When DarioHealth (NSDQ:DRIO) CEO Erez Raphael looks at the medical device world, he sees solutions that were designed by healthcare professionals and doctors – and this presents a stark contrast with the consumer device industry, he pointed out.
“We have seen there are a lot of cases, most of the cases in the industry, where the overall user experience of an existing device is very professional-centric and not user-centric,” he told Drug Delivery Business News.
User experience is at the heart of DarioHealth’s design mentality, according to Raphael, among other related measures like user engagement and data collection.
Diabetes is a crowded industry, with companies like Medtronic (NYSE:MDT), Abbott (NYSE:ABT) and Dexcom (NSDQ:DXCM) investing millions into creating and selling solutions for people to monitor and manage the chronic condition. But DarioHealth stands out, Raphael said, because of its product.
“In order to provide the best user experience, we thought that we don’t want to create some kind of second device that can be synced with the smartphone,” he explained. “We literally want to extend the smartphone to be a medical device.”
DarioHealth’s platform includes a blood glucose monitoring system, which connects via a headphone jack to a user’s smartphone, as well as a lancing device and test strips. There is no carrying case or batteries, according to the company, and users can access real-time and historical blood glucose data to watch out for trends.
“I think from a cost of goods perspective, we managed to create one of the cheapest glucose monitors in the market and one of the best user-experience monitors in the market, and also the best data capturing tool for the user,” Raphael said.
The 38-person company has had an array of regulatory and commercial wins in the last month. DarioHealth won CE Mark approval for the version of its Dario blood glucose monitoring system that fits with the Lightning connector on Apple’s iPhone 7 and iPhone 8 smart phones.
Also in October, its diabetes platform launched in Germany – the ninth country in which the Israel-based company’s technology is commercially available.
Looking ahead, Raphael is preparing his company for the trends developing within the medical device world. Like many players in healthcare, his company believes the market is heading towards personalized medicine.
“Personalization is data-driven and if you want to get data, you need to get users that are engaged. For engagement, you need the best user experience,” Raphael said.
There’s another pattern emerging in the diabetes space, he pointed out.
“We believe that the market is being transformed from a pure monitoring and diagnostic market to managed care, which means that two years from now, three years from now, users or employers will buy full subscription solutions that combine the device, the test tubes and all the disposables in a combination of some kind of lifestyle management that is provided by a coach that is responding in real-time to events and data collection,” he said.
Shares in DarioHealth fell slightly today after the company topped earnings expectations but missed sales estimates on Wall Street with its third quarter results.
The company posted a net loss of -$2.98 million on sales of $1.38 million for the 3 months ended Sept. 30, for sales growth of 89% compared with the same period last year.
Adjusted to exclude 1-time items, earnings per share were -30¢, a penny ahead of consensus on The Street, where analysts were looking for sales of $1.45 million.
DRIO shares were trading at $1.55 apiece today in early morning activity, down -2.5%.
The company currently has tens of thousands of users, but Raphael is thinking bigger – with the help of potential partners, he hopes to see hundreds of thousands of people using DarioHealth’s tech.
“Practically it’s about scaling up the business and getting the overall solution to as many users as possible to be a billion dollar company,” he said.