The wearable health tech market is predicted to be one of the largest and fastest growing markets of the next decade. Wearable health tech has the potential to disrupt a number of parallel markets and at the same time lower healthcare costs significantly. Cost savings are driven by better treatments and better resource management.
Consumer-led healthcare
Healthcare is in the midst of a transformation into a patient-centric, consumer-led model. The traditional inefficient and costly model: a person seeks medical help from the doctor – the only source of information and the doctor makes decisions based on a fragmented medical history or medical records. The rich sets of available data generated by wearable technologies now make patients the point of care. Consumer-led healthcare will change patient care pathways, driving the industry to grow and collaborate in new ways, both with patients around their own health and with partners and innovators. Wearables will primarily support people living healthy lives, and then diagnostic and therapeutic abilities will follow, led by the user themselves at the point of care.
Accountability
Digital technologies and combined data enable a more holistic EHR, medical studies, clinical experience, and experience constructing a more holistic medical picture at both the micro and macro level. This is changing the distribution of data and responsibility with the patient as the point of care and engaged in medical decisions. At some point, clinicians will collect wearable and sensor data from their patients as part of routine care.
Regulators
As the capabilities of wearables increased, the FDA grappled with how to regulate the new technology. Originally, wearables were not considered medical devices unless they made claims about treating specific diseases or conditions. However, as the technology of wearables advanced, the FDA regulated some new features.
For instance, Apple released an EKG feature on its watch to detect Atrial Fibrillation. Since it was meant to detect Atrial Fibrillation (an irregular heartbeat), Apple could not classify the feature as a general wellness device and the feature needed to be FDA cleared.
WellDoc’s diabetes platform, for example, has been FDA approved as a digital therapeutic. What makes this a therapeutic versus an informational tool versus a diagnostic? Welldcoc Diabetes tracks blood glucose levels just like any other blood glucose meter. In the traditional monitoring model, a patient will review their blood glucose data and then decide how to adjust their insulin dosage accordingly. In the Welldoc model, the Welldoc platform tells the patient precisely how much insulin to inject. This changes the paradigm from patient/doctor making the dosing decision to the technology platform making the dosing decision (to drive clinically tested outcomes). This “dosing decision” makes the platform a therapeutic and not a monitoring device and this in turn requires a full FDA therapeutic approval.
As the impact of biosensors and syn-bio develops in the wearable platform, regulators will need to consider the devices and their software in many categories; diagnostic, medical device, digital therapeutic, and just straight therapeutic. Although the FDA could exercise its regulatory power over the wearable industry, a more permanent solution is likely to require updates to the Food, Drug and Cosmetic Act and this may slow down the growth of the market.
Reimbursement
Reimbursement has taken a while to align with digital tech innovation in general but as the cost-benefit cases begin to build around resource and manpower utilization, payers will be driving the change through reimbursement. Good data analytics and AI will be able to demonstrate that the hardest part is changing older health provision and delivery models.
Additionally, as strong therapeutic benefits grow so too will reimbursement, but this will require significant investment in good quality clinical trials and pharmaco-economic studies. This in turn will require strong pharma/biotech type leadership and management at the helm of new innovating companies.
Privacy
Beyond regulatory and reimbursement challenges are new and additional legal dynamics for manufacturers marketing their smart wearables. Most prominently, these concern the privacy and security of the processed data. New levels of detail and insight into an individual will be available through the data collected by new devices and this will bring new levels of concern about privacy. There will be additional legal requirements regarding the application of the device, such as the liability for malfunction, the professional regulations of medical users, and the data processed.
Market opportunity
With such a broad application across a number of markets, we’ve seen some quite dramatic differences in predictions for wearable health tech. Clearly these differences are dependent on what aspects are included. We believe a reasonable estimate is around $17 billion in 2020 with expected growth at a compound annual growth rate (CAGR) of around 28% from 2021 to 2028 to well over $100 billion.
A greater focus on health and wellness and a growing elderly population will see fitness, remote monitoring and personalized medicine as key sectors of growth but the arrival of more therapeutic applications will accelerate growth dramatically.
While some of this developmental work is still in early-stage development, the potential value is clear to the market. Ziylo has developed an innovative technology platform, which could be a key component to enable the next generation of insulin, able to react and adapt to glucose levels in the blood, therefore eliminating the risk of hypoglycemia – dangerously low blood sugar levels – and leading to better metabolic control for people living with the disease.
Ziylo was acquired by Novo Nordisk in a deal worth $800 million.
What is clear is that wearable health tech will be highly disruptive as its impact will spread across many market sectors – from healthcare delivery, to diagnostics, to therapeutics. Key to successful investment is understanding precisely which technologies, market sectors and regulatory factors will ultimately drive market growth.
Photo: exdez, Getty Images
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