Fitbit Ionic smartwatch
Fitbit plans to amplify its smartwatch portfolio and leverage de-identified health data generated from its devices to get FDA clearance on digital health tools. Those were some of the plans highlighted by the fitness wearables business on its call with analysts to review fourth-quarter earnings.
The company is also fresh from a significant acquisition earlier this month. The Twine Health deal is a move that the company hopes will align the business and its customers closer to healthcare providers. Fitbit cofounder and CEO James Park noted on the call that the company’s chronic condition management tools will be rapidly integrated and available to its customer base.
Although revenues were $1.6 billion for 2017, Fitbit experienced net losses of more than $277 million, an increase over the $102 million in losses from 2016. CFO Bill Zerella said the disappointing results were partly due to a product lineup that skewed towards connected health and fitness trackers rather than smartwatches. Sales were also impacted by a more aggressive promotional environment, he said. Fitbit cofounder and CEO James Park and Zerella noted that the launch of Fitbit’s operating system will help it to scale future smartwatch products more quickly and improve the user experience.
Leveraging aggregated data The company’s status as a leader in fitness wearables and smartwatches has also helped it amass a considerable trove of de-identified fitness data. For example, Fitbit claims to have 105 billion hours of heart rate data, 6 billion nights of sleep and 200 billion minutes of exercise tracked. “We do believe if there was a compelling value proposition people would be more willing to share data,” Park said, although he emphasized that the company only uses de-identified data. Touching on the company’s work with the FDA and its participation in the digital health pre-certification pilot program, Park said the company plans to submit digital health tools centered on Afibrilliation and sleep apnea detection for clearance this year.
More smartwatches coming Park said on the call that the company plans to bring “a family of smartwatches” into the market. That move would tie into Fitbit’s belief that the company’s sales will shift to smartwatches as it has more products to sell. Park also expects the line between wearables and smartwatches to continue to blur.
The business model in healthcare Park and Zerella noted that some of its healthcare deals in the past year were based on a revenue model of per member, per month, such as Blue Cross Blue Shield of South Carolina and UnitedHealthcare-Dexcom. It also expects to have a recurring revenue model from its Twine Health deal.
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
With a nod to its Twin health acquisition, Park noted that “technology has advanced to the point where it can help clinicians deliver more personalized care.
