Welcome to Who Would Have Thought, my name is Sacha Heppell, Chief Marketing Officer of SmartTab. Today we dive into the impact of digital technologies on the practice of pharmacy and the exploding tsunami of digital ingestible pills, an ingestible sensor device that complements our SmartTab Drug Delivery Platform.
Sacha Heppell
I'm hosting this podcast with Robert Niichel, our Founder and CEO, Robert's experience in leadership and management of pharmaceutical research and development led to the founding of SmartTab in 2016 to combine wireless technology with pharmaceutical drug delivery. I'll pass it over to you Bob to introduce our honorable guest today behind the revolutionary ingestible capsule, improving medication adherence and forwarding the future of digital health.
Robert Niichel
Thank you Sasha. Today, we would like to welcome Harry Travis, President and CEO of EtectRX. This company has created an FDA cleared ingestible event marker, a sensor embedded into a gel cap that patients take and can measure and monitor adherence. Harry has an extraordinary background in pharmacy and is an influential speaker on digital technologies transforming the practice of pharmacy. Hello Harry and welcome for joining our podcast today. So to get started, first of all, congratulations on your FDA approval for the EtectRX capsule. Very impressive maybe talk a little bit about your background and how you moved into this space of the wireless ingestible capsules and digital pharmacy.
Harry Travis
Well, thank you, Bob. Thank you, Sacha. It's great to be here and I appreciate the opportunity. A little bit about my background, trained as a pharmacist that the University of Pittsburgh School of Pharmacy Practice pharmacy, little in the community, and then went back to school to get my MBA at the University of Virginia Darden School of Business and took my career on the corporate side of healthcare with a long stint at Baxter and IV drug delivery systems and then at Cardinal in oncology distribution, and it was after that, that I really got deep into Specialty Pharmacy as more of the or as the early, real expensive, genetically engineered drugs started coming on scene. I was the Chief Operating Officer at a specialty pharmacy in Memphis called Accredo. We were acquired by Medco and then after that, I moved to Aetna where I was the head of their specialty pharmacy and later included their mail order pharmacy operations. And then about three years ago, I saw the opportunity here locally to join with a couple investors and acquire this company that was developing an ingestible microchip for medication adherence company was called Etect we invested in the company and recapitalized it and rebranded it as EtectRX. And it took us about almost four years to get the product from kind of early lab stage through the FDA It was a device so it was cleared as opposed to approved I learned that the FDA approves drugs but they clear devices so our device was cleared in December of last year. So that's the quick background and how I got to where I am now.
Robert Niichel
Yeah, thank you for that. Let's talk specifically about the EtectRX the capsule, just exactly how does the capsule work?
Harry Travis
Well, I joke about it, the easy way to think about it is go back to high school when you turned an orange or a potato into a battery by sticking an anode and a cathode into it, and you're able to get a light bulb the light or a volt meter to register. It's the same principle. With the magic of incredibly efficient microchips these days that can run on incredibly low power. We put a little bit of magnesium in a little bit of silver chloride, a very small amount on a thin film of biocompatible plastic with a microchip and as soon as that gets exposed to your gastric acid, there's enough electron flow between the positive and the negative there for that microchip to take that energy and turn it into a radio signal that broadcasts from your stomach about one meter off your body for about 20 to 30 minutes. So essentially, we have got cleared an ingestible radio, a miniature ingestible radio it is ingestible not digestible. It powers up powers down and then it, as we say, goes out with the trash. And it indicates the fact that you swallowed it.
Robert Niichel
Yeah, very, very interesting. So as we look at that technology specifically, then how do you see this being deployed? And how will this interface with the digital pharmacy of the future?
Harry Travis
So the FDA has a class for this product, that is called the ingestible event marker. So technically, what the device does is it marks the fact that you have ingested it. So we are building off of that to deploy primarily on medication adherence applications, but there could be applications beyond that. medication adherence, as you know, is a big problem. There's over close to $400 billion worth of prescriptions sold in the United States. And you know, the famous quote by C. Everett Koop A long time ago was the you know, the most expensive medicine is the one that's not taken, and there's a lot of those out there, unfortunately, and various estimates put it as high as 300 billion in additional health care costs as a result of poor medication adherence. So our first target market, obviously, is medication adherence on medications where there is a real urgent need an obvious need for medication adherence, that could be very high cost drugs. There's a lot of those coming online now, or could be what we call high impact drugs, where if you don't take the medicine, you could have a bad event fairly shortly. That could be a transplant patient. It could be a patient with some type of infectious disease if you don't take your medicine, the virus or the bacteria goes resistant on you those type of applications.
Robert Niichel
Very interesting. So you take a look at the the capsule, the EtectRX capsule and some of the work we're doing here at SmartTab with wireless and ingestible capsules for drug delivery. And then what's your vision in terms of, say 5, 10, 20 years, what the pharmacy will look like, how pills are tracked and delivered. And well you know kind of the vision of the pharmacy and say 10, 20 years.
Harry Travis
I think there are two trend lines that are going to come closer and closer together over time. One is on the medication side, the desire for the payers, whoever they are government, commercial employer, the desire for the payers to understand what are they getting for the cost of all this medicine? What is the outcome? Can we quantify the outcome? Can we correlate the outcome back to the fact that the patient didn't take their medicine, therefore, we got a bad outcome or we're not getting the outcome we wanted because the drug is actually not working. So I think there is a strong growing desire on the part of everybody in that kind of healthcare chain to quantify outcomes and eliminate medication and appearance as one of the unknown variables there. The other trend line that's going on inside the pharmacy world is the trend to essentially reengineering restructuring the role of the pharmacist. So not many people realize that the pharmacist today is not paid for his or her time pharmacist gets income as a result of dispensing drugs and the gross margin on the dispense, which really sets up strange incentives for the pharmacy business. There is a strong move and there has been and it's finally gaining traction to get the pharmacist provider status so that they can bill for their time. Just like a physician, just like a nurse just like a physical therapist, just like a respiratory therapist. One of the things that the pharmacy profession is proud of is the fact that if you look at all of the healthcare professions, the pharmacy profession is the second most educated behind physicians and it takes about six, seven or eight years with a with a fellowship to get a PharmD everybody gets a PharmD today. And the American Pharmaceutical Association has done a great job of moving the profession in that direction. So you can see that with that and the technology coming available to provide better accountability for the use of medication. Both of those trends are going to work well together.
Robert Niichel
Yeah, very interesting. And then let's talk a little bit about the online area. So today, you walk into a pharmacy with your prescription, you then get it filled and you go home with your medicine. There are some new reoccurring online services that are out there, but 5, 10 years from now, do you see, how do you see the digital format evolving for prescription drugs with online services like Amazon and then how does that blend into the pharmacist like you were just talking about what their advanced degrees and how does that all shake out, as online services become more and more prevalent in our society?
Harry Travis
Well, the one thing I can pretty much guarantee is it won't shake out in one way the market is so big, you're talking 400 billion today, growing easily at 8%, something like that. Older population, more medications. So there's going to be lots of interesting, large segments and lots of interesting small segments. So, you know, let's talk about a couple of them. You know, maybe the most interesting or one of the most interesting is pharmacogenomics. So if you're, you know, you're talking about digital and you marry up your 23andme profile with a consultant pharmacist who can now take his or her time to look at your genetic profile and say, You know what, you've got a couple single nucleotide polymorphisms Everybody's got to know what their snip numbers are in the future, you've got a couple snips that lead us to believe you're not going to be able to metabolize this particular drug real well, or you might metabolize it too well, so let's adjust your dose. So there will be a whole segment of the profession that's just started now on kind of consultant pharmacogenomics, which will be powered by the data and the trend toward okay, we're going to pay pharmacists for their time. So that's, that's just one aspect of it. You could see pharmacy contracting or pharma contracting for medicine now becoming much more scientific. You're just hearing the beginnings today, of the term value based contracting or outcomes based contracting. You know, we don't think anything about spending $40,000 for a car and we expect a warranty. We expect guarantees. If something doesn't happen, we're going to get service and we're gonna get something back. Do we think of that in terms of drugs? Do the insurance company think in terms of you know, we're spending $50,000 a year for drugs for one Multiple Sclerosis patient, what are we getting in return? These technologies are going to allow a much finer definition of that problem and getting to that answer. So outcomes based contracting is going to be one thing that's going to look much different five years from now, pharmacogenomics is going to look much different, you will see more distribution channels as 90% of the prescriptions today are generic and are relatively inexpensive. So it is easy to see the market kind of possibly bifurcating where a lot of these generic meds will go through what we'll call non traditional channels pill pack or direct to consumer or something with Amazon while Amazon pillpack something along those lines.
Robert Niichel
Yeah, very nice. It's interesting how things have advanced so far with the pillpack and trying to enhance the delivery systems get things more organized. Let's talk a little bit about artificial intelligence. Last week, we had a guest on our podcast, the CEO of Cliexa, and they write software algorithms that monitor and analyze patient data. So you could see the future of how you're blending in things that are sensors, collecting patient data, analyzing those data through artificial intelligence, and then adjusting the medicines accordingly. How do you see these types of artificial intelligence moving in the direction of helping out and assisting the different algorithms as they apply those to different pharmacy medications?
Harry Travis
I think there's an enormous opportunity for AI and pharmacy. And as you think about AI everyone kind of debates whether it is going to cost people jobs, or is it going to be an augment to help people do their jobs better? I'm hoping that it'll be the latter with pharmacy that it will help help a lot of pharmacists to do their job better because as more drugs come online, they become more complicated as more patients take more medicine, as the population ages, there is an enormous database and the problem of polypharmacy of a patient being on multiple medications plus who knows what diet restrictions and things like that, creates a massive data problem for healthcare organizations to assess is the patient on the right med, perform what generally is referred to in pharmacy as medication therapy management or some kind of medication counseling. So there are companies coming online now when that you should explore a company called Arine, which does just that takes all of the patient's medical data, pharmacy data, runs it through an advanced algorithm and will prioritize those patients that are at greatest risk for some kind of interaction or untoward event company like that TabulaRasa does Same kind of thing. So there are these medication therapy management companies coming online using these algorithms to just grind through all of this data. And then you throw in quote unquote, social determinants of health. And you really get a much better picture of what's going on or what could go wrong with that patient.
Robert Niichel
Yeah, and we, you know, see those types of things, as we, you know, discuss these topics with other guests as well. And now, the next step in the podcast series, we're going to move it over to Sacha, since he is over the younger generation, he's going to ask some more questions of how the younger generation can take advantage of, you know, kind of, they've grown up with iPhones, they've grown up with digital things where we may see some things fast track, if you will, since a lot of these platform technologies are already out there so Sacha hand it over to you.
Sacha Heppell
Yeah, yeah, thank you. So you know, we have all these billions of devices connected devices out there and a lot of these young people are born into it and it's almost like their smartphone is a piece of their body in some sense because they're just, they're just born into it. It's so natural for them to use it. Now, do you see the younger generations adopting these new technologies more than maybe people who did not grow up with technology?
Harry Travis
I think the obvious answer is yes. But not just because of the technology. I think like anything, you'll have that answer the question, what's in it for me from the patient's perspective? So if companies can create engaging platforms, we talked a bit ago about outcomes management. So with that smartphone in your hand, we now have a terrific platform to track any number of outcomes. It could be that your smartphone is just connected to your scale and you're getting on your scale every morning and you're reporting your weight back, or it could be you're presented with a survey every day or at the end of every week that asks for a pain scale or an ease of activity scale or something like that. So the more that these things can be made engaging, and then taking the next step of gamifying them, put some kind of reward there. I'm already hooked on my Apple Watch and closing my rings and I get my little rewards and all of that. Okay, so why can't we do the same thing with something as important as medication adherence, and possibly monetize it? Okay. I mean, it's in everybody's interest on the health care chain for you to take your medicine, why can't there be some kind of incentive that you get a gift card or something in the mail? Or who knows what, right off a copay if you're not greater than 98% inherent on your medication for a period of time? So yes, if you're comfortable, like the younger generation is, that's great. But I think it's ultimately up to the technology companies and healthcare providers to build the interfaces that really engage people.
Sacha Heppell
Yeah, we talked to a patient Natalie Haden patient advocate for IBD and she was really sharing about how some of these new technologies help a lot of the newly diagnosed to navigate the condition and be able to really, in real time communicate with their physician about what they're going through and just it'll be really interesting to see how that's going to evolve.
Harry Travis
It is and I think at all will be in a positive direction. It's just a matter of at what rate? And there may be certain diseases IBD might be a good one might be a certain disease where patients are more engaged than others. There might be a certain disease where there's a greater younger cohort that would go after it.
Sacha Heppell
Yeah, and you talk about this digital tsunami. I wanted to look at that for a moment because tsunamis are unexpected and could happen at any moment. Can you speak more to that transformation that you see coming to pharmacy and how it would kind of occur like a tsunami in some sense?
Harry Travis
Yeah, I refer to that in one of the presentations that I made of the combination of if I can remember them the four forces that I think digital forces that in combination can really upset the industry as they have upset many other industries. You think about bookstores you think about travel agents, you think about video stores all gone, right? If you think about smarter microchips so we now can swallow a microchip and a can power up and generate a radio signal and the microchip is not much bigger than four ridges on your fingertip on your fingerprint, smarter microchips, 5G, which is going to make those smartphones just incredibly powerful. Okay, artificial intelligence. We already talked about that. And then layer on top of that natural language processing, and the fact that you could be talking to an AI agent at a fairly high level about your symptoms, your problems, or one of these AI algorithms could be driving an outbound call out to a patient to say, you know, we've reviewed your record, and we see that you might be experiencing the side effects, are you or are you not, and go online and watch the Google duplex demo that they did a couple years ago that, you know, melted down the internet when they had some, you know, the Google computer calling out to a restaurant making a restaurant reservation and nobody knew they were talking to a computer. So that's what I'm characterizing as the digital tsunami, you know, natural language processing, AI, bigger and bigger bandwidth and faster and faster microchips. And within each of those trends, there's nothing but progress being made every day to a more powerful state.
Sacha Heppell
Yeah, and we see all the progress that's happened since COVID-19 with tele medicine, the talking to your doctor on your computer, and just how everybody's kind of adopted that now. It's gonna be very Interesting, when do you think this type of transformation could take place what you're talking about?
Harry Travis
Yeah, I wish I know when it'd be nice to be able to pick the point where it goes from kind of straight line to logarithmic and hit the exponential point on the curve. I don't know. But clearly COVID has kind of thrown both a monkey wrench into the works and an accelerant in it. So people are more comfortable with digital. We have more patients doing telemedicine, is it going to stick or when the vaccine comes? And we all relax and feel like we're protected? Are we all going to go back to our old ways? Or are the digital remote monitoring capabilities going to really hold? I don't know. All I do know is I don't think we're going back. I think we're just going to proceed forward, can't predict the rate or the turning point.
Sacha Heppell
Yeah, we had the wave of wearables. And now maybe the next wave is ingestibles. And with what you're developing 10-20 years down the road. What do you think? ingestible technologies will look like how is that going to evolve?
Harry Travis
I think it will start initially with your high cost high impact meds I think it will they will then move to maybe lower cost meds but meds with a high impact. Like I said transplant meds or behavioral health meds as well. I also think that it's not just contained to medicine. Okay, there is a whole as you know, and the work that you're doing, there's a whole new arena of ingestible sensors and ingestible sensors transmitting data out, different with the nanotechnology that's coming on stream. You know, we're comfortable with terms like wide area network for your cellular and local area network for your WiFi and Personal Area Network for your Bluetooth. There will soon be and there are people talking about it right now Body Area Network. So the next network platform that we're all going to be dealing with is Network standards around implantables and ingestibles. So that they're all on the same kind of bandwidth or same data platform.
Sacha Heppell
Very interesting Body Area Network. I've never heard that term before.
Harry Travis
Yeah, the IEEE, the organization that set the standards for all of the others is working on a Body Area Network right now with the USP United States Pharmacopoeia. So it's early stages, but you can see where it's going.
Sacha Heppell
So what's next for EtectRX? And how do you see the company evolving in the next 5-10 years?
Harry Travis
We are rolling out our commercialization model right now, which is focused squarely at pharma manufacturers, to work with them to put up pilots and studies of target drugs that we think where remote monitoring medication adherence, a total capture of the data around the patient that includes not just medication adherence, but other factors involved in the disease that will give them a much better picture of kind of the total care of the patient. So that is our primary goal right now.
Sacha Heppell
Awesome. Awesome. Thank you. Thank you for your drive and your commitment to forwarding these technologies and improving medication adherence, which is really, really will transform the industry and just thank you to your team and keep up the great work.
Harry Travis
Thank you for the opportunity. I want to put a plug in for the pharmacy profession and our drive to get the provider status and if I could put just one plug in for the profession, the American Pharmacy Association is at the website pharmacist.com. And if you're interested in learning more about provider status and how the profession is changing, which will be you know, one of the linchpins to this whole thing. That's where I would recommend folks go.
Sacha Heppell
Awesome, awesome. And how can listeners or potential partners find out more about EtectRX and get in touch with you?
Harry Travis
Our website, etectrx.com or you can find me on LinkedIn at Harry Travis or on Twitter at @hjtravis.
Sacha Heppell
Awesome Harry. Thank you!