October 19, 2018

Google and Apple in Healthcare: Threat or Opportunity?

Hanna Phelan

Health has truly met wealth with the new strides of tech giants Google and Apple who are becoming increasingly confident in healthcare. While early advances, such as Google Glass in the OR, arguably left little impact on the healthcare sector, more recent efforts by both organisations have demanded more serious consideration by hospital systems, consumers, regulators and life sciences organisations.

In this week's blog we take a look at some of the notable healthcare activities Google and Apple have engaged in so far in an effort to provide an insight into their healthcare strategies and where healthcare incumbents may be challenged or where healthcare organisations may stand to benefit from the precedent and structure they pave in the slowly shifting healthcare environment.

Google Alphabet - Artificial Intelligence, Collaboration and Radical Experimentation

Not many companies garner the impact required to become a verb. Since their Menlo Park beginnings in 1998, Google has done far more than creep into our everyday lexicon, manage our business correspondences and facilitate rabbit hole web searches. While Healthcare is a relatively recent foray for the tech giant, their strategy so far has been confident (sometimes too confident) involving aggressive experimentation, collaborative partnerships and a firm belief in their grasp of AI and data navigation. The Google restructuring to Alphabet in 2015 highlighted their newfound commitment to healthcare following a few failed healthcare projects. This restructuring led to the development of life sciences, technological research and investment arms either dedicated to, or heavily involved in, different therapeutic areas and technological delivery methods spanning precision medicine, aging, smart sensors, infectious disease management, diagnostic support tools and more.

The AI Path to Market Monopoly

Verily, Google Ventures (GV) and Deepmind are the three characters at the core of the Alphabet healthcare efforts. Verily are the designated life sciences group focused on moonshots like the glucose sensing contact lens, biologically engineering mosquitos to eradicate malaria and more predictable efforts such as their study watch. GV takes the reigns in terms of early stage venture capital, with an impressive portfolio of data driven startups at the fore of precision medicine and novel diagnostics such as Flatiron Health and GRAIL. And then there is Deepmind, the AI gurus, who are working with NHS bodies such as Moorfields Eye Hospital NHS Foundation Trust to leverage deep learning techniques for early detection of conditions such as macular degeneration.

AI interest and activity has spanned across all departments from investment in Kaggle, the acquisition of Deepmind, research partnerships into conditions such as diabetic retinopathy and other conditions that could benefit from increased accuracy and automation - Google is well positioned for AI Monopoly. This was the main point of concern in a recent independent review carried out following the NHS data sharing concerns in 2016. The independent investigation echoed a common concern that Deepmind could “exert excessive monopoly power” in terms of data access. While the Alphabet AI group claims to want to facilitate emerging companies leveraging their system it remains to be seen how facilitative this will actually be in practice.

Alphabet - Friend or Foe?

While there are many potential benefits for existing healthcare start-ups and life sciences companies, who may be able access their data and infrastructure or gain their support through partnerships and collaborations, there is also an obvious element of competition and whispers of market domination - particularly for less established healthcare innovators in AI and precision medicine. It will be challenging (to say the least) to compete in terms of resources. However, there is hope as it appears the Alphabet healthcare players are aware of their own shortfalls in terms of healthcare acumen leading which has seems to have resulted in an openness to partnerships.

Some examples of the Alphabet partnerships include their miniaturized continuous glucose monitors (CGM) to help people with Type 2 diabetes manage the condition, created in tandem with Dexcom. Their G6 Glucose tracking device was given FDA approval in April 2018 highlighting a tangible milestone for the Alphabet collaborations. Notably, Verily also joined forces with Johnson & Johnson in 2015 in an effort to democratise surgery with their robotic surgery intervention Verb which leverages machine learning and advanced analytics to improve OR accuracy. To date there has been very little information released in terms of progress other than the expected launch date will be in 2020. Google will need to make sure it proves it’s motives of partnership are more than marketing ploys by sharing real outcomes of clinical efficacy research - just as is expected of smaller digital health counterparts.

Fail Fast - Fail Better

It hasn’t all been rosy. Inevitably with aggressive experimentation in such a vast and increasingly federalised system there will be failures such as Google Glass, Google Flu Trends, Google Health Records, the Deepmind-NHS privacy uproar, in addition to some very audacious Verily pre-announcements around tricoders and glucose sensing contact lenses. So, why did these moonshots fall short and have the new Alphabet health champions learnt from their predecessors mistakes? Yes and no. In terms of Google Health Records that announced it’s defeat in 2011, there was speculation that the main reason it flopped was lack of consumer awareness and industry buy in addition to a lack of trust in the giant to have access to such information. The Google Health Records effort was a largely bottom up move that didn’t involve hospital systems. Without the clinical buy in, consumer adoption was lacking any real traction.

This is one lesson the giant has taken on board. Now when it comes to evidence of the efficacy of their new healthcare developments, the Alphabet group doesn’t seem to be resting on its laurels and is actively engaging in multiple research partnerships with well regarded hospital systems such as Stanford Medicine and Brigham and Women's - relationships that will be invaluable in cementing their healthcare credibility and generating an evidence base. However, outcomes will need to be disseminated to address speculation around purely publicity based partnerships.

Alphabet have the resources to burn, but the above highlight that no amount of capital or talent can forge a healthcare project that is just not a market fit, lacks internal buy in or health system integration. Rather than scoffing at these failures as an example of how healthcare is ‘too complex’ for these healthcare newcomers, we should learn what we can from these unprecedented efforts.

Experimentation is central to healthcare reform, however, accountability and collaboration are crucially important accompaniments to this more agile way of working. Long lasting change is crucially connected to collaboration which appears to be something that Alphabet’s healthcare leaders are aware of and something that pharma such as J&J and health systems like the NHS can stand to benefit from if they can stay true to evidence based healthcare while leveraging the resources and consumer know-how of the Alphabet healthcare players.

In terms of implications for the start-up community, there is an opportunity for those that catch the eye of GV to avail of funding (more than $2.4B is at the disposal of GV), in addition to engineering support, potential connections into the Alphabet family and PR and marketing advice all in return for equity. For start-ups such as 23andMe and the 60 other life sciences companies invested in by GV since 2009, there is a clear value proposition beyond capital with 5 of their healthcare investments already gone public in the past year.

Apple - Remote Monitoring, Patient Centricity and Regulatory Moves

Apple are sticking to what they know. Unlike Google who until recently were a predominantly software based company and was seen to struggle with early hardware ventures such as Google Glass, Apple has the advantage of established industry know-how in pairing software and hardware together when starting their journey into the unknown digital healthcare realms.

Direct to Consumer Know-How

Apple recently announced the launch of their HealthKit capability where health record data can be transferred to third-party iOS apps through the new Apple Health Records API. The feature allows users to share their health data from more than 500 hospitals and clinics. The likes of Medisafe, a medication management app, can connect with the Health Records feature allowing consumers to import their prescription list without manual entry, enable pill reminders and provide relevant information on the likes of drug interactions. Naturally, there are concerns around this offering- an opportunity for the sharing of sensitive data in an insecure environment. However, it is a positive move in terms of providing increased ownership of healthcare data to consumers and empowering them to take control of their own health and wellness.

The new centrepiece to this Apple Health ecosystem is their newly FDA approved Apple Watch which facilitates a more holistic view of a consumers health by integrating remote monitoring biometric data. Apple is also one of the nine organisations (alongside Pear Therapeutics and Verily) to be made a part of the FDA Pre-Cert initiative potentially giving them bargaining power to drive the sector in their favor but also highlighting their dedication to be taken seriously in the regulatory environment - potentially a sign of less light touch consumer interventions around the corner?

Despite FDA approval, there are worries around false positives being triggered by the HR monitor of the new apple watch causing people to seek unnecessary formal care. Apple CTO Jeff William’s assertion on stage that the watch was the first ECG product offered over the counter, directly to consumers when announcing the FDA approved device caused a bit of a stir in the digital health space given the AliveCor launch of its own FDA-cleared mobile device for monitoring heart rate last year.

Apple products and services in healthcare are not limited to consumer facing interventions, although this is definitely their sweet spot and a smoother regulatory navigation. Hospitals such as Geisinger Health, Johns Hopkins Medicine, Dignity Health and Cedars-Sinai Medical Center were announced in January to be part of of a cohort of 12 US hospital systems to pilot Apple’s medical record system. This is an opportunity for Apple to pair the records with iPads and other facilitative devices and funnel patients towards follow-up care services such as Medisafe post-discharge. It’s early days for this intervention and questions remain around the integration of clinical notes and how the giant may deal with navigating pre-existing interoperability issues. Whatever the outcome, the vote of confidence provided from engaging such notable systems is a milestone for the giant and an opportunity for the health systems to garner valuable insight on user experience and consumer centricity.

Collaborating for Clinical Grade Monitoring - Biotech and Beyond

The Apple Heart Study, an ongoing collaborative research project with Stanford Medicine also uses data from the Apple Watch to identify irregular heart rhythms, including those from potentially serious heart conditions such as atrial fibrillation. Apple and Stanford are conducting this research study in order to improve the technology used to detect and analyze irregular heart rhythms. While on paper big names like Stanford Medicine and other health systems add impressive credibility there has been past partnerships that seem to have never shared (or reached?) any sort of outcomes. The Apple Watch partnership with Medopad and Kings College Hospitals in 2015, intended to improve medication management and adherence for cancer patients undergoing chemotherapy, is one such example.

Apple CEO Tim Cook announced publicly in 2015 that he was uninterested in pursuing an Apple watch that would require FDA approval due to the restriction of long processing cycles. However, since the FDA approval, the Apple watch may become a clearer avenue for pharma and biotech to pursue as they strive to fit consumer centric expectations. Most recently Zimmer Biomet, one of the leading medtech organisations, announced a joint replacement study leveraging the new Apple Watch and iPhone for their mymobilty app, which they co-created.

Apple’s influence in digital health to date looks for the most part as if it will be more of a facilitator for smaller start-ups, innovators and researchers looking to piggyback on their UX and consumer engagement know how.

Here to Stay

Whether we like it or not it looks like Apple and Google are firmly embedded in the foreseeable future of digitized healthcare. There are definitely valuable assets these giants can bring to the table such as consumer engagement expertise, designing seamless user experience, vast technological insights, huge amounts of capital, and access to large quantities of data. For start-ups, pharma, medtech and hospital systems that manage to navigate relationships with these organisations there is a lot to be gained.

Conversely, there are also very real risks associated with opening the doors of healthcare to the agility and risk-taking nature of the big tech sector. To date a number of failed healthcare ventures, lack of outcomes and outlandish moonshots have not acted in the favour of these giants. There is, however, a mounting realisation that true innovation in healthcare should not happen in isolation giving way to unprecedented partnerships across the sector.

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