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by EOS Intelligence EOS Intelligence No Comments

Pet Wearables – Are Companies Barking Up the Right Technology?

As the human wearables market begins to mature, a lot of interest and developments are also happening in the pet wearables space. An increasing number of pet owners becoming more technologically savvy has fueled product innovations in this segment, which traditionally was limited to GPS tracking. While location tracking continues to be the largest piece of the pie, other solutions, such as health monitoring devices, have been gaining prominence. However, this segment is still in its infancy and is toying with several technologies, such as biometrics, radar, and acoustic technology, to develop functional, accurate, and price-effective devices.

The last decade has witnessed exponential growth and advancements in human wearables. However, recent years have also seen the trend of wearables permeating the pet market. With upcoming technological advancements, the industry is expected to witness double-digit growth over the next six years and expand into new territories.


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ID tracking is the largest category, health monitoring is growing the fastest

The pet wearables market is primarily bifurcated into four applications: ID tracking, behavior control, safety, and health monitoring. At the moment, the largest category within the market is ID tracking solutions, which comprise GPS—and RFID-based trackers that help identify and locate pets. One of the leading players in this space is US-based Tractive, which provides a GPS collar that allows pet owners to know the exact location of their pets at all times.

The fastest-growing category is health monitoring. This segment encompasses devices that monitor a pet’s vitals and general health and raise an alarm in case of any irregularities. Growing pet obesity cases have resulted in pet owners choosing health monitoring devices for their pets. A popular product in this space is the PetPace Smart Collar by US-based pet wearable company, PetPace, which tracks physiological metrics such as pulse, respiration, temperature, heart rate variability (HRV), activity level, and posture. Along with GPS tracking and emergency alerts, it helps in early symptom detection and disease management.

The behavior control segment, which is still relatively small, covers products that help teach pets appropriate behavior, such as bark collars, which deter dogs from barking continuously. An innovative and popular product in this category includes the PetSafe Treat & Train Remote Reward Dog Trainer by US-based pet-tech company PetSafe. The product allows pet owners to dispense treats remotely through an electronic trainer to induce calm behavior in case of distracting situations, as well as allows owners to reward their pets in case of good behavior.

The smallest category is safety, which is largely an extension of ID tracking and comprises pet cameras that capture a pet’s movement. Mr. Petcam is a US-based company that provides collar-mounted HD video cameras for dogs or cats, allowing pet owners to see what their pets see in the yard, at home, or during walks.

Pet Wearables – Are Companies Barking up the Right Technology by EOS Intelligence

Pet Wearables – Are Companies Barking Up the Right Technology? by EOS Intelligence

The industry is undergoing both organic and inorganic growth

Pet adoption increased significantly during the COVID-19 pandemic as people were confined to their homes and lacked social and emotional connection. As per the American Society for the Prevention of Cruelty to Animals, one in five Americans purchased or adopted a pet during COVID-19.

Many of these pet owners are adept in technology and spend vast sums of money on their pets. As pets are increasingly considered family members and with growing concerns for their health and well-being, pet wearables are experiencing a surge in popularity. The success of wearable technology for humans further fuels this trend. Moreover, increasing costs of veterinary services and treatments have propelled pet owners to invest in health and prevention-based wearables. Therefore, the industry is expected to grow significantly, especially in Europe and North America, in the coming years.

However, that being said, the industry is in its nascence and is highly fragmented at the moment. There is a large number of players fueled by several start-ups and new entrants. The industry is seeing a surge in acquisitions as players in the pet care and tech space are looking to expand their offerings to include pet wearables. Moreover, growing interest from venture capital firms is also resulting in large investments in companies showing promise in this space.

One of the leading players in the pet market, Mars Petcare, launched Companion Fund in 2018 and Companion Fund II in October 2023. The US$100 million and US$300 million venture capital funds, respectively, have been created to invest in start-ups in the pet care space, including pet wearables. Earlier, in 2016, Mars Petcare acquired the Whistle pet monitor and GPS tracker, similar to a Fitbit for dogs, for about US$117 million. This provided Mars Petcare an entry into the pet wearables space.

Several other players in the technology space have also acquired companies to expand their business to cover pet wearables. In 2019, Florida-based IoT company Smart Tracking Technologies acquired Link AKC for an undisclosed amount. This wearable pet technology company developed GPS-enabled dog collars and won the Best Innovation award at CES 2017 in the wearable technology category.

In April 2023, Ultrack, a leading global GPS tracking solutions provider, signed a contractual agreement to acquire and market Supreme Product’s wearable GPS-based Pet Tracker. The device is expected to have multiple features, such as health monitoring, behavior modification, predictive analytics, social media integration, and virtual fences.

Similarly, in May 2023, Datamars, a global data solutions company, acquired Kippy, an Italy-based GPS tracking and activity monitoring solution provider. Kippy collar’s main features include GPS tracking, customized activity monitoring and analysis, reminders and access to vet records, temperature alerts, tone and vibration training controls, a built-in flashlight, and the ability to create safe places for the pet.

While several companies are adopting the inorganic growth strategy, there is also a lot of venture capital interest, especially in ID tracking, which is the largest product category and acts as an entry point device for many customers in the pet wearables space. In 2021, Austria-based leading pet tracking company Tractive raised US$35 million Series A round (led by Guidepost Growth Equity) to expand its offerings in the USA. Similarly, in 2021, Fi, a US-based pet wearable start-up, received US$30 million in Series B funding (following a Series A funding of US$ 7 million in 2019) for its smart pet collars to expand its footprint across the USA.

Pet wearables companies seek the right tech for pet health monitoring

While most technologies used in pet wearables are fairly similar to those used in human wearables (such as GPS), one of the key differentiators is the effectiveness of biometric sensors for health monitoring. Biometric sensors are widely used in human wearables, although given the fur presence in animals, they are somewhat ineffective in the case of pets. Thus, pet wearables depend on other contactless sensors such as radar and acoustic. However, these have their own functional and developmental challenges.

Among these, acoustic sensors are some of the oldest and are used by one of the market leaders, PetPace. Acoustic technology uses sound waves to monitor a pet’s heart rate, heart rate variability (HRV), and respiratory rate. Players such as PetPace and Inupathy use this technology in their smart collars. Moreover, in 2020, the Bioengineering Department at Imperial College also developed wearable technology for sniffer dogs based on acoustic sensors.

While this technology is fairly widely used for clinically monitoring health for both humans and pets, there are certain challenges when it is translated into wearables for pets. Given external factors, such as background noise and motion artifacts, the PetPace collar is said to have only 53% heart rate detection sensitivity (i.e., in 53% of the cases, the standard deviation from measurements by PetPace and ECG was within 10%) based on a study conducted in 2020. However, based on another 2017 study, the device’s pulse monitoring accuracy levels can be much higher at 94.3%.

That being said, Tokyo-based Inupathy also uses acoustic sensors to capture a dog’s heart rate and HRV and displays colors and patterns on its pet collar to depict emotional state and heartbeat ranges. For instance, the calmest state is depicted with deep blue, whereas the most excited state is bright red. While the company claims to have 90% accuracy when compared with ECG monitors, the collar is marketed as a device to broadly understand the mental and physical state of the pet instead of accurately monitoring and projecting heart rate readings.

Thus, while acoustic technology can be used in pet wearables, it has limitations, especially regarding accuracy. With the PetPace collar being priced at about US$150 (with a monthly subscription of US$15) and Inupathy at US$200, the customer must be able to find value in the readings. One of the initial companies using acoustic sensors, Voyce, went out of business in 2016 due to slower-than-expected acceptability.

Acoustic sensors-based solutions by themselves may not be a sound product offering, however, when clubbed with other technologies and solutions, they can offer a wholesome solution to the pet owner. This can be seen in the case of PetPace Smart Collar, which, along with acoustic-based health monitoring, has additional offerings such as thermometers for temperature detection, 6-D accelerometers for activity, calories, and posture calculation, and GPS for location tracking.

A more promising and upcoming technology for health monitoring in pets is radar technology. The technology uses radio waves to enable continuous and contactless heart and respiration rate monitoring. While it is relatively new, it is expected to have better accuracy when compared with acoustic sensors. Two companies, France-based Invoxia, and Taiwan-based ITRI, launched smart collars with radar technology in 2022. Invoxia’s smart collar is priced competitively at US$99 (with a monthly subscription of US$13). It uses embedded artificial intelligence and miniaturized radar sensors to track a dog’s health. In addition, it monitors a dog’s daily activity, such as walking, running, scratching, eating or drinking, barking, and resting. The device has an accuracy of 98% for heart rate detection.

Similarly, ITRI also launched its smart wearable device, iPetWear, in 2022. The device uses contactless micro-physiological radar sensing technology to monitor a pet’s health. The sensor can monitor a pet’s heart rate, respiratory rate, sleep cycle, and activity levels through the detection of pulse and chest motion through its lower-power Doppler radar technology. The device claims to have an error rate of under 10% for heart and respiration rate and under 5% for activity monitoring. The device is priced at US$80.

Given the improved accuracies and competitive pricing of these products, it is safe to say that radar technology-based sensors can disrupt pet health monitoring wearables. However, this technology is difficult to develop, and at the moment, only a limited number of companies have managed to commercialize it.

Companies are also exploring ways to make biometric sensors effective for pets, even though furry pets present a challenge for such sensors. This is seen in the case of Invoxia, which had previously launched the radar-based Smart Collar. At CES 2024, Invoxia launched another pet wearable device, the Invoxia Minitailz Smart Pet Tracker. The tracker uses advanced miniaturized biometric sensors along with AI to track respiratory and heart vitals and detect anomalies in the behavior of both dogs and cats. In addition, it tracks a pet’s location and daily activities and can differentiate between types of movement. It also claims to be the first pet collar in the market to detect atrial fibrillation (AFib). The device also seems to have high accuracy (similar to radar technology) as it claims to have 97-99% accuracy rates for monitoring respiratory and heart vitals. The product, priced at US$99 with a monthly subscription cost of US$8.30, is relatively new in the market, and its effectiveness is yet to be established.

If Invoxia Minitailz Smart Pet Tracker is successful and delivers on its promise (with regard to accuracy and functionality), several other players will likely also explore biometric sensors for pet health monitoring.

Other technologies, such as LiDAR and infrared, are also being explored as potential alternatives. However, there are not many commercially successful solutions based on them yet.

Potential risk of data breach is one of the biggest threats to pet wearables

Given the expanding scope of all these technologies, the pet wearable market is booming. However, it comes with its own set of challenges. While companies claim to have high accuracy rates, no FDA approvals are required for pet wearables at the moment. Thus, there is no way to verify the actual effectiveness of these devices. Moreover, since they deal with critical health conditions, a missed reading or a misdiagnosis can have dire consequences. Pet owners can also not consider these devices to be a replacement for their vet visits at large, and the devices can only act as information gatherers that can help vets make quicker diagnoses.

The industry is also facing a significant obstacle in the form of substandard battery technology. Given the number of features on each device (such as GPS tracking, health monitoring, two-way communication, etc.), its continuous and real-time work requirement, and the limited lifespan of lithium-ion batteries, companies have difficulty providing sufficient battery life for their devices. In several cases, pet owners find that the battery gets discharged sooner than they can recharge it. Therefore, the device loses its purpose since it is meant to provide continuous real-time data to be effective. To mitigate this, companies are looking into other battery options, such as lead acid (less efficient than lithium-ion) and silicon carbide (a more expensive option).

Another issue with these devices is the potential risk of data breaches. Wearables collect large amounts of data about pets and pet owners. In a 2019 study by Bristol University, pet wearable devices collected four times more data about the pet owner than about the pet itself. If this data is not properly secured, it could result in data leaks and cyberattacks and put the owner at risk.

EOS Perspective

With pet ownership increasing, the market for pet wearables will undoubtedly grow. Moreover, as human wearables continue to permeate our daily lives, it is natural that pet owners are looking for a similar advanced level of monitoring for their beloved companions.

The market, which started with single functionality tracking devices, is now moving towards more complex and technologically advanced solutions. While tracking and GPS-based devices continue to form a significant portion of the market at the moment, several leading players in the space (such as Tractive) are now integrating other functionalities with their location-tracking offerings.

Thus, the market is expected to move towards multi-functional solutions that offer basic features such as tracking along with advanced features such as activity and health monitoring. Also, within health monitoring, offerings will continue to differ based on complexity. For instance, some devices offer insights only into weight and temperature changes, while more advanced devices offer heart and pulse rate monitoring. As seen in the case of human wearables, the market is likely to move towards the latter as continuous advanced health monitoring becomes a standard way of managing well-being for both humans and pets.

Given the industry’s nascence, fragmented market, lack of big established brands, and low brand loyalty, the products’ key differentiating factors are likely to remain competitive pricing, advanced offerings, and effective technology.

For this, it becomes essential for companies to stay ahead of the curve and to explore possible technologies, beyond what is effective in human wearables. Therefore, companies that are investing in exploring suitable technologies, such as radar and biometrics, for advanced features, such as heart rate monitoring, are likely to emerge as market leaders in the long run.

Moreover, the pet wearables market is likely to also benefit from integration with pet insurance in the future. Both industries have synergies as the insurance sector can gain from health-based data derived from pet wearables. On the other hand, increasing demand for pet insurance is expected to provide a push to the pet wearables market, as pet owners who track and monitor their pet’s health can negotiate better and more competitive insurance rates.

Undoubtedly, the industry is poised for steady and strong growth. The market will likely consolidate, while players offering technologically advanced wearables focused on health monitoring and priced at around US$100-150 will emerge as leaders.

by EOS Intelligence EOS Intelligence No Comments

IRA: Are Patients Winning at the Cost of the US Pharma Sectoral Growth?

The market reaction to the US Inflation Reduction Act of 2022 is mostly mixed. It is expected to change the pharma industry dynamics in terms of the competitive positioning and product pricing of those companies projected to be negatively impacted by the IRA. The answer to whether the IRA will be able to curb rising healthcare costs in the USA lies in the legislation’s on-the-ground application.

IRA to decrease prescription drug prices via a four-pronged strategy

Prices of prescription drugs in the USA are 2.78 times higher than in 33 other countries analyzed in a 2024 report published by RAND, a public policy think tank.

In pursuit of reducing healthcare costs in the USA, the Biden government passed the Inflation Reduction Act (IRA) in August 2022. One of the major goals of the act includes the reduction of prices of prescription drugs.

This is expected to be achieved through a four-pronged strategy, the mainstay of which involves the US federal government negotiating the prices of some high-priced prescription drugs covered under Medicare.

The second prong includes pharmaceutical firms paying a rebate to Medicare if they raise the price of prescription medicines covered under Medicare by a rate that is higher than the inflation rate.

The monthly cost of insulin for Medicare patients is capped at US$35, as the third prong.

The fourth prong aims to reduce prescription drug prices by capping the out-of-pocket costs of Medicare Part D patients at US$4,000 in 2024 and US$2,000 in 2025.

IRA Are Patients Winning at the Cost of the US Pharma Sectoral Growth by EOS Intelligence

IRA Are Patients Winning at the Cost of the US Pharma Sectoral Growth by EOS Intelligence

Pharma companies to suffer more due to IRA compared to projected government savings

Under the IRA, large pharmaceutical companies, defined as those with over US$1 billion in net profits, are required to pay a minimum of 15% annual taxes, a financial burden on these companies. Analysts predict that the annual revenue from corporate taxes could be to the tune of US$222 billion. Furthermore, the IRA is expected to save over US$287 billion for ten years from the roll-out, as per the estimates of the Congressional Budget Office (CBO).

Apart from the increased financial burden on some companies, experts foresee potential adverse impact on several pharmaceutical companies based in the USA to a considerable extent.

The pharma companies witnessing the least to no impact are the ones with their primary operations based outside the USA, biologics or large molecule drug producers, and the ones that do not receive government funding for R&D. This is because of the differing timelines under IRA for negotiating the prices of biologics and small molecules. Biologics’ timeline is 11 years after FDA approval, while small molecule drugs are eligible after 7 years. Therefore, Medicare negotiations will begin four years earlier for a small molecule drug that has received approval at the same time as a large molecule biologic drug.

Apart from these adverse effects, such as differential treatment of small molecule drugs compared to biologics under Medicare price negotiation timelines, there are some other negative impacts on the overall US pharma industry, such as diminishing competition among generic drug producers, decreased discovery of new treatments, and new uses of existing drugs.

IRA to affect the revenues of top pharma companies surely but variably

There are differing viewpoints regarding the impact of IRA on pharmaceutical companies’ revenue. One group of experts suggests that Medicare prescription drug negotiations under the IRA will depend on the expiration of the drug’s patent. Other experts expressed their opinion that irrespective of when a drug loses exclusivity, a significant threat to drug revenues comes from the competition entering the market and not from lower negotiated drug prices.

The first group of experts states that lower negotiated prices in 2026 are expected to have a lower impact on medicines projected to witness revenue loss owing to patent expiry around the same time. One such example of a drug losing its exclusivity in the USA in 2025 is Stelara by Janssen Biotech approved for treating psoriasis.

In contrast, pharma companies producing medicines that are expected to witness competition from their generic counterparts after 2026 are projected to lose revenue owing to lower negotiated prices even before the drugs lose exclusivity. However, some companies’ revenue will be affected more than others.

Medicare price negotiations to hit revenues of some drugmakers drastically

The pharma industry’s revenue is expected to decrease by 2% due to the new measures brought about by the IRA, as per a 2022 report by Morningstar, a US financial services firm. Among the companies that will be highly affected are Novo Nordisk, Gilead, Bristol Myers Squibb, AbbVie, and AstraZeneca. In contrast, others, such as Pfizer, Merck, Roche, and Novartis, will not be as much impacted by Medicare price negotiations.

Some 15% of global branded drug sales come from Medicare in the USA, as per Morningstar estimates. Therefore, the impact of the IRA on pharmaceutical companies depends on their reliance on Medicare sales, price adjustments, high-cost specialized drugs, and extended patent protection.

Medicare prescription drug negotiations are projected to impact pharma companies the most among all IRA measures, although this impact might not be uniform across the players. On the other hand, Medicare negotiations are projected to save the government approximately US$100 billion through 2031. The pharma companies facing the highest revenue losses include Novo Nordisk, Gilead, and AstraZeneca.

When the Medicare price negotiation measures start to roll out in 2026, two drugs of Novo Nordisk, namely, Ozempic and Rybelsus, that are approved to treat type 2 diabetes, are expected to witness an 8% decline in their projected revenue through 2031, as per Morningstar. Gilead’s Biktarvy, which treats HIV-1 infections, is expected to be subject to price negotiation in 2027 and thereby face a projected revenue loss of 7% through 2031. On similar lines, Calquence (to treat mantle cell lymphoma) and Tagrisso (to treat non-small cell lung cancer) drugs of AstraZeneca are expected to lose 6% revenues through 2031 owing to Medicare price negotiations.

In contrast, considering the existing portfolios, Pfizer, Merck, Bristol Myers, and BioMarin are expected to witness no revenue loss due to Medicare negotiations.

Medicare inflation caps to impact major pharma companies negatively

Another important IRA measure is Medicare inflation caps. This measure involves drug producers paying penalties for increasing drug prices beyond the inflation rate. It is expected to result in US$62 billion in government savings through 2031.

Around March 2023, the US federal government, along with the Centers for Medicare & Medicaid Services (CMS), released a list of 27 drugs whose prices were increased by their manufacturers at a higher rate than the inflation rate. This list included AbbVie’s Humira (to treat Crohn’s Disease) and Astellas Pharma’s and Seagen’s Padcev (to treat urothelial cancer). Gilead Sciences, Johnson & Johnson, and Pfizer are among other impacted companies by Medicare inflation caps. Pfizer had the most drugs on the list, with a total of five.

Bristol Myers Squibb is one of the pharma companies that is expected to be highly impacted by Medicare inflation caps. The company’s drugs, such as Eliquis (to treat or prevent blood clots), Opdivo (to treat melanoma), Orencia (to treat rheumatoid arthritis), and Yervoy (to treat various cancer types) are among the medicines that are expected to face revenue loss owing to inflation caps. Other drugs on the list include Novo Nordisk’s drugs such as Novolog and Levemir (both for type 1 diabetes) and Victoza (for type 2 diabetes), Johnson & Johnson’s drugs such as Imbruvica (to treat certain cancers) and Xarelto (to treat or prevent blood clots), along with Novartis’s Sandostatin (for severe diarrhea and flushing related to metastatic carcinoid tumors).

In contrast, Merck is not expected to face any revenue loss due to inflation caps, while GSK, Regeneron, Roche, and Sanofi are projected to witness minimal revenue loss as these companies have not raised the prices of their drugs beyond the inflation rate.

IRA to potentially reduce competition from generics

According to the IRA, following the price negotiations of some of the branded drugs, manufacturers of the generic versions of such drugs will have less scope to charge a reduced price for those drugs. This would disincentivize the generic drug producers to manufacture generic versions of the already low-priced branded drugs.

EOS Perspective

The IRA represents a substantial change in the US legislation that strives to make healthcare more affordable to Americans through increased access to more reasonably priced prescription medicines.

However, IRA can be expected to affect small-molecule drugmakers more negatively than biologics. Moreover, some pharmaceutical companies are projected to feel the pinch more than others in terms of revenue losses.

Companies such as Merck, Bristol Myers Squibb, and the pharmaceutical association PhRMA have filed lawsuits against some provisions of the IRA, stating that they are unconstitutional. Bristol Myers Squibb and J&J are planning to appeal after the US court dismissed the IRA lawsuits. These pharmaceutical companies are trying to find ways to circumvent the negative impact of the legislation.

IRA is also expected to negatively impact R&D and medical innovation. This is evident from the fact that biopharma companies have reduced their R&D efforts in the neuroscience space, especially since a lot of development work in this space involves small-molecule drugs. Moreover, as IRA exempts only one orphan drug from price negotiation, investments in R&D for orphan drugs are likely to get deprioritized. Many pharmaceutical companies are reconsidering their R&D planning and investment strategies to counter the effect of IRA.

IRA is clearly not a win-win strategy for all stakeholders. Pharmaceutical companies are mostly at the losing end, while patients could be winners. Considering all the positives and negatives of IRA, only time will tell the actual impact of the legislation on the overall pharmaceutical industry.

by EOS Intelligence EOS Intelligence No Comments

The Rise and Fall of Cue Health: Market Lessons and Implications

Cue Health, the portable COVID-19 test maker, reached its zenith during the pandemic’s peak, securing investments and contracts from both government and private sectors. The company was lauded for its user-friendly, rapid-response COVID-testing kits. At its peak, Cue Health’s products were seen as game-changers, with the potential to revamp the healthcare sector by providing accurate at-home diagnostic results within minutes. However, sales of these testing kits plummeted before Cue Health could diversify and establish other revenue streams, leading to a series of layoffs and, ultimately, the shutdown of its operations.

As the public focus shifted away from the pandemic, so did the demand for testing. For Cue Health, the COVID-19 test was essentially their sole product, and this decline in demand marked the onset of turbulent times.

In the past few years, Cue Health struggled to maintain its market position and technological edge, focusing on restructuring and streamlining its operations. The company engaged in talks with potential investors and stakeholders, which did not materialize. It also implemented several cost-cutting measures to remain afloat amid financial turbulence, but these were insufficient to counter the broader economic challenges that Cue Health faced. Its share prices declined steadily, and several rounds of layoffs followed.

The final blow came when the FDA issued a warning letter and a safety alert on May 10, 2024, asking users and healthcare providers to discard Cue Health’s product. The FDA discovered unauthorized changes made to Cue Health’s COVID-19 testing kits. This ultimately led to Cue Health’s winding down operations and filing for bankruptcy in May 2024 after laying off all its employees.

Cue Health’s business failures: A look at three critical oversights

Absence of recurring revenue streams: The company’s COVID-19 testing device was a one-time purchase, and it did not need any consumables or refills. This prevented the development of a recurring revenue model, such as subscription-based services or ongoing product sales, which is essential for financial stability and sustained revenue stream. Dependence on the one-time test kit sales implied that once its demand subsided, there was no consistent income to support operations.

Top-heavy business model: Cue Health employed many individuals in leadership positions, a common mistake that start-ups tend to make. This resulted in high salary costs, even amidst financial turbulence, eventually leading to several layoffs.

Moreover, the company struggled with financial management and strategic planning. Efforts to engage with investors and stakeholders did not yield results, further compounding the company’s financial crisis.

Narrow focus: Cue Health’s business model heavily depended on a single product, the COVID-19 testing kit, which nearly constituted its complete product portfolio. This singular focus left the company vulnerable to the declining demand for COVID-19 testing kits, and it was not able to pivot quickly to diversify product offerings. Moreover, the company was also unprepared for post-pandemic market realities, which led to its decline.

Cue Health’s wind down: Repercussions for diagnostics sector and investors

Regulatory and compliance implications: Cue Health’s regulatory challenges highlight the critical need for compliance and transparency in product modifications. Consequently, other companies in the diagnostics and medical devices sector may now encounter heightened regulatory scrutiny by the FDA. To stay afloat and avoid similar pitfalls, these companies must invest more in compliance, ensuring all products meet regulatory and quality standards. This could result in better overall product quality and safety across the industry, although at a higher cost to the device makers.

Industry lesson: Cue Health’s trajectory – from swift growth to sudden downfall – serves as a case study for industry players to understand the risks associated with over-reliance on a single product and the importance of portfolio diversification. Companies operating in the diagnostics sector should leverage the company’s experience to reevaluate business strategies and enhance risk management practices.

Investor sentiment: Cue Health’s downfall, despite the substantial funding and a successful IPO, could lead to more cautious investor behavior and diminished confidence in healthcare start-ups, particularly those with a singular product focus. For future investments, investors may demand more scrutiny and rigorous due diligence. Consequently, companies may be pressured to build diversified product portfolios and more sustainable business models to mitigate risks associated with market fluctuations and regulatory challenges.

EOS Perspective

Cue Health’s shutdown highlights the volatility and unpredictability of the MedTech sector, underlining the importance of regulatory compliance, portfolio diversification, and market adaptability. While innovation and growth are imperative for staying competitive in the diagnostics sector, striking a balance with robust financial planning and risk management practices is equally important.

For other diagnostics companies, Cue Health’s downfall serves as a cautionary tale, emphasizing the importance of building sustainable business models that can withstand market fluctuations and external pressure. For investors and stakeholders, it accentuates the requirement of stringent due diligence and risk assessment for high-stakes investments in emerging health technologies.

Despite Cue Health’s closure, its journey is important. The company leaves behind a legacy of innovations, diagnostic tools, and resourceful healthcare delivery models. Other diagnostics companies can build on Cue Health’s technological foundation, learning from its experiences to navigate the complex healthcare technology landscape.

by EOS Intelligence EOS Intelligence No Comments

Denmark – A Trailblazer in Digital Health Innovation

The COVID-19 pandemic has spurred the need to embrace new digital tools and technologies within the healthcare sector. There has been a significant increase in the use of technology to provide care, resulting in improved health outcomes. In Europe, Denmark has made significant progress and is at the forefront of the digital health transformation with a 99% digitalization rate. Over the last few years, Denmark has strived to digitalize further its healthcare infrastructure, testing and leveraging technologies such as AI and robotics to implement them at full scale across the country. In this transformation, the Danish digital health system can be a source of valuable lessons, uncovering various opportunities it presents for health tech companies.

Demark’s digital health: Harnessing power from a robust public infrastructure

Denmark’s healthcare system is among the most expensive worldwide, with 10% of GDP allotted for healthcare expenditures and 90% publicly funded through taxes. The health infrastructure is highly digitalized, with almost 99% of healthcare communication done electronically.

The national e-health portal, Sundhed.dk, launched in 2003, plays a key role in Denmark’s digitalization, offering a comprehensive platform catering to both healthcare professionals and citizens alike. Sundhed.dk provides safe and secure access to an individual’s personal health records (from hospitals), medication information, vaccinations, laboratory results, appointments, and referrals. The portal is user-friendly and is regarded as one of the superior models for public healthcare information exchange worldwide.

Over the last 20 years, the Danish government has supported and invested in various digital health initiatives, rolled out several IT services, and strengthened its digital healthcare infrastructure. In 2007, the country introduced E-record, through which individuals can access their medical information from EHR systems using the Sundhed.dk portal. The government also launched Shared Medication Record, which has records of patients’ prescriptions, details of the doctor who prescribed the medicines, and information pertaining to where the medications were picked from. During the COVID-19 pandemic, the “My Doctor” app was introduced to facilitate video consultations between GPs and patients. These digital initiatives contribute to improved care coordination and increase the patient’s trust in the system.

Denmark – A Trailblazer in Digital Health Innovation by EOS Intelligence

Denmark – A Trailblazer in Digital Health Innovation by EOS Intelligence

Unraveling the blueprint: Denmark’s digital health success story

Well-formulated digital health strategies address the needs of patients and healthcare workers

Many countries develop digital health strategies, which are frequently focused solely on technical aspects, steering away from addressing the actual needs of patients and healthcare professionals. Moreover, these policies often function as plain vision documents with no clear description of action plans or the roles and responsibilities of various stakeholders.

In contrast, Denmark’s digital health strategy is well-formulated and primarily focused on addressing the needs of patients and healthcare workers. It provides a clear vision of how digital technology can help meet their needs. In addition, the strategies highlight the importance of cross-sectoral collaboration, detailing focus areas and specific initiatives that must be jointly executed. For instance, it clearly mentions how the health and education sectors should work together to promote digital health literacy.

Denmark’s well-crafted digital health policies are a cornerstone of its successful digital health transformation. Since 1999, the country has been updating these strategies every four years, ensuring ongoing review and modernization of its digital health infrastructure.

Governance models aid in the speedy integration and implementation of digital healthcare tools

Denmark follows a regional governance model instead of the top-down approach, controlled by the state (national) government. The states and municipalities are responsible for developing and implementing their own health IT solutions in alignment with the national strategy.

Further, the government has established several steering groups to aid in implementing and disseminating digital health initiatives for rapid digital uptake. For instance, Connected Digital Health in Denmark, a cross-governmental organization, manages, coordinates, and ensures the implementation of various action plans mentioned in the national digital health strategies.

In addition, the government also regularly engages in public-private partnerships to boost its digital capabilities. The country’s strong governance is considered one of the critical success factors for the digital health transition.

Common IT standards help in effective healthcare data exchange

Many countries have deployed digital health technologies; however, integration remains sparse, resulting in a fragmented digital landscape. Integrating patient information siloed across multiple healthcare segments is crucial for establishing a high-quality digital health infrastructure. The adoption of common IT standards helps facilitate this data exchange and integration.

Denmark has been using these standards since 1990 for electronic health data communication as well as improving workflows between public hospitals, general practitioners, private healthcare entities, specialists, laboratories, and home care services. The early development of these standards significantly increased electronic communication within the healthcare sector, contributing to the high level of digitalization of the Danish healthcare sector.

Strict testing protocols ensure digital health tools are user-friendly

The user-friendliness of digital technologies is considered one of the major factors for early e-health adoption. Denmark undertakes several initiatives to ensure that digital health tools and technologies are user-friendly and easy to use. For instance, the country collects feedback from healthcare stakeholders about their experience with various digital health solutions, checks if they are user-friendly, and uses the input received to develop new solutions.

The country has also implemented strict testing protocols for telehealth solutions by evaluating their performance on mobile devices and testing the products with a range of end users, including the elderly and people with disabilities.

Government’s focus on educating and training healthcare stakeholders helps them to use digital tools effectively

Denmark educates and trains healthcare workers to use digital tools appropriately. According to a 2020 Deloitte report, nearly 76.8 % of Danish clinicians mentioned that they are well-trained and supported in using digital health tools and solutions.

Local governments and hospitals in Denmark collaborate with tech professionals to provide support, education, and training on using digital solutions such as EMRs, telemedicine platforms, and shared IT standards for healthcare data exchange. Digital health literacy of front-line healthcare workers is one of the core objectives of the country’s digital health strategy.

Unlocking opportunities: Denmark’s digital health sector for health tech companies

According to Statistics Denmark, the percentage of the Danish population aged 75 or above is expected to double from 7.8% in 2017 to 14.4% in 2047. In addition, the country faces a severe labor shortage, with projections suggesting that by 2035, Denmark might have a shortage of 14,500 healthcare workers. These factors are expected to put increased pressure on the Danish healthcare system.

In order to tackle these challenges, Denmark’s government continues to invest in advanced innovative technologies and digitalization strategies. In 2018, the country launched a digital health strategy titled “A Coherent and Trustworthy Health Network for All: 2018-2024”, aiming to modernize the healthcare infrastructure further. Under this initiative, the country aims to expand telemedicine solutions, increase virtual care visits, and automate the administrative and clinical workflows within the Danish healthcare system. This initiative is creating opportunities for startups and companies offering health tech solutions in the areas of telemedicine, video consultations, remote patient monitoring, hospital automation, and diagnostics.

Danish government seeks to expand telemedicine solutions for various segments of the patient population

Denmark has been using telemedicine services since 2012, beginning with home monitoring solutions for Chronic Obstructive Pulmonary Disease (COPD) patients. The country seeks to further expand the rollout of telemedicine solutions for patients with COPD, chronic diseases, heart failure, comorbid conditions, and pregnant women facing complications. In December 2023, the government of Denmark invested about US$72 million to expand telemedicine solutions for these patients, offer digital rehabilitation courses, and increase the number of virtual consultations through GPs.

Various governmental organizations in Denmark have been looking to partner with companies providing innovative remote monitoring and virtual care solutions to facilitate home treatment.

For instance, in 2021, in collaboration with the local government, Trifork, a Denmark-based digital health company, developed a telemedicine solution called Telma for severe COPD patients. The solution provides COPD patients with medication, measuring tools, and devices to track pulse and oxygen levels at home. The Telma app transmits this data in real time and facilitates communication between healthcare professionals and patients through video consultations, thus lessening the need for frequent hospital visits.

Similarly, in 2022, two Denmark-based health tech companies, Copenhagen Center for Health Technology (CACHET) and Cortrium, forged a research collaboration to develop a novel technology to monitor a patient’s heart rhythm remotely. This allows heart failure patients to receive prompt medical care without visiting a hospital.

The Danish government is also looking to provide telerehabilitation services amidst the rising mental health issues across the country. In 2021, the government established the Centre for Digital Psychiatry to develop, test, and implement several nationwide digital services. In March 2023, the Center initiated a research project with Monsenso, a Danish mobile health company, to provide personalized digital treatment for patients with depression.

A rise in telemedicine programs catering to various segments of the patient population is expected in the forthcoming years. This surge in demand fuels the growth of companies offering telehealth solutions nationwide.

AI presents several opportunities for innovation and collaboration within the healthcare segment

Denmark actively seeks to integrate AI into its healthcare system, especially in diagnostics, presenting numerous opportunities for AI-based health companies to thrive. The country has established research and innovation centers across the country focusing on AI for uses such as identifying at-risk stroke patients, helping radiologists interpret scans, and assisting in other diagnostics.

In 2021, Denmark established the Radiology AI Test Center (RAIT) to accelerate the development and implementation of medical AI applications in the country. Through RAIT, private companies can test and validate their AI-based technologies in Denmark. For example, in 2021, through the RAIT program, several Danish hospitals in Copenhagen partnered with US-based imaging AI startup Enlitic to evaluate an AI-based algorithm to read chest X-rays. Similarly, in 2023, RAIT partnered with Cerebriu, a Denmark-based health tech company, to use AI to improve MRI imaging of the brain.

Investments in advanced digital technologies modernize healthcare infrastructure

As Denmark endeavors to digitalize its hospitals, ample opportunities arise for companies specializing in robotics and mobile health to improve hospital and clinical workflows, among other areas.

Some steps have been taken to digitalize hospitals. For instance, the Centre for Clinical Robotics (CCR), a research and innovation center for healthcare robotic technology in Denmark, aims to leverage robotic technology for various hospital processes, such as food service, cleaning, medication dispensing, clinical sample collection, etc.

Another interesting instance is the pilot project between Systematic, a Denmark-based software company, and physicians at the Aalborg University Hospital. Systematic has developed a communication platform called Columna Flow Clinical Tasking, which facilitates direct communication among the physicians at the Aalborg Hospital. The solution offers a real-time overview of the patients, including their medical conditions and the workload of hospital clinicians on duty. This empowers physicians to prioritize patients and efficiently allocate tasks during peak hospital hours.

EOS Perspective

The Danish health system is poised for an even more profound digital transformation in the coming years, aiming to improve patient accessibility and convenience. Denmark’s healthcare market is already highly digitalized, which provides a robust foundation for further digital transformation and innovation.

Home care and telemedicine, health data interoperability, AI-based diagnosis, healthcare automation, personalized medicine, and preventative health are likely the key focus areas for the next phase of digital health transformation.

Further, the country is looking to elevate patient care through its super hospital program, which involves consolidating smaller hospitals into larger, higher-capacity units. The aim is to provide superior medical care at lower costs. Technology will play a key role in improving healthcare delivery and patient outcomes in these hospitals, with applications across logistics, clinical decision support tools, diagnostic tools management, and patient engagement, among other areas.

These initiatives can be expected to make the Danish health system even more robust. The system is expected to move from a doctor-centric to a patient-centric care model, where patients would be actively involved in taking care of their own health. The country’s meticulously crafted digital health strategies, well-established digital infrastructure, and technology-proficient population lay a solid foundation to usher in the next wave of innovation.

As Denmark persists in its commitment to build a healthcare system fit for the future, there are abundant opportunities for health tech companies to thrive and drive innovation within the Danish healthcare industry.

by EOS Intelligence EOS Intelligence No Comments

An Era of Innovation: Novel Drugs Redefining Multiple Sclerosis Treatment Paradigm

Since the approval of the first drug, interferon beta 1b (IFNβ-1b), in 1993, the treatment landscape of multiple sclerosis (MS) has significantly changed. Currently, there exist more than 20 disease-modifying therapies (DMTs) to treat MS, encompassing orals, injectables, and infusions. These drugs, however, can cause adverse side effects such as toxicity, pregnancy-related complications, and gastrointestinal symptoms, among others. Moreover, about 5-10% of the patient population still develops disability. Despite the wide range of therapeutic options available, patients experience relapses and worsening disease symptoms, which significantly reduce their quality of life.

The ongoing challenges have driven pharmaceutical companies to develop and launch drugs that offer greater efficacy and safety, enhancing patients’ health outcomes in the longer term. In particular, significant efforts are geared towards treating the progressive forms of MS, such as Primary Progressive MS (PPMS) and Secondary Progressive MS (SPMS), for which therapies are currently limited.

Several emerging therapies are in various stages of development, targeting distinct mechanisms of the underlying disease etiology. Among all the emerging therapeutic approaches, Bruton Tyrosine Kinase Inhibitors (BTKIs) emerge as the most promising, currently in later stages of clinical trials, poised for approval. The potential advantage of BTKI agents is that they can treat both relapsing and progressive forms of MS.

Remyelination is another equally promising therapeutic approach, as it has the potential to promote myelination, restore axonal and neuronal health, and prevent disability; however, extensive clinical trials are essential to develop these drugs and fully integrate them into clinical practice.

On the other hand, monoclonal antibodies (mAbs) are becoming the most common therapeutic option due to their higher selectivity for B-cells (a type of immune cell), a fact that plays a crucial role in MS disease pathogenesis. The higher selectivity of mAbs allows to efficiently target these cells and reduce inflammation.

An Era of Innovation Novel Drugs Redefining Multiple Sclerosis Treatment Paradigm by EOS Intelligence

An Era of Innovation Novel Drugs Redefining Multiple Sclerosis Treatment Paradigm by EOS Intelligence

Pharma companies place high hopes on BTKI

Following the success of B-cell depleting therapies in treating MS, there has been a notable surge in interest in utilizing a novel class of medications called BTKI. BTK is an enzyme crucial for the functioning of B-lymphocytes, which elucidates the autoimmune response in MS patients. Unlike B-cell depleting therapies, which directly reduce the number of B-cells, BTKIs alter B-cell function, preventing relapse or slowing disease progression in MS patients.

These BTKIs can be taken orally, offering a convenient and easy way of administration. Another potential advantage is that BTKIs can cross the complex blood-brain barrier, which other MS drugs fail to do. Due to this potent efficacy, researchers believe that BTK inhibition can even act as a cure for MS.

Over the past few years, top pharma companies such as Roche, Sanofi, InnoCare, and Novartis have betted big on BTKI to treat MS patients. There are currently four BTKI agents that are being investigated for MS treatment – Sanofi’s Tolebrutinib, Roche’s Fenebrutinib, Novartis’ Remibrutinib, and InnoCare’s Orelabrutinib. Among these, Sanofi is ahead in the race, looking to submit its BTKI drug Tolebrutinib to treat Relapsing-Remitting Multiple Sclerosis (RRMS) for FDA approval in 2024. The company is also currently evaluating Tolebrutinib in a phase 3 trial for treating PPMS, which is expected to be completed in August 2024. If successful, Sanofi would become the first pharmaceutical company to offer BTKIs for both RRMS and PPMS. At present, Roche’s Ocrevus (Ocrelizumab) is the only DMT approved for treating PPMS. Sanofi’s approval of BTKIs would set the stage for direct competition between Roche and Sanofi in the treatment of PPMS. However, Roche’s Ocrevus patent expires in 2029, hence the company remains focused on its BTKI drug Fenebrutinib.

Similar to Sanofi, Roche is testing Fenebrutinib for treating both RRMS and PPMS patients. Roche is slated to complete its phase 3 studies investigating the drug to treat RRMS in November 2025 and PPMS in December 2026.

Novartis and InnoCare are slightly trailing in the competition. Novartis is currently evaluating its BTKI drug, Remibrutinib, in phase 3 clinical trials to treat people with RRMS, expected to be completed in 2029. On the other hand, InnoCare is currently evaluating Orelabrutinib in phase 2 trials for RRMS treatment. Both Remibrutinib and Orelabrutinib cannot be used to treat PPMS, which is a major limitation.

The development of BTKI fosters hope for the next era of MS treatment, as the therapy treats both relapsing and progressive MS. However, the safety and efficacy of each drug still needs to be understood.

Results from BTKI clinical trials indicate that these drugs differ in the strength of BTKI inhibition, BTK enzyme binding mechanism, and central nervous system (CNS) penetration. For instance, Sanofi’s Tolebrutinib showed greater CNS penetrance than the other BTKI agents, making the drug a potential candidate for treating PPMS. On the other hand, Roche’s Fenebrutinib is the only reversible BTK inhibitor that does not cause drug resistance, thus offering a better and safer treatment compared to the rest of the BTKI agents.

It is too early to predict the timeline and extent to which these drugs will be incorporated into the MS treatment paradigm. Until then, pharmaceutical companies in this space will persist in vying to accelerate the launch of their therapies in the fiercely competitive MS market.

Therapies targeting remyelination nearing clinical trials

In MS, myelin, a fatty tissue that surrounds the nerve cells, gets damaged, impairing the nerve’s ability to send electrical signals. At present, no therapies can promote myelin repair in MS patients. The current treatments focus primarily on reducing immune system activity and stopping immune cells from entering the CNS to reduce relapse rates and improve symptoms. The emergence of remyelination therapies holds extensive promise by protecting and restoring neuronal function, and preventing clinical disability in MS patients.

Remyelination works by either removing myelin debris or by creating a type of cells called oligodendrocytes to repair and replace the damaged myelin sheaths.

Over the last few years, pharmaceutical companies have shown heightened interest in evaluating and developing drugs that could promote remyelination. Some of these drugs are in later stages of development, nearing clinical trials.

For instance, in March 2024, Convelo Therapeutics, a US-based biotechnology company, announced that its two oral therapies showed promising evidence in myelin repair in animal models. Similarly, in the same month, the FDA granted a breakthrough device designation to a neurostimulator, for treating RRMS. The device is developed by SetPoint Medical, a US-based healthcare company, to slow myelin damage in RRMS patients. Both these companies have been working to begin clinical trials soon to test their remyelinating agents.

Numerous other companies across the world are also conducting extensive research on remyelination therapies for MS. Additionally, studies are underway to explore the potential of existing drugs, such as Metformin, Ibudilast, and Clemastine, among others, in promoting myelin repair. Encouraging results from preclinical trials and ongoing research studies foster growing optimism that this approach will become viable in treating MS patients in the future.

However, work on remyelination to treat MS patients has just begun, and there is still a long way to go. Defining the optimal clinical criteria for evaluating myelin repair appears largely undefined. There is also an urgent need to develop tools to measure the remyelination achieved and assess the drug’s effectiveness. That said, recent discoveries shedding light on remyelination processes and the functions of oligodendrocyte cells inspire hope that these issues will be effectively addressed in the coming years. Companies are also developing advanced imaging techniques to quantify myelination.

Overall, remyelination emerges as the sole therapy focused on repairing the neuro damage and improving the neurodegenerative conditions in MS patients, which is not currently fulfilled by existing treatments. This underscores remyelination as an inevitable treatment approach for both RRMS and PPMS.

Monoclonal antibodies continually transforming the MS treatment landscape

In recent years, mAbs have emerged as the indispensable treatment option for managing the relapsing forms of MS. These therapeutic agents offer high efficacy in managing symptoms while providing additional advantages such as ease of dosing and lower side effects compared to traditional therapies.

Given the promising potential of this therapeutic approach, pharma companies strive to introduce novel mAbs targeting different cells, molecular pathways, or molecules. Interestingly, new mAbs are also being developed to help repair the damage or disability that has already occurred. Thus, mAbs aim not only to alleviate symptoms but also repair the damage caused by MS, potentially reversing disability – a critical unmet need in the MS treatment landscape.

Among all the mAbs approved, antibodies that target the CD20 molecule (a protein found on the surface of B-cells) have gained significant interest lately. In recent years, the FDA has approved various therapies targeting anti-CD20 molecule. Currently, anti-CD20 mAbs such as Ocrelizumab, Natalizumab, Ofatumumab, Ublituximab, and Rituximab are used for the treatment of MS. Ocrelizumab, developed by Roche, stands out as the only mAb approved for treating both RRMS and PPMS. Ublituximab, developed by TG Therapeutics, is the latest addition to this group, approved by the FDA in 2022.

The mAb market is highly competitive. Hence, companies have been increasingly seeking to differentiate their products based on parameters such as efficacy, safety, and dosing convenience to capture larger market shares. For instance, Novartis considers the ease of administration to be the primary differentiating factor to help drive its mAb sales. The company launched Ofatumumab in 2020, the only mAb that can be administered via injection for treating RRMS. Similarly, Roche is developing Ocrevus subcutaneous injection version similar to the IV infusion. Phase 3 trials are currently underway to evaluate the drug to treat both RRMS and PPMS.

Companies have also been looking to differentiate their drugs in terms of safety. The common side effect of MS therapies is lymphopenia, i.e., lymphocyte depletion, which can pose risks, such as increased vulnerability to infections. To address this, Sanofi is developing a CD40-based mAb named Frexalimab to treat RRMS and SPMS. CD40L is a protein that activates the innate and adaptive immune systems in humans. Sanofi’s phase 2 trials investigating Frexalimab rapidly reduced the disease activity up to 89% without depleting the lymphocytes, thus offering a safer treatment option. Sanofi already has a strong MS pipeline with its BTK drug, Tolebrutinib, to be approved in 2024. Frexalimab, once approved, is expected to further boost the company’s market share.

While mAbs are promising, factors such as high prices hinder their market penetration. Consequently, companies have been looking to develop biosimilar compounds for mAbs, aiming to lower drug prices while simultaneously maintaining and expanding their market share. For instance, in August 2023, the FDA approved Tyruko, a monoclonal antibody that is a biosimilar version of Biogen’s Natalizumab, for treating RRMS. Overall, an increased interest in R&D, coupled with the number of clinical trials underway indicate that mAbs will remain a favored approach in MS treatment for the foreseeable future.

EOS Perspective

The MS treatment market is expected to witness significant growth, reaching a value of US$39 billion by 2032. The increasing prevalence of MS and the demand for highly effective therapies are driving pharma companies to investigate and develop novel drugs. Extensive R&D efforts and the high unmet needs for treating PPMS and SPMS are the other key factors fueling market growth. In addition, governments worldwide are actively supporting drug research with substantial funding.

To gain higher market shares in the competitive MS market, pharma companies are fiercely focusing on innovation and differentiation. They are conducting extensive clinical trials to demonstrate their drugs’ efficacy and superiority. Additionally, these companies are striving to innovate in other aspects, such as drug safety, tolerability, ease of dosing, and convenient routes of administration.

The primary challenge slowing market growth is the high cost of drugs. MS drugs are very expensive, with prices consistently rising each year. According to a 2019 survey published by the National Multiple Sclerosis Society, 40% of respondents terminated their treatment due to the high costs of DMTs. Hence, companies must navigate reimbursement processes and negotiate drug prices with payers to ensure broad patient access and increased market penetration.

Other challenges inhibiting the market growth include patent expiration and the complex nature of MS. Patent expiration allows low-priced generics to enter the market, negatively impacting drug sales. Additionally, the disease’s high heterogeneity limits companies’ ability to develop therapies for the long term.

However, despite these challenges, the MS treatment market looks promising and is continually evolving. In recent years, the treatment landscape has shifted towards introducing highly efficient and safer therapies earlier in the disease course to prevent complications in the longer term. Consequently, companies demonstrating higher drug efficacy are expected to gain a significant foothold in the market. In addition, substantial opportunities exist for companies that address neuroprotection, as the majority of the existing treatments primarily target the inflammatory part of the disease.

by EOS Intelligence EOS Intelligence No Comments

FemTech: A Game-Changer in Women’s Healthcare

Women’s healthcare is one of the most neglected and understudied fields in the healthcare sector. Despite substantial advances in medical sciences in recent years, there still exists a huge gap in the treatment of diseases that are specific to women. FemTech focuses on addressing some of these gaps and offers the potential to help tackle the longstanding issues of women’s health.

FemTech developed as an answer to inadequate healthcare for women

According to a 2018 article published in Our World in Data, a UK-based online scientific publication, human life expectancy has increased tremendously from 30 to 73 years during the last two centuries (1800–2018). But this leap has not been reflected in women’s life quality. A 2024 report published by the World Economic Forum and the McKinsey Health Institute indicated that women live 25% longer in poor health than men, although they typically outlive males.

FemTech, a group of technology-enabled solutions such as diagnostic tools, wearables, products, software, and services, aims to tackle women’s health issues, such as maternal, reproductive, menstrual, and sexual health, as well as menopause. An example is the UK-based Flo Health app that tracks ovulation and the menstrual cycle, offers customized health insights and tips, and a closed community for sharing concerns and queries. US-based Natural Cycles is another example. This application provides personalized insights based on each user’s menstrual cycle patterns. This novel approach to improving women’s health and well-being has been gaining more importance in recent years.

Several challenges slow down progress and widespread acceptance

While FemTech offers promising solutions to help diagnose and manage many health issues affecting women that were previously overlooked, several challenges are awaiting interested players.

One major bottleneck players face is the scarcity of investments. Many investors still consider FemTech a niche sector and shy away from investing compared to other healthcare fields. This situation is slightly improving, as the industry has seen an increase in investment in recent years. Data from Dealroom, an Amsterdam-based provider of data and insights on start-ups and tech ecosystems, indicated that the venture capital (VC) funding into FemTech startups reached US$2.1 billion in 2021, an all-time high.

Despite this increase in investment in FemTech, the total funding for this sector still trails other sectors, especially if it is female-led. The CEO of a leading US-based fertility tracker Mira, said in an interview with Forbes that though 70% of FemTech startups are female-founded, male-owned businesses tend to raise more capital.

Investors and lenders often have unconscious biases against female entrepreneurs, affecting their willingness to invest in female-led businesses, according to a 2020 study published in the Journal of Financial Economics, a peer-reviewed financial journal. Also, women might only have restricted access to male-dominated fundraising sources, including crowdfunding websites, angel investors, and VC firms. Similarly, the traditional male dominance in some areas, such as technology and finance, can also lead to power imbalances in fundraising and limit the options available to women.

Insufficient R&D support is another major challenge faced by players in the FemTech sector. This can be seen from the fact that a significant proportion of the funding allocated to healthcare R&D is not focused on issues that directly impact women’s health and well-being, with a meager 4% dedicated to this area according to a 2018 article published in Forbes. This insufficient funding can cause innovation stagnation, set back product development, and reduce market opportunities.

The inadequate representation of women in clinical trials is another difficulty faced by FemTech companies. This lack of representation has created a knowledge gap in understanding important facets of women’s health, such as female anatomy, physiology, health issues, etc. A 2022 study published in Contemporary Clinical Trials, a peer-reviewed journal, showed that though women constitute 50.8% of the US population, just 41.2% of those involved in clinical trials were female. This creates a certain lack of awareness of how women’s bodies work, making it challenging for FemTech businesses to develop effective solutions.

Cybersecurity issues are also creating challenges in the development of FemTech. A joint study by Newcastle University, Royal Holloway, University of London, and ETH Zurich found serious privacy, security, and safety concerns that could put users at risk. The research indicated the danger of leaking sensitive information, such as fertility, medical data, etc., to third parties.

Cultural and social taboos are another bottleneck faced by FemTech companies. Female-specific issues such as postpartum depression and premenstrual syndrome are rarely openly discussed. This makes bringing societal focus to FemTech products a difficult task.

FemTech A Game-Changer in Women's Healthcare by EOS Intelligence

FemTech A Game-Changer in Women’s Healthcare by EOS Intelligence

FemTech industry is seeing significant development in some segments

Though confronting numerous challenges, FemTech remains a promising industry for interested players with its projected market growth. The FemTech market, estimated at US$40.2 billion in 2020, is expected to reach US$75.1 billion in 2025, according to a 2021 report by the US-based market research agency Arizton Advisory & Intelligence.

General health and wellness is the fastest-growing segment

FemTech offers several solutions for improving women’s health across various segments, with general health and wellness companies attracting the most VC investment, followed by reproductive health and contraception.

The general health and wellness segment combines digital health clinics, mental health services, and direct-to-consumer products. Since companies in this segment focus on broad-ranging solutions that address multiple issues, demand for them is expected to rise.

An example is Maven, a New York-based company offering a holistic solution encompassing pre- and post-pregnancy care. This virtual clinic provides 24/7 access to healthcare professionals, including mental health therapists, relationship consultants, and sleep coaches. In 2022, Maven attracted US$300 million in funding from prominent investors and individual strategic partners.

Another example is Stockholm-based Grace Health, acquired by Penda Health, a Kenyan medical care chain in 2023. It uses an automated health assistant called Grace to monitor and understand women’s sexual and reproductive well-being and receive timely reminders and notifications. The company is also expanding its local footprint in key African markets, including Nigeria, Kenya, and Ghana, to solidify its position as a market leader in these regions.

Reproductive health segment is also seeing strong demand

The reproductive health segment and menstruation care are also expected to continue holding the interest of investors and customers alike. According to the NIH, in the USA, 20% of women are now having their first child after turning 35, owing to a greater emphasis on education and career. With increasing age, some women may experience difficulty before, during, or after pregnancy. Women will also need to effectively and accurately track their fertility to make informed reproductive choices. This is likely to greatly contribute to in increased demand for FemTech reproductive health solutions.

An example is the Clue App, a Germany-based fertility tracker that leverages user data to compute and predict individuals’ periods and PMS. In 2023, the company raised US$7.6 million in funding and partnered with global universities such as the University of Exeter to bridge the diagnosis gap for women’s health conditions. This collaboration is expected to create new trends in managing female health issues.

Oncology products are now aimed at individuals and medical professionals

Development is also underway in the oncology segment. An example is Nevada-based Cyrcadia Health developing a breast monitor that tracks changes in breast tissue temperature over time to aid in the detection and risk management of breast cancer. The monitor consists of two patches that track temperature changes and send the data anonymously to the Cyrcadia Health core lab. This data is analyzed using machine learning (ML) algorithms and predictive analytics software to identify and categorize abnormal circadian patterns in healthy breast tissue. The results are then delivered to healthcare providers. This solution, when it becomes available in the market, is expected to enable women to take more proactive control of their breast health.

Cancer continues to be a leading cause of women’s death both in middle-income and high-income countries, according to a 2017 article published in Cancer Epidemiology, Biomarkers & Prevention, a peer-reviewed journal. Therefore, the focus on FemTech oriented at breast cancer and cancer in general is expected to gain momentum in the future.

Stigmatized conditions and marginalized subpopulations are increasingly addressed

Many FemTech companies are now exploring areas beyond menstrual and reproductive care and addressing stigmatized and unmet conditions such as preterm birth, endometriosis, pelvic care, and sexual health.

An example is London-based Elvie, a company that addresses pelvic floor dysfunction, a common and often overlooked health issue affecting many women. According to the NIH, 27% of women aged 40-59 and 37% of women aged 60-79 experience some form of pelvic floor dysfunction. Elvie has developed a Kegel trainer that uses biofeedback technology to improve pelvic and sexual health through five-minute workouts. The development of these solutions is expected to persuade more women to seek treatment and improve the diagnosis of these health conditions.

Similarly, apps are also being introduced for different sections of the population such as LGBTQ+, black women, and women from low and middle-income societies. US-based InovCares, an app designed to address the crisis of maternal mortality affecting Black women, is an example. This virtual OB-GYN platform connects users with culturally sensitive healthcare professionals who cater to various health needs, including fertility, childbirth, and breastfeeding.

Solutions are being developed in various geographies

While FemTech solutions development is concentrated in the USA and Europe, it is also visible in developing geographies such as Africa and Southeast Asia. An example is Indonesia’s BukuBumil which provides information on various aspects of pregnancy, including fertility, maternal health, baby immunizations, family planning, and post-pregnancy care in the Indonesian language. The platform also allows users to track a baby’s development and milestones.

Another one is Ethiopia-based YeneHealth, a multilingual and culturally responsive platform with AI-powered trackers for menstrual cycle, pregnancy, and medication management.

AI and ML are expected to shape the future of FemTech

Technological advancements are creating waves in the FemTech industry. Many companies are developing smart wearables and AI-powered solutions. Zurich-based Ava Women has developed a wearable, the Ava bracelet (available without prescription), to track hormonal changes. It allows users to monitor their ovulation and detect potential health issues. Ava’s technology uses big data and AI to provide accurate and personalized insights.

Similarly, Ovum, an Australia-based health management app, currently in its pilot phase, offers an AI health assistant designed for women to generate a dataset to improve treatments and diagnostics of various conditions. The app integrates and stores medical records, allowing users to track their health and receive personalized recommendations. This comprehensive data repository is crucial for complex or chronic conditions such as endometriosis, where a diagnosis can take years.

Experts believe the widespread use of AI and ML in FemTech apps will help players provide more accurate and data-driven solutions to users. AI can also analyze large datasets and use predictive analytics to anticipate health risks, such as gestational diabetes or pre-eclampsia.

EOS Perspective

The FemTech landscape, though still developing, is expected to expand more and grow quickly, especially with the increasing discussion around female health, Amazon CTO Werner Vogels commented at the 2023 AWS re:Invent conference, the largest conference in the cloud computing community. He has highlighted the significant potential of FemTech to transform the female healthcare system, specifically considering that women make up 50% of the population and account for 80% of consumer healthcare decisions.

FemTech has also the potential to significantly impact the healthcare sector and the global economy as a whole in the coming years. A 2024 report by the McKinsey Health Institute indicated that improving women’s health could boost the world economy by at least US$1 trillion annually.

The market is expected to see FemTech players widen their business scope, offer multiple services, and address a broader set of health issues. An example of this trend is UK-based Peppy, which initially helped organizations better support their women staff members after they had a baby, but now also deals with menopausal issues. This shift demonstrates a broader approach to women’s health under a single solution and reflects a development towards more comprehensive and inclusive offerings within FemTech.

Since FemTech is still developing, extensive R&D can be expected in the coming years. Experts believe health issues affecting older women also offer interested parties a research investment opportunity. Even now, in discussions and debates regarding FemTech, the diseases suffered by older women get overlooked. This makes it a promising area for future developments.

As the FemTech market expands, it is likely to attract collaborations from players operating outside the healthcare sector. One of the first examples of this was seen in August 2021, when the French cosmetic giant L’Oréal partnered with Clue to research the connection between the menstrual cycle and skin health to improve its skincare products. Such collaborations, whether just publicity stunts for cosmetic companies or not, can help put FemTech solutions on the map of legitimate tools close to women’s health. Considering that FemTech is still considered a niche sector, this can draw attention to the relevance of this market and its players and, consequently, stimulate investment.

Over the long term, women-led companies are expected to create more effective FemTech solutions that identify and cater to women’s unique healthcare requirements. The key factor behind it is that women are better placed to understand the health issues affecting women. A 2022 study published in Harvard Business School’s digital research publication Working Knowledge has also indicated that female-led research teams are more likely to study conditions that impact both genders than male-led ones. With more women stepping into STEM (science, technology, engineering, and mathematics) roles and female-led FemTech start-ups emerging, there is a promise of a more comprehensive scope of FemTech solutions.

A 2023 article published in Harvard Business Review noted an important trend that may positively affect the FemTech market: female investors are more likely to invest in and support female entrepreneurs. This suggests the potential for more capital flowing into women-led businesses, including in FemTech. As more women take on senior leadership roles in both FemTech startups and VC firms, this could substantially propel the industry growth.

by EOS Intelligence EOS Intelligence No Comments

Gut Matter: Will FMT Change How We Look at Disease Treatments?

Converting poop to pills was something unimaginable a few years ago, but now Fecal Microbiota Transplant (FMT) is taking the medical world by storm. This revolutionary technique, which promises to treat a wide range of diseases, from GI disorders to mental health issues, is becoming popular due to its success in treating recurrent clostridioides difficile infection (CDI), a serious infection that can damage the colon. FMT offers tremendous opportunities but also has challenges that players should consider if they want to thrive in this industry.

FMT is a procedure in which feces from a screened, healthy donor are transplanted into a recipient to balance the gut microbiota. This procedure can help treat certain infections and lessen the severity of some gut health issues.

Gut infections are usually treated using antibiotics, which can occasionally destroy beneficial bacteria. A 2000 study published in the Journal of Microbiology, a delayed open-access journal of the American Society for Microbiology, indicated that CDI recurring in around 15% to 35% of people is caused by antibiotics disrupting the gut microbiota and its balance (gut dysbiosis). Dysbiosis has been linked to several chronic illnesses, such as cardiovascular disease, inflammatory bowel disease (IBD), diabetes, and colorectal cancer (CRC).

FMT is highly efficient in treating recurrent CDI, with a cure rate of 90%, according to a 2015 study published in the American Journal of Gastroenterology. Numerous trials to understand the efficacy of FMT in treating conditions such as obesity, liver disease, ulcerative colitis, Crohn’s disease, Parkinson’s disease (PD), and IBS are underway. There are also some pre-clinical studies in progress to understand the potential of FMT in treating illnesses such as diabetes, skin issues, lung diseases, and autism.


This article is the second in EOS Perspectives' coverage 
of Fecal Microbiota Transplantation in animals and humans.

Read our related Perspective:
 Poop to Pills: Is FMT the Future of Veterinary Medicine?

FMT is showing promising growth

The human FMT sector is expected to grow at a CAGR of 5.1% and reach US$3.15 billion by 2031, according to a 2023 report published by India-based market research company The Brainy Insights.

The key factor influencing this growth is the rising incidence of GI disorders. According to the GI Alliance, a US-based network of gastroenterology providers, around 20 million Americans have chronic digestive disorders. Similarly, the CDC estimates that there are around 500,000 cases of CDI reported annually in the USA, and about 9% of elderly patients die within a month of contracting healthcare-associated CDI. All these have influenced the growth of FMT, which offers a promising solution to several conditions.

Other factors influencing the FMT sector growth are the rising patient awareness and interest in preventive healthcare and the emergence of effective probiotic strains.

There are several biotechnology companies currently involved in R&D and product development. Australia-based BiomeBank became the first company to get approval from a competent authority to market its FMT-based CDI solution called Biomictra Faecal Microbiota (colonoscopic, enema, and upper GI delivery) in November 2022. This was followed by the FDA approval of US-based Rebiotix-Ferring Pharmaceuticals’ REBYOTA (rectally administered) in the same month. Seres Therapeutics, a US-based company, has also received FDA approval for its orally delivered product Vowst (SER-109) for treating CDI in April 2023. Following Seres’ footsteps, Rebiotix-Ferring is now conducting trials to develop an oral alternative, RVX7455.

US-based Finch Therapeutics is another major company developing solutions presently undergoing phase-3 studies for diseases such as chronic hepatitis B and autism. Its solution, CP101, for treating CDI, has been discontinued.

Gut Matter Will FMT Change How We Look at Disease Treatments by EOS Intelligence

Gut Matter Will FMT Change How We Look at Disease Treatments by EOS Intelligence

The FMT sector is grappling with a multitude of pressing challenges

The FMT sector has the potential to treat numerous GI and other related disorders effectively. However, the business landscape is still marred by several challenges that players must consider.

Lack of consensus about policies is making development challenging

Regulatory hurdles are one major roadblock players face. The FDA currently regulates FMT as an unapproved biologic medicine. There is a lack of uniform guidelines for FMT, causing variations in processes, such as donor screening and processing.

The FDA took its first step toward FMT regulation in 2013. It released a set of guidelines removing the need for investigational new drug (IND) applications when FMT is used for treating CDI unresponsive to standard treatments if medical practitioners secure informed consent. However, this application is needed when FMT is used for other reasons, including safety studies.

The FDA drafted new guidance in 2016, which was finalized in November 2022. In this guidance, the FMTs acquired from stool banks are exempt from regulatory discretion. Also, the IND requirements will be waived if some conditions are fulfilled, such as getting informed consent from patients or authorized representatives and screening and testing stool under the supervision of competent healthcare professionals. There should also be no known potentially serious safety concerns, such as issues with improper handling or storage, or issues with administering product collection without the proper testing or screening. All these increase the procedural burden for healthcare practitioners. However, the FDA has indicated no regulatory policies for stool banks to reduce the administrative burden of private practice settings without the support of research staff.

Due to the significant variation in gut microbial composition among samples, FMT fails to satisfy EU drug classification requirements. Also, since human cells are not an active component of fecal matter, FMT is not covered by EU Directive 2004/23, which deals with the safety and quality of human tissues and cells. Therefore, the European Medicines Agency (EMA) has authorized the member states to regulate FMT however they see fit.

This lack of consensus has led to diverging regulatory policies, causing uncertainties for interested players and making developmental activities challenging, particularly in Europe. But despite this, many companies, such as Rebiotix-Ferring Pharmaceuticals, are making leaps in R&D.

Donor selection has social, ethical, and financial challenges

Another bottleneck that needs to be addressed is the availability and selection of suitable donors. There is a debate regarding whether the patient should know the donor or not. Also, the ideal donor should be free from chronic illnesses or infections and willing to donate. The donor is screened for obesity, antibiotic resistance, microbiome diversity, oncogenic potential, a history of antibiotic use, and risky behaviors such as drug abuse.

Stool banks require donors to follow several restrictions, such as maintaining BMI, abstaining from unhealthy eating habits such as spicy foods or saturated fatty acids, and avoiding travel to infection-prone tropical regions for an extended period. With that, donor dropout is high due to the considerable commitment needed, according to a 2019 study published in Gastroenterology, the official journal of the American Gastroenterological Association (AGA).

FMT implementation is also facing several social and ethical challenges with questions such as donor compensation, gender of the donor, donor and patient vulnerability, and commercial use of fecal matter.

Companies can launch educational drives targeted at patients and ideal donors to raise their awareness about FMT, tackle social resistance towards the procedure, and build trust with prospective donor candidates and patients. This can help reduce people’s reluctance to participate in FMT procedures.

The procedure remains risky, especially for vulnerable population

FMT is associated with an increased risk of transmitting infections such as Shiga toxin-producing E. coli (STEC) and enteropathogenic E. coli (EPEC) from the donor to the receiver. Immunocompromised patients are at a higher risk of developing side effects, according to a 2020 study published in Digestive Diseases and Sciences, a peer-reviewed journal. Similarly, a 2019 case study published in the New England Journal of Medicine, a journal of the Massachusetts Medical Society, showed a fatal infection contracted by an elderly immunocompromised individual following an FMT procedure.

Another challenge is the very few pediatric clinical trials, which makes it difficult for physicians to make the best judgments for when to initiate FMT therapy in children.

To tackle safety-related challenges, the FDA released safety advice in 2019 and 2020 regarding the possible risk of severe, potentially fatal infections associated with the procedure. Companies such as Boston-based OpenBiome have promptly modified their sample screening methodology to identify such infections.

Lack of studies on long-term effects

The lack of understanding of the long-term changes FMT can cause in a patient’s microbiota is another challenge. Several studies reveal that liver diseases, cancer, cardiovascular diseases, etc., can develop due to microbiota dysbiosis. Investment in R&D by interested and capable players can help medical professionals understand the long-term implications and complications of FMT and identify feasible solutions, which can pave the way for widespread treatment acceptance.

The sector’s future appears bright, underpinned by extensive development

FMT is a highly effective treatment for recurrent CDI. New developments have been taking place in many areas, such as administration modes, stool collection, and storage, and interested players can find opportunities in these areas. The FDA is also becoming more accepting of FMT-based treatments that show good results. This is shown by the approval of Rebyota and Vowst, both of which were more effective in reducing recurrent CDI compared to placebo in randomized controlled trials.

Stool banking and processing is another area ripe with opportunities for interested players. Conventionally, fresh stool is used for FMT, but this can increase the cost of the procedure. Stool banks are being developed to facilitate cost-effective and safe treatment. An example is OpenBiome, the USA’s first and biggest public stool bank. Stool banks can also make the standardization of stool processing and donor selection easier, according to a 2019 report published by the European Helicobacter and Microbiota Study Group.

Players can also form collaborations with healthcare professionals and research institutions to offer FMT treatments and support microbiome research. Many government organizations are also showing interest in the development of FMT therapies. The GBP500,000 grant awarded by the Biotechnology and Biological Sciences Research Council (BBSRC), a part of UK Research and Innovation, in 2022 to Norwich-based Quadram Institute (QI) to build and equip a new FMT research facility is an indication of this.

Investing in the development of FMT treatments can revolutionize the treatment of several diseases, and companies that can invest in research can gain a head start in the competition. Rigorous R&D is going on to develop FMT solutions for conditions such as obesity, depression, cancer, pediatric diseases, and autoimmune disorders such as Crohn’s disease.

A 2023 trial conducted by the US-based Emory University School of Medicine also showed that FMT can reduce the colonization of multidrug-resistant organisms in kidney transplant patients. Investigators believe more research in this field can help improve transplant success rates and decrease the chances of infection. Individual case studies have shown great improvement in cure rates for certain diseases, including mental health conditions, but more research is needed to present a solid case for product development.

EOS Perspective

FMT is gradually establishing itself as a promising solution for recurrent CDI and is expected to create waves in the treatment of numerous physical and mental health conditions despite facing several challenges.

Improvements in donor selection, early identification of certain conditions with better risk assessment, and increased treatment efficiency can be expected with ongoing research expanding the knowledge base of the medical community.

Experts are also looking into FMT’s potential as an adjunct therapy in treating diseases such as tuberculosis, and it is expected to open the door to interested players to create personalized and targeted FMT-based treatments for various diseases.

Studies are also being done to understand and substantiate the potential of gut microbiota to anticipate diseases such as IBD and CRC using AI (Artificial Intelligence) and ML (Machine Learning). ML can be used to identify biomarkers in the gut microbiota to aid in the early detection of CRC. These studies, when extended to FMT, are expected to help medical professionals identify ideal donors and improve treatment efficiency.

The Brainy Insights, in its 2023 report, predicts a growth in the probiotic infusion segment owing to the increasing studies on diabetes management. Therefore, competitive players interested in FMT can also diversify their portfolios by including consortia (multi-population systems with a broad spectrum of microbial species) and probiotic products that have the potential to offer regulated, standardized treatments. This can help them get an edge over their competitors.

Several oral FMT solutions are currently in phase-1 and phase-2 clinical trials, and many are geared toward treating conditions other than recurrent CDI. For example, US-based Vedanta Biosciences is developing FMT therapeutics for IBD, food allergies, solid tumors, etc. As research continues, it is expected that investigators will be able to identify the bacterial strains that can treat different diseases and isolate and mass-produce them, leading to a decrease in stool collection and processing and a reduction in stool transplant-related infections, but this development is expected to occur very far in the future.

Although marred by several challenges, FMT is well-positioned in the microbiome industry to obtain FDA approval and (with time) widespread acceptance. Right now, interested players can expect good returns by investing in oral FMT development, stool banking, and R&D.

by EOS Intelligence EOS Intelligence No Comments

Poop to Pills: Is FMT the Future of Veterinary Medicine?

Fecal Microbiota Transplant (FMT), the transfer of healthy gut bacteria from a donor to a recipient to treat a myriad of conditions, has been gaining traction rapidly in recent years. Though the human FMT market has stolen the spotlight, the animal segment is also quietly blooming as a niche area, presenting a unique business opportunity for enterprising players.

The global human FMT market, estimated at US$2.11 billion in 2023, is projected to reach US$3.15 billion by 2031 with a CAGR of 5.1% between 2023 and 2031, according to a 2023 report published by India-based market research company The Brainy Insights. The animal FMT market is undoubtedly smaller, but it is difficult to determine its exact size due to a lack of consistent data on exact use. Also, while the human segment has many players, such as UK-based Microbiotica, US-based Finch Therapeutics, and US-based Rebiotix, Inc., the animal segment has a few competitors, such as Amend Pet and AnimalBiome, both US-based companies.


This article is the first in EOS Perspectives' coverage 
of Fecal Microbiota Transplantation in animals and humans. 

Read our related Perspective: 
Gut Matter: Will FMT Change How We Look at Disease Treatments?

Veterinary FMT is slowly but steadily growing

Increasing pet ownership is one of the most important factors influencing the growth seen in the veterinarian FMT sector. The American Pet Products Association (APPA), a Connecticut-based NPO, conducted a 2021–2022 National Pet Owners Survey, which found that 70% of US households own a pet, an increase from 56% in 1988 and 67% in 2019. A 2022 report published by HealthforAnimals, a Belgium-based global animal health association, indicated that owners are becoming more aware of their pets’ health needs. Similarly, a 2012 State of Pet Health Report released by Banfield Pet Hospital, a US-based veterinary hospital chain, has shown an increase in chronic diseases in cats and dogs.

The high incidence of diarrhea in pets also affects the FMT adoption rate. A 2008 report published in The Veterinary Record, a UK-based peer-reviewed journal, states that one of the most frequent causes of pet owners seeking veterinary care is acute diarrhea (AD).

Antibiotics are frequently used in the treatment of AD in dogs, 45% to 70%. The use of antibiotics in dogs can cause imbalances in the gut microbiota, leading to other diseases. This makes it essential to have a more holistic approach to managing pet diseases without disrupting their gut health.

The FMT sector is marred with several challenges

Though the FMT procedure offers many benefits, large-scale adoption still faces numerous challenges.

Empirical and scientific evidence is still lacking

A 2021 article published in Gut Microbes, a journal from the UK-based publishing company Taylor & Francis, indicated that the experimental information provided in preclinical FMT protocols is extremely uneven and/or lacking. The study suggested the reason for this is the lack of reliable guidelines for reporting requirements that would support efforts to replicate the study and, eventually, yield reproducible research. Many papers considered in the study lacked information on core aspects; for example, 92% had no reliable data about anaerobic conditions needed for FMT prep, and 49% had no information on efficient fecal material storage.

There is also currently minimal scientific information available in the field of veterinary FMT. Moreover, there is very little information on the therapeutic effectiveness of FMT in small animals such as dogs and cats, according to a 2016 article published in Veterinary Medicine (Auckland, N.Z.), a peer-reviewed journal. The article suggests that though adverse effects are limited in human patients, assessing whether the procedure is safe in animals is difficult.

Regulatory framework is in its infancy

Regulation is a bit complex in veterinary FMT. While there are not many specific regulations for veterinary FMT, the FDA considers FMT treatments used to prevent or treat diseases in animals as a new drug. Marketing new veterinary drugs in the USA without an approved or abbreviated new drug application is illegal. These require the manufacturer to submit information proving that a proposed generic medication is equivalent to an approved reference-listed drug (RLD) in terms of quality, safety, and efficacy. The lack of detailed clinical studies in the veterinary segment can slow down regulatory clearance. The Center of Veterinary Medicine, the US department approving drugs for pet animals, does not have any specific regulatory policy regarding the use of FMT either.

Veterinarians lack experience

Lack of technical expertise and procedural experience can also hinder FMT adoption. A 2022 study published in Topics in Companion Animal Medicine indicated that 71% of veterinarians had never performed FMT. These results were based on 155 responses from 13 different countries.

Risk of transmitting disease phenotypes is high

FMT can transmit disease phenotypes, including obesity and metabolic disorders such as diabetes, according to a 2020 study published in Medicine in Microecology, a peer-reviewed journal. Similarly, changes to the gut microbiota, such as exposure to antibiotics or the transfer of cecal material (fecal material from the bottom right quadrant of the cecum, a part of the large intestine), can affect disease phenotypes, such as an elevated risk of colitis.

Donor selection is difficult and pricey

The selection of an ideal donor is another challenge. The donor animal should be free from all kinds of parasites and pathogens and without any history of gastrointestinal diseases. Similarly, the donor should have no history of behavioral issues and should be of ideal weight. There should also be no history of antibiotic use within six months before the sample collection. Stool banks must thoroughly test the samples used for FMT, increasing procedural costs and hindering widespread acceptance and adoption of the technique among pet owners and veterinarians.

Poop to Pills Is FMT the Future of Veterinary Medicine by EOS Intelligence

Poop to Pills Is FMT the Future of Veterinary Medicine by EOS Intelligence

Numerous investment opportunities are available for interested players

Though veterinary FMT is still in its infancy, businesses still have several investment opportunities in this sector.

Focusing on extensive R&D

Veterinary FMT is a promising sector, but more research is needed to support product and service development. Since the current competition is concentrated on rigorous R&D, interested players capable of making risky research investments will likely gain an upper hand over their competitors.

The research so far has been promising, and the extensive R&D helps drive the market and build the necessary base for FMT to be recognized as a separate category for approvals. A 2022 study published in Frontiers in Immunology, a journal of the International Union of Immunological Societies, has indicated that several studies were conducted in the field of FMT from 2001 to 2021. This study analyzed key aspects such as donor selection, efficacy, and adverse effects. The incidence of minor and serious adverse effects after an FMT procedure was found to be 11.63% and 1.59%, respectively, while the overall efficacy was 76.88%.

The results from this study are promising, but they also indicate that more research is needed to understand and confirm the efficacy, safety, and quality of FMT treatments in animals. The FDA is more likely to approve these therapies with more robust evidence from newer studies, giving market players more opportunities.

Even though there is currently a lack of consensus or evidence-based standards regarding FMT dosage or donor screening for animals, a recently established international expert organization, the Companion Animal Fecal Bank Consortium, is developing guidelines in these domains. This can also be considered as a first step towards prompting FDA approval.

Developing the oral delivery route

Market players can find opportunities in developing FMT treatments administered through oral rather than nasoesophageal or rectal routes. Currently, the FMT delivery route is one of the critical bottlenecks in the more widespread adoption of the therapy.

Both nasoesophageal and rectal delivery routes are considered more efficacious but are associated with considerable risks. Nasoesophageal treatments use endoscopes that cause discomfort and aspiration and make it difficult to assess the colon mucosa or get mucosa tissue samples. In rectal FMTs, colonoscopes and anesthesia are involved, the latter often being a significant risk to the pet patient, deterring pet owners from choosing FMT. Both rectal and nasoesophageal routes are also associated with a risk of perforation, bleeding, infection, etc.

Conversely, the oral delivery route is generally preferred due to non-invasiveness and ease of use. However, oral FMT takes longer to reach the large intestine and has been perceived as less effective.

Market players can attempt to meet the preference for the oral route by building on a few research studies showing the good efficacy of oral FMT in pets. While research on animals is still limited, research in humans can be extended to identify approaches to improved efficacy of oral FMTs in treating animal GI infections. One such research was a 2017 study published in JAMA Network Open, an open-access journal by the American Medical Association, which indicated that in humans, oral FMT had efficacy in the treatment of C. difficile infection similar to that of rectal FMT.

One of the pioneers in this area is AnimalBiome, which developed an oral Gut Restore Supplement in an enteric-coated capsule (a coating that protects the medicine from the stomach’s acidic environment before it reaches the intestine and reduces side effects). The company conducted a pilot study in 2019 to observe the impact of the capsule on 40 dogs and 72 cats suffering from IBD. The study found that symptoms improved in 83% of the cats and 80% of the dogs. As the availability of such FMT solutions is still meager, there is plenty of room in the market for businesses to follow AnimalBiome’s footsteps and invest in creating oral FMT solutions.

Driving adoption through at-home administration kits

Another growth area for players is the development of user-friendly oral at-home administration kits for more straightforward treatment requirements. There is a demand for such easy-to-administer at-home solutions in the animal FMT space, as getting the pet to a vet is typically stressful for both the animal and the owner.

A 2011 survey published in the American Veterinary Medical Association (AVMA) journal indicated that out of 2,188 dog and cat owners polled, 38% of dog owners and 58% of cat owners said their pet “hates” visiting the vet. If FMT has to be repeated or spread over multiple visits, the treatment process is also time-consuming, further decreasing the likelihood of completing the therapy.

At-home application solutions can help make significant inroads into FMT acceptance, as pet owners are more likely to opt for such treatments rather than in-hospital procedures whenever possible.

Increasing specialization and targeted treatments

Developing more target FMT treatments (specific to animal breeds or conditions) appears to be a good area of opportunity. Currently, studies are being carried out to develop farm-specific FMT to treat various conditions in cattle.

A 2022 article published in PLOS One, a peer-reviewed journal, investigated the effects of farm-specific FMT on pre-weaned calves. The study indicated that FMT-treated calves’ alpha-diversity (indicating microbiota richness) had increased. It also suggested that the success of FMT will improve with proper criteria for donor selection. This offers scope for further investigation for market players to develop such targeted therapies.

Expanding through complementary products

Players can grow their FMT business by building a range of products to complement FMT therapies, such as specialized probiotics or microbiome health supplements.

A 2015 study published in BMJ Open, an open-access medical journal, has indicated that the gut microbiome can be strengthened and balanced in humans with the help of proper diet, probiotics, prebiotics, and FMT. Researchers are now looking into the positive impact of probiotics on animal health, such as improvement in digestion, lowered risk of gastrointestinal diseases, etc. With support from such research studies, players can work to offer comprehensive treatment and maintenance product lines.

Working on awareness through educational initiatives

Apart from immediate business opportunities, players might also have to get involved in activities that inform, educate, and help build the FMT market. Though it is a promising emerging therapy, very little information is available on veterinary FMT. In order to reap long-term rewards, businesses should spotlight and promote FMT and its positive effects on animal health to the vet community and the public by launching educational drives, conferences, and other similar initiatives. Existing players already recognize this need. For instance, Amend Pet, a major company in the veterinary FMT segment, has free educational courses in the form of RACE (Registry of Approved Continuing Education)-approved videos for veterinarians.

Increasing adoption through collaborations

Further, players in the FMT space should collaborate with veterinary hospitals and other organizations dealing with animal health to work with them and increase FMT adoption.

An example of this is the strategic collaboration between Amend Pet and the Association of Shelter Veterinarians (ASV) that started in May 2023. With this partnership, Amend Pet plans to offer easy-to-use and affordable FMT treatments to shelter dogs. The ASV has over 2000 veterinary professionals and 23 student chapters worldwide. Partnerships such as this can be expected to raise awareness about FMT among the public and veterinary sector, leading to improved adoption rates.

EOS Perspective

While veterinary FMT still has a long way to go before becoming a mainstream therapy, it is already an exciting field with many expected developments.

The spectrum of animal health conditions that can be treated or managed with FMT will continue to expand to include immune system disorders, metabolic conditions, and behavioral issues. Progress in the animal FMT space will likely be linked to research done in human FMT, as these studies can be extended to animal healthcare or at least be a starting point for animal FMT-specific research, revolutionizing veterinary treatments.

Improvements in donor selection processes, such as more stringent and advanced inspection of the donor’s gut microbial diversity and behavior evaluation, can be expected as many studies are now being done to understand the connection between behavior and gut microbes.

Rapid technological development, especially in AI, is expected to influence veterinary FMT as well. AI-powered equipment might be used for guided rectal FMT treatments to improve the procedures’ accuracy. This is likely to be safer for the animal and can prompt pet owners to choose FMT to treat their pet’s gastrointestinal issues. Companies investing in research can expect growth in this field.

All these developments, if accompanied by simultaneous partnerships between industry players and veterinary clinics, offer a promising future for the animal health FMT. The return on investment in this sector might not be immediate. For now, the industry needs to prioritize driving adoption, educating and disseminating knowledge, and gathering scientific data and empirical evidence to build a sound understanding of FMT in veterinarians, pet owners, and regulatory bodies. Nonetheless, the industry prospects are promising, and the players can expect the long-term benefits to be substantial.

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