At Medgadget, we cover a lot of digital health devices and wearables. Some are developed by startups, while others come from brand name businesses that have branched out into this new and growing market. A common thread among most of the digital health technologies covered is the need to record data through various sensor technologies. However, most companies do not have the intellectual property or capability to develop sensors themselves and instead turn to “ingredient technology” companies to provide these components.
Valencell is one of these ingredient technology companies, making some of the sensors powering many of today’s wearable devices. With a portfolio of over 50 hardware and software patents generated in only twelve years, Valencell claims to be integrated into more biometric wearable devices than any other ingredient technology provider in the world. Part of the versatility of Valencell’s technology is the variety of form factors it can be incorporated into including earbuds, arm bands, or wrist-worn devices.
At the Health 2.0 event a few weeks ago, Medgadget had a chance to sit down and learn more about Valencell’s origin, technology, and entry into the digital health market from Ryan Kraudel, VP of Marketing for Valencell.
Medgadget: Let’s start with a little about Valencell and the technology you bring to the large and growing market of wearables.
Ryan Kraudel: Valencell makes biometric sensor systems that go into all kinds of wearable devices from wrist and arm-based devices to earbuds. The technology we build is designed to be very flexible in terms of both how it can be implemented and the form factors it can go into. The company began in 2006, way before the term wearables and the market for consumer-worn sensors existed. The original founders bootstrapped the business in those early days while doing a lot of development with optical techniques like photoplethysmograrphy (PPG). A common medical application of PPG is in pulse oximeters that shine light through your finger to capture a blood flow signal. A challenge, however, is that PPG is extremely sensitive to motion which, in that example, causes more scattering of light, which in turn reduces the accuracy of the blood flow signal. A lot of Valencell’s core intellectual property is based on our founder’s early work making this optical technique more motion tolerant and therefore more wearable.
Medgadget: Is Valencell’s IP around PPG hardware, software, or both?
Kraudel: Both! Valencell’s hardware patents are around optomechanical design. For example, how far away the diode sits from the skin. The software patents are around signal processing with a big focus on making the output signal more motion tolerant. This involves using accelerometer data in combination with the pulse waveform to identify motion. Speaking of being able to identify motion, unlike most systems which just provide a stream of sensor data, when Valencell’s technology generates the serial data stream to our client’s host processor our data actually includes a signal quality flag related to our identification of confounding motion artifacts. The flag that lets the host know if the signal quality is below a certain level meaning they should not use the data. If the quality flag is above that level, it means we are locked onto the blood flow.
Medgadget: We’re meeting here at Health 2.0, but was health always the focus for Valencell’s sensor technology?
Kraudel: The original premise of the company was to collect biometric signals accurately from things people already were wearing on a day-to-day basis. This directed us towards creating sensors that were noninvasive and good at passively collecting data in the background. Back then, there were no such things as wearable devices so the ultimate form factor, and to some extent the use case, was kind of undefined. Our biggest customers today are still the consumer-driven businesses such as Samsung, Bose, and LG who were some of the first to begin licensing Valencell’s patents and IP.
By the nature of how wearable technology began to evolve, however, we did start to see a change in who was interested in our technology. Two years ago we saw a shift in the kinds of inbound requests we were receiving with more and more coming from medical device and pharmaceutical companies who were all looking at the phenomenon around patient generated data. These companies were paying more attention to the devices patients were wearing outside the clinic and recognizing the accuracy and capability of the technology in those devices. With information like heart rate interval and variability being typical end points of our data feed, there’s now a lot of interest in how these can be incorporated into processes that link to the electronic medical record or treatment protocols.
Medgadget: Is the healthcare interest you’re seeing in the market coming from any specific use cases?
Kraudel: The interest we are seeing in the health and medical space falls into a few categories:
First is therapeutics where wearables with our sensors are being used to supplement existing therapies. For example, with chronic conditions like asthma or COPD, you might be interested in monitoring a patient’s vitals in order to predict the onset of a respiratory attack with enough time to get to an inhaler and take corrective action. Similarly, there is some interesting work being done to recognize or predict when a migraine is imminent or highly likely. For all of these examples, companies are using wearables with our sensors to collect information, implement pattern recognition, and create predictive models.
The second area we’re seeing interest in is clinical research. A good example of this category is a recent conversation I had with some researchers at a world renowned medical school where they believe they have identified a way to quantify pain. Today, there are a lot of challenges defining pain in a reproducible way and it can end up being very subjective based on the patient. This team is using data points like heart rate and activity as well as blood pressure to more reliably create pain scores that complement, rather than completely replace, the subjective mechanisms of assessing pain used today.
Finally, the third category of interest is actually a combination of a few different trends including virtual reality, artificial reality, and mixed reality. Again, a good example for this category also relates to pain. There is a company, Scosche, that developed arm band monitors to replace traditional chest strap monitors. The device was initially designed for runners and athletes wanting their monitors in a different place rather than for any healthcare applications. However, the arm band is now being used to feed heart rate data into a virtual reality experience that helps patients forget about their pain by getting them to relax. Eventually, Valencell’s sensors might even be in the virtual reality headset itself!
Medgadget: Is licensing Valencell’s primary business model or has that also changed over time?
Kraudel: We have seen a shift in the business model over the last couple years. Prior to two years ago, we did all the technology development and then licensed the technology to OEM manufacturers who would integrate our technology into their products. We would teach customers how to use both our hardware and software designs, which we created together to optimize performance, through a network of contract manufacturers with experience building technology with our products in them. Two years ago, we switched to building pre-packaged modules utilizing the same technology but in a form factor where there’s no licensing involved meaning no legal discussions around who owns the IP. Pre-packaging also means a faster time to market with plug and play components. That said, if a client needs something customized, we still retain the option to go down Valencell’s traditional licensing pathway.
A good example of a company Valencell is working with on a custom project is Suunto who is like the Garmin of Europe making high end sports watches and other high precision instruments. Suunto had a watch that needed to survive down to 100 meters underwater, something our pre-packaged modules were not tested to achieve. So we have engaged with Suunto around a custom build for these watches through our technology licensing business model.
Medgadget: As a technology ingredient company, do you face market competitors?
Kraudel: Yes, we see three types of competitors. First, on the software side of things, there are companies doing things with the raw sensor data that comes out of our hardware. These are generally smaller companies like LifeBEAM. Second, on the hardware side of things, are the more traditional silicon vendors like AMS, Texas Instruments, and Silicon Labs. While these companies also have software to complement their hardware, it is generally considered weaker and most of their clients take the hardware and use it with their own or someone else’s software. Third, indirectly, are OEMs on the consumer side who have decided to do all aspects of the technology themselves like Apple, FitBit, or Garmin.
Medgadget: Are there any new technologies or capabilities Valencell is working on today or is excited about for the future?
Kraudel: We see a lot of opportunities to leverage and grow capabilities on Valencell’s optical hardware platform. For example, something we’re putting a lot more of our recent research and development effort into has been what you can do with the data. You can get a lot off of a PPG waveform. Resting heart rate and heart rate responses are standard but breathing and respiration can also be tracked from the PPG signal. Blood pressure has also been a big area of development since we know how important it is for hypertension. For a long time we’ve known you can roughly get pulse pressure from the amplitude of the PPG waveforms though it is not exactly blood pressure. However, with additional algorithms and processing, we can derive blood pressure and have reached the point where we are as good as consumer-grade blood pressure cuffs. There is still a lot of work ahead to get it into a medical grade cuff.
Part of the development process involves working with early partners to help with commercialization and understanding what they want to do with these new capabilities. For our ability to monitor blood pressure, for example, mobile phone companies are now interested in offering a blood pressure monitor right on the phone itself. Those same companies are also cognizant of the FDA, however, so the question becomes whether you want to be able to make a diagnosis, a recommendation, or just show an estimation or categorization of the reading.
Another exciting area we think is coming down the pipeline is sleep technologies. The future of sleep technology is likely going to be similar to the consumer wearable space. The first wave of interest was around activity and using accelerometer data. This data is correlated to, but maybe not super insightful in, understanding why someone had a poor night sleep. The next phase of sleep-related wearables will provide more data into how the patient’s body is responding throughout the sleep process representing an opportunity to generate more versatile and impactful insight.
Medgadget: You mentioned Valencell’s work capturing blood pressure. Earlier this year Valencell announced the ability to monitor blood pressure without a cuff. How is Valencell building upon the state of the art of blood pressure reading today?
Kraudel: There is a high degree of variability, even among FDA-approved products and in blood pressure cuffs in particular. If you take a medical grade cuff and put two on the same person, there is going to be a 5-6 mmHg difference between them. For a consumer grade blood pressure cuff that difference is going to be more like 9-10 mmHg. Part of the reason for that variability is that blood pressure cuffs today are not calibrated based on age, weight, or fitness level. With calibration, the readings become more accurate. We are still in the early stages of using calibration with vitals reporting. Most of Valencell’s partners interested in blood pressure monitoring are more interested in the traditional uncalibrated blood pressure model so that where we’re focusing today. Ironically, traditional medical device companies are becoming more interested in calibrated blood pressure readings. They have previously been happy with readings taken once a day but if they can use wearable technology with sensors like ours to record more frequently while capturing other data points for calibration, it could mean blood pressure devices begin to take on a variety of different form factors besides just a cuff.
Medgadget: Since Valencell’s technology often ends up in other company’s products, how do you handle quality testing?
Kraudel: The company was founded by three research scientists so Valencell’s DNA is not just in technology development but also in the testing of hypotheses to produce the same outcomes in the lab as in the field. Testing and validation is a big part of what we do in addition to hardware, software, and implementation expertise. When a company is using Valencell’s technology, we’re often involved, or at least aware, of the new technology up to 24 months ahead of it actually being announced or released depending on the situation. Optical techniques work differently on different people in terms of absorption due to varying body types and BMI levels. We have volunteers who help assess the technology coming through our labs and who help test early prototypes of devices using our technology to see how the dynamics of these devices work across a broad population. Luckily, we benefit from having gone through north of 40 different product development cycles in which we’ve solved a lot of common challenges at this point.
Medgadget: We’ve talked about Valencell’s entry into the healthcare wearables market which represents a big piece of the content here at Health 2.0. What kind of value are you taking away from participating in this year’s conference?
Kraudel: There is a ton of value to a company like ours coming to Health 2.0. We’ve entered a very complicated market with so many different dynamics and elements that a technology ingredient company like ours doesn’t necessarily understand. I’ve enjoyed the opportunity to network and meet people from different aspects of the industry who can help us better learn how to navigate. There are definitely a lot of companies we can see working with in the future here.
Another important insight that events like these help us keep the pulse on is data integration. At the end of the day, the technology is a data collection tool which cannot in and of itself impact patient outcomes unless the data gets to the right place, at the right time, in the right context. So we are interested in how we not only provide data but also partner with the right companies to make sure the data is ultimately useful. It’s important to remember that a lot of companies created wearables without knowing the user experience or even knowing what people, and later other companies, wanted out of those devices. This just means that we need to spend some time on education regarding the quality of the data captured from someone wearing a device outside of the clinic. One lesson we’ve learned from consumer wearables is that not all companies recognize the value of the data. Luckily, that seems to be less true in healthcare.