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Summary

  • Researchers at Cleveland Clinic used iPad as a tool to perform an array of performance tests for multiple sclerosis.
  • This new use of iPad could inspire Apple to launch a medical device that would be treated as an unmet need.
  • Apple investors may eventually get a medical device business free due to a future healthcare spinoff.

The use of Apple's (NASDAQ:AAPL) iPads in the medical world is nothing new. For example, medical device maker Medtronic (NYSE:MDT) widely uses iPads for delivering its technologies to physicians and patients worldwide. The company has developed a number of in-house apps for iPads in order to access information, improve efficiency, and enhance customer engagement.

However, an iPad can also be used as a medical device itself. Although it seems unbelievable, it's true. An iPad coupled with a specially designed attachment can work as a state-of-the-art MS (multiple sclerosis) assessment tool. MS is an inflammatory disease of the CNS (central nervous system) that can affect young adults, particularly women. In an article few days ago we analyzed Apple's potential to evolve as a healthcare company. The recent news that iPads can be used as medical devices has strengthened our analysis.

The Success of iPad could Inspire Apple to Launch a Medical iPad

Since MS affects its sufferers in different ways and at different rates, assessing the progress of the disease is a critical part of MS management. Researchers at Cleveland Clinic used iPad as a tool to perform an array of performance tests relevant to MS assessment. They attached iPads on the backs of MS patients, who were tasked with moving metal pegs between different holes. The iPad screen collected a detailed analysis on their posture, which helped researchers track disease progression through an internal app.

Apple wants to position its upcoming iWatch as a medical device. We believe that Apple has plans to launch a medical device that would be a modified version of today's iPad. The device may not exactly look like iPad, but it would be designed specifically as a medical device. Apple is building a team of senior medical technology executives, which could be a hint that the company is planning to launch a serious medical device in near future. The recent use of iPad in MS management by the researchers at Cleveland Clinic could inspire Apple to introduce its first serious medical device (other than iWatch) very soon.

Apple's Device would be More Than a Basic Monitoring Tool

Apple is aggressively hiring prominent experts in biomedicine, and most of the hiring is in the area of sensor technology. Apple's Chief Executive Tim Cook said last year that sensor technology is ready "to explode."

Some industry insiders that are not Apple's employees believe that the company will offer basic devices for monitoring everything from blood-sugar levels to nutrition. While nobody is expecting that Apple's upcoming iWatch and other wearable devices will be merely fitness-oriented devices, we believe that Apple has much bigger plans. "This is a very specific play in the bio-sensing space," said Malay Gandhi, chief strategy officer at Rock Health, a San Francisco venture capital firm. Rock Health has backed many prominent wearable-tech startups, such as Augmedix and Spire.

A mobile health executive recently told Reuters on the condition of anonymity that an Apple executive from the iWatch team told him that Apple has aspirations beyond wearable devices, and is considering a full health and fitness services platform modeled on its apps store. In February, Apple filed a patent for a smart earbud with built-in sensors that could track steps and detect gestures of the head, which makes us believe that Apple will certainly launch a medical device that would be considered an unmet need. Some of Apple's top executives recently met with FDA officials, which signals that the company's upcoming products would be directed towards covering unmet medical needs.

Conclusion

If Apple really emerges as a specialized healthcare player, we expect that the business would be a separate entity from its current consumer electronics business. Initially it's expected to be a separate division, but eventually a spinoff will happen. From investors' point of view, this could be really exciting.

Business relationship disclosure: The article has been written by a BB Research stock analyst. BB Research is not receiving compensation for it (other than from Seeking Alpha). BB Research has no business relationship with any company whose stock is mentioned in this article.

Source: iPad Used As Medical Device, Huge Success For Apple In Healthcare