Mobisante Sees Early Demand for Ultrasound on a Smartphone, Before It’s Really Ready to Roll
The folks at Redmond, WA-based Mobisante have what entrepreneurs sometimes call a “high-class problem.” The startup is getting more attention for its ultrasound-on-a-smartphone product than it really wants in its infancy.
Mobisante, a startup founded in 2007, started turning heads back in February, after Xconomy reported that it was the first company to win FDA clearance to sell a diagnostic ultrasound tool on smartphone hardware. The vision was to put the power of ultrasound—with its ability to look inside the body at damaged internal organs or developing fetuses—on a machine that costs as little as $7,500. That’s exciting to people in developing countries, and budget-strapped clinics in the U.S., who can’t afford the ultrasound machines on the market today that typically run between $20,000 to $100,000 and up.
Suddenly, ER doctors who have limited access to ultrasound got buzzing. The company caught the attention of Bloomberg BusinessWeek, and the folks at MobiHealthNews, who wrote stories in the past few weeks about the promise of the technology, and its commercial rollout.
The excitement about the device was encouraging, says co-founder and CEO Sailesh Chutani, but he doesn’t want people to get carried away. His company has four employees, and a network of consultants. It took months longer than expected to get manufacturing protocols set up to FDA standards, so that the devices could be properly tracked in case of a future product recall. Mobisante hasn’t built up inventory of its product yet, and hasn’t started actively marketing, and yet it is sitting on a list of 300 sales leads from potential customers. Eight months after FDA clearance, it has gotten to the point where it can take advance payment from customers, and deliver a device in three weeks, Chutani says.
Just last week, it reached a milestone. It got paid for its first commercial device, from a customer in the Philippines.
“We didn’t want to make a fuss about the product, we want to have a ‘soft’ launch,” Chutani says. “Our goal has been to sell limited numbers to our clinical partners. Somehow the news got viral.”
Before Mobisante can seriously start converting more customer leads into sales orders, and orders into deliveries, it has a lot of work to do. It is talking to a couple of VCs about raising some more money, striking some important clinical partnerships, and working behind the scenes to hit its stride in manufacturing. And, importantly, it has some key clinical trial work still to do.
Excited as some of the initial customers are, Mobisante has gotten feedback from customers over the past several months about a new iteration that could be even more interesting. The company is working on a tablet-based ultrasound system that it says some customers will prefer over the original smartphone product.
There are a few reasons why customers might prefer a tablet. The original MobiUS that’s now FDA-approved runs on a Toshiba TG01 smartphone handset, which has a Windows Mobile 6.5 operating system. That’s an old version of the software, but Mobisante had to go with it. That’s because the Toshiba smartphone has a USB port, and that’s the software version compatible with a USB data feed. There’s no getting around that—an ultrasound machine must connect with a transducer that sends and receives the ultrasound signal. So that means the hardware has got to have a USB port.
While the Mobisante software operating system may not be cutting-edge, it enables doctors to do things they couldn’t before. By running on a smartphone, Mobisante’s machine has long battery life that can be useful in remote areas, or poor parts of the world without consistent electrical access. Even more importantly, the smartphone enables doctors to transmit images to a colleague somewhere else so they can quickly, and easily, get a second opinion on how to diagnose the patient. That’s something existing ultrasound machines can’t do nearly as easily.
Tablets offer the same kind of portability and long battery life of a smartphone, with the added bonus of bigger, high-resolution screens that produce a more data-rich image. Some doctors will surely find that more attractive for reviewing the sometimes-grainy ultrasound images. One complication here is that Apple’s iPad is the dominant tablet, but its hardware lacks a USB port. Right now, Mobisante is working instead on a tablet version of its ultrasound application on an HP Slate that runs an updated version of the Windows 7 operating system, Chutani says.
It’s still too early to say whether the original smartphone configuration, or a tablet configuration, will be more popular with customers, Chutani says.
While the company has a lot of engineering work on its plate, much of Mobisante’s future will hinge on how its respective systems perform in the clinic. Chutani isn’t saying much yet about what he has in mind here, but essentially Mobisante needs to run more rigorous controlled trials that compare its miniaturized ultrasound tools to bigger, high-powered systems that are used every day in hospitals, by companies like Philips, Siemens, GE, or Bothell, WA-based SonoSite (NASDAQ: SONO). It would be easy enough to dismiss such a tool as a mere toy, and Chutani wants to run it through the paces to see how accurate its machine really is in a variety of clinical settings, compared head-to-head.
Then, after about a year, it will be ready to roll with marketing, Chutani says.
“Now, we can get early adopters,” Chutani says. “But to go after broad market, we need good quality data published in medical journals, so people can say ‘Yep, this is how it performed vs. existing systems.’” But as long as people don’t get too carried away with overinflated early expectations, Chutani says he’s in a good position, seeing this much early demand. “I view it as a confirmation of a real need out there,” he says.