The Theranos Story, ch. 44: Walgreens settles lawsuit, cash box empties further

click to enlargeWalgreens realizes Theranos’ funds are not bottomless. Confirming the June Wall Street Journal report [TTA 26 June] that Theranos had advised its investors of a negotiated settlement with Walgreens Boots Alliance, Tuesday’s announcement offered few specifics. According to the Theranos release, the settlement resolves all claims by Walgreens and dismisses the lawsuit, with no finding or implication of liability. Terms were not formally disclosed, but sources told the WSJ (FoxBusiness) that the settlement was over $25 million. In June, it was estimated to be less than $30 million, so the over/under wasn’t very wide. Payment timing was not disclosed.

As we noted in June, Walgreens had invested an estimated $140 million between direct funding (a $40 million loan convertible into equity), and an “innovation fund’ designed to fund the store location rollout. The lawsuit filed last November was intended to recoup that amount. The thorn that Walgreens and its attorneys grasped was that even with insurance, there was not $140 million left in Theranos and nothing of equivalent non-cash interest. As a public company, certainly the realization that putting $25 million on the books this year was better than nothing. It is also likely that $110+ million has already been written off.

Not much left in Theranos’ till, other than some dollar bills and coins. In June, Theranos disclosed that their cash on hand was $54 million with a monthly burn of $10 million, leaving as of today $44 million. Even if the Walgreens settlement is covered 100 percent by insurance, at best Theranos has about four months of life–if nothing extraordinary happens. There are also ongoing SEC and DOJ investigations, plus the Colman/Taubman-Dye suit in California, which may result in more fines and settlements.

While Theranos makes much of its new management structure and commercializing new technologies (of which there is no word), there are no signs that beyond recapitalization earlier this year that there is fresh investment. Reports indicate they are trying, at long last, to exit real estate they no longer need–subleasing their expansive (and expensive) Palo Alto headquarters and relocating to their former lab in an industrial park in less tony Newark, California. As this Editor concluded in June, it is increasingly difficult to see a future for Theranos without Chapters 11 or 7 in it. It is rapidly arriving at a familiar place for startups, but not former Unicorns: Flat Brokedom.

Meanwhile, Walgreens Boots Alliance, barely dented in the exchequer, has closed on a $1.4 bn joint investment with KKR for institutional pharmacy company PharMerica. Drug Store News

It’s all hackable by Black Hats: pacemakers, Amazon Echo, trains, heart monitors, prison cells!

It’s the servers, stupid! Unlike the economy, where people comprehended the problem, it seems we are automating more and securing less. The annual Black Hat Conference, where participants see this as a challenge, and the news are serving up some prime examples.

In Las Vegas, Lucas Lundgren, a senior security consultant at IOActive, scanned away–and was able to open prison doors, gain access to alarm systems, an oil pipeline, a German train controller, pacemakers, heart monitors, and insulin pumps. These communicate with servers through an open-source messaging protocol known as MQTT used in home and industrial systems. The problem is that access to the servers is not protected through a user name and password, much less two-factor authentication. “Not only can we read the data — that’s bad enough — but we can also write to the data.” Scary when you contemplate a hospital with insulin pumps, BP monitors, and multiple surgical devices all going haywire.  ZDNet 

Similarly, easy hacking pickings have turned up in IoT cameras–over 175,000 inexpensive cams made by Chinese manufacturer Shenzhen Neo Electronics’ as NeoCoolCam and distributed worldwide, discovered by BitDefender. Older Amazon Echo devices can be physically tampered with and malware uploaded to be turned into listening devices, according to MWR InfoSecurity.

And Anthem gets no respect. After suffering its 2015 data breach of 80 million members–and spending $115 million to settle the lawsuit–there’s a third-party contractor, LaunchPoint Ventures, who decided that no one would notice if 18,500 patient records were sent to a home email a year ago. Actually, it was noticed after the contractor was nabbed for unrelated “identity theft-related activities” this past April. More ‘splainin’ to do to HHS, surely, after filing their July 24 report. At least it’s not an IoT breach! Healthcare Dive

AI good, AI bad (part 2): the Facebook bot dialect scare

click to enlargeEeek! Scary! Bots develop their own argot. Facebook AI Research (FAIR) tested two chatbots programmed to negotiate. In short order, they developed “their own creepy language”, in the words of the Telegraph, to trade their virtual balls, hats, and books. “Creepy” to FAIR was only a repetitive ‘divergence from English’ since the chatbots weren’t limited to standard English. The lack of restriction enabled them to develop their own argot to quickly negotiate those trades. “Agents will drift off understandable language and invent codewords for themselves,” said Dhruv Batra, visiting research scientist from Georgia Tech at Facebook AI Research. “This isn’t so different from the way communities of humans create shorthands.” like soldiers, stock traders, the slanguage of showbiz mag Variety, or teenagers. Because Facebook’s interest is in AI bot-to-human conversation, FAIR put in the requirement that the chatbots use standard English, which as it turns out is a handful for bots.

The danger in AI-to-AI divergence in language is that humans don’t have a translator for it yet, so we’d never quite understand what they are saying. Batra’s unsettling conclusion: “It’s perfectly possible for a special token to mean a very complicated thought. The reason why humans have this idea of decomposition, breaking ideas into simpler concepts, it’s because we have a limit to cognition.” So this shorthand can look like longhand? FastCompany/Co.Design’s Mark Wilson sees the upside–that software talking their own language to each other could eliminate complex APIs–application program interfaces, which enable different types of software to communicate–by letting the software figure it out. But for humans not being able to dig in and understand it readily? Something to think about as we use more and more AI in healthcare and predictive analytics.

AI good, AI bad. Perhaps a little of both?

Everyone’s getting hot ‘n’ bothered about AI this summer. There’s a clash of giants–Elon Musk, who makes expensive, Federally subsidized electric cars which don’t sell, and Mark Zuckerberg, a social media mogul who fancies himself as a social policy guru–in a current snipe-fest about AI and the risk it presents. Musk, who is a founder of the big-name Future of Life Institute which ponders on AI safety and ethical alignment for beneficial ends, and Zuckerberg, who pooh-poohs any downside, are making their debate points and a few headlines. However, we like to get down to the concretes and here we will go to an analysis of a report by Forrester Research on AI in the workforce. No, we are not about to lose our jobs, yet, but hold on for the top six in the view of Gil Press in Forbes:

  1. Customer self-service in customer-facing physical solutions such as kiosks, interactive digital signage, and self-checkout.
  2. AI-assisted robotic process automation which automates organizational workflows and processes using software bots.
  3. Industrial robots that execute tasks in verticals with heavy, industrial-scale workloads.
  4. Retail and warehouse robots.
  5. Virtual assistants like Alexa and Siri.
  6. Sensory AI that improves computers’ recognition of human sensory faculties and emotions via image and video analysis, facial recognition, speech analytics, and/or text analytics.
click to enlargeFor our area of healthcare technology, look at #5 and #6 first–virtual assistants leveraging the older adult market like 3rings‘ interface with Amazon Echo [TTA 27 June] and sensory AI for recognition tools with broad applications in everything from telehealth to sleepytime music to video cheer-up calls. Both are on a ‘significant success’ track and in line to hit the growth phase in 1-3 years (illustration at left, click to expand).

Will AI destroy a net 7 percent of US jobs by 2027? Will AI affect only narrow areas or disrupt everything? And will we adapt fast enough? 6 Hot AI Automation Technologies Destroying And Creating Jobs (Forbes)

But we can de-stress ourselves with AI-selected music now to soothe our savage interior beasts. This Editor is testing out Sync Project’s Unwind, which will help me get to sleep (20 min) and take stress breaks (5 min). Clutching my phone (not my pearls) to my chest, the app (available on the unwind.ai website) detects my heart rate (though not giving me a reading) through machine learning and gives me four options to pick on exactly how stressed I am. It then plays music with the right beat pattern to calm me down. Other Sync Project applications with custom music by the Marconi Union and a Spotify interface have worked to alleviate pain, sleep, stress, and Parkinson’s gait issues. Another approach is to apply music to memory issues around episodic memory and memory encoding of new verbal material in adults aging normally. (Zzzzzzzz…..) Apply.sci, Sync Project blog

Tunstall pairing with Inhealthcare digital health for NHS remote monitoring

click to enlargeA digital link of hope for Tunstall’s future? Announced at The King’s Fund Digital Health & Care Conference but oddly not receiving much notice was the UK collaboration of Tunstall Healthcare and Inhealthcare. Inhealthcare builds infrastructure for digital health services, and currently works extensively with multiple NHS regions and programs, such as the North of England Regional Back Pain Programme, NHS England’s Sheffield City Region Test Bed and the Darlington Healthy New Town project. Their services include telehealth monitoring for INR, COPD, medication reminders, a smartphone app platform, chronic pain management, and a surprising one that addresses undernutrition in older adults. The Tunstall-Inhealthcare objective is to integrate health and social care with clinical care systems in six areas: LTC home monitoring, identifying vulnerable patients, involving family members, 24/7 clinical care coordination centers, post-discharge management, and digital health at home innovation. Also noted is that Inhealthcare has programming technology that can reduce the time to build out services and apps.

Inhealthcare Ltd is part of Intechnology plc, owned by Peter Wilkinson, who has developed several UK internet and technology companies at scale–Planet Online, Freeserve, and Sports Internet (now Sky Betting and Gaming). Tunstall release

CTE found in 99% of former, deceased NFL players’ brains: JAMA study (updated)

click to enlargeUpdated for additional information and analysis at conclusion. In the largest-ever case study published of CTE–chronic traumatic encephalopathyVA Boston Healthcare System (VABHS) and the Boston University School of Medicine’s CTE Center found mild to severe CTE pathology in nearly all of the brains of former football players studied. Jesse Mez, MD, BU Medical assistant professor of neurology and lead author on the JAMA study, said that “The data suggest that there is very likely a relationship between exposure to football and risk of developing [CTE].” The CTE is marked by defective tau (stained red in the brain sample pictures, click to expand), which is also evident in Parkinson’s and Alzheimer’s Disease.

Of the 202 brains donated to the VA-BU-CLF (Concussion Legacy Foundation) Brain Bank:

  • The most dramatic finding is the detection of CTE in 110 of 111 donated former NFL players’ brains (defined as having played one play in a regular NFL season game).
  • In addition, the brains of other football players were studied. CTE was detected in seven of eight Canadian Football League former players (88 percent), nine of 14 semi-professional players (64 percent), 48 of 53 college players (91 percent), and three of 14 high school players (21 percent).
  • The severity increased with length of play, with the majority of former college, semi-professional and professional players having severe pathology. The deceased high school players diagnosed with CTE had mild pathology findings. Age at death ranged from 23 to 89.
  • Player position mattered. Linemen, running backs, defensive backs, and linebackers, who take most of the punishment in football, were the bulk of the donated brains with CTE.

Separately, and with no knowledge of the pathology, backgrounds on each donor were compiled to gather medical history and symptoms. What was striking were the personality changes evident with even mild CTE. Dr. Mez: “We found cognitive, mood and behavioral symptoms were very common, even among players with mild CTE tau pathology. This suggests that tau pathology is only the tip of the iceberg and that other pathologies, such as neuroinflammation and axonal damage, contribute to the clinical symptoms.” 

Preliminary to the current study was UNITE (more…)

Shouldn’t we be concentrating on digital therapeutics rather than ‘health apps’?

Where the money and attention are going. The first generation of Quantified Self apps was all about viewing your data and storing it online in a vault or graphs…somewhere, usually proprietary. Your Pebble, Fitbit, or Jawbone tracked, you crunched the numbers and found the meaning. At the same time, there are wellness companies like Welltok, ShapeUp, Keas, Virgin HealthMiles, and RedBrick Health, usually working with companies or insurers, that use various methods (money, gamification, other rewards) to influence lifestyle and improve a person’s health in a quantified, verifiable, but general way. What’s happened? There are now apps that combine both data and behavior change, focusing on a specific but important (again) condition, coach to change behavior and verify results rigorously through clinical trials. Some, like Omada Health, prove through those clinical trials that their program successfully changes pre-diabetic indicators, such as weight loss, decrease cholesterol and improved glucose control–without medication. This results in big savings for insurance companies, one reason why a $50 million Series C was led by Cigna. Another model is to work with pharmaceutical companies to better guide treatment. Propeller Health with its asthma/COPD inhaler tracker is partnering with pharma GlaxoSmithKline on a digital platform to better manage lung patient usage, and surely this will go through a clinical trial. We will be seeing more of this type of convergence in medical apps. (The rebooted Jawbone Health Hub is moving in this exact direction.) The Forbes article, while short, is written by someone who knows the business of apps– the co-founder of the AppNext distribution/monetization platform. He does achieve his aim in making us think differently about the potential of ‘health apps’. 

The King’s Fund 2017 Digital Health Congress: videos, presentations now posted

click to enlargeThe King’s Fund’s annual two-day Digital Health and Care Congress now has videos and presentation decks posted on the event page.  If you missed it, or want to see the sessions you could not attend, here’s your opportunity to review and share with staff. All the plenaries and keynotes have both video and presentations. Selected workshops/breakouts have video along with PowerPoints on nearly all, including posters. Attendance this year was between 400 and 500. On Twitter: #kfdigital17, @TheKingsFund TTA was pleased to be a marketing supporter of the 2017 conference as we have for several years. Many thanks to events coordinator Claire Taylor.

For planning ahead, The King’s Fund Annual Conference will be two days this year, 29-30 November. Early bird registration is available until 1 September and sponsorships/exhibit opportunities are open.

Fitbit’s smartwatch on track; Intel exits the game

click to enlargeFitbit’s ‘Project Higgs’ in-house designed smartwatch is, by all reports, on schedule to hit the market later this year in time for the holidays, at least in Wall Street’s expectations. To the FT (may be paywalled) CEO James Park reassured, “The product is on track to meet our expectations and the expectations that we’ve set for investors. It’s going to be, in my opinion, our best product yet.” It will be waterproof, a battery that lasts several days, have mobile payment capability (from the Coin acquisition), simple health tracking,  heart rate monitor, sleep tracking, stream music (Spotify and Pandora are rumored), and its own app store. It will be either Wi-Fi or smartphone connected. TechRadar’s agglomeration of rumors include pricing ($199 to $299 –about £231), swappable bands, a full-color screen with 1,000 nits of brightness, an aluminum body and built-in GPS. The most interesting part is the proprietary operating system which uses Javascript. Also Pocket-Lint articles 18 July and 19 July

Intel, however, is giving up the smartwatch and fitness tracking chase. In 2014 they acquired Basis in a well-publicized move and enlisted hip celebrities like 50 Cent to endorse their products versus the likes of Apple and Fitbit. In November about 80 percent of the group was let go, according to CNBC, and entirely eliminated this month. The New Technologies Group is now focusing on augmented reality. CNBC

Can Google Glass’ enterprise iteration solve the patient documentation crisis?

click to enlarge“Glass is a hands-free device, for hands-on workers.” What a marketing position! Google Glass finally arrives at where it should have started–not a techie toy or a social snooper banned from bars, but a tool for specific work needs that solve specific but important problems. This is not only ‘on trend’, but also the ‘professional case’ is steak on the grill as a powerful way to lend legitimacy to a new product (the classic is Tang ‘orange drink’ going into space in the early ’60s). The recent announcement of Glass Enterprise Edition (EE) marking its emergence from stealth mode was a refreshingly low-key (for Google and parent Alphabet) surprise. Even the revamped look is sturdy and utilitarian in full glass mode (left) or in clip-on (and also serves as eye protection). 

Their on-trend position for healthcare is to reduce the amount of time that doctors spend charting and documenting patients. Augmedix, a Glass partner, built the documentation automation platform for Sutter Health and for Dignity Health that captures the information from the interaction between patient and doctor via a ‘remote scribe’. Jay Kothari, the Glass project lead, quotes data from Dignity that it reduces clinician daily documentation time from 33 percent to less than 10 percent,  The Sutter Health estimate is two hours per day. Out of the gate this is extremely valuable because it improves the clinician-patient face-to-face (and presumably virtual) visit in eye contact, reduces the break in taking notes, and reduces time pressure generated by post-visit review. Netherlands-based swyMed concentrates on facilitating virtual visits, and is testing a home visit pilot with Loyola University Health System practitioners in Maywood, Illinois. Others, like John Nosta, have been continuing to use Glass in business. Our Readers may want to check out these partners as that is how Google is making the Glass available, not directly. SF/Boston-based partner Brain Power wasn’t mentioned in Mr. Kothari’s blog, but their AI/VR applications for brain conditions such as autism and TBI, as well as other uses such as clinical trials and care for older adults. mHealthIntelligence interviewed Augmedix’s CEO Ian Shakil, who notes that Glass still needs improvements in battery life for the hard work of documenting patient visits.

Update: An interesting comment on this via Twitter. The paper is from 2015 but the regulatory and privacy questions around recording patients and information remain. Augmedix does state on its website that it is HIPAA compliant.

 
click to enlarge

Toyota’s $14 million bet on Intuition Robotics’ social companion robot (JP/IL/US)

Social companion robots for older adults and the disabled are hot again. Tel Aviv and now San Francisco-based Intuition Robotics is enjoying a $14 million second Series A investment from Toyota Research Institute (TRI) for the ElliQ ‘active aging companion’. The ElliQ desktop robot is tethered to a proprietary tablet to connect an older adult with the outside world via video chat, using machine learning about the person to recommend activities, and assist with appointments, medication reminders, music, wellness, and environmental monitoring. ElliQ is still in pre-release. The $14 million is being put to immediate use in initial testing with users in the Bay Area, and Intuition is ramping up with a team there. 

TRI is based in Los Altos CA and is wholly owned by Toyota North America. Earlier seed and Series A investments totaling $8 million were made by iRobot, Terra Venture Partners, Bloomberg Beta and ManivMobility. This is the second older adult-targeted robotics news in as many weeks, with the more fully-featured and ‘humanoid’ KOMPAÏ in France going the crowdfunding route (as Intuition did early on) for €250,000 to fund the next generation [TTA 5 July]. After viewing the video below, it seems to this Editor that a lot of the interactive voice command technology has been overtaken by assistants already in market like Siri, Amazon Alexa, and Google Home. TechCrunch, Home Health Care News

 

TSA appoints new chair

Paul Shead has succeeded Andrew Gardner as Chair of TSA. He has worked closely with the TSA and its membership since the organisation’s inception, and has been on the TSA’s board of directors since May 2012. He will chair the board for the next 12 months, working to develop strategy, monitor performance and extend the organisation’s sphere of influence. Paul’s experience of the telecare industry spans more than 20 yearsCurrently he is Managing Director of Verklizan, supplier of the UMO telecare and telehealth monitoring platform to housing associations, local authorities and private companies in the UK.

Commenting on his appointment, Paul said: ‘Social care and health are facing unprecedented pressures. The need effectively to commission, procure and quality-assure technology enabled care (“TEC”) has never been greater. The shift of analogue to digital also presents huge opportunities and risks. The fast-changing pace of TEC means that a new audience of digital health companies is springing up alongside more traditional telecare organisations. I’m keen to ensure that TSA can support and inspire every part of the UK’s diverse technology enabled care sector. I look forward to working alongside the TSA Board, Chief Executive, President and staff to ensure that we respond effectively to challenges, make the case for TEC and work to shape future policy. We must provide our growing and diverse membership with the knowledge, intelligence and ideas to sell their products and take the sector forward.’ (more…)

Tender Alerts: Warwickshire, Thurrock, and Hertfordshire

Susanne Woodman of BRE, our Eye on Tenders, alerts our Readers to two open and one probable new tenders:

  • Nuneaton and Bedworth Borough Council (NBBC) in Warwickshire is seeking a 24/7 ‘reactive repair service’ for Tunstall telecare equipment presently in 35 independent living accommodations. The contract is for an initial period of two years, with two optional one-year extensions. Closing is 4 August. Details here.
  • Thurrock Council in Essex is seeking “to appoint a Consultant who will work as Project Manager with Adult Social Care and Health staff to develop an Assistive Technology Strategy and support implementation of the strategy.” The contract is valued at £25-50,000. Interest must be registered by 28 July at the Council’s Delta eSourcing page. On the Council page there is additional information in a summary of the Council’s of the Careline service and a resolution to expand/upgrade assistive technology for local users. 

Not registered as a tender yet is a plan by Hertfordshire County Council to bring wearables such as activity trackers and software-enabled clothing into the homes of at-risk local adults, plus online systems for video-link calls, scheduling messages and reminders for people to take their medication and connect with families. This article in the Watford Observer tells some of the story but the page on the Hertfordshire blog is oddly missing–however, captured by the sharp-eyed Ms. Woodman here. They advise monitoring the Herts County Council on social media–right now they are burning up Twitter @hertscc on the alphabet countdown to potholes and fire safety tips from Reqs the Fire Dog!

Creepy data mining on medical conditions runs wild: where’s the privacy?

Ever heard of AcurianHealth? If you are in the US, you may get a letter for one of their research studies or drug trials based upon your prescriptions, your shopping habits, or your internet browsing. Where do they get that data? Quite legitimately, based on consent, Walgreens Boots will mail invitations for studies organized by Acurian to their pharmacy customers, where the user identification is withheld from Acurian. The privacy policy by which Walgreens does business with you permits this type of contact with you. These letters direct users to a generic sounding website for the study–and then life gets interesting. A visit to the site, whether from a letter, a search, or an online ad, may capture your information. There’s a bit of code from a company they work with, NaviStone, that captures information from partial or unsent information requests or signups. NaviStone then matches it up with what you think is anonymous behavior with other databases, and voilá, mail is sent to you via their ‘proprietary technology.’ Acurian uses databases from large data broker/aggregators like Epsilon and cranks away. It’s creepy behavior that stretches the definition of privacy and consent. Not reassuring is that Acurian has a database of over 100 million people who are supposedly opt-ins. How a Company You’ve Never Heard of Sends You Letters about Your Medical Condition (Gizmodo) Hat tip to Toni Bunting

UDG Healthcare buys American, adds Vynamic, Cambridge BioMarketing for up to $67 million

Consultancy acquisitions the latest trend–who’s next? Dublin’s UDG Healthcare acquired Philadelphia-based healthcare consultancy Vynamic last week, then topped it on Monday with marketing/communications company Cambridge BioMarketing. Cambridge has an unusual specialty–campaigns for orphan and specialty drugs and treatments with clients from small to large pharma and biotech. Vynamic, an industry management consultancy, provides services from strategic planning to process design and systems implementation.

This follows on the reveal earlier this month in Bloomberg of the potential sale of The Advisory Board’s healthcare practice to UnitedHealthcare. Last week, this Editor mentioned Evolent Health in Rock Health’s record-breaking review of first half 2017 funding. It turns out that publicly traded Evolent is partly owned by The Advisory Board, with a share valued at $170 million, and reportedly had been seeking funding to itself purchase The Advisory Board, now considered unlikely (BizJournals). What will happen to this share isn’t known.

The Vynamic acquisition is structured as an initial purchase price of $22 million with an additional consideration of up to $10 million payable over the next three years, based on the usual achievement of agreed profit targets, for a total of $32 million (€27.8 million). Irish Times Vynamic will join UDG’s Ashfield Division. Release For Cambridge, it’s a similar arrangement of $30 million (€26m) paid up front, with the potential for an additional $5 million (€4.3m) paid over the next 12 months, again dependent on achieving financial targets. RTE.ieRelease