SINGAPORE (April 8): Kuldeep Singh Rajput did not quite have the heart of an engineer, even as he was pursuing an undergraduate degree. Instead, he became enamoured of the idea of controlling a wheelchair with brainwaves — for use by paralytics. That eventually led him to pursue a PhD in neurotechnologies at the National University of Singapore. Around the same time, he formed a digital health start-up, Biofourmis; when that took off, Rajput had to forgo his doctorate.

“I’m the only one in my [core] team with no PhD,” he tells The Edge Singapore. Still, Rajput has achieved much. Biofourmis, which he founded in 2015, is set to cut hospital readmissions and, by doing so, significantly lower the burden of healthcare costs for patients.

It aims to use digital analytics to predict and manage medical conditions, typically in combination with other drug therapies. The start-up says its clinical trials show that its software can predict heart failure decompensation two weeks in advance before actual hospitalisation, and is 90% accurate.

Biofourmis’ digital platform recently received regulatory clearance, and the company has more than five partnerships with global pharmaceutical companies. It is closing a Series-B round of fundraising in the coming weeks. The start-up had raised close to US$11 million ($14.9 million) prior to this. The funds will go towards the running of clinical trials for digital therapeutics products and establishing more partnerships for its services.

“We will have a couple of new board members,” Rajput says. “One of them specialises in taking companies to a public exit.”

It took nearly two years for Biofourmis to build its first digital analytics system, as outpatient and ambulatory care data is difficult to obtain. Rajput says the company is fortunate to have scored major partnerships that allowed it to run clinical trials. Among its partners are US-based Mayo Clinic and Massachusetts General Hospital.

The digital therapeutics company provides a companion service to patients who have just been discharged from hospital. Its platform called Biovitals is used to manage patients with heart failure, acute pain and chronic respiratory disease. The start-up offers its service only in the US for now. “We picked the US because hospital readmission is an obvious pain point for its healthcare system,” Rajput explains.

The digital platform is integrated with existing sensors in the market such as VitaPatch and Biobeat. Patients who wear these sensors will have their data synced to Bio-fourmis’ mobile application. The system captures a variety of physiology signs. This information is made available in real time to the patient’s nurse or clinician, who will monitor and make necessary adjustments to the patient’s treatment plan.

While some hospital admission software uses only population-wide data to predict the readmission rate, Rajput believes the additional layer of personalised data will provide better insights into how the patient is doing. The Biofourmis system takes about four hours to build an initial profile of the patient. “The idea is to predict [a relapse] before a medical episode occurs,” he says.

In the US, at least one in five patients is rehospitalised within 30 days of being discharged, according to the Agency for Healthcare Research and Quality. This costs the US healthcare system an additional US$41.3 billion a year, of which US$17 billion could have been avoided with better care. For heart failure patients, part of the reason for the high readmission rate is that only a small number of patients is given treatments in line with the guidelines set by the American Heart Association.

In any case, the US is moving towards a value-based payment model, instead of fee-for-service model. About 30% of healthcare bills in the US in 2016 were paid through a non-fee-for-service model. About 25% of branded drugs are also paid or reimbursed by insurers based on patient outcomes, which can mean a lower readmission rate or improved conditions in patients.

As such, Biofourmis partners pharmaceutical companies to bundle its Biovitals platform with the drugmakers’ therapies. It provides value-added services such as the monitoring of side effects and the tracking of drug efficacy. Biofourmis is paid either through a fee-for-service model or based on outcomes achieved by the therapies.

The start-up currently has a mix of pilot projects and long-term contracts with these companies, the longest of which is for three years. While it does not disclose revenue or profit figures, Rajput asserts that the company is cash-flow positive.

Now, Biofourmis wants to expand its patient management services. It is working on clinical trials and seeking regulatory clearance to use its data analytics for healthcare intervention for patients with heart failure such as dose changes and to guide overall patient behaviour. All this could improve outcomes of therapies and reduce readmission rates.

Typically, digital therapeutic trials can take eight months to a year to complete and receive regulatory clearance. Each set of trials can cost up to US$5 million.

Value-based healthcare systems a boon

Digital therapeutics, observers say, are taking off as more countries turn to value-based healthcare to lower costs. Abel Ang, CEO of Accuron Medtech, a global medical device maker, says: “Value-based healthcare policy guidelines make it possible to viably monetise the outcomes that digital therapy companies are attempting to deliver. The first movers in the sector are working directly with pharmaceutical companies and medical benefit providers to carve a niche for themselves in areas such as addiction, mental health illnesses and other areas to showcase how their models can work.”

In Singapore, other start-ups are also moving in this direction. Digital health provider Holmusk is working with Duke-NUS Medical School professor Eric Finkelstein to link its mobile application with health sensors. Called M-POWER, the platform gives diabetic patients financial incentives to improve their health through lifestyle changes. “We are soon testing it in randomised controlled trials with funding from the Ministry of Health. My hope is that people will use the technology to improve behaviour in an effort to get their costs covered,” says Finkelstein.

But the sector is still nascent. Regulatory challenges would differ from country to country. And there is still little proof that these tools can truly make a difference in healthcare outcomes or costs, say observers.

“Success or failure in the sector will depend on the compelling value that these digital therapeutic companies provide to the various healthcare stakeholders. Do the patients get objectively better treatment? Are the healthcare outcomes and costs indeed better? These benchmarks will decide the winners and losers in the sector,” Ang says.

Whatever the case, Rajput is focused on his strategy of growing Biofourmis through more partnerships, and completing more clinical trials in the US to obtain regulatory approval for its platform. Its success could very well alleviate the growing burden that healthcare is becoming for governments.

Japanese crypto start-up hits US$1 bil valuation

By <a href="https://www.bloomberg.com/authors/AR_ria0JXAc/yuji-nakamura">Yuji Nakamura</a>

<a href="https://quoine.com/">Liquid Group</a>, a Tokyo-based crypto-currency trading platform, put out a <a href="https://www.newswire.ca/news-releases/liquid-com-announces-first-close-of-ongoing-series-c-funding-hits-tech-unicorn-status-833456653.html">press release</a> on April 3 that it had raised venture funds at a valuation in excess of US$1 billion ($1.35 billion), making it one of the rare so-called unicorns in Japan.

The start-up has secured funding from investors including venture fund IDG Capital and crypto mining giant <a href="https://www.bloomberg.com/quote/1374554D:CH">Bitmain Technologies</a>, it said in the statement, but in a somewhat unusual step did not disclose how much money it had taken in. Liquid has commitments for about US$50 million, according to a person familiar with the matter, a relatively small amount for such a lofty valuation. Start-up valuations are viewed sceptically if the amount of capital raised is less than 10%.

That is not to take away from Liquid’s progress in building its business, including securing a coveted crypto-exchange licence from Japan’s financial watchdog and handling more than US$50 billion in cumulative trading volume. IDG is also a marquee investor, having funded crypto start-ups such as Coinbase and Bitmain.

Crypto start-ups have a history of pushing aggressive valuations. In June, Circle Internet Financial raised US$110 million, valuing the mobile payments and crypto trading platform at <a href="https://www.bloomberg.com/news/articles/2018-05-15/circle-says-bitcoin-miner-bitmain-leads-110-million-investment">US$3 billion</a>. Coinbase <a href="http://fortune.com/2017/08/10/bitcoin-coinbase-unicorn/">raised</a> US$100 million in 2017 at a <a href="https://blog.coinbase.com/coinbase-raises-100m-series-d-led-by-ivp-f5f25cb51019">valuation</a> of US$1.6 billion. Non-crypto start-ups tend to raise even larger amounts in their unicorn rounds.

Liquid, founded in 2014 and previously known as Quoine, raised the latest funds as part of its ongoing Series C round. Co-founders Mike Kayamori and Mario Gomez Lozada had raised more than US$20 million in prior rounds from investors including Jafco Co. Separately, they raised US$100 million through an initial coin offering in 2017.

The new funding will be used for global expansion and comes amid rising optimism that last year’s brutal correction for crypto assets is coming to an end. Bitcoin jumped more than 20% last week to its highest in five months.

Japan has few start-ups valued at more than US$1 billion, as loose listing rules make it easy for founders to go public sooner than in other countries. Online flea market operator Mercari became the nation’s first unicorn in 2016. At the time, the US already had 92 unicorns. — Bloomberg LP

This story appears in The Edge Singapore (Issue 875, week of Apr 8) which is on sale now. Subscribe <a href="https://www.theedgesingapore.com/subscribe" target="_blank">here</a>

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