Improving Medication Compliance with a Smart Pill Bottle Cap

In this episode, the discussion revolves around digital healthcare, specifically PatchRx. Andrew Aertker, CEO and co-founder of PatchRx, elaborates on their smart cap enabled platform aimed at tackling medication non-adherence—a major issue in healthcare. PatchRx's technology tracks medication intake through a universal smart pill bottle cap and provides real-time data to patients, providers, and caretakers. The discussion covers the technical aspects of the product, including connectivity to a gateway device with multi-carrier support facilitated reliable data transfer even in rural areas. Andrew details the company's journey, their alignment with healthcare regulations, and the crucial role of data in improving patient outcomes. The interview also highlights the complex customer landscape, spanning patients, providers, and payers, and the importance of user-friendly design for successful adoption.

Transcript

Ryan C: 0:27

Today on What to Expect When You're Connecting we're talking about one of our favorite themes, which is digital health care, the use of connected technology to improve patient outcomes, save lives and make health better for everybody. This isn't just about targeting a specific industry, but this is something everyone gets to benefit from. Today, we're here with Andrew Aertker, who's both CEO and co founder of PatchRx. It's a smart cap enabled platform embedding and unlocking new insight on medication adherence and facilitating better adherence and outcomes through proactive care interventions. Ooh, that's a mouthful, but welcome to healthcare. And Andrew, welcome to the interview.

Andrew Aertker: 1:08

Ryan, thanks so much for having me.

Ryan C: 1:10

So tell us for someone who isn't familiar with smart cap enabled platforms,what did you build

Andrew Aertker: 1:20

Sure, that's a dense question. what we built is essentially a medication tracking device. it's a universal smart pill bottle cap that sits on the underside of any size pill bottle and tracks when patients take their medication. The core concept is really developed around this whole issue of medication non adherence, which if you're familiar with it, it's one of the biggest issues in healthcare, which is essentially just patients missing their medications, patients either not taking their medications on time due to forgetfulness or other issues in their lives, or intentionally abusing or misusing medications. And obviously, this is prevalent through the entire spectrum of healthcare, any therapeutic area you can look at. You're looking at national adherence rates around 50%. So patients are essentially taking their medication correctly about 50 percent of the time. And so what our technology is designed to do is essentially provide the information back to the patient, the provider, and the caretakers, and everybody associated with that patient's care to actually, facilitate not only better adherence, but to facilitate that data back to the individuals that we think can either take proactive care interventions or make a meaningful difference in how that patient is actually taking their medication. This has a super long history for us personally, but it also has a long history in the healthcare industry. I was a cancer patient in college and started to take a bunch of medication and that was essentially partially how this concept was initially conceived for us. And then my co founder actually, Gavin Buchanan, his grandfather passed away when we were in college due to medication non adherence issue as well. And so for us personally, obviously this issue of non adherence is not just some healthcare statistic of, 350 billion in economic spend as a result of medication non adherence. It is a very personal thing and I think it is for so many people. And so our technology, like I said, at the end of the day, our goal is how do we essentially provide something that's super intuitive, super simple, and helps patients remember to take their medications on time, tracks and provides that data transparently back to everyone associated with that patient's care for the promotion of better care for that patient patient

Ryan C: 3:20

I got to imagine that one of the biggest challenges is that it's either people who are intentionally not taking it. I've heard many stories in senior care where they are trying to You know, it's almost like cutting your pills to extend how you're not taking the medication that you need, but it's a financial, like thrifty need to like, not use it as much when the reality is not adhering to the medication protocol means you're more likely to end up in the hospital, costing everyone more money anyways. So it's the over to pick up a penny to trip over a dollar kind of thing. And. But then tell me, how does this help as far as an accountability network for, memory care or people who just aren't remembering? When they're taking their medication. So walk me through that experience and how does it leverage connectivity to create that feedback mechanism?

Andrew Aertker: 4:19

Yeah. I think you've hit it right on the head. Not adherence. I'll back up a tiny bit. medication, not adherence is an issue. I think you hit a spot on it is so multifaceted in terms of what causes it that I think when you're designing technology around it, and I think the reason why there's been such a struggle in the space to actually design technology that does solve the issue is because there are so many variables at play. You hit on the huge piece of this, which is financial implications of taking a medication or not taking a medication. I think it's one of the biggest issues of medication nonadherence is people thinking that, if I mitigate the need for myself to take, the whole pill every day, if I split my pill in half, if I take it every other day, I'll essentially extend the life cycle of my medications. The problem with that is medications are very explicitly designed by pharmaceutical manufacturers to react with your body in a very certain kind of way. And when you start to split that medication or take it according to a schedule that you're essentially creating for yourself, you essentially reroute the entire spectrum of how that medication is actually designed to affect your body. When you look at something like an opioid, especially for a pain management industry that we've been very close to for the past couple of years. when you're looking at that medication, you're looking at MME morphine milligram equivalent. How is that body or how is your body essentially metabolizing that medication? And if you take a medication every four hours versus for every eight hours, it is massively affecting your risk for developing opioid use disorder. And that has, massive implications on your financial burdens. If you're sent into the hospital, if you're incurring additional, disorders as a function of that. that is the same exact issue. Like you said, across the entire spectrum of healthcare, any therapeutic area you look at when you're taking your medication, not as prescribed, it is materially affecting how your body is behaving with that medication. But it is a Like I said, multifaceted issue, it is not just financial implications. It is forgetfulness. People get busy. One of the number one reasons that we see and that we treat for senior care especially is I took my medication for the past week. I feel pretty good today and so I'm not going to take it today. And you go, no. The reason you feel great is a function of the medication. It is working. That is how it's designed to work. And when you stop taking it, you essentially. just rid all the essentially positive effects it's having on your body. And you have to start from zero a lot of the times. And so it is, It's not only just a tech issue that we're putting into practice a lot of the times, but what we do and what we've been doing for the past six, seven years is a ton of education, either provider education, patient education, caretaker education, it is education on why is this medication prescribed for you? Why is it interacting with your body in the way that it is? How can you essentially feel better? And how can you take your medication according to schedule in order for it to actually benefit your life in the long term? And I think so many people, it's very hard to get people to grasp a hold of that concept of saying, no, if you spend a little bit more money now, yes, you're going to essentially incur that in tenfold in terms of savings in the future just as a function of it. But it is a difficult issue top to bottom and senior care, wherever you go, if medication on adherence is a very prevalent issue in a myriad of ways.

Ryan C: 7:24

Knowing that people from all walks of life, all socioeconomic statuses, there is no discrimination against those who need to be taking medication at some point in their life. Talk to me about the. the technology that you've built around this need, I'm interested in hearing how you are uniquely addressing or replacing what is a manual process. That is. Effectively an honor system.

Jason: 7:52

Yep. That

Andrew Aertker: 7:56

process and I think for tech in the healthcare industry in and of itself, I think tech is actually very difficult to design because what you're embedding yourself in, especially in the United States is a very complex industry with a ton of incumbents and a lot of bureaucracy. And so your first hurdle. As a tech player in the spaces, how do you get stakeholder buy in, stakeholder incentives to align and ensure that you're designing tech that seamlessly works in clinical workflows that already exist? and so when we designed this pill bottle cap and the reason why we designed it in the way that we did, was we said, we need to figure out a way to make it universally applicable. What that means for us is whether you go to Walmart, whether you go to Walgreens, CVS, wherever you go, our pill bottle cap is not going to incur a ton of manual. Hey, you've got to transfer your pills into another pill bottle, or you've got to move it into a pill tray, or you've got to take notes, or you could take a video of yourself taking that medication. It is a peel and stick device that sits on the underside of any size pill bottle cap. The reason for designing that is we said, if you're, So if you're 85 years old and you've been taking medication for 45 years, or if you're 25 years old and just taking a medication for the next two weeks, we want it to be 15 seconds of setup. And that was the first design constraint for us. and it really comes down to how are we fitting in terms of the healthcare workflows that exist. So for us, that was a big piece. But to walk through that whole stakeholder landscape, that is what is so difficult. At the patient level, the hurdles that you run into naturally are going to be patient resistance to new technologies or new workflows. Naturally, people are going to be skeptical of things that are involved in their health. and that is just a human nature. we cannot change that. There's no one that can change that. No matter how much trust you build with someone, unless it is personal and human to human, it is really hard to build trust.

Jason: 9:41

teaches

Andrew Aertker: 9:42

And that is, that's just a hard piece. So you have to get that right. And that was a long process for us. What we have done in that regard is done. we've conducted user interviews of thousands of patients. we have accumulated a ton of data and ensure that what we're sending and providing to patients at the end of the day is not only secure, but it works with that human. A lot of patients with clinical staff members that we either have on site. We work with a lot of health systems and practices that actually have those clinical teams that human to human interface allows yourself to use technology for the promotion of better care outcomes for that patient. So that's the first piece on the patient side. Second piece is getting that provider buy in and providers I think are some of the most So I'm going to talk about some of the most complex pieces of this entire puzzle, because at the end of the day, when you're talking about providers, you're talking about any physician or any nurse practitioner, whoever it is, their degree in what they're supposed to do as a clinician is treat patients. And when you start to involve new pieces of technology in their workflow, you have to make sure that on day zero, they are essentially seeing an ROI for that piece of technology in terms of time and in terms of, finances. And for a lot of eat what you kill kind of models where you have private practices, that time piece for providers is so critical for them. When you lose a couple of minutes here and there, it really can be meaningful for a practice. and so that time piece is massively influential on their decision making process of involving new tech, whether it has that ability to promote better outcomes or not. And then as you yeah, go ahead. Transcribed

Ryan C: 11:13

that's actually a really important point with providers. We know that they're either going to be on a fee for service situation where the faster they can see patients, the more billing they can do. But then there's also going to be the value based care practices where the number of core patients that they can see per provider. We'll also ultimately dictate what type of reimbursement they get at the end of the year. So time is still like the universal constant, either more time that I can be spent consulting rather than the nose in the electronic health record system. Or it's just a matter of, being able to prescribe something that creates better adherence and ultimately, better outcomes. we've, we had a previous conversation about, Every digital health technology is going to have three things they need to do. The first one is people need to be able to adopt it. And that starts with design. So designing for adoption and use, right? The hard, a product that requires you to take extra steps. Is going to be unlikely to be adopted by the patient, which means when we're talking about their, we're already having people that are having a hard time taking their medication, let's make it harder and make them jump through extra hoops. So this idea of a peel and stick device that goes underneath the cap of the pill bottle, they're already used to opening. They're already used to receiving it. I'm what I'm hearing is you just went into an existing user workflow, quote unquote, and you're letting them just go through the same motions they did before with no extra changes to their behavior. So if they're already familiar with taking pills, we're not adding extra steps. you'd mentioned that there's the financial incentive and clinical return on investment are those two other factors. So we have to have products that make sense, right in healthcare. I think it's interesting versus building business to consumer where you're fighting over wallet share. Whereas in healthcare, like especially in the United States or in, in some of the, places where there's the billing codes and, reimbursements, your financial source isn't always the end user. It's. The payers, right? So talk to me about why is what you're doing better than the status quo for the payers, right? Because how does your product build that return on investment for the practices that are willing to. Adopt this new technology and prescribe it.

Andrew Aertker: 13:59

So in the United States, obviously there's a couple ways you can engage with payers and obviously the biggest payer in the U. S. is obviously Medicare and Medicaid services. So when we looked at this market, and I think when you look at the adherence problem, it's One of the biggest issues with it was that there has never been a real honest financial incentive, a clear proven ROI. and so when you looked at these adherence technologies, what you were essentially doing was, as a provider, as a health system, whoever it is, and you're looking at your payer contracts, you're essentially assessing, hey, is the, technology that we're about to invest in, I think we've seen it. Worth it in terms of the reductions in ER visits. The reductions in cost that we're going to see as a health system or as a practice or whatever it is. and it's really hard to associate those costs. frankly it is hard to generate that clear ROI model to say if we spend 50 bucks a patient per month, It is clearly going to, impact us positively. And so what we did, and I think what Medicare has done a phenomenal job of actually over the past couple of years is, through this kind of virtual health boom over the past, since COVID, there's been a lot of, traction. with a lot of these companies offering remote services, remote care services. And one of the big things that Medicare has done is actually work alongside that. And so they have put out new CPT billing codes, which are essentially the billing codes that providers use to essentially bill out services, for remote patient monitoring in 2019, which was a big subset of codes that essentially paid for remote care services that tracked physiological data points. And then in 2022, partially as a function of some of our support. And, a lot of other companies in the space, they extended that into remote therapeutic monitoring, which allowed for the payment of therapeutic monitoring devices, which if you had to guess, one of those kind of pieces is actually medication adherence tracking. So non physiological data points coming back into what that does and what we were able to take from that and why we supported that so heavily was, you're essentially able to take it and go. To a provider and say, Hey, here's a very clear now immediate financial ROI for investing in your patients. and that just never had existed prior. And what we love about that is it not only makes it easier for a provider to stomach up front, but it guarantees some baseline revenue, some baseline profit. And so at the end of the day, the value in our service is not the revenue. That is not where we're going. and we're trying to push value. The value is in the outcomes and how that's going to material effect, the provider, the practice, the health system, whoever it is, every stakeholder involved, but it gives you that baseline. It gives you that entryway. And I think that's a phenomenal thing that Medicare has done is adjust accordingly over the past couple of years. Now, when you look at the commercial landscape, you mentioned the distinction between, value based programs and arrangements and the CPT and the fee for service side. I think one of the biggest pieces. that we see is a pretty broad shift towards value based arrangements. And I think that's been happening over the past couple years. I don't think that's any news to anybody, but what we're seeing is people are using actually, and this is what we're doing in a lot of cases as well, is we're using fee for service as an entryway to essentially get our technology into the hands of those that want to establish value based arrangements. And so we have practices that use us right now, actually, under CPT models, and they are generating data. Basically, it takes you to payer contracts, and then establishes the value based arrangements as a function of the fact that the technology has shown to improve outcomes for the patients and whatever you have there. And so I think that's been a huge shift. Obviously, I think, again, Medicare has done a phenomenal job of accommodating for these remote care technologies and promoting the investment in them. And then as people shift towards more value based arrangements, which I think Medicare is expecting to have. shift towards value based care by 2030, which is a hugely ambitious and probably not so realistic objective. But that is the way things work. And so I think there's a great mix of incentives right now for remote care tech.

Ryan C: 17:56

What's interesting is when we're talking about those distinctions between value based care and fee for service, I there's a lot of people, out in the world that don't necessarily know that there's two different ways that doctors get paid and they have to choose a path. Fee for service is exactly what it is. It's like professional services. It's. you submit a bunch of codes, and that's, it's literally code for how you're going to get paid, how much you get paid for each service, and then the more codes you can apply on a visit, whether it's diagnostic tests, complexity codes, or in your particular case, medication adherence, the payers on the other end, assign a value to each one of those codes, and the goal is to pay for itself. and the more codes you can add on to a visit, the more you make. But then there's this idea of the value based care where a doctor says, I'm willing to, as a provider, I will maintain, these 120 patients. And you have to prove to, Medicare in this particular case, the more you can do preventative things that keeps them from being a more expensive patient or using a bunch of population health data. And it's a statistics game. So you're going to start with looking at all your. Diabetic patients, and are they getting their A1C levels checked every six months? It will keep you out of the hospital like crazy. But then I'd imagine there's things like the opioid, abuse. There's medication adherence. there's a lot of research that's available on what it means to stick with this. I'm going to bring this around by talking about adoption and adherence of your technology. We spoke with, Darby Davenport, who was the director of telemedicine for University of Alabama, their health system. And she was mentioning that, from a payer's perspective, they send, blood pressure, coughs, weight scales, and, diabetes testing devices, depending on The patient, but they need to have at least, I think it was like 16 check ins per calendar month in order to qualify for that payout. So you need to be able to demonstrate a level of adherence in order to get paid for that service. You can't just send people home with remote patient monitoring technology. Talk to me about the medication adherence. Are you following similar rules in which. You need to show a certain level of adoption before, you can get paid or the provider can get paid.

Andrew Aertker: 20:34

Yeah, we work under the same exact constraints actually. And so for those devices that she's using and her practice and health system is using, those are probably under remote patient monitoring or physiological monitoring and both those subsets of codes, RPM and our codes, RTM, have the same constraint on billing, which is you have to have 16 days worth of data collected from that patient on a calendar month basis, in order to actually bill out for it. And I think that's a threshold. granted there's a. new draft of the physician fee service that came out a couple weeks ago that might modify that threshold and reduce it down a little bit for a different adjustment and payouts. But the initial threshold for that was saying, if you look on a calendar basis, if a patient is 16 out of 30 days, we would deem them as an adherent patient to that service. Now, if you look at like our technology, for example, we're typically getting for a patient that's adherent and using our services anywhere from 28 to 30 days. we're getting a heartbeat essentially every day. And so one of the benefits of our service, if you look at it from a medication on adherence standpoint is we're going to send you as your, as a provider or as a clinical staff member, Or as a caretaker, as a patient, we're going to send you data every single day. You're going to have that exact knowledge. And I think one of the biggest gaps that we have in healthcare today is the fact that when you judge a patient's, medication non adherence, you're looking at a score that's arbitrarily designed around refills. You're looking at, so if you get a patient to come in for a fill today, you get them back in 90 days. Your adherence is how many days elapsed in that period of time. Over the amount of time that it was supposed to be. So if you came in 90 days or nine days late and you're supposed to come in a 90 days, you're 99 over 90. And, that's just a terrible metric for judging adherence. It's not a daily adherence score, and that's what we essentially generate. But if you look at any of those pieces of tech, You have to look at it and go, is it imperative that we're getting a daily data point? And for some of them, no, you'd see, for certain blood pressure cuffs or something like that, sometimes you don't need it every day. but do you need it 16 days a month? Maybe. And so I think that's where Medicare needs to evolve a little bit in their CPT distinctions and their code sets is essentially, can you, create a little bit more of a flexible code set to allow for, different technologies to require different thresholds of data because it really isn't a necessary piece for medication. Like I said, absolutely mandatory that you're getting a daily data point for some of these other pieces of tech for weight scale, something like that. probably unnecessary to get it every CPT side of things.

Ryan C: 23:11

Interesting. Interesting. So what I would like to talk about is your technical decisions on how you implemented a technology that could easily be integrated. for example, Darby was mentioning that they used to use. RPM solutions that required mobile apps and, Bluetooth pairing, and there's a bunch of extra moving parts. And so the adherence was very low and the minute they ended up moving to a vendor where one, it had its own cellular connection. Two, it, just automatically reported. They didn't have to change any behaviors other than weigh themselves or put the blood pressure cuff on and get that immediate feedback themselves. How much am I weighing? there wasn't again, extra moving parts. I have, I'm, I don't know the answer, but I'm excited to hear more about the technical design decisions that you made to overcome. Adoption or adherence challenges. So other than it being a cap with a sticker, what types of technologies from connectivity perspective did you choose and what was that decision process? What did it look like as you evaluated your options? Was there any clear, tests that said, Nope, let's not go that direction. I'm interested to hear about that journey.

Andrew Aertker: 24:30

we've tried a lot of different technologies, I will say. like I said, we've been designing this piece of tech for about six, seven years. And the initial prototypes, we're never gonna publicly show them because of how bad they were, but they were super interesting in the fact that what we had was everything packed into a single smart pill bottle cap. It was a dispensing device. It had the cellular chip. It had everything routed in it, but we had a massive lithium ion battery in there. it was a catastrophe. But the initial design was can we have essentially data communicate from anywhere and Can we essentially ensure that data will not get lost? I think security of data is a huge piece for us And so as we iterated, we did explore I think as everyone did in the very mobile app heavy 2010s is Can you put a mobile app in every patient's hands? And I think what you start to see and what people have seen for years is patients really don't want another app or widget on their phone. they really don't want to do something that's outside their workflow again. And to get someone to engage in a mobile app everyday is really difficult. Even Instagram or Facebook or some of these incredibly like engagement designed apps only get 50 to 60 percent, engagement on a monthly basis from even their active users. And what you're looking at there is really hard to get. So we worked with that. We worked with, embedding everything on the actual device. And what we ended up with was somewhere in between. And so what we have is, the patch cap that actually sits on the pill bottle. And then a gateway device. It's essentially an in home wall wart. plugs into the wall immediately ready to go and sends every piece of data there. And so as we were evaluating chips as well and evaluating how do we essentially ensure that what we are doing is as universally applicable as possible, one of the biggest constraints was for us was cellular connectivity in rural areas. And, a majority of our population that we work with today is in rural places in the United States. And when you look at coverage there. we've explored interesting technologies like Amazon Sidewalk, which is really interesting for, really dense commercial settings, or places like New York, you're going to have a great network there through all the Amazon devices or, a LoRaWAN network, which runs, it's in a similar kind of consolidated network, these small private networks. but as we were evaluating, one of the Soracom was, We need the flexibility to engage on various mobile networks at any point in time. We need to ensure that not only are we going to be transferring data effectively, and that we can be sure that there's, it is securely transferred, but that we can flip into, the virtual aspect of the SIM allows us to actually flip between networks and, exercise bandwidth wherever we need it, or wherever there is excessive bandwidth or, flexible bandwidth from different carriers. And so I think one of the biggest pieces for us, like I said, is How do we ensure that, what we are doing allows for any patient anywhere in the country to take our technology home and not be disrupted by where they live or what their zip code is or what the connectivity in their areas. We need the ability to offer the service to everybody in the country, and that was a huge piece for our design constraint.

Ryan C: 27:32

I hear that from a lot of our customers is what they appreciate is that you don't have to pick a carrier in this race. The device gets to just pick it on its own. And if you move to another side of the house or the residence or wherever it might be, and you lose that connectivity with one carrier, it'll just find the next best carrier. in that situation, when you're thinking about remote patient monitoring and you're serving everybody, that was one of the interesting things that, Darby had mentioned about rural Alabama is that it's very rural and cellular is one of the few ways in which people can even get connectivity. So the idea of creating devices that rely on your own home internet, one is a security challenge, but it's accessibility. It's not even the security. It is just. If we're going to be fair and equitable and want to treat everyone, you have to think about how do you reach everyone. So take me back to the day when you first decided to evaluate Soracom and tell me what happened.

Andrew Aertker: 28:36

Yeah, so what we initially explored was, we actually went with individual carriers first. and so we evaluated each individual one and their kind of networks. and what we did was we actually ran a bunch of tests with our gateway devices. And we sent them with various kind of networks and various carriers to different practices. And said, okay, let's test and see what the kind of uptime looks like and how things populate on our maps. and what we saw was, We just had really intermittent abilities to understand whether we were going to be able to serve that customer or not. And I think at the end of the day for us, the last thing that we wanted to do is go to a practice and say, Hey, customers that your patients that are in these kind of zip codes or these areas may have intermittent service. what a terrible service offering. So what we did is really explore broadly, where can we find sims or e sims that essentially allow us to. expand in different ways and use a bunch of different carriers. And I think that's where we landed on Soracom was not only, I think the prices were very effective for us and allow us a little bit of flexibility, but really the ability for Soracom's AirSims to accommodate for what we need. What we were actually looking for in a lot of those rural networks has been exceptional, and I think, we've been extremely pleased, obviously, with the work that we've done with you guys, but I think it just comes down to the fact that there really wasn't another service provider that had what you guys are capable of, which is, offering, really excellent bandwidth and coverage in really rural networks in the United States. and when you look at that, when you're looking at universal solutions, when you're looking at healthcare and you're saying, we don't want to silo patients based on their socioeconomic status or zip code, you absolutely need the ability to offer that across the entire spectrum of the United States. And I think, again, what you guys have built and what you guys have designed has been phenomenally, helpful for us.

Ryan C: 30:32

What kind of deployment sizes do you look at within a particular region? Like how many devices are we talking about that you're supporting if we're talking about pill bottle caps?

Andrew Aertker: 30:41

Yeah, it's a lot more than you'd expect, in certain consolidated areas, when we work with a patient, it depends on the therapeutic area where, or how many patch caps we're actually giving people. So for opioids and high risk medications in that kind of therapeutic area of pain management, musculoskeletal conditions, we typically are giving them one to two patch caps. So one, we're tracking one or two medications. every patient gets a gateway, and then, obviously that contains the chip, and that's essentially their device at home. in certain regions we have a couple thousand patch caps. I think, to date, we've, probably sent out ten, twenty thousand patch caps. and I think that's ramping up pretty heavily this summer. But, in terms of the actual coverage of it, it is across the entire United States. We have everything from rural Nevada, and that's a lot of consolidation of our pain management clinics in Nevada or California. all the way to very consolidated networks in, in New York City or Boston. And so I think for us, it's been really interesting to see what those different populations look like. how many, patch caps not only to use, but how they engage with their medications. What are the different factors that influence their adherence in, these very like condensed networks and cities versus very rural populations. But again, going back to, the biggest thing for us is can we ensure that we're serving every patient equally? and that just comes back to having really great technology that we can rely on.

Ryan C: 32:05

All right. I want to paint a picture of the tech stack itself. So we've got a cap that communicates over some sort of, I'm assuming like either a BLE or a ZigBee or something along those lines to your gateway, which is, you called it the wall wart. So it's just a little thing you plug in the wall. You mentioned eSIM, which is the embeddable SIM. So it's soldered right onto the circuitry and in it has the Soracom profile, which gets you access to all the different carrier networks. Realistically, I suppose you could even sell this overseas if there was a market for it since Sorcom can get you into all of the different countries as well, multi carrier. So that's cool. You're sending the information out to, I imagine the cloud. So paint a picture about what the, where the data goes and, where are you pulling for as far as sources, since we know that doctors don't want more portals to look into, so how are you working into their workflow? And getting the data that you need.

Andrew Aertker: 33:07

You're exactly right. that's exactly the tech stack. And so we run everything through Bluetooth, low energy, BLE, like you said, and that's just casting all the data through our gateway and then back into our backend that we essentially either spin up into a web portal. And so we have a web front, front end web portal that, providers can use. They can add patients, engage with patients, send alerts or, whatever it is. It's a full spectrum, very well built out web app, but the majority of our use cases today are direct integrations. And I think this is part of a broader initiative across healthcare that, I think there's a huge piece and a huge problem, like you said, with embedding more web apps and more new workflows in front of clinicians. The thing is so much, I think it's over 50 percent of clinical time right now is being spent on administrative tasks and it's such an unhealthy. point of data for us to continue to invest in and not work for solutions around. Because what you're doing is you're essentially just mitigating the amount of time you're having, the amount of time that clinicians can actually invest in improving their patient's health. And so what we've done, and I think what a lot of companies are doing right now is consolidation. We have an API that we essentially cast out for folks. They can ping it, they can hit it, and essentially they're able to grab that data directly from us, pull it into their web app or their system, and embed it right into their workflow. And our goal at the end of the day is we're going to be excellent at one thing, and that is medication adherence data. We are going to get you great data whenever you want it. We are going to ensure that data is securely transmitted, that it is accurate, that it is real time if you want it real time or whatever cadence you want it, and it is going to be portrayed in whatever system you want. But at the end of the day, it is your job as a clinician or as your job as a developer on some of the, remote care companies that we work with or we integrate directly into to surface that data in a unique way that works within that clinician's workflow. But our goal at the end of the day, like I said, is How do we essentially make sure that data is as relevant and as important as possible to be able to surface in a really materially helpful way? And so what we do is actually surface really three characteristics or data points. one is medication consistency. So what we look at a lot and what we actually provide as a data point is how often is this patient taking their medication according to a consistent schedule. So if you're supposed to take it eight hours apart, the first dose and the second dose, Are you consistent with that? And if you're taking it every six hours, are you at least consistent every six hours? And so that consistency plays a huge part in how that drug will actually affect you. Second piece is that routine and that velocity actually is more how I would put it. Are you increasing or are you decreasing that medication dosage over time? if you're really starting to increase and your body's metabolizing that medication faster and faster, that's typically a sign that you either need a higher dosage or you or that your body's not reacting to it effectively and you need to change your care regimen. So that's the second kind of data point that we always push. And then the third one is the true adherence score. obviously adherence is a really hard metric to calculate when you're looking at it on a patient by patient basis and a medication by medication basis. You're looking at scheduled medication, one that you're supposed to take every morning at 8am. It's going to be a very different adherence score than one that you're supposed to take at most. three times a day, right? So having a very, we have the kind of dense algorithms to actually push data that's really relevant in the adherence score, but always pushing some sort of adherence score. So people can look at it and go, Hey, this patient is 55 percent compliant or 95 percent compliant and get a general understanding of how's that patient behaving in according with, with their schedule.

Ryan C: 36:41

How often does that data get reported out from the individual location? is it event driven or is it schedule driven?

Andrew Aertker: 36:48

So we store the actual events on the device. and then we advertise that data about every three hours. Typically, that's a typical use case of sending out data. what we've seen in a lot of circumstances and a lot of different therapeutic areas is that data actually needs to come real time. And we have the ability to just change that setting in terms of sensitivity. Obviously, what you the pros and cons to that are you're going to spike up your battery in terms of battery consumption as a function of running that advertising constantly. But what you get is real time data. And so for higher high risk medications, for high risk medication groups and patients, you need that data real time. We can push it real time, but typical use case is about three hours.

Ryan C: 37:29

So technology is oftentimes just one part of a workflow. And in this case, it's just a check engine light in some cases. I know that in a lot of RPM scenarios, when there's a loss of adherence, just the fact that there is tracking, let someone know before the next doctor's visit. Hey, they're not complying to whatever the procedure might be, which can result in a phone call from a nurse practitioner or someone who's just monitoring their particular use case, talk to me about situations or feedback that you've had from providers. Clinicians and the patients on what that positive cycle looks like for driving adherence. Since I'd imagine it's not that the cap like screams at you. It's not like a Harry Potter device that you're not taking your medicine. what does that situation look like?

Andrew Aertker: 38:25

No, you're exactly right. And it doesn't do that, thankfully. But, it, it does, we know, we do have an SMS based service, that actually provides alerts to patients if they request it. and I think that's been a great benefit to us. like I said, the great piece, or the really hard piece, frankly, about medication non adherence is not knowing when to interact or when to intervene. And I think what we have, like I said, as current metrics in the industry is your fills and refills. And it provides you no mechanism for proactive intervention. So what our data does is it tells you, hey, is this patient interacting or not interacting with their pill bottle? And as a function of that, do you need to intervene or not intervene? And it not only improves care manager efficiency, but improves provider's ability to interact. And we've had a lot of really interesting anecdotes from providers on how they're actually utilizing the data and how, it's being surfaced to essentially help them facilitate better care regimens or treatment plans for patients. About a month or two ago. We had a patient come in to a provider, that patient's data was showing essentially that they hadn't been taking medication for about three weeks. And so when they came in, the provider's first question was, Hey, what's going on here? You haven't showed to have taken your medication for three weeks. we didn't reach out or we did reach out. You didn't contact us back. We don't know what's going on here. And oddly enough, this patient was on an opioid and just taking a singular medication. And she came in and said, The first time I took the medication, I got so nauseous that I was too afraid to take it again. And the provider said, great, we'll get you on a different medication. We'll change your care treatment plan and we can adjust from here. But the thing is, I think patients are reserved about providing even information to their physician, their doctor a lot of times. And I think people are generally reserved about providing health information to others. that data may not have ever surfaced that patient wasn't either taking that medication or that they had received a really bad reaction to that medication in the first hand, had we not had that data. And so even in use cases like that. And I think there's a ton of different use cases for adherence data, from a security and compliance issue, but also from, a safety issue. But this alone, in these circumstances happen all the time for patients with us to say, there's data that provides an underlying piece of information that you just would never have without it. and to have that, and you put the human element on top of it, which is the provider relationship with that patient, you can really treat a patient incredibly well, but you have to understand what's going on behind the surface.

Ryan C: 40:52

So these SMS updates, are they going to the provider's end point and then showing up in their health record? As a result of, because I know there's a number of EHRs where you can send SMS messages in or you could use. a fire API of some kind for data interoperability. So I imagine you're leveraging as many tools as each electronic health records or, EMR or EHR. is it engaging practice by practice or health system by health system and then just working with the tools that they have? is that what the rollout has looked like?

Andrew Aertker: 41:29

Yeah, partially. So the lot of the companies like I think we that we work with today are remote care companies that have their own either integrations directly, but they have typically their own web apps. And like I said, what we do primarily is give them access to our API, and they're able to essentially spin that up and surface that in their system. We don't have a lot of direct integrations into EMRs and EHRs, and partially that's a reflection of the fact that the industry has made it unbelievably difficult. For outside companies to do so without incurring massive shavings off your profits. and and the technical hurdles and the dev hurdles and timelines typically don't work for a startup. what we've done is actually integrate into a lot of tech companies that have those integrations already spun up and they're able to actually facilitate that data transfer or if they're actually spinning it up and servicing it in the EMR or EHR, they already have that integration set up and so there's not a ton of, hurdles for them to work through there.

Ryan C: 42:25

When we talk about customers, there's the buyer and there's the user. And it's rarely the same person outside of, business to consumer. And even in that case, it's, oh, I'm buying this for my kid. I'm not the user. They are. I'm hearing something very interesting about what you're doing with PatchRx, is that the user is the person who's taking the medication. In many cases, the other user, maybe, or the beneficiary would be the care team that is getting that feedback, but then the buyer, I'm hearing the person who ends up realistically wanting to work with patch. Rx is someone who's not even at the doctor's office, but it's the remote. Patient monitoring team, company, are these managed care providing teams or, talk to me a little bit about who your customer is when it comes to making that decision to adopt PatchRx.

Andrew Aertker: 43:24

You're exactly right. The customer profile, I think, is super complex for us. And frankly, I think it's even more complicated than you alluded to because at the end of the day, the person who's actually even paying for it is a commercial payer or Medicare. And so you even have a different lever that's involved in this very complicated program, but that is just healthcare in the United States. But what we have for us in our primary customer profile is typically A remote care company, so any RPM device company or provider. we also work with a lot of companies that have, CCM programs or have a consolidated network of pain management clinics or private practices. And so they just run essentially those consolidated, groups of networks or practices or clinics. And so there's a varied customer profile, but the core piece of it is they have a piece of software. Indoor pieces of hardware that they're currently distributing to clinics or health systems and we integrate with them And so what we do is we sell to them. They sell it to the clinic. The clinic is their customer They're our customer and then the clinic essentially dispenses and disperses the technology to their patients And then the clinic is essentially billing Medicare or billing the insurance from there. So definitely a complicated network There's a ton of variables involved in so I think one of the biggest pieces for us has been Can we ensure that we are, achieving the right variables, setting the right internal metrics for us to assess success in the right way, but also working really closely with every individual along the way. And I think this is a, it's been a wonderful process, I think, in a lot of ways for us to see how collaborative we can be. If people can really get when you're looking at patient outcomes from the lens that I think we all are. and when you're looking at the problem of not medication, not adherence in the way that we are. we have been phenomenally overjoyed with how, how full our partners are in either collecting information or collecting feedback to essentially help, promote, make the service better, but also just really working closely with those providers to say, Hey, can we, assist you in these kind of ways, and how can we make adjustments to our software or hardware to essentially help you perform your services and treatment better.

Ryan C: 45:30

In connected health, there's, it's not a secret that regulations and the regulatory changes in the law are what ultimately drive investment and adoption of new technologies. What regulatory Statutes or changes in the law does PatchRx help providers, patients, and health systems achieve compliance better, faster, cheaper, sooner. Is there a particular, goal or strategic initiative that, that your customers have that you help them achieve? Better, faster, stronger

Andrew Aertker: 46:12

Yeah, so it's varied. I think depending on the customer profile and customer in this reference case is the clinic or practice or health system. So the actual provider group, a lot of the cases that we work under are. in health systems, the hospital reduction readmission programs. and essentially those programs are designed to reduce the rate of readmission. And one of the biggest use cases there is in transitional care teams and essentially dispensing for, say a chronic heart failure patient, and providing that to essentially mitigate, reduce the readmissions essentially. And the reason that is so critical is that there are such massive fees incurred by health systems when patients exit or transition out of that health system and then are readmitted into the hospital for a similar or, close, disease or problem or piece. and when they're remitted, they incur these massive fees. And so for us, our technology is essentially promoting or helping those programs accelerate it. in a way that they can essentially prove and have different tools to essentially increase, or reduce, readmissions in this case, that is a singular kind of option that we often kind of work under. But I think a lot of this is more. when you look at Medicare Advantage or when you look at some of these bigger programs, if you look at the very payer level of this and you look at star ratings, which are essentially the mechanism under which payers are evaluated and programs are evaluated, that's where this gets super interesting. And there are essentially three star ratings. I won't dive too much into this, but there are three, measures that they're evaluating for adherence. I think it's diabetes, high cholesterol, and there's one more and I'm blanking on it. hypertension, there it is. And what they evaluate there is, is that is essentially how a plan is weighted and the plans rated essentially on a five star scale and how they perform under those measures affects their fees and their, savings or their profits on a monthly or a calendar year basis. And so as things change and fluctuate, like this year, for example, Medicare Advantage had some massive changes that are coming in the payment year 2026 to affect. those adherence weights, when those weights increase, it materially affects how plans need to or want to invest in different technologies or innovations. And so what that does is it's, that's the top, right? That is the payer at the end of the day. And so that has a trickle down effect into every different level and stakeholder involved. And so they'll push that on to payers. They'll push that on to health systems. And everybody that's got these arrangements or agreements or contracts with payers, which everybody does, will start to be affected by that and start to invest in innovation or technology that essentially hits those very specific weights or those quality measures that exist to essentially, help out that, that payer essentially do better, right? Perform

Ryan C: 49:00

right? and cut out the biggest challenge of so much of that quality measures reporting is having the data, right? Eliminating the human in the loop from going in and having to enter the stuff in because you have to prove it's did you, do you have your receipt? you want to return or you want a price match? Where's your receipt? And in this particular case, you're giving people that automated heartbeat to show compliance or non compliance. And even applying what I'm hearing is, some score, some algorithmically determined scores to help people wait, which patients are higher risk, which ones are lower risk because at the end of the day, if your goal is to keep people out of the hospital or from taking on more high cost procedures as a result of their health conditions. it's just, again, it's a check engine light of this 30 percent of my patient load. We should be giving them phone calls. We should be getting them into the clinic. We should be asking them. So what's going on? why haven't you been taking your stuff? This is really fascinating. I think it's the simple. Yet novel approach, if it's novel and obvious, it's probably the right step. And I think with technology, we have this urge to over engineer and their scope creep and maybe it could do this, that, and the other thing. But what I'm seeing is through all of your research in the field and working with customers, actually customers in the regards of the payers, providers, the clinicians, and even the patients. You've landed on something that's. Both simple, easy to adopt, and provides people the reporting mechanisms that they need in order to inform the human in the loop and improve patient outcomes. So this has been really cool to hear about such a simple connectivity solution that has so much complexity underneath it. Knowing that building connected products is hard for anyone that was thinking of getting into digital health. And they had this idea. they had their own personal mission, like yourself, your own personal story on why, what about the connectivity journey would you caution people about, and what is your advice for being successful?

Andrew Aertker: 51:24

It's a hard question for sure. and I think it's a hard industry. I think the number one thing that I would say is it's important to have a personal interest in it because the complexity of healthcare is not to be understated. the way that we have designed things in the United States has made it not only incredibly complex for innovation to make a dent, but incredibly complex for people that are new to the space. And I think when we approached this market, it was relatively naively in saying that we can make a dent very quickly. What we realized years in is, We need a broad amount of education in just the nature of how stakeholders interact with each other before we even start to take our first step. because I think that is the number one thing to do in digital health before you even take a stab at it, is understand who's incentivized by what and what changes behavior.

Ryan C: 52:16

Follow the money.

Andrew Aertker: 52:18

follow the money and it is really tough. It is frankly a hard piece of the puzzle to understand. And I think you only understand by trial by fire and understanding, how are people experiencing different products, how are people engaging with different products at each individual level of the kind of stakeholders in healthcare. And so I think that is the number one thing that I would recommend. continue to invest in personally, is just continuous education and continuously having that white coat envy. Essentially, if I know that I'm not a provider, but I can at least, ask the right questions to put myself and our company in the right scenarios. and just continue to be a sponge for understanding and knowledge of this very complex in that space.

Ryan C: 52:57

That's great. I'm hearing just do your homework and, get in and understand all those different moving parts. you know what? Connectivity is complex. It's not always easy as it seems. As far as cloud providers, do you have a particular flavor that you use? And why?

Andrew Aertker: 53:14

it just, in terms of our tech stack, we use AWS for pretty much everything. and I think similar to Soracom, it's managed services that are pretty great within there. and I think that's what we like about these kind of platforms, is you have the ability to create and be a little bit innovative with how you actually design things and have everything centralized under a core resource.

Ryan C: 53:32

It seems that you've gone through a long journey. We're really glad that you landed on Soracom. It's a, it's great aligning to causes that are meaningful because no one's out to buy an IOT. No one just wants to get the datas, right? Like they're looking to, to the stories of how connectivity is being used to change the world around us. So, Andrew with PatchRx, thank you for sharing both your story, how your technology works, and we look forward to sharing that story to the greater world, thank you for your time. I appreciate it.

Andrew Aertker: 54:07

Ryan, pleasure. Thanks so much.

54:09

This has been another episode of What to Expect When You're Connecting. Until next time.

Ryan C: 54:17

What is Soracom to you?

Andrew Aertker: 54:23

Soracom to us is the facilitator of all the data that we have, from our patch caps. It is the mechanism under which we are able to communicate what is vital to our providers and to our patients. without Soracom, frankly, and without the kind of virtual ability for us to communicate with our patients. Confidence and transmit data with confidence. we are in the dark and I think that's what we saw with carriers prior and trying to do it on our own. was, you never really have absolute confidence. And so Soracom to us is really that creator of a broad virtual network for us to ensure that not only we can transmit data wherever we believe that we need to, but to have that and have the ability to do that with confidence.

Ryan C: 55:07

right now, you use Soracom strictly for the multi carrier connectivity with cross carrier failover

Andrew Aertker: 55:13

Correct. Yep.

Ryan C: 55:15

as far as, things on the road map. Is there a particular platform feature either to reduce the amount of data that you have to transmit over cellular or. The security side, things like a virtual private gateway and the ability to communicate to your own private cloud. Is there a particular direction that you've been leaning as far as looking at the future?

Andrew Aertker: 55:36

I think I'd have to talk to my, technical and product people to understand what they're looking at there. But I think one of the biggest pieces for us is, as we start to adopt new technologies and start to look at our product from a, hey, are we designing the right tech to, provide the right, actual physical, whether it's a pill bottle cap or it's a pill box or, whatever mechanism or workflow that a patient uses to take their medications. Do we have the right ability to store that and how's that data, but also transmit that data. And I think what we'll start to see is a really heavy increase. We don't use a ton of data today. We'll start to see as a heavy increase of actually storing that on device. and so we'll need to explore different services, but I think today it's just a matter of. Can we have, everything that we're doing run with pure confidence and security?

Ryan C: 56:22

Cool. As far as the AWS side, are you using things like AWS IoT or are there like Airflow or Elastic Beanstalk? Are there unique services that you're aware of that you're using?

Andrew Aertker: 56:34

No, we have a pretty, pretty simple tech stack. everything for us is just, we have a React front end, and then everything on the AWS side is relatively simple as well, but, but no, nothing on the IoT side, actually, from AWS.

Jason: 56:45

since joining with Sorcom, how has it changed your process? Have you been able to scale? how Sorcom has Impacted you guys beyond just being, the provider for the connectivity?

Andrew Aertker: 56:55

I think there's two pieces that are maybe less technical. One is, I think the reliability piece has been huge for us. I think we ran into a ton of issues, frankly, early on, with running things on carriers. we did try different networks, and then we actually tried to run just AT& T SIMs for a while, and just had a ton of reliability issues. And the problem is, with our reliability is We don't have really a direct relationship with the customer or the end user. And so we can't go to them and say, hey, we think your gateway is down. We have to guess. And so we've obviously stood up services internally to be able to monitor that. But that was such a pain. We said we need to have that reliability. I think you guys use all the major carriers but the, I think that was a big piece for us. It's just reliability. But I think, frankly, that the number one thing that's kept us apart of it, too. Other than that has just been the customer support has been phenomenal. I don't work with your team as much as I think Mile Bach on our team on the product side or technical people. But, We haven't had any downtime, frankly, which is pretty outstanding given the fact that we've been running on these chips. I don't know, for two'ish years maybe and then anytime we have issues or need to change something, I think we've been able to get you guys that week. And so I think it's, that's been a phenomenal kind of, a piece of the puzzle for us.

Ryan C: 58:07

The stuff works, and we help when there are any issues.

Andrew Aertker: 58:11

The best carrier in the world or the best chip SIM in the world is a team that you don't really have to talk to because it works. That's that's what you want at the end of the day. And I think that's what we've gotten a lot of with Soracom, which has been phenomenal.