Whitespace innovation study healthcare ecosystems

Whitespace Innovation Study:

Evolutionary, Revolutionary and Disruptive Healthcare Ecosystems: 2020

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Company X Whitespace Innovation Study – Final Report

Table of Contents Pages

n  I. Research Objectives and Methodology, Profile of KIL Respondents 3-4

n  II. Key Healthcare Trends Emerging 5-11

q  Paradigm Shifts q  Disruptive Innovations q  Long-term Outlook –KIL Insights and Predictions (Healthcare, Medicine)

n  III. Key Healthcare Policy Initiatives & New Healthcare Models 12

q  U.S. (Models, Drivers, Inhibitors) q  International (Models, Drivers, Inhibitors)

n  IV. Healthcare Ecosystems Overview (Market Dynamics, Technologies, Key Players) 13-38

q  KIL Insights and Observations

n  V. Key Whitespace Opportunities 39-47

n  VI. Global Healthcare Trends and Timelines 48-51

q  Major Trends and Timeline (2010, 2015, 2020)

n  VII. Recommendations (3-5 yr. ROI Estimate) 52-55

q  Adjacent markets, Drivers and Trends

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Company X Whitespace Innovation Study – Final Report n  I. Research Objectives and Methodology

q  Research Objectives and Methodology Process:

§  Provide primary and secondary market research/analysis, while assisting in the identification of emerging innovation, technology, products, trends , evolving healthcare ecosystems, along with new whitespace/disruptive innovation insights and opportunities. This research also serve as a market analysis which identifies emerging global healthcare business opportunities/markets.

Qualitative Research Methodology: Harrison Hayes utilized a primary, qualitative Key Innovation Leader (KIL) research module – customized specifically for the needs of the Company X Whitespace Innovation research initiative along with supplementary secondary research.

§  Harrison Hayes utilized a variety of database resources to recruit a world class group of KILs. Harrison Hayes identified a number of valuable individuals to interview and created a project-specific database with all pertinent KIL contact information for Company X.

§  41 KILs based in the US, UK, Belgium, Netherlands, Norway, Spain, Australia, S. Korea, Panama and

India were interviewed by phone. The KIL's were pre-screened to assure they could provide insightful observations and innovative approaches.

§  All interviews were conducted by Harrison Hayes’s Principals and Market Research Team who had the autonomy to probe deeper and maneuver through unique issues that arose during discussions with the KILs – what is referred to as improvisational interviewing.

§  The overall content of this study reflects (1) the combined/integrated feedback and in some cases, consensus, of the KILs who participated in this study, and (2) Harrison Hayes data and qualitative primary and secondary research analysis .

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Company X Whitespace Innovation Study – Final Report n  I. Profile of KIL Respondents

Number of KILs Interviewed: Geographic Scope: Represented Countries:

-- 41 -- US, UK, Belgium, Netherlands, Norway, Spain, Australia, S. Korea, Panama, India

Professional

Categories of KILs Interviewed:

-- MD’s (specializing in Telemedicine/Telehealth -- Health IT (Futurists, Solution Providers) -- Medical/Clinical Informatics Innovators, Researchers (Academia), Corporate Directors, President of European Union -- Six Sigma Experts (Supply Chain Innovation) -- Innovation Research Experts (Health IT, Enterprise Solutions) -- Clinical Neuropsychologists/Psychologists -- CEOs EMR Companies -- Senior Technology Innovation Analysts -- eHealth/mHealth Experts (Global)

KIL Specialties & Research Area Focus:

--Healthcare IT - -Clinical/Medical Informatics (Research and Development) Global - -EMR (Electronic Medical Records) solutions/services/middleware - -WHO-World Health Organization- Telemedicine/Telehealth - -HIE (Health Information Exchange) Services (SaaS) - -Medical Simulation Technology (Virtual Reality) - -Federal (US) Health IT (Innovation/Initiatives - -Technology Innovation - -Global Process & Equipment Innovation - -Telecommunications Global Services - -Advanced Technology (Military-US) - -Technology Futures - -Psychology/Cognitive Sciences - -Clinical Neuropsychology - -Innovation Research-Enterprise Solutions - -Supply Chain Innovation - -Advanced Telemedicine - -Healthcare IT Futurists - -Health/Wellness Virtual Game Applications

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Company X Whitespace Innovation Study – Final Report n  II. Key Healthcare Trends Emerging (Global)

q  Paradigm Shifts

n  Moving from a supplied healthcare model to more of a personalized patient self-management /multidisciplinary provider managed care model, with special focus on patient outcome and quality of care. “Integrated Care” model (parallel providers working as a team).

n  Physician’s role is changing from the “Lone Doctor” to a role similar to a conductor of an orchestra – or a shift from primary care to a more integrated care /participatory health model (multi-disciplinary teams; case managers).

n  Shift from taking care of sick people to trying to prevent people from becoming sick. Lifestyle changes important in patient healthcare self-management.

n  Shift to larger focus is on disease prevention (disease management) and wellness.

n  Shift from primary/secondary health care to more of a focus on patient healthcare self-management and where the care is given.

n  Shift to IT and communications tools (e.g. smartphones, iPhones, iPads) as new ways of delivering healthcare.

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q  Disruptive Innovation

n  Value-based healthcare delivery

q  The only way to contain costs is to improve healthcare outcomes: in a value-based system, achieving and maintaining good health is inherently less costly than dealing with poor health.

q  Principles of Value-Based Health Care Delivery

Prevention -Early detection -Right diagnosis -Right treatment to the right patient -Early and timely treatment -Treatment earlier in the causal chain of disease -Rapid cycle time of diagnosis and treatment -Less invasive treatment methods *Source: Michael Porter, Harvard Business School 2010

-Fewer complications -Fewer mistakes and repeats in treatment -Faster recovery -More complete recovery -Less disability -Fewer relapses or acute episodes-Slower disease progression -Less need for long term care -Less care induced illness

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q  Disruptive Innovation – cont’d.

n  Healthcare Information Highway (Health IT)- (infrastructure and applications). Example: The Apple ITunes transformed the way people listened to music. How do we build a better health information/data platform that will be safe and secure?

n  Implications

q  The healthcare information highway will transform how people communicate. How do we build a set of standards and infrastructure? Continuing to build an economy and ecology for this service.

q  NOTE: The Office of the National Coordinator for Health Information Technology (ONC) –Office of Health and Human Services - awarded $60 million to four institutions - Mayo Clinic, Harvard University, University of Texas Health Science Center at Houston and University of Illinois at Urbana-Champaign - through the Strategic Health IT Advanced Research Projects (SHARP) program.

q  Each institution's research projects will identify short-term and long-term solutions to address key challenges, including ensuring the security of health IT (University of Illinois at Urbana-Champaign), enabling patient-centered cognitive support for clinicians (The University of Texas Health Science Center at Houston), making progress toward new health care application and network-platform architectures (Harvard University), and promoting the secondary use of EMR data while maintaining privacy and security (Mayo Clinic of Medicine).

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q  Disruptive Innovation – cont’d.

n  Personalized Medicine/Healthcare

q  Overview

§  This system has been described as personalized health care-treatments and services targeted to the biology of the individual, leading to potentially significant improvements in patient care.

§  New technologies offer the potential for revolutionary changes in the development and distribution of personalized medications, along with the practice of medicine - from molecular diagnostic tests that detect disease before symptoms are evident - to patient profiling techniques that help predict which patients are most likely to benefit from or be harmed by specific therapies/medications. These approaches and the extensive data they require will need to be supported by a new information architecture.

§  Personalized Medicine has given the diagnostics field a huge boost in terms of publicity/public attention, revenue potential, and investment interest.

q  Implications

§  Will require a new approach to technology assessment and dissemination, one that embraces the tremendous potential of the vision of personalized medicine.

§  Will have an enormous impact on supply chains and sales forecasting for pharmaceutical companies and drug distributors (e.g. gender specific drugs, costs of drugs, going from commodity drug supply to tailored drug supply)

§  New business models will have to be designed to accommodate the change in drug development, supply chain management and entry into new markets.

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q  Long-term Outlook (Healthcare, Medicine)

q  KIL Insights and Predictions: Major Changes over Next 20 Years

§  Significant life extension with ever-increasing quality of life. §  Diabetes-Cure within 10 years; Cancer-Early cures in 5 years; all cured in 20 years (via

Nanotechnology) ; Chronic Disease Pain Management-All cured or managed within 15 years.

§  Major new understanding of how the brain works; and how mental pathologies can be safely ameliorated – better drugs, drug targeting with nanotechnologies (genetic/epigenetic testing).

§  An increase in the use of advanced, intelligent machines and technologies.

§  Cures to most, if not all, major diseases, chronic pain and aging process.

§  Changes in IT are exponential. Processing power to increase a million times; computing will be embedded into society at the smallest, inter-cellular levels.

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q  Long-term Outlook (Healthcare, Medicine) – cont’d.

q  KIL Insights and Predictions: Major Changes over Next 20 Years

§  Re-growth of tissues/organs; Bio-printing of replacement organs, tissues, medicines.

§  Sports will receive major biologic/mechanical/pharmacologic improvements.

§  Doctors offices will be eliminated for most procedures.

§  Tailored, personalized medicines that will be monitored.

§  Medicine is moving from a trial and error science to an information technology; and information technologies have shown themselves to be on an exponential growth curve.

§  New understanding of the brain and better drugs and drug targeting (via Nano) will enable deep and even routine pathologies to be eliminated or ameliorated.

§  Genetic/epigenetic testing will also give parents a tool to better secure their child’s future against pathologies.

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q  Long-term Outlook (Healthcare, Medicine) – cont’d.

q  Major Changes over Next 20 Years

§  Innovation will come from the private sector (mHealth, eHealth, Health IT), not from the US government.

§  In 3-5 years, will see a lot more connectivity between mHealth, eHealth, Health IT solutions and related devices.

§  Data Explosion: We will see more cloud computing and hosted informatics solutions and services, resulting in much better health-related data analysis. Integration of all the data will be challenging, however, and could take 5-10 years before the data is totally integrated. Will take longer, worldwide.

§  New healthcare payer business models will evolve. Healthcare payers will gather more critical diagnostic and usage data from patients (home-based), which will in turn help with more efficient case management analysis, etc.

§  Medication management will come into its own. Pharmaceutical companies will provide venture capital to fund advanced medical device development that will provide monitoring and advanced diagnostics for patients, for example. These initiatives will also provide critical data of medication usage for more efficient drug procurement and management of medications.

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n  III. Key Healthcare Policy Initiatives & New Healthcare Models

q  U.S. (New Models, Drivers, Inhibitors)

n  Now in the midst of the biggest capital infusion of money; the US federal government has invested $36 Billion into EMR and PHR and related healthcare technologies, with goal being by 2014 that a majority of the population have electronic health records. The onus is on the physicians/providers to migrate paper health records over to digital formats. The physicians will be provided with monetary incentives to this migration.

n  Inhibitors: Migrating patient health records over to a digital format is still a tortured Technology adoption by physicians is and will be the largest driving force in health IT. We are not there yet, since the adoption numbers are still low. It will take from 3- 5 years for this migration (estimate). It will take a little longer than people expect, but it is definitely on the track.

q  International (New Models, Drivers, Inhibitors)

n  Healthcare is a crucial sector for the economy of European Member States (EU); in particular, the increase of elderly people and chronic diseases asks for new models of care, able to assure an economically sustainable evolution of the healthcare systems (Council of the European Union (2007).

n  Within each country (EU), there is a need to assure the continuity of care across healthcare facilities and to facilitate the access to healthcare and social services. A key challenge is the close coordination of the activities of the healthcare (and social) professionals for shared care, as well as the proactive involvement of the patients themselves and of their families (patient empowerment) in the daily management of the diseases.

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Company X Whitespace Innovation Study – Final Report n  IV. Key Emerging Healthcare Ecosystems

Ecosystems Focus Facilitators Market Drivers (Impact)

Market Inhibitors

(Implications)

Key Players

Health & Wellness (Preventive/ Predictive Cure) (Sub: Patient-centric/self-managed healthcare)

•  Prevention before cure

•  Early diagnosis & treatments

•  Wellness lifestyle (holistic health, well being)

•  Wellness one-stop shops

•  Customized products (nutraceuticals, functional foods, age-related, etc.)

•  Alternative medicine health services

•  Remote patient monitoring, diagnostics • Smart phones (iPhone, Droid) •  iPads, others •  Digital Health (Health 2.0) •  Clinical Informatics •  Telemedicine, Telehealth •  mHealth •  Advanced diagnostics

•  Healthcare costs are pushing employers to provide wellness incentives

•  Smart tools, wearables and applications being developed around the world to address health issues, maintenance, diagnostics, patient health data

•  Health/Wellness SW (games) (e.g. Wii Fit; Incentive Wellness games, etc.)

•  Studies have demonstrated effectiveness of wellness programs

•  Boomer effect •  Local food supply growing in popularity (e.g. organics, etc.) – global movements

• Growing costs of healthcare - worldwide

•  Costs associated with wellness

•  Global economic issues (demographic s)

•  Medical device suppliers

•  Functional food suppliers

• Corporations

• Consumers (aging populations, parents)

• Alternative medicine providers

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n  IV. Key Emerging Healthcare Ecosystems

A.  KIL Insights and Observations: Health & Wellness (Preventive/Predictive Cure)

n  Market Segments: n  Patient-centric/self-managed healthcare; simulation/virtual reality solutions; video games for health (with

incentives built in); wellness tracking devices (Ambient, virtual medical records, instant diagnosis).

n  Wii Fit: The growing popularity of the Wii Fit product is a great indication of the direction of physical fitness in the near future; makes exercise fun and competitive.

n  Over the long-term, wellness/health-related games will become even more enticing, tailored to keep an individual engaged in a virtual reality ad infinitum. Currently, health clubs are now combining fitness with video games – age ranging targets from7-17 years old.

n  Over the long-term, it is predicted that exercise will be unnecessary as treatments will be developed to get you fit without the work.

n  Over the long-term, obesity will largely disappear through treatments.

n  Over the short-term, it is projected that mobile technology will help to put a “therapist in your pocket.” Applications are currently being developed to aid in “mood management”, “stress relievers”, and direct communication –anywhere and anytime- with a possible, avatar/virtual reality therapist. This is currently a nascent market.

n  Wearable body sensors which are combined with your mobile device are projected to grow in popularity. The concept is called “Body Language” –a system combining wearable body sensors, a mobile phone app and a simple messaging system that facilitates a dialogue between a person and their body, giving the person advice about what it needs and what to do (e.g. count calories/lose weight; stop smoking; heart monitors. Can also scan personal social networks to track behaviors, content, etc.

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Company X Whitespace Innovation Study – Final Report n  IV. Key Emerging Healthcare Ecosystems-cont’d.


Market Inhibitors

(Implications)

Key Players

Personalized Healthcare/Medicine

•  Disease detection (cancer, diabetes, hypertension)

•  Home-based, self-managed healthcare

•  Personalized medications/targeted therapeutics

• Home-based diagnostics/disease maintenance/chronic pain management

• Integrated physician and pharmacy (Google Health, Microsoft Health Vault, etc.)

•  Telemedicine and Telehealth (e.g. Teleradiology, Telenursing, Telesurgery)

•  Digital Health

•  Remote patient monitoring

•  Smart phones (iPhone, Droid) •  iPads, others •  Health 2.0 •  Device/Drug Identification •  Nanotechnology • Functional foods • Robotic prosthetics • EMR, PHR (Personal Health Records)

•  Aging independently (e.g. Boomer effect)

•  Growing aging population (Global) •  Expansion of health and wellness (Corporate, personal)

•  Fragmentation of market (increased niches)

• Personalized medicine’s ROI, not until 7-10 years due to technology still evolving. Still hard to monetize.

• Federal healthcare reform (its impact still up in the air)

Samples: Abbott Diagnostics Affymetrix, Inc. Agilent, Althea Technologies Curidium Medica, PLC. Dako Gen Probe Genzyme Corporation Ipsogen Lipomics Osmetech Perlegen Sciences Provista Life Sciences Qiagen Singulex Theranostics Health Ventana Medical System

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n  IV. Key Emerging Healthcare Ecosystems A.  KIL Insights and Observations: Personalized Healthcare/Medicine

n  Growing Market Segments n  Cyberdocs n  Telehealth & Telemedicine (& Telepresence) n  Personalized drugs n  Home-based, self-managed healthcare n  Advanced/Remote Diagnostics

n  Important Impacts in Personalized Healthcare/Medicine over next 3-5 years n  Extending care providers ability to interact with patients in real-time, including rural and remote patient populations via telemedicine / telepresence technologies.

n  More information (including healthcare information ) will be carried by the patient via smartphones, iPads, computers, and mobile monitoring/diagnostic devices. BOTTOM LINE OBSERVATION: Within 20 years, every device will have an interface into some type of healthcare “cloud” network.

n  Medical imaging real-time technology/solutions cost-curve coming down - physicians will be able to perform medical consultations, procedures remotely and get reimbursed.

n  Movement toward patients receiving common diagnostic tests in homes, via toilets, sinks, mirrors, phones, for example. These tests could include: blood, urine, heart, temperature, level of bacteria in system, etc. Physicians, hospitals and pharmacies would also be able to track and receive baseline health information data , with alert mechanisms. Doctors offices would be eliminated for most procedures.

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A.  KIL Insights and Observations: Personalized Healthcare/Medicine-cont’d.

n  Six Sigma Approach to Healthcare

n The *LEAN Six Sigma approach can be applied to healthcare. Instead of treating symptoms, look at the root cause and work from there.

n  Wellness Management vs. Disease Management: It was also suggested that the LEAN Six Sigma approach be applied to the practice of medicine, along with products and research, instead of just to the business processes of medicine. * Lean Six Sigma is a relatively well-known approach for achieving operational excellence

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Market Inhibitors

(Implications)

Key Players

Smarter, On-Demand, Personalized Drugs (Sub: Smart Medicine Management) NOTE: Nootropics (pronounced /also referred to as smart drugs, memory enhancers, and cognitive enhancers, are drugs, supplements, nutraceuticals, and functional foods that are purported to improve mental functions such as cognition, memory, intelligence, motivation, attention, and concentration.

•  Non-invasive delivery

• Genetic/personalized drugs

•  Pills-On-Demand

•  Smart Capsules

•  Nootropics/Mind Enhancing Drugs

• Intelligent pills: Aids formulation development; clinical drug trials; drug selection; dosing profiles

•  Microchips into pills-networked, digital drugs-dosage/disease management

•  Smart medicine management

• Bio-medical materials (bio-medical printing, customized dosages, remote delivery, just-in-time delivery)

•  Digital Drugs

•  Smart Drugs

•  Device/Drug identification

•  Food industry applications – aids in site absorption studies; hunger suppressant studies, allergic reaction studies

•  Growth in personalized medicine technology and innovation • Nanotechnology continuing advancements

• Advanced monitoring (systems which can be swallowed into a patient’s body)

•  Possible government (FDA) pushback and/or regulation delays

• Manufacturing and development costs

• Possible consumer backlash

• Possible supply chain/distribution problems

•  Philips (technology) IntelliCap

• Proteus Biomedical – backed by Novartis/Medtronic

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A.  KIL Insights and Observations: Smarter, On-Demand, Personalized Drugs

n  Pills on Demand: Over the long-term, printing pills “to order” to create safer, faster-acting medicines will be productized. New methods will enable multiple types of medicines to be printed onto one pill. However, there will be supply chain and sales forecast ramifications. Going to more “customized” medicines will directly affect these areas and will be quite disruptive to current related processes.

n  Smart Capsules: Researchers at the CNRS Paul Pascal Research Center in Bordeaux, France have designed smart capsules that are able to release their contents on demand, simply by raising the temperature. Described in an article published in the journal Langmuir, this novel system has just been patented. It opens up the way to many applications in a large number of fields such as food, perfumes and agriculture, for instance to deliver pesticides above a specific temperature. The principle is very simple, cheap, and applicable to a very large number of systems. The method could be used to monitor freshness of foods or to release a perfume into the air, onto fabric or onto skin. Another possibility is the release of a therapeutic agent onto the skin, which in this case could be triggered locally by rubbing when it is applied (rubbing would cause warming).

n  Smart Drugs/Nootropics: Additional research suggests that smart drugs or “Nootropics” such as methylphenidate, modafinil and piracetam are increasingly being used by the healthy to augment cognitive ability. Although current nootropics offer only modest improvements in cognitive performance, it appears likely that more effective compounds will be developed in the future and that their off-label use will increase. NOTE: Over the next ten years, it is projected by analysts that the issue of nootropics will become huge. There will be questions on whether people should be free to take these drugs, whether the social advantages outweigh the personal advantages, and whether they confer an unfair advantage to users by leading to higher grades, better jobs, more money. But there’s also the issue of drugs development. If a strong market for nootropics emerges, there is every chance that new, more effective drugs will follow. Then the question arises – who gets the “good” stuff, and who suffers as a result? Therefore, the 2010’s are set to be an interesting decade for mind-enhancing substances

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A.  KIL Insights and Observations: Smarter, On-Demand, Personalized Drugs – cont’d.

n  Intelligent Pills: Philips' new IntelliCap technology has the potential to take intelligent drug delivery to the next level. It is a technology which designs a pill that combines technologies for localized drug release with the ability to measure the internal environment and communicate this information to the outside world - without the need for large machines or wires. The IntelliCap technology produces a pill that has been designed to be swallowed with food or water like a regular pill. This IntelliCap is more a drug-filled capsule that uses the natural digestion process to reach the intestines and then deliver treatment at a specific spot. Once there, IntelliCap has the technology on board to take specific internal measurements, such as temperature and acidity levels, and wirelessly transmit the data via a transceiver to an external unit for the doctor to monitor. APPLICATIONS: Food industry applications – aids in site absorption studies; hunger suppressant studies, and allergic reaction studies.

n Digital Drugs: Proteus Biomedical, Redwood City, CA, is developing ingestible chips that can be embedded in pills turning them into networked, digital drugs. The technology aims at reducing the likelihood of a patient missing a dose, which could lead to serious complications. The Proteus system (e.g. Raisin) has been tested in trials for drugs that treat heart failure, hypertension, TB and other diseases. There are other companies with similar technology, however, Proteus is one of the closest to market. According to Proteus, Raisin-enabled drugs are expected to go on the market as early as 2012. n  NOTE: Novartis plans to use the system next year in a trial for a transplant drug.

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Market Inhibitors

(Implications)

Key Players

Informatics

•  Health IT Informatics

•  Clinical Informatics

•  Medical Informatics

•  Nursing Informatics

•  Pharmaceutical Informatics

•  EMR/PHR

• Medical Imaging Informatics

• Hosted Informatics (e.g. Pharma R&D SaaS) OR Cloud Sourcing (“Electronic Lab”)

•  Decision Support

•  Disease Management – Personalized

• US Federal Government

• Physicians/Clinicians

•  Hospitals

•  Health IT (Middleware) Solutions

•  Health Information Exchanges (e.g. Verizon HIE)

• Cloud computing technology

• 4th Generation ELNs (Electronic Lab Notebooks- shared library)

•  RFID Middleware solutions

•  Individualized treatment plans for each patient

•  Parallel healthcare providers working as a team

•  Chemical care paths for patient decision support

•  Federal (US) EMR incentives/penalties

• Excellent potential for mining EMR for advanced decision support solutions

•  Cloud Computing: Health IT/Cloud Sourcing-Improves operational agility –”Just in Time” (will help with more efficient CRO (Contract Research Organization) engagements

•  EMR resistance of physicians (lost time, costs, etc.)

• Issues of privacy, identity and permissions (particularly challenging on a worldwide basis.)

•  Data integration across data layers (enterprise and globally. Will take time – approx. 5-10 years, conservative estimate

•  Hospital EMR: Allscripts/, Eclipsys, Epic, Siemens, Cerner; Ambulatory EMR: MD-IT

• Clinical Informatics: Partners Healthcare

• Health IT Middleware: •  IBM •  Oracle •  Intel

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n  IV. Key Emerging Healthcare Ecosystems A.  KIL Insights and Observations: Informatics

n  Future Electronic Lab via Hosted Informatics: A growing sector which can bring scientific information to scientists’ desktops. A subscription-based, software as a service (Saas) model (based on cloud computing) could provide pharmaceutical companies improved operational agility and virtual collaboration more effectively with virtual teams and partners in a shared, resource environment.

n  Clinical Informatics: Growing Area-Clinical Informatics is the study of information systems (computers/programs) used in the clinical practice of medicine. Examples of aspects of the field include: (1) Data Entry at Point-of-Care which automatically links to a patient’s electronic health record (HER); (2) Telemedicine – transmittal and access of patient health records via teleconferencing/ teleradiology/ imaging informatics, etc.; (3) Imaging-new CT scanners can incorporate new software algorithms that allow for 3D reconstruction of vital structures; (4) Data Display-vital signs can be highlighted when abnormal; and (5) Decision Support-immediate feedback at the time of order entry about drug-drug interactions or patient allergies has been shown to reduce both patient morbidity and healthcare costs.

n  One of the study’s KIL respondents based in the Netherlands, leads a Dutch IT (Information Technology) researcher and development team that is currently working on new clinical informatics solutions focused on a “clinical /healthcare team approach” to healthcare. One of the core elements to their approach is a “treatment plan for each patient.” This approach includes working in parallel , a team of healthcare/clinician/pharmaceutical providers working together with the patient. The IT system is designed to be able to accommodate and maintain the clinical and chemical (drug) care plan and link the results of the steps in the process to the objective. In addition, the data will also link to care standards parameters unique to specific drug and health ailments/disease states (both local and national repositories). Resulting data will go into a decision support module to allow for immediate medication and/or diagnostic feedback to the care team and patient.

n  NOTE: Approximately 99% of the physicians in the Netherlands and the UK are on EMR (electronic medical records). Technically, however, the US is ahead. We have a bigger set of EMR R&D initiatives spurred on by the US Federal government.

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A.  KIL Insights and Observations: Informatics n  Clinical Informatics: cont’d.

n  Important insights from another study KIL, who is a director of clinical informatics at Partners Healthcare (Brigham's & Women’s Hospital and Harvard Medical School) include the following:

n  Healthcare Technologies Investment Outlook: Predicts 1-5 years for investment in healthcare technologies based on the US Federal government stimulus (capital infusion of $36B.) The benefits in adopting EMR and PHR is well understood.

n  Working on building a Healthcare information network (Healthcare IT) prototype which would include essential sources of data. This data would be used to create and manage a virtual database for comparative data analysis that would be leveraged for development of new devices and drugs.

n  The data from this Healthcare information network would also spur a new type of data analysis that would use large data sets to make evaluations in disease prevention, as a means of comparison. This would represent a dramatic change in how we conduct clinical research, resulting in clinical trials for drug studies becoming easier (e.g. having the ability to identify a plethora of drug side effects with demographic views of large populations will become very important).

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n  IV. Key Emerging Healthcare Ecosystems A.  KIL Insights and Observations: Informatics- cont’d. n  Clinical Informatics:

n  Continued: Important insights from another study KIL, who is a director of clinical informatics at Partners Healthcare (Brigham's & Women’s Hospital and Harvard Medical School) include the following:

n  The Healthcare information network (Healthcare IT) prototype also addresses pain management and related disease states. This technology allows them to move from an episodic care relationship to a continuous care relationship which, in turn, can be home monitored (e.g. for weight, medication dosage, diagnostics, etc.) and intervened by clinicians and/or care case managers so that they can become more proactive. Clinicians or care case managers can get a continuous read on the disease with online access enabling the survey of the patient data. This data can also help to predict certain diseases which can ultimately affect mortality.

n  Another part of this network is the public health data record repository which would include when a patient’s record is online. In turn, the sytem would have the capability to predict an outbreak of diseases, such as the flu. This information could spur proactive immunization and wellness initiatives to prevent disease with a good record of a patient’s health and to help system can keep people current to help ward off epidemics.

n  The network would also enable the patient to be much more proactive using online tools. Whether iPhone applications for exercise, or weight loss programs, this technology enables the “patient” to be much more proactive in their health care.

n  Synergy with Pharma companies. This type of system would also help to provide pharmaceutical companies with a more targeted and customized therapy for smaller populutations of patients. Pharma should move away from the blockbuster drug concept, to more personalized medications.

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Market Inhibitors

(Implications)

Key Players

Nutraceuticals (Sub: Functional Foods) * The US Functional Food Market is estimated to represented 35-50% of global sales. Together, the US and Asia-Pacific are estimated to account for approximately ¾’s of current global market for functional foods.

•  Increased focus on memory loss

• Increased focus on weight management

• Increased focus on anti-aging

• Increased focus on libido (performance enhancement)

•  Increased focus on joint health

• Increased focus on digestive health

•  Increased focus on “beauty from within”

•  Increased focus on pet food nutraceuticals and functional food

•  Boomer Effects

•  Enhanced Pet Foods

•  Food and beverage companies

•  Ingredient and formulation suppliers

•  Agricultural & biotech researchers (DuPont, Bayer Plant Science, Monsanto)

•  Retailers (Wal-Mart, Safeway, Whole Foods)

•  Wellness /Organic food movements – global

•  Personalized medicine

• Steady growth in baby food markets (e.g. Omega3; Pro & Prebiotics)

•  Disease prevention approach

•  Emerging food processing technologies

•  Premium pricing potential

•  Label legislation (simplified approval process)

•  Consumer skepticism

•  Marketing disconnect

•  Niche confusion

•  Pricing problems •  Ineffective dosage viability of nutraceuticals

•  $ value vs. preventing disease

•  Functional Foods: Nestle, PepsiCo, General Mills, Kellogg, Kraft, Danone, Unilever, Yakult. Coca Cola

•  Cargill, ADM, Danisco

•  Wal-Mart, grocery stores, Target

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A.  KIL Insights and Observations: Nutraceuticals/Functional Foods

n  Market Dynamics: Changing demographics including aging baby boomer population are helping to set the foundation for future growth. Healthcare trends, including Pharma investments and research into diseases and chronic conditions are a further source for potential market growth. In turn, inorganic growth has been largely due to acquisitions, licensing and partnership agreements.

n  Niche nutraceutical market segments include:

n  Kids (US-90% of parents find it difficult to find health products with “child-appeal”.)

n  Seniors (US-31M will turn 65 over the next 10 years, with a growing demand for condition-specific foods; half of 50-64 yr. olds are very concerned about lack of mental sharpness vs. 43% of the total population)

n Libido n  Cognitive Function n  Beauty from Within n  Energy

n  Diabetics (Worldwide: Approx. 140M -2009; projected to grow to 300M by 2025. A new generation of children suffering from type 2 diabetes will further drive functional food market opportunities.)

n  Obese (weight management: In the US, $30B a year is spent on self-care products for obesity. Satiety is currently a very strong growth section).

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A.  KIL Insights and Observations: Nutraceuticals/Functional Foods- cont’d.

n  Niche nutraceutical market segments include: - cont’d. n  Menopausal Women (US-47M women are either menopausal or pre-menopausal)

n  Athletes (Approximately 120M US adults and 30M children participate in organized sports)

n  The largest functional food (nutraceutical) categories are not considered therapeutic. Rather, they are focused on preventative or wellness-oriented products/services.

n  Focus increases on personalized medicine (e.g. genetic profiles) – future growth.

n  Function foods comprise approximately 5% of the overall US food market. Estimates for sector growth range from 8.5% to 20% per year. n  Bottom up trends:

n  Fiber n  Omega3s n  Plant Sterols n  Peptides n  Nanotechnology n  Phyto-specific

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Market Inhibitors

(Implications)

Key Players

Regenerative Medicine (Sub: Biomaterials Market)- High Growth Mkt. • The Biomaterials products had a market size of $25.5 billion in 2008, and the biomaterial device market size was $115.4 billion in the same year, and is expected to reach $252.7 billion in 2014. In the next five years, the biomaterials market is expected to grow at a CAGR of 15%. • Emerging economies such as China, India, Japan, Brazil, Russia, and Romania represent a high growth rate.

•  Bio-Medical Printing

•  Cell Therapy

•  Tissue engineering (e.g. artificial skin) • Biomaterials products include orthopedic, dental, cardiovascular, gastrointestinal, wound care, urology, plastic surgery, and others.

•  Bio-printers (e.g. “printed” human veins; sprays skin cells on burn wounds; print several drugs onto one pill; biosensors embedded into clothing)

• Reconstructive surgery and Orthobiologics are the dominant segments in orthopedic biomaterials market.

•  Sports medicine

•  Personalized healthcare •  Home-based healthcare

• Improved patient benefits form the most important factor stimulating market growth for biomaterials.

• Increase in aging population, rising awareness, shorter product approval time, and larger application area

• Improvement in fabrication technology and new product development at competitive prices • Reduced clinical trials expenses

•  On-demand •  Extended reach •  Personalized printing (e.g. customized dosages)

• Lack of tissue availability and proper reimbursement facilities are restraining the growth of the biomaterials market.

SAMPLE:

• Organovo (Open to investment) •  GSK; Univ. of Leeds, UK (collaboration) •  Wake Forest University, NC

• University Hospital Virgen de las Nieves in Granada, Spain (artificial skin research) •  Boston Scientific Corp. •  Genzyme Biosurgery

•  China (Active development)

• Harvard University

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A.  KIL Insights and Observations: Regenerative Medicine

n  Future in vascular tissue (human veins) regeneration (over next 5-6 years)

n  Biomaterials are widely used in medical devices, tissue replacement, and surface coating applications. n  Printing human tissues on demand - This was the inspiration for start-up company Organovo who built and will market, the world’s first production 3D bio-printer.

- KIL study respondent interview with Dr. Gabor Forgacs, Founder of Organovo and George H. Vineyard Distinguished Professor of Biological Physics Department of Physics, Biology and Biomedical Engineering University of Missouri Columbia - on company’s progress and technology: Organovo will start with producing, only simple tissues, such as skin, muscle and short stretches of blood vessels and these will be for research purposes. However, based on demand, the company will be productizing its 3D (inkjet) bioprinter over the next 6-8 months. However, the company expects that within approximately five years, once clinical trials are complete, the printers will produce blood vessels for use as grafts in bypass surgery. With more research it should be possible to produce bigger, more complex body parts, according to Dr. Forgacs because the machines have the ability to make branched tubes, the technology could, for example, be used to create the networks of blood vessels needed to sustain larger printed organs, like kidneys, livers and hearts. The actualization of printing larger organs could take up to 7-9 years, based on FDA approval, etc.

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A.  KIL Insights and Observations: Regenerative Medicine-cont’d.

n  Though printing organs is new, growing them from scratch on scaffolds has already been done successfully. In 2006 Anthony Atala and his colleagues at the Wake Forest Institute for Regenerative Medicine in North Carolina made new bladders for seven patients. These are still working, however, there have been some complications which haven’t been officially reported according to sources.

n  Implications:

n  On-Demand: Will require a just-in-time system (supplies, database, etc.)

n  Extended Reach: Decentralized production of supplies will result in decreased shipping and distribution time of medical goods during emergencies and access to hard to reach locations.

n  Closer to Home: Off-location bio-printing systems can store medical specs relevant to individuals, providing closer access to care.

n  Personalized Printing: Allows for customized dosages and other healthcare-based on individuals’ needs.

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Market Inhibitors

(Implications)

Key Players

Advanced Healthcare Diagnostics and Monitoring

•  Mobile health diagnostics – instant blood/saliva tests

• Home Healthcare: Home-based and remote field patient diagnostic and home monitoring

•  “Anywhere” diagnostics (mobile, home-based, field)

•  Patient monitoring devices (e.g. remote, non-invasive blood pressure monitoring, cardiac rehab, critical care and perioperative monitoring, remote field monitoring,

• Home self-diagnostics/monitoring: Blood glucose monitors and test strips, blood pressure monitor, holter monitor, heart rate meters, pneumonia, diabetes, apnea and sleep monitors, multi para diagnostic monitors and other equipment)

•  Medical Imaging (e.g. Digital mammography, Molecular imaging, imaging informatics, etc.)

• Triage, Emergency Testing in Hospitals

• Veterinary medicine (field tests, border & disease inspections)

• Aging population

•  Patient preference for portability, automation and customization • Physicians and hospitals prescribing home care to the patients to reduce huge patient inflow • Rise in number of vehicle accidents and sports injuries

• Women’s health: increased innovation in breast cancer research and diagnostic • Early detection of diseases •  Aids R&D processes

•  Delays in commercialization due to strict regulations/manufacturing difficulties inhibiting productization

•  Stability of nanoparticles inside biological tissues is important issue to be considered to reduce contamination by drugs

•  Argento (UK)-Start-up-Spin-out from UK National Physical Lab) Open to investment & licensing/supply agreements

•  (Sample): 3M Healthcare, Roche Diagnostics, J&J, Medco, Medtronic, GE Healthcare, Baxter, etc.

• Nanotechnology device companies: Abraxis BioSciences, AstraZeneca, Capsulution Nanoscience AG, Do-Coop, Elan Corporation, J.R. Nanotech, Liquidia Technologies, Company X KGaA, Novartis, Pioneer Surgical, Smith & Nephew,Star Pharma and Wyeth Pharmaceutical

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A.  KIL Insights and Observations:

n  Biocompatible implants and coatings and diagnostics comprise some of the major applications which are estimated to experience high growth between 2009 and 2014, 42% and 21.8% respectively.

n  Nanotechnology in Diagnostics and Healthcare: The role of nanotechnology in healthcare is very important in terms of managing and eradicating diseases. NOTE: Argento Diagnostics (UK) has developed a technology via a mobile device that provides instant mobile medical testing (instant blood and saliva tests in less than 10 minutes. The device uses nanotechnology to analyze the samples.

n  Web and Mobile connected devices are now able to capture an individual's health-related data and communicate that information to healthcare professionals situated, anywhere. This information allows for distributed care enabling remote diagnoses, alerting doctors to changing conditions as they occur in real-time and providing a total picture of a person’s health so that necessary care can be given.

n  Implications: Less beds, better health; Foreign expertise-Specialists can be utilized in geographically remote areas through technology/communications-enabled consultations; More relevant, accurate and real-time data of the health of populations can be gathered.

n  New Diagnostic Devices: n  Detecting potential skin cancer. A home-use, medical device made for the early detection of nodular

melanoma. n  Web-based stethoscope for remote diagnosis n  Intelligent body monitor that preemptively predicts heart failure n  Remote patient monitoring via an iPhone-mobile services that allows physicians to monitor patient

status information away from medical centers in real-time.

Advanced Healthcare Diagnostics and Monitoring

33



Market Inhibitors

(Implications)

Key Players

Virtual Reality, Simulation and AI Technology Solutions (Sub: Cognitive Neuroscience; Cognitive Testing Systems)

Treats patients with anxiety disorders •  Cognitive Disorders: PTSD (Post Traumatic Stress Disorder) •  Dyslexia, Autism, Alzheimers, Age-related cognitive Decline •  TBI (Traumatic Brain Injury) ; Worldwide 51 Million patients

•  Provides Avatar (3D) advanced medical training (surgical simulation technology)

•  Provides advanced mental health care

•  Collaborative, virtual medical environments for medical/surgical training •  • Aging with disabilities

• Virtual surgery & simulations

Development of cognitive enhancement software

• Development of therapeutic software used at home on iPhone, PDA, computer

• Mobile technology (e.g. augmented reality applications-physician training)

• Cheaper, more powerful consumer electronic devices

• More powerful computer graphics processing

Behavioral /mental/cognitive services healthcare – emerging market-driven by aging boomers, military, etc.

• PTSD (Post Traumatic Stress Disorder)-Returning war veterans, military •  Dyslexia •  Autism •  Alzheimers •  Age-related cognitive decline •  TBI (Traumatic Brain Injury) •  Growing need for MD/Nursing medical training simulation centers/programs

•  Increased military suicides

•  Increase in youth sports, recreation has spurred repeat head injuries, cumulative concussions –Opportunity in high schools

•  Reimbursement issues over advanced simulation treatments

• Business models still evolving

• Costs of equipment

•  NYU, University of Pittsburgh

• Virtual Reality Medical Center (open to investments)

•  Innovation in Learning (open to investments) (California-based) •  Sony •  Microsoft •  Virtual Game solution providers

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n  Imaging simulation and virtual reality (VR) technology: According to a study KIL who is an expert in virtual reality/simulation technology research, this technology brings to clinical care and clinical research a controlled stimulus environment of simulation which is projected to be of significant value in the future for behavioral /mental/cognitive services.

n  This technology can now build VR systems, environments that assess, rehabilitate, test and treat under a range of controlled conditions for a much lower cost of entry than in the past due to the following factors:

-Computing has gotten faster, better -Gaming industry has developed better graphics

-Can now watch videos on-line and via mobile smartphones, at greater data speeds -Now better graphic processing units in computers, smart phones

n  Can now design VR simulations that can be applied across a wide domain of clinical care solutions:

General domains - Test drug affects - Surgical simulation - Psychological research and treatment (study psychological processes,

measuring and treating them) - Cognitive neuroscience research and clinical applications - Motor or physical/occupational therapy

Virtual Reality, Simulation Technology Solutions, and Artificial Intelligence

35




n  Imaging simulation and virtual reality (VR) technology: cont’d

n  Game Simulations for Physical Therapy: Can now build simulations of physical therapy games that utilize actions in a virtual world or a game that can drive a character’s movement, such as Wii Fit. This technology puts people in digital, game-like environments to engage and motivate them to do physical therapy- after stroke or brain injuries. It can also track a patient’s body movements in space, where you can systematically control what is going on in functionally relevant environments . You can also control the stimuli present and measure performance in a more systematic fashion.

n New VR and Simulation Technology Value Proposition: Can now build AI (artificial intelligence) human characters that serve purposes in the clinical setting. Virtual avatars (characters) can become patients, letting doctors /nurses/technicians practice skills with a virtual character…e.g. adolescent that has a sexual assault..taught how to conduct a sensitive clinical interview, etc.

n  Advancements in Medical Training Technology: The development of virtual humans that have AI and enhanced graphics and animation features, are able to have almost life-like appearance and voice recognition ; the ability to mimic interaction with real people with life-like facial expressions and body gestural behavior.

Virtual Reality, Simulation Technology Solutions, and Artificial Intelligence

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Ecosystems Focus Facilitators Market Drivers (Impact) Market Inhibitors

(Implications)

Key Players

Sports Medicine (Sub: Orthopedic Soft Tissue Repair) • In 2009, the combined US sports medicine and orthopedic soft tissue repair market was valued at nearly $920M. Combined annual revenues are estimated to reach $1.6 billion by 2016.

•  Combined European market was approx. $542M in 2009.

• A majority of devices address sports-related injuries (e.g. knee and shoulder treatments.)

• Some therapies, such as reinforcement patches and cartilage repair, have applications in other fields such as small joint microsurgery and the treatment of osteoarthritis.

•  Market segments: - Splint products - Pain management drugs - Sports Nutrition (Global market: $27-32B in 2009) Supplements -Sports foods (energy drinks) and beverages - Synovial fluid replacement products - Arthroscopic equipment (visualization and powered instruments) - Surgical implants (cartilage replacement, meniscal replacement - Ligament/tendon replacement, shoulder fixation devices - Cognitive Testing Systems

•  Yearly growth in children’s participation sports (e.g. 30M)

•  Approx. 150 million adults participate in non-work related sports.

•  Growth of Baby Boomer population-market demand

• Increased demand for more out-patient surgeries

•  Increased reimbursement for sports injuries

• Varying characteristics of implants suit the needs of operative sports

• Quick healing medicines boost growth

• Continued innovation in advanced diagnostics, functional foods, orthopedic soft tissue repair

•  Growing obesity problem/Global

•  Over-inflated sports nutrition claims (e.g. fortification of Whey products; muscle building, etc.)

• Arthrex, Conmed Linvatec, Depuy Mitek, Genzyme, MTF, Fidia and Smith & Nephew lead the market, among many others (e.g. J&J, Stryker, Bayer AG, Regeneration Technologies, Cardinal Health, etc.)

• PepsiCo, Coca Cola

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n  Sports Medicine R&D Focus: The current focus of sports medicine is the continued research and development required to help reduce and prevent the number of injuries experienced, speed up recovery, while reducing the loss of efficiency and performance (Emphasis on proper training, diet, and fitness). The following procedures are some of the most cutting-edge practices being tested and researched today:

n  Using electricity to zap muscle pain has been a practice for decades, but more and more pro athletes are turning to a newer form of the treatment, Frequency Specific Microcurrent, to hasten healing. Traditional electrotherapy methods block pain in part by zapping nerves around the wounded area, but FSM actually speeds the body's healing capacity by mimicking the electrical currents that occur naturally in human cells. Terrell Owens (ankle), Donovan McNabb (chest) and Tracy McGrady (back) have all used it to recover more quickly.

n  According to researchers at Stanford, there's a new surgical alternative for tendinitis: your own blood. Scientists report that by drawing blood from a healthy part of the body, processing it to boost platelet content and injecting it into the blood-poor region of the affected elbow, doctors can kick-start healing. The result: a 93% success rate, equal to that of surgery & but without the knives.

n  To help badly broken bones heal more quickly, sports orthopedists and prominent surgeons such as Dr. James Andrews are turning to a new bone-grafting method called Infuse. Approved by the FDA for use in the tibia and spine, the process uses a naturally occurring bone-building protein called BMP that has been genetically engineered in large quantities. Its new form, rhBMP, is soaked into a bovine-collagen sponge and applied as a graft to the broken bone. The process triggers much faster healing than a conventional bone graft.

Sports Medicine

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n  Sports Medicine R&D Focus:

n  Silk is one of the strongest natural fibers on earth, and it may also be the best way to repair a blown ACL. Boston biotech firm Serica, building on research by Tufts University, has developed a procedure in which a ruptured ACL is rebuilt with a scaffolding of biodegradable silk. Serica says the surgery results in a stronger ligament than one repaired via traditional means (repurposing tendons from the patient's body). The goal: to reduce recovery time from six to three months. Human clinical trials begin this year.

n  The presence of AEDs (automated external defibrillators) on high school sidelines continues to grow. Following the deaths of four prep athletes from sudden cardiac arrest in 2006, Texas has joined Illinois, Maryland and New York in requiring all public schools to have the device on their premises. Even states without such laws are seeing a jump in the number of AEDs available to young athletes: More than half of Washington's schools now provide defibrillators

n  Immediate Post-Concussion Assessment and Cognitive Testing system (ImPACT): a computer program that measures an athlete’s memory, reaction time, and processing speed. Used to establish a player’s baseline conditions at the start of the season, then implemented if the player sustains a mild concussion. Results provide coaches and trainers with a more objective measure of whether the athlete is healthy enough to return to play. Currently being used by the NFL, NHL, and colleges throughout the nation. (opportunity for future implementation in high schools)

Sports Medicine – cont’d.

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Company X Whitespace Innovation Study – Final Report n  V. Key Whitespace Opportunities

Whitespace Focus/Opportunities Facilitators

Wellness

•  Prevention before cure •  Early diagnosis & treatments •  Wellness lifestyle (holistic health, well being) •  Wellness one-stop shops •  Customized products (nutraceuticals, functional foods, age-related, etc.) •  Alternative health services

•  Smart phones (iPhone, Droid) •  iPads, others •  Clinical Informatics •  Telemedicine, Telehealth •  mHealth, eHealth •  Advanced diagnostics

Personalized /Self-managed Healthcare (e.g. home-based)

•  Disease detection (cancer, diabetes, hypertension) •  Home-based, self-managed healthcare (medical devices that can predict skin cancer; diabetes, pain management, etc.)

•  Personalized medications •  Growing aging population (Global)

•  Telemedicine •  Remote patient monitoring •  Smart phones (iPhone, Droid) •  iPads, others •  Health 2.0 •  Social media (networks, online communities) •  Device/Drug Identification

Cyberdocs •  Virtual provider care (via Internet, mobile devices, telehealth) •  Medical Informatics – Decision Support

• Telemedicine •  Remote patient monitoring •  Smart phones (iPhone, Droid) •  iPads, others

Smarter, On-Demand Drugs

•  Non-invasive delivery •  Genetic/personalized drugs •  Enhanced nutraceuticals (e.g. foods, beverages)-for increased memory, productivity, physical performance, anti-aging, etc.) •  Pills On Demand •  Pill Alerts (let’s doctor/family know when pill has been ingested)

•  Functional foods •  Bio-medical materials (bio-medical printing, customized dosages, remote delivery, just-in-time delivery) •  EMR •  Device/Drug identification •  Smart “pills” – Remote Diagnostics

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Company X Whitespace Innovation Study – Final Report n  V. Key Whitespace Opportunities (cont’d.)


Virtual Hospitals •  Medical tourism

•  Health Information Exchanges (at local, state and federal and global levels). Virtual hospital connectivity

•  Telemedicine, Telesurgery, Teleradiology, Telenursing

•  Virtual surgery and simulations

•  Health 2.0 •  Health Information Systems •  Health Information Exchanges •  EMR, PHR • Telemedicine •  Remote patient monitoring •  Smart phones (iPhone, Droid) •  iPads, others • High quality computer graphics/graphics boards •  Faster data/wireless data networks (4G+) •  Expanded fiber optics networks (Verizon, Nextel-Sprint)

Advanced Diagnostics

•  Mobile health diagnostics – instant blood/saliva tests (e.g. Argento)

•  Disease and pain management devices continued innovation and deployment into home

•  Instant mobile diagnostic testing device innovations

•  Patient-centric healthcare becoming more prevalent •  Advanced diagnostic screening using next generation imaging technologies

• Health 2.0 •  Health Information Systems •  Health Information Exchanges •  EMR, PHR • Telemedicine •  Remote patient monitoring •  Smart phones (iPhone, Droid) •  iPads, others

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Cognitive/Training/Wellness Services (Home and mobile device-based) (Personalized, numerous market niches)

• Medical training simulation training centers and mobile applications (e.g. augmented reality, virtual reality simulation technology)

•  “Therapist in a Pocket” via mobile applications (e.g. mood maps on user cell phones, therapeutic exercises via mobile app, progressive muscle relaxation techniques via phone, etc.)

•  Boomer effect (loss of memory, cognitive prowess)

•  Competitive gaming software with cognitive enhancement software tools – Helps to improve cognitive functions (Can be designed to be modular – for babies, children, teenagers, adults, aging, corporate, military, medical) 2-3 year development?

•  Advanced MRI (MRI-based diffusion weighted imaging techniques) to analyze nerve axonal injuries at the millimeter level

•  Personalized medicine/healthcare

• 4G Smartphones •  Web 2.0 •  iPad •  Computer •  Virtual reality (simulation) technology (advanced) •  Home electronic devices

• NYU Medical Center, Clinical Neurology – Developing cognitive enhancement software tools

•  University of Pittsburgh-Cognitive Program Center, Brain Imaging research/development

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Clinical Informatics (Sub: Personalized healthcare)

•  Treatment plans for each patient •  Parallel providers working as a team •  Chemical care paths for patient decision support • Excellent potential for mining EMR for advanced decision support solutions

•  Health 2.0 •  Health IT (middleware) •  Health Information Exchanges •  EMR, PHR • Telemedicine •  Remote patient monitoring •  Smart phones (iPhone, Droid) •  iPads, others

mHealth (Mobile) •  Smart tools, wearables and applications being developed around the world to address health issues, maintenance, diagnostics, patient health data

•  Mobile Video (assists with home visits, medical training, medical consultations, etc.)

• Remote patient monitoring •  Smart phones (iPhone, Droid) • 4G smartphones w/televideo features = 4G iPhone •  iPads, others •  Health 2.0 •  SMS, MMS (text and multi-media instant messaging)

Remote Pharmacy Portals (Sub: mHealth)

•  Allows physicians to access info and complete medication orders from anywhere

• Bio informatics- Drug Delivery (computer models that predict drug interactions-cuts down amount of time in clinical trials and drug discovery/R&D costs efficiencies)

• Health 2.0 •  Health IT (middleware) •  Health Information Exchanges •  EMR, PHR • Telemedicine •  Remote patient monitoring •  Smart phones (iPhone, Droid) •  iPads, others

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Smart Healthcare Solutions /Disease Management

•  Web-based EHR (Electronic Health Record) solutions

•  Online medical condition and chronic disease management solutions

•  Secure Web technologies to allow cross-sector sharing of relevant clinical data by multidisciplinary teams

• Software that will allow pharmacists to log all adverse reactions that patients report to them/ The data will be collated at a central repository where it can be analyzed to identify problematic scenarios. NOTE: This new computer program has been developed by the University of Tasmania (Australia) to monitor adverse reactions to prescription medication has the potential to save the health system nearly a billion dollars.

•  Telemedicine •  Remote patient monitoring •  Smart phones (iPhone, Droid) •  iPads, others •  Health 2.0 •  Health Information Systems •  Health Information Exchanges •  EMR, PHR

E-Health/Health 2.0 (Health 2.0 will have the biggest impact when the combination of tools, content, and community changes health behavior.)

•  SMS (mobile text databases) – can text “pill codes” and specially tagged medicine barcodes numbers to receive object info in native tongue. Goal: to help provide easy access to vita health data, dosage info, symptom assessments, pharmacy drug orders, age recommendations, etc.

• New virtual/business intelligence tools for employers, doctor’s offices and patient communities

• Telemedicine •  Remote patient monitoring •  Smart phones (iPhone, Droid) •  iPads, others •  Health 2.0 •  Health Information Systems •  Health Information Exchanges •  EMR, PHR

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Whitespace • Focus/Opportunities Facilitators

Medical Imaging, Imaging Informatics, Diagnostics (Imaging Informatics, aka Radiology Informatics or Medical Imaging Informatics, is a subspecialty of Biomedical Informatics that aims to improve the efficiency, accuracy, usability and reliability of medical imaging services within the healthcare enterprise. It is devoted to the study of how information within medical images is retrieved, analyzed, enhanced, and exchanged throughout the medical enterprise.

FUTURE DIRECTIONS: Molecular imaging & diagnostics; Medical imaging informatics; Networked Medical imaging and virtual reality

• Molecular imaging/Molecular Probes: One of the most rapidly evolving areas of medical imaging. Has applications in drug R&D and clinical diagnostics. Molecular imaging can be used to determine drug biochemistry & pharmacology in situ (confined to its site of origin and has not invaded neighboring tissue or gone elsewhere in the body) and enable researchers to predict toxicology issues and provide information on the metabolism and action of a drug. In the clinical setting, molecular imaging probes may be used as surrogate endpoints to assess new treatments or monitor the effect of therapy for a variety of diseased states, leading to developmental cost-savings through the rapid accumulation of clinical evidence to support drug approval and usage.

•  Virtual Surgery & Simulations: Via Human Computer Interaction (HIC) can help to plan/prepare for an operation, saving time and improving patient safety.

•  Imaging Informatics: Exists at the intersection of several broad fields: Computer science, Bio & Information science, cognitive science, bio engineering and medical physics. Also includes: Data mining from medical image databases; PACS and component systems; workflow, Business Intelligence, EMR, etc.

•  SPECT-CT & PET-CT hybrids Spectral CT High field MRI

•  Novel imaging agents CT imaging agents MRI imaging agents Ultrasound imaging agents PET & SPECT imaging agents, real-time, whole animal imaging,

•  Computed tomography Magnetic resonance imaging

• Key Players: GE Healthcare, Hitachi Medical Corp., Philips Medical Systems/Healthcare, Siemens Healthcare, Toshiba, Hologic

• US market (biggest market for diagnostic imaging) NOTE: Even with factors such as cuts in physician fees for services by Medicare, and declining reimbursement levels, the US is still expected to lead the global market.

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Regenerative Medicine (Sub: Bio-Medical Printing Materials)

• Building on advances in physical and 3D printing technologies, artificial constructions of biomedical materials are becoming a reality. Developments that allow for rapid printing of medicines, artificial prosthetics and human tissue point toward future access to medical support any-where and on demand.

• Opportunity: Personalized dosage printing – Allows for customized dosages and other healthcare delivery based on an individual’s needs.

• Opportunity: Extended reach – Decentralized production of medical supplies, enhanced supply chain shipping/distribution, access to hard-to-reach locations

• Opportunity: “Pill on Demand”- There could be a better way for medicating complex formulations (especially for the elderly), namely a "pill on demand" system that combines macroscopically normalized powders with a "base" material, and cranks out pills on demand, in any combo-formulation required. This would be an enormous step forward for the pharmacists and doctors who could deliver drugs more uniformly (especially for the elderly) over the day.... where the active dose per day is custom-divided into the pill-size - and could even accommodate missing doses, or tardy administration through slightly upgraded formulary.

• Opportunity: Digital gastronomy – Stores favorite ingredients and food components and allows them to print food using ink jet-like nozzles.

•  3D Bio printers (e.g. can create new blood vessels, etc.-e.g. Organovo (open to investments) 2-3 year investment

•  Bio printers that can spray skin cells onto wounds (Wake Forest University, NC)

•  Bio printers than can print “personalized” pills (University of Leeds, UK and GSK)

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Home-based Healthcare Market

• Demographic shifts in the healthcare market, along with other factors in the sector include technological developments – for example wireless home monitoring – and economic trends such as the rising cost of institutional care will drive the growth of the home healthcare (personalized healthcare) market. There is also a growing receptivity to home healthcare among physicians and private and public insurers

• The value of the global market for home medical equipment is expected to be $17.7bn in 2010, according to US-based market research. The market forecasted to increase to nearly $23.8bn in 2015, at a compound annual growth rate of 6.1% over the five-year period.

• The largest segment of the market is made up of monitors, sensors, and telemetry devices. This is projected to increase at 7% per annum, rising to $11.3bn in 2015, after being valued at nearly $8.1bn in 2010.

• The second largest segment, assistive devices, is estimated at $5.3 billion in 2010, and is expected to increase at 1.7% per annum to reach more than $5.8bn in 2015.

• The segment made up of therapeutic devices is expected to reach nearly $6.7bn in 2015, after rising at 9.3% per annum from its 2010 value of nearly $4.3bn. • Targeted Therapeutics – Genetic/personalized medicine – will have a broad impact on health and wellness

•  Advanced, mobile diagnostics

•  Advanced mobile disease monitoring devices

•  Home-based diagnostics/monitoring device innovation –integrated with pharmacists/doctors who reviewed reports. (Kaiser Permanente, CO-trialing easy home-based monitoring devices)

• IPads, IPhones, Smartphones, Computers

• Wii Fit, wellness game software

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Telehealth/Telemedicine/Telesurgery/Telenursing/Teleradiology Global Perspective: The fastest growing areas in Telemedicine/Telehealth have been in South America. Brazil, Argentina and Chile have many programs running right now and have many different ways to fund these programs. The government is also involved in majority of those programs. Some projects in Colombia are funded by the government, but most are funded through grants from Europe and Canada. India and China also very active in telehealth/telemedicine services, technologies, etc.

•  Telemedicine will be the enabling technology for an entire new generation of walk-in clinics. In the foreseeable future, immediate access to world-class experts could also become commonplace. •  Two are the main telemedicine market segments : Doctor to Doctors and Doctors to Patient •  Doctor-to-doctor / Second Opinion or hospital to doctors are those applications targeting opinion sharing between specialist or centre of excellence to make decisions on diagnosis or for continuous medical education purposes. ( Second Opinion between doctors / hospitals, mainly data exchange and consultancy between experts, essential to make medical decisions in real time to address diagnoses issues with the aid of remote medical experts consultations with the advantage to allow doctors to compare their opinions and clear any doubts essential in remote areas, lacking of specialist doctors ) • Doctor-to-patient / Home care that is to say doctor visiting patients for routing health control, psychological support or homecare monitoring of vital parameters, as it is the case for early hospital discharge or chronic illness patients (allows patients to benefit from medical visits in their own home, without having to stay long time in a hospital for post surgery control or for chronicle illness. Well applied when daily or periodic medical control are requested for health care, monitor parameters such as blood pressure, temperature, heart beat and frequency, oxygen saturation, ECG, etc.)

•  Teleconference technology •  4G IPhones

•  Large, Global initiatives

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Company X Whitespace Innovation Study – Final Report n  VI. Global Healthcare Trends and Timelines

q  Major Trends and Timeline (2010-2014, 2015, 2020)

Major Trend 2010-2014 2015 2020

• Power Patients •  Patient access to healthcare records •  Patient social networks

•  Patient-centered, multi-provider team care •  Baby Boomer retirement

•  Patients totally connected to healthcare providers – virtually and on a global basis

• Consumer Patients •  Earlier retirement •  Health 2.0

•  Implementation of Health IT •  Physicians using technology •  Customized products

•  Total Home-based, virtual healthcare

• Prevention before Cure

•  Earlier treatments •  Wellness treatments

•  Implementation of Health IT • Decision Support Solution Advancements

•  Pre- symptomatic diagnostics

• Personalized Medicine and Healthcare

•  Genetic testing •  Targeted clinical trials •  Advanced diagnostics •  Bio-medical printing

•  Major diseases understood at molecular level treatment •  Bio-medical printing advancements •  Nanotechnology advancements •  Virtual reality/simulation technology advancements and related solutions

•  Pre- symptomatic diagnostics •  Bio-medical materials advancements •  Nanotechnology advancements •  Virtual reality/simulation technology advancements and environments

• Smarter Drugs •  Non-invasive delivery •  Bio-medical printing •  Smart pills

•  Non-invasive delivery •  Bio-medical printing advancements •  Smart Pills - advanced

•  Drug cocktails that will enhance productivity, memory & physical performance

• Virtual Hospitals •  Hospital to Hospital connectivity (EMR) •  US Federal Healthcare reform stimulus funds (Health IT)

•  Virtual medical communities (growing demand for EMR-global) •  Hosted (cloud computing) Informatics

•  Global hospital to hospital connectivity (hosted informatics)

• Virtual reality (simulation) hospitals – global scope

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Major Trend 2010-2014 2015 2020

• Regenerative Medicine

•  Early stages of Bio-medical printing (tissues, wound treatments, pills, etc.)

• Bio-medical printing (pills) –increased innovation and development advancements

• Continued innovation and development advancements of 3-D bio-medical printing of tissues/veins

• Bio-medical printing (organs/tissues) – major advancements – personalized medicine-genetic

• Advanced nanotechnology regenerative medicine innovation

• Nutraceuticals •  Baby Boomer retirement •  Health 2.0 •  Increased focus on weight management • Increased focus on anti-aging • Increased focus on libido (performance enhancement) •  Increased focus on joint health • Increased focus on digestive health •  Increased focus on “beauty from within” •  Increased focus on pet food nutraceuticals/functional food

•  Focus on personalized medicine • Implementation of Health IT •  Physicians using technology •  Customized products •  Cognitive function technology – advanced •  Mood food advancements and demand •  Continued focus on joint health •  Advancements in mood and energy nutrients •  Advancements in digestive health nutrients • Increased focus on pet food nutraceuticals/functional food •  Increased focus on disease prevention

•  Sophisticated food processing/formulation technologies

•  Major nanotechnology advancements in nutraceuticals

• Continued focus and advancements in personalized medicine (genetic tailoring)

• More specialized variations of nutraceuticals (genetic tailoring)

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Major Trend 2010-2014 2015 2020

• Sports Medicine •  Continued research and development in devices to help reduce and prevent number of sports-related injuries – and to speed up recovery

•  New surgical alternatives becoming more prevalent

•  Advancements in bone grafting techniques

•  Advancements in cognitive treatments and related devices

• Advancements in pain management medications, devices, etc.

•  Advanced post-cognitive testing systems

•  Advanced wearable sensors for detection of concussions, etc

•  Timed-medications (nanomedicine) for pain management, etc.

• Advanced Diagnostics

•  Disease and pain management devices continued innovation and deployment into home

•  Instant mobile diagnostic testing device innovations

•  Patient-centric healthcare becoming more prevalent

•  Remote patient self-monitoring

• Continued patient-centric healthcare becoming more prevalent • Increased patient medical record connectivity with doctor, hospital

• Advancements in pre- symptomatic diagnostics

• Total Home-based, virtual healthcare (fully connected with healthcare providers – physicians, hospitals, pharmacies, etc.) •  Large embedded installed base of diagnostic devices in the home and remote areas

• Virtual medical diagnostics network – global scope

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Major Trend 2010-2014 2015 2020

• Cyber Docs •  Virtual patient-doctor relationship

•  Decision support – predictive personalized diagnostics

•  Total healthcare services provided by virtual, multi-provider teams

•  Digital Health •  Market of consumer-based health and wellness innovations steadily converge with technology and healthcare

•  A plethora of steadily advancing medical diagnostic and health maintenance devices will hit the market – for hospitals and the home (e.g. robotic prosthetics, telemedicine, remote monitoring devices, mobile health applications, etc.)

•  Wide-spread connectivity of patient’s health records

•  Seamless healthcare services provided virtually

• Robotic medical doctors

•  Virtual hospitals

• Hosted Informatics or Cloud Sourcing

•  IT cloud services will form 25% of all incremental global IT spending by 2012

• Pharma will continue to outsource its globally dispersed, multi-disciplinary, virtual teams via hosted solutions in the IT cloud.

• Increased potential for Pharma to provide a hosted informatics SaaS (software as a service)

• Cloud computing technology advancements continue to strengthen and provide more lucrative business models for hosted informatics SasS

• On-demand information and collaborations continue to spearhead major cost R&D efficiencies for Pharma

•  Virtual, electronic labs provide accelerated drug technology (nano) innovations and deployments

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Company X Whitespace Innovation Study – Final Report n  VII. Recommendations (3-5 yr. ROI Estimate)

n  Adjacent Market/s Potential

n  Recommendations

FOCUS: #1 -Home-based, self-managed healthcare (Patient-centric)

n Recommend Company X consider a multi-faceted- consumer-directed - medical device and related hosted data services market play, geared toward the home-based, self-managed healthcare market.

n  Varied acquisitions, partnerships and/or collaborations could leverage Company X’s core competencies (see adjacent markets potential)

n  New role for Big Pharma as “integrator” to generate value and brand awareness across the entire healthcare and/or disease and/or niche demographic (e.g. kids, teens, elderly, etc.) spectrum

n  CHALLENGES: Short-term ROI; data integration; partnership/acquisition potential

n  Medical devices n  EMR Solutions/Services

n  Cognitive services/drugs/solutions n  Radio frequency identification (RFID) Solutions for Healthcare

n  Drivers

n  Personalized healthcare market growing n  Consumer electronics prices going down (e.g. smart phones, video devices, better graphic processing units, etc.) n  Increased computer power; emerging device connectivity; middleware solutions n  Increase communications bandwidth (4G networks and growing) n  Changing healthcare service paradigm that will be geared more toward home-based consultations, disease and health maintenance n  Aging populations (global) n  Global Markets, including remote populations (India, China) n  Advancements in cognitive services potential (e.g. mobile, home-based applications, medical devices, smart drugs, advanced simulation technology, etc.)

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FOCUS: Sports Medicine n Recommend Company X consider a multi-faceted - consumer-directed – sports medicine market play, with a phased-niche (energy-teens, athletes, Boomers, women, etc.) strategy approach. NOTE: Niche markets also include sports pain management medications, devices, diagnostics, orthopedic soft tissue repair, etc.)

n  Varied acquisitions, partnerships and/or collaborations could leverage Company X’s core competencies

n  New role for Big Pharma as “integrator” to generate value and brand awareness across the entire healthcare and/or disease and/or niche demographic (e.g. kids, teens, elderly, etc.) spectrum

n  CHALLENGES: Partnership/acquisition potential

§  Orthopedic tissue repair; advanced/remote diagnostics; nutraceuticals/functional foods; orthopedic devices

n  Drivers

• Yearly growth in children’s participation sports (e.g. 30M)

•  Approx. 150 million adults participate in non-work related sports.

•  Growth of Baby Boomer population-market demand

• Increased demand for more out-patient surgeries

•  Increased reimbursement for sports injuries

• Varying characteristics of implants suit the needs of operative sports

• Quick healing medicines boost growth

• Continued innovation in advanced diagnostics, functional foods, orthopedic soft tissue repair

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FOCUS: Digital Imaging, Medical Imaging (diagnostics, molecular imaging), Imaging Informatics NOTE: Imaging informatics, aka Radiology Informatics or Medical Imaging Informatics- which is a subspecialty of Biomedical Informatics (devoted to the study of how information within medical images is retrieved, analyzed, enhanced and exchanged through the medical enterprise. Subsets: Molecular Imaging/Probes and Diagnostics; Virtual Surgery & Simulations

n  Virtual Reality/Simulation Technology n  Advanced Diagnostic Imaging Technology n  Health IT/Informatics (EMR) n  Teleradiology

n  Drivers

n  Medical Imaging Market: The aging population, urbanization, growing chronic diseases, government stimulus plans and economic recovery in emerging markets are few key factors which are driving the industry growth. n  Market Analyst Projections: The medical imaging market earned revenues of $5.73 billion in 2009 and is estimated to reach $6.55 billion in 2012, as the market is expected to bounce back from declining reimbursements and effects of the economic downturn. NOTE: Pacific Asian countries are expected to remain economically unaffected due to the “demand for healthcare along with increasing ability of the patient population to spend on improved health services in these regions

n  VII. Recommendations (3-5 yr. ROI Estimate)

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FOCUS: Health IT: Middleware; Middleware for the Elderly (incl. Ambient Intelligence) (e.g. Elderly Smart Spaces, Unobtrusive sensors, long-term monitoring, elderly, smart spaces, telemedicine, assistive systems, personalization. Examples: The PERSONA (Perceptive Spaces Promoting Independent Aging) project geared toward developing a scalable, open platform for building a broad range of ambient assisted living solutions- Norway: www.aal-persona.org Potential Ambient Intelligence Middleware Market Segments/Niches n  People with disabilities; Pre and post operative care at home; Patients with muscular dystrophy (apnea) or sleep apnea; Pregnancy at risk; Patients in prison facilities; drug rehab programs; Chronic pain management (home-based)

n  RFID Healthcare solutions n  Health IT Middleware solutions, including Middleware solutions for the Elderly n  Telemedicine n  Advanced, remote diagnostic devices

n  Drivers

n  Increased development in so-called ambient technologies that sense and respond to the presence of people. There are user interfaces that can read gestures, facial expressions, or that can be controlled by eye movements. The flexibility in the architecture means that all of them can be integrated with the Universal Control Hub.

n  A growing amount of medical and monitoring wireless devices are being incorporated to residential and healthcare environments, as hospital or elderly residences

n  Europe now has both the highest proportion of, and the greatest increase in, elderly citizens of any major world area. This is leading to an increase in the number of people with impairments, disabilities or chronic illnesses.

n Continued innovation of enterprise, systems/data integration engines/architectures, including data mining, business intelligence, EMR, transaction engines, clearinghouse services/analytics and device interconnectivity.

Presentations & Public Speaking

Whitespace innovation study healthcare ecosystems