Apple building expertise in medical technology

Apple Inc is building a team of senior medical technology executives, raising hackles in the biotechnology community and offering a hint of what the iPhone maker may be planning for its widely expected iWatch and other wearable technology.

Over the past year, Apple has snapped up at least half a dozen prominent experts in biomedicine, according to LinkedIn profile changes. One prominent researcher moved two weeks ago, and Apple is recruiting other medical professionals and hardware experts, although the number of hires is not clear, said two people familiar with the hiring, who declined to be named.

Much of the hiring is in sensor technology, an area CEOTim Cook singled out last year as primed "to explode." Industry insiders say the moves telegraph a vision of monitoring everything from blood-sugar levels to nutrition, beyond the fitness-oriented devices now on the market.

"This is a very specific play in the bio-sensing space," said Malay Gandhi, chief strategy officer at Rock Health, a San Francisco venture capital firm that has backed prominent wearable-tech startups, such as Augmedix and Spire. He was aware of several of the moves.

New product categories

Apple is under pressure to deliver on Cook's promise of new product categories this year. The company has not introduced a new type of product since the iPad in 2010, a fact that weighs on investors' minds: its stock remains well off its highs despite a series of buybacks and dividend payouts.

Investor Carl Icahn tweeted his approval of Apple quarterly results and buyback plans on April 23. "Believe we'll also be happy when we see new products," he added.

Apple has registered the trademark "iWatch" in Japan. Several Apple patents point to wrist-worn devices, and in February, Apple filed a patent for a smart earbud patent that could track steps and detect gestures of the head.

One mobile health executive, who asked not to be named, told Reuters he recently sat down with an Apple executive from the iWatch team. He said the company has aspirations beyond wearable devices, and is considering a full health and fitness services platform modelled on its apps store.

Apple spokesperson Steve Dowling declined to comment on the company's health-tech plans or its recent hires.

Apps for medical use

The med-tech community is betting on Apple to develop the apps-store style platform so startups can develop their own software and hardware mobile medical applications.

"There's no doubt that Apple is sniffing around this area," said Ted Driscoll, a Silicon Valley-based partner at Claremont Creek Ventures, which specializes in digital health and medical devices. He said Apple seemed primarily focused on recruiting engineers with experience in "monitoring the body's perimeters."

Apple has poached biomedical engineers from companies including Vital Connect, Masimo Corp, Sano Intelligence and O2 MedTech.

Masimo is best known for its pulse oximetry device, which non-invasively measures patients' oxygen saturation, an indicator of respiratory function. Vital Connect focuses on tracking vitals like heart rate and body temperature. O2 Med Tech also is experimenting with biosensors and developing new devices.

A LinkedIn search shows Masimo chief medical officer Michael O'Reilly; Cercacor chief technology officer Marcelo Lamego; and Vital Connect's Ravi Narasimhan, vice president of biosensor technology, and Nima Ferdosi, an embedded sensors expert, are among those who have moved over to the Cupertino company.

Sensor technology

One source said Alexander Chan, a former biomedical engineer at Vital Connect, has also defected. His LinkedIn profile states he now works at a "technology company."

Apple has also hired hardware experts Nancy Dougherty, formerly of wearable sensor company Sano Intelligence, and Todd Whitehurst, vice president of product at Senseonics Inc, a glucose monitoring product, according to their LinkedIn profiles.

And most recently, Divya Nag, founder of StartX Med, a Stanford-affiliated startup accelerator, joined an Apple research and development team two weeks ago to focus on an unspecified healthcare product, two people familiar with the matter say. Nag did not respond to requests for comment.

Attempts to contact the people on LinkedIn were not successful, except for Ferdosi, who declined to comment. Sano and Vital Connect declined to comment, Masimo and Cercacor confirmed the departures, Senseonics did not return an email requesting comment and O2 MedTech could not be reached.

Singularity University's Daniel Kraft, who chairs the FutureMed program that explores developing technologies and their potential in biomedicine, said the first version of the iWatch might track blood pressure and heart rate, among other vitals.

Eventually he expects Apple to release a device that could continuously monitor glucose levels without requiring a blood draw.

"Some of the talent (Apple recruited) has access to deep wells of trade secrets and information," said Joe Kiani, chief executive officer of medical device firm Masimo Corp, who lost his chief medical officer to Apple in mid-2013.

'Just buying people'

Kiani said that Apple was offering sizeable salaries with little indication of what researchers would be doing. "They are just buying people," he said. "I just hope Apple is not doing what we're doing."

Apple may face regulatory hurdles if it aims for devices which do more than monitor fitness. In January, the New York Times reported that Apple executives, including O'Reilly, met with senior officials at the Food and Drug Administration, including Bakul Patel, who drafted the FDA's final guidance for mobile health.

In fall of 2013, the FDA announced that it would focus on regulating applications that attempt to turn a smartphone into a medical device, or that are intended to be used as an accessory to a regulated medical device. That might include apps and attachments to measure lung function or analyze urine, for instance, but not devices such as Nike's FuelBand, which tracks your steps but does not offer medical recommendations.

Apple also has witnessed rivals trying, and failing, to produce devices that reach a mass market. Samsung's Galaxy Gear smartwatch was panned by critics and consumer reviews have been tepid at best.

A report from Endeavour Partners found that one-third of American consumers who have owned a wearable ditched it within six months. Key challenges include battery life, style, usefulness, and medical relevance, it said. And this month, Nike confirmed to Re/code that it had laid off some of its FuelBand team.

Meanwhile, Google is taking a different approach. In March, it pre-empted Apple by unveiling Android Wear, a version of its Android software tailored for wearable devices. Like Apple, it's shown interest in medical technology: it is exploring contact lenses that can monitor glucose levels in tears.