The future of personalized wireless drug delivery – Interview with Robert Niichel, Founder & CEO, Velóce Digital Health – SmartTab™ wireless ingestible capsule

Medication adherence has huge impact on the desired health outcomes for the patients. According to WHO, more than 50% of all medicines prescribed to patients are not taken correctly. This alone can impact patients’ health dreadfully and it costs the healthcare system billions. Together with Robert Niichel, Founder & CEO, Velóce Digital Health, we explored the future of personalized wireless remote-controlled targeted drug delivery, the huge billion market potential and the company’s business model.

Medication non-adherence has an enormous impact on patients’ lives and healthcare costs. Healthcare stakeholders have developed technology-based solutions to significantly improve patient outcomes, increase drug compliance and lower toxicity. Digital precision medicine combining sensors and active pharmaceutical ingredients was born. In 2017 FDA approved the first drug in the U.S. with a digital ingestion tracking system, a product created in a partnership between Proteus Digital Health & Otsuka Pharmaceutical. This has paved the way to a new market niche promising patients empowerment with nearly real-time insights on their medication treatment, behaviour patterns, as well as lowering the cost related to non-adherence.

Two years later things have changed for Proteus Digital Health as more comprehensive efficacy evidence were needed to keep Otsuka Pharmaceutical as a partner. What does this mean for the market? What can other market players learn from a leader’s experience?

We talked to Robert Niichel, Founder & CEO, Velóce Digital HealthSmartTab™, the world’s first ingestible wireless powered and remote-controlled drug delivery system, about the future of the market, the huge market opportunity based on Billions of tablets and capsules prescribed globally, the company’s unique value proposition and what lessons has he learned from Proteus Digital Health story.

Enjoy the interview!

Research2Guidance: As a short introduction, could you please share Smart Tab’s story
Robert Niichel: SmartTab™ is an ingestible wireless powered and remote-controlled drug delivery system providing effective and targeted drug delivery. The problem that we are trying to solve is that today, most medicines are either not taken as prescribed or they are not delivered internally to the human body as designed.

Let’s look at Crohn’s disease, an inflammatory bowel disease, to show in practice how our solution might work. In general medications used to treat inflammation of the colon are not able to reach the colon intact. With SmartTab™ targeted delivery system a patient swallows the tailored capsule, which will be able to travel to the colon and then the active ingredients inside the capsule can be released at the most beneficial time by clicking on a button on a smartwatch, smartphone, or a PC in a clinical setting. There is also an automatic release to where the capsule comes with the correct range and then it is triggered. So, there are better patients’ outcomes, less side effects, low dosages, thus money is saved in the healthcare system. It is a huge relief for the patients – getting the active ingredients at the right time and place to take care of the pain they experience.

In the United States there are around three million adults reportedly being diagnosed with Crohn’s disease. The mean hospitalization cost of this disease is over $11,000 which implies that over $34 billion is spent each year in treating the disease.

Research2Guidance: How a patient can control where the capsule is delivered?
Robert Niichel: Typically, in a clinical setting the doctor will be using a small patch which is the targeted area and when the capsule becomes detected within that range then the active ingredients are being able to be released.

Research2Guidance: What is your business model? How do you envision making money?
Robert Niichel: In 2019 we completed successfully pre-clinical animal studies and we soon will enter human clinical trials and later an FDA submission. Once we have that then we will partner with large Pharmaceutical companies to integrate their existing drugs into the SmartTab capsule to create a much better delivery system.

So, our business model will be B2B. We will manufacture the capsules; we will then sell them and license this technology to the Pharmaceutical companies. Companies like Novartis, Pfizer then will be able to put their active ingredients into capsules and send them out as a ready product to their distribution channels, like Pharmacies, wholesalers, etc.

The revenue stream will come from one selling the actual hard piece to Pharmaceutical companies and two licensing for exclusivity based upon a particular market share or a certain prescription drug, around that.

Research2Guidance: What do you think about Proteus Digital Health and the challenges the company had – failed partnerships and not being able to materialize on their reality? What are the lessons that can be learned?
Robert Niichel: Proteus Digital Health did a good job in paving the way for FDA and regulatory approvals. They kind of pioneered this path around consumer usable electronic ingestible devices and their approval in that sense is a big deal.

We believe that the reason they had / have a hard time to be successful commercially is “What problem are they solving?”. They took a chip and embedded it to a normal capsule. So, what they do is monitoring adherence. There is nothing that increases the benefit of actual drug delivery. We are increasing the benefit around how prescription drugs are delivered.

Another issue could be the first drug they look at is a drug for schizophrenic. These patients are probably the worst type of patients for this solution. They are concerned about taking their medicine and how this pill will affect them, so right away there is a resistance to take the pill or try to bypass the system, etc. So, it could be something as simple as Proteus picking the wrong prescription drug to try to deploy their solution on a commercial scale.

Also, maybe the education wasn’t correct when the pills had been prescribed. Overall, the company was making great progress, so I think once they work through those issues’ things might change.

What we can learn from them is to make sure that we have a very clear solution, which I believe we do. And we are going way further then Proteus with very targeted drug delivery. We believe we are not only solving a much bigger problem, but we are also increasing the benefits for the people.

Research2Guidance: Who do you consider your competitor(s)?
Robert Niichel: At present, on the market no company is offering targeted electronic wireless drug delivery system. We don’t have any direct competitors.

There are activities in the space and some companies are doing something related to a capsule with some cool technology embedded into it. Like Proteus Digital Health that we talked about. Microchip Technology, for example, offers an implant that goes under the skin and then releases the active ingredients daily and that is controlled wirelessly.

Research2Guidance: What trends do you see in your niche?
Robert Niichel: I think in near future people will swallow smart capsules that will help them with their health journeys. We are also working on next generation SmartTab™ with multiple compartments. So imagine you need to take antibiotics for a week and what if you take just one capsule you swallow it and then each day at the same time you send the signal from your watch or phone and it releases the active ingredient for that day. At the end of the week the capsule washes out of your system.

Trend we believe in 10 – 15 years when walking into a Pharmacy most of the tablets will be capsules offering some type of electronic delivery system, monitoring system, tracking system and this will be the way the medicine is delivered.

Research2Guidance: What are the main barriers for your solution? What are your challenges?
Robert Niichel: Some potential key challenge that we recognize is the FDA approval pathway – how do they respond, how do they review, so we are working with a Consultant to help us successfully go through that.

A challenge is also the capsule itself. You look at the surface of the solution and it is very cool. But we have to make sure that the wireless communication works through the body, skin, the muscles of people of all sizes and make sure that signal is very robust. Also, at some point we have to look at cyber security. Someone is taking the capsule and what can prevent somebody else from triggering that capsule besides your phone?

Research2Guidance: You have mentioned FDA, does this mean that you will concentrate only on the US market?
Robert Niichel: A company should stay focused. At present, our attention is on the US market. We will be going to Europe shortly after we obtain FDA approval. European market is an interesting market and I believe we can be successful there too.

Research2Guidance: How big is the market? Are you looking to solve only a specific health issue with the SmartTab like, for example, Crohn’s disease or hypotension or you are interested in the market as a whole?
Robert Niichel: In a long run any market can benefit from our technology. And the market is very, very large.

Let’s look at some numbers. There are 200 Billion tablets and capsules prescribed in the USA last year alone. We can’t integrate our technology in all the capsules right away, so we pick one very good application which is Crohn’s disease. There are million people in the USA that have this disease and they have to take their medicine every day. In theory that would be 30 million capsules per month, which is 360 million capsules per year. If we are able to get let’s say 20% from that market within the first couple of years just that market will be a large market worthwhile to be part of. Later we can look at other diseases.

As I have shared, let’s look at antibiotics, which have a worldwide application. If you have one capsule for each one of the antibiotics prescribed and this capsule has multiple compartments which will help patients have their medicine at the right time, right place and only with one swallow within 7 days, wouldn’t this be fantastic? And then if you look at the financial side, here alone we are talking about hundreds of billions of dollars.

What about the 3rd world countries, can we help patients there too? I believe so. If we think about their healthcare system, but also the challenges that the patient is facing, as simple as “do I have clean water? Where can I get the medicine?” So, if there is one capsule that a patient swallows the first day at the doctor’s office with a good clean water and in the next 7 days this capsule with multiple compartments releases the active antibiotic ingredients every single day, at the same time without the need of water or extra effort from the patient, wouldn’t this make a difference in this person’s life!

There are different market opportunities. Right now, we need to be focused, successful in the first niche we have set our eyes on and then we can go into hundreds of different applications.

Research2Guidance: What is next for SmartTab™? What are your near future plans?
Robert Niichel: In the nutshell, we are doing a series of funding rounds to raise capital and to start our human clinical studies. The next step will be an FDA submission, get an approval and clearance for our medical device. With that we can reach out to a Pharmaceutical company to have one of their drugs integrated with the SmartTab. Having done that the next step is to do another clinical study with this drug inside the SmartTab to show that the solution is working perfectly, after approval, we will be ready to go to the market. The whole process might take three or four years or even quicker. Meanwhile, we might be bought by a larger Pharmaceutical company before some of the above happens, yet we do have a very clear strategy how to get our solution to the market.

Research2Guidance: What do you think is missing right now in the digital health market to empower the patients’ journey further?
Robert Niichel: If we are looking at the digital healthcare space there are a lot of apps that track data (how you take your medicine or your weight) but these apps do not do anything besides that. And I believe a solution needs to do something for the patient – like, deliver the drug, or send a signal for something. Our capsule doesn’t require a battery. So, this idea of how to power devices from a long distance could be developed more.

The big gap is that there are a lot of software people creating these cool apps collecting a lot of data, but at the end of the day what is done with this data. In the USA we have a lot of apps to help people be healthier, be more fit and lose weight. Yet, in the last 10 years people are getting bigger, bigger and bigger. So, there is a huge disconnect. What we are trying to do is deliver drugs and make people’s lives better by improving the actual physical implementation system.

Research2Guidance: Robert, thank you very much for your thoughts and insights.

About Velóce Digital Health
Velóce Digital Health is developing the SmartTab™ Drug Delivery system, a wirelessly controlled and inductively powered ingestible capsule that contains an electronic receiver, smart polymer actuator, and active ingredients. This precision digital delivery system can be remotely triggered via an external device and deliver active ingredients to targeted areas. SmartTab™ will deliver active ingredients to highly specific areas in the human body at specific times or in response to a monitored physiological condition. The system will interface with custom or current wearable and monitoring technology (e.g. Apple Watch, Garmin, Fitbit, etc). The SmartTab™ has the capability to deliver a wide range of active ingredients. To learn more visit: https://smarttab.co/

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