [Telephone]

Fax [Fax]

[Email Address]

Name

Title

Tel [Telephone]

Fax [Fax]

[Email Address]

Company Information BE BOLD TECHNOLOGIES, LLC

4321 Kingwood Drive, Suite 140, Houston, TX 77339

Tel 1 (800) 505-0639

Fax 1 (713) 370-3152

www.WearablesGroup.com

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