The Bosua Supremacy (Part 2)

During a recent conversation with $KNWN CEO Phil Bosua, $KNWN chairman Ron Erickson, BioPub associate editor Jonathan Coulborn and managing editor Allan Lee, I made a point about cultural inertia, about resistance to change, and how an event as momentous as the advent of UBAND could trigger a societal backlash. UBAND may change lives in the best way imaginable, and while most may cognitively support that, some will viscerally be terrified and will resist. John Galsworthy: “The beginnings and endings of human undertakings are usually untidy.”

It’s one of my favorite anecdotes about how societies, how people, function: on 8 July 1853, Commodore Matthew Perry of the United States Navy, commanding a squadron of two steamers and two sailing vessels, entered Tokyo harbor aboard the frigate Susquehanna.

When hillside Japanese spotters noticed them, they gave runners a handwritten message to take to authorities, but the message revealed more about the Japanese than it did about the new ships in the harbor: “悪魔の黒人船.” Translation: “black warships with hostile mien.” At that time, centuries of feudalism had been toppled and consolidated into a shogunate that for perhaps 250 years had sequestered Japan off from the rest of the world. Despite having among the most aesthetically and technologically sophisticated cultures on earth, a bias to xenophobia has long lurked in the Japanese mindset. Most who don’t speak Japanese, for example, are unaware of its two writing systems, the hiragana and the katakana. For words, concepts and memes indigenous to Japan, the Japanese write in hiragana. For words, concepts and memes emerging from “foreign” cultures, those are de rigeur always rendered in katakana, forever marking them as notions from the outland (not even the at-times haughty French are so relentlessly exclusionary). For the Japanese to partition themselves somehow felt normative to them, even however as they’d begun to sense a burgeoning world beyond their hills and walls.

Perry had come to attempt persuading Japan to enter into trade with the United States. Early in the encounter, the Japanese recognized Perry’s considerable firepower and had elected not to behave in a hostile manner. The historical record is unclear on how much force Perry was actually prepared to use, but in negotiations, he soon insisted on a treaty permitting trade and the opening of Japanese ports to U.S. merchant ships. The truth is that Perry’s small squadron of ships by itself wasn’t enough to force Japan’s hand, but it prompted the Japanese to think: do we here redouble the sealing off of ourselves from the rest of the world? Or do we fling wide our gates, let the world in, accept it and even embrace it? The Japanese were smart enough to be aware of flourishing interest in their islands from people they regarded as irrevocably foreign, and that Perry would soon be followed by emissaries from Russia, Britain, France, and Holland…all sharing Perry’s interest.

The upshot was the Meiji Restoration, perhaps the most important shift of stance in Japanese history. Years of solipsism gave way to the nation flinging its gates wide, admitting foreigners and trading with them. In no sense would Japan ever be precisely the same again, and yet even Japanese tended to agree that the Meiji Restoration was inexorable and needed…and that Japan owed Commodore Perry a debt of gratitude and honor. Even in modern Japan, you buy a bar of Meiji chocolate knowing it’s with wink and nod to the west.

I’ve gone on about this because I believe Know Labs will soon provoke a similar epochal cultural jumpcut in the history of clinical medicine. The UBAND will be resisted, bedeviled in some quarters….only to be then regarded in a greetings! hail fellow well-met! kind of way for the rest of human time. We stiffen our necks against the inevitable til we cannot do so anymore and still save face….and then decide the inevitable’s actually rather a cool thing and wish we’d thought of it.

 

KSS

Phil, we were speaking about the democratization of medicine by the UBAND. When I practiced, I routinely would have patients show up in the office that had literally no means of paying and no coverage ….and I would see them anyway and mostly eat the expense of the labs, trying to triage them. You almost envision a time when the doctor’s office keeps a device like this around for those situations where it would be very helpful to have a sense of hemoglobin or albumin or certain electrolytes, potassium for example, not to mention solutes like glucose, and can offer those gratis to a patient and potentially save a life without incurring a risk of the patient going into debt to do this. You know, is the patient going to be hounded by bill collectors for the rest of his life because of a medical dalliance today in the office?  And that’s a reality for patients right now in this country. You have the first solution to that I’ve ever seen.

Jonathan Coulborn

Dr. KSS, you mentioned the idea that, you can kind of look to see, after you’ve had your spicy whatever: am I having a heart attack-type event, or is it just acid reflux? As you’ve discussed, if you’re sitting at home and you’re worried if you’re having a heart attack or not, that’s a “do I call an ambulance or do I just take a Pepcid?” That’s a multi-thousand dollar decision, ER costs and ambulance costs and if you can just look down at your device and just say “Oh, I’m absolutely fine,” imagine what that does for healthcare, costs and debts issues.

KSS

And the thing there, Phil and Ron, is that patient who’s got no means of paying, invariably, they’ve got an iPhone and they’re paying for that. I mean, I’m not trying to be cynical about things, whether they’re representing their financial circumstances accurately. But my point being your price point is easily within the means of some of our less well off people and so you do start to democratize things…. and I think we have as a society an ethical obligation to bring it to that if the technology enables it. I mean, I just see us kind of lurching, leaping, several logarithms ahead in terms of quality of care here, and at one fell swoop.

Phil Bosua

Yeah, that’s exactly how I feel. Absolutely!

KSS

Allan, do you have any questions?

Allan Lee

I do! Just a couple of questions regarding the software development steps going forward.

As you said, there are so many different paths you can take in terms of diagnostics, and the key question now is only what you’re going to pursue later on. I was wondering how long it takes to actually break into diagnostics indications. It’s obviously very different and circumstantial for each, but perhaps you can just provide some more insight on the software development component. Would it take months or many years? At what cost? Would you have to scale your team dramatically?

Phil Bosua

Yeah, another good question. I think it’s a combination of what you just described. So it’s a very delicate balance inventing something this innovative. Our whole core internal team is quite small and we have a really nice dynamic. But eventually we’re going to have to expand that and grow because the demand, the commercial opportunities, to help look after the people’s health is going to compel us to want to branch out and expand the offering. The actual software side, all the work was in the first one. So now we found blood glucose; it’s a matter of just rinse-and-repeat on other molecules and compounds. So, from a software point of view, that’s something we feel very confident with, and we don’t feel like that will be a stopper. It’s not going to hinder us at all.

Allan Lee

Great. Now we have no doubt your product works and you guys seem to be the first one here. But the whole concept of non-invasive and RFID, others have tried it in the past, and correct me if I’m wrong, they had trouble making it work, so maybe you can help some of our readers understand the breakthrough that you had that led to your success. We’re not asking the recipe of your secret sauce, but what made it possible? What did everyone else miss?

Phil Bosua

There’s two things. One was a very novel antenna design. So I contracted an agency to help us with the antenna design and one of the RF guys was from Lockheed Martin in their RF department for many years and was founder of an agency. So that’s the caliber of people who are working with. He started designing antennas for us, but then he was pretty intuitive and said to me one day, “You kind of have a way about you with all these technical things, amongst other things.”

And he said, “I think I want to teach you how to design, how to REALLY design, antennas, if that’s something you’re interested in”. So yeah, he spent a few days doing them and I’m pretty a quick learner. I’m not professing I’m the best antenna designer on the planet, but what I ended up coming up with was something that was, out of the box, a very novel idea that got us to move forward in leaps and bounds.

It does the opposite of what most antennae do. I can’t say any more than that, but it’s not like I had to do 10 years of physics and RF schooling. It was really zooming out and looking at it from a completely different perspective and then it took weeks for me to come up with the antenna and the guy then refined it after I came with initial concept. Then we put it through thousands of simulations in the computer and then we were happy with what we were looking at and tried many variations of it as well.

Then, we got them all made up and it worked as simulations described. So that’s the first one, and then the second one. Once we got the raw data reading from this novel antenna design, then there’s a series of algorithms that we had to design ourselves, the software algorithms to find blood glucose. They were more difficult than I expected and now knowing what I know, I’m like, Wow I’m glad that I’m not going to have to do that again! It’s a very complicated algorithm….the truth is that it’s complicated and simple at same time. Once you figured it out, like any other algorithm, it’s very easy to apply. But it took about nine to 12 months to really, really nail that.

Allan Lee

That’s amazing.

Jonathan Coulborn

You know, obviously this being an unfortunate time in history as regards privacy issues, some days you’ve got to have questions about hacking concerns. If someone can get hold of that patient data, data privacy, you know….are there questions around that segment? I assume you guys have put a lot of thought that area, especially if you’re working with any of the app stores; they all have things governing what all information can and cannot be shared.

Phil Bosua

Yeah, absolutely. Other than the actual inventing of the technology and refining it, security’s the second thing we think about most and we feel like we’ve got a good solution. It took us a while to understand but we try to think outside the box and what we decided upon is that we are NOT going to collect  information from  people that we don’t need…… so if we don’t collect their name and their address, how can you have a security breach without that identifying information being there to start with? So clearly we’ll collect all the data that reports back the medical diagnosis, the compounds, and molecular understanding of what’s going on in your body. But if we don’t know who those people are to start with, then we feel like that is the best security method we can employ. On top of that, we’re going to have the highest security measures as well technical, hardware and, software security measures we can employ which would include measures for being HIPAA- compliant

Jonathan Coulborn

I was going to say that I’m sure you guys are years ahead of me, but you’ve considered all the HIPAA compliance issues and all that. And I’m sure you’ve got an attorney who sits there and hopefully is there make to everyone’s life more difficult as they do, but they’re such useful people.

Phil Bosua

Yeah we’ve got a few of those as well [mirth all around].

Jonathan Coulborn

Well that’s good news. Moving along …..FDA? I don’t know. Are we looking for a 510 k pathway? What exactly is going to be governed as a device? Is FDA regulatory approval even needed?

Phil Bosua

The calorie counter’s a lifestyle product, so even though we’re using blood glucose to measure the caloric intake from carbohydrates, we don’t need FDA approval for that. So we will be releasing that without FDA trials or applications. The blood glucose form of the device….that definitely does require FDA approval if diabetic patients are going to use it for making medical decisions. We’ve got Dr. James Anderson, who is ex-Eli Lilly head of endocrinology and diabetes, and he’s going to run our regulatory process. In saying that, I want to be hands-on with it myself, or at least aware of everything that’s going on, but he’s got a lot of experience in that.

Ron Erickson

He (Dr. James Anderson) really is extraordinary. We talked to him on the phone, and he wanted to come to Seattle and see if it was real, because at Lilly, he had looked at probably 50 different proposed solutions for non-invasive blood glucose and they were all non-starters. So he was intrigued and this has been his life’s work. He flew to Seattle, spent a day in the lab and I’m gonna let Phil finish the story.

Phil Bosua

Yeah so it was a really good day, and probably halfway through I said to him you know I just want to run something by you: we see this consistently and I’m just not sure what it is. So I explained to him that we were getting 85%, 90% correlation to a Dexcom G5, using our non-invasive sensor, and that was when we used the moving average across our raw data. We know that Dexcom and Freestyle Libre all have moving averages as well. So the moving average is very simple algorithm, but I said this is my raw data and I showed him my raw data and it kind of spikes up and down a lot, in the order of 60 milligrams per deciliter every sort of five or 10 minutes or so. I was, like, so what’s going on here? I was sort of alluding to the fact that maybe I’m missing something, but I don’t know why the moving average would correlate every test.

Anderson smiled and said, “AHHH it’s definitely not a mistake.” He said the body and the gut will pump, via peristalsis, the blood glucose into your system as it materializes in the gut. So he said that was one of the reasons he really wanted to get involved was because I thought it might have been a mistake. And then he said, the fact that you told me you thought this might be a mistake and it was actually the reality, when I didn’t even understand the physiology of that…he said that just made him want to double down on this project with me.

KSS

So Phil, you can picture a vigorous peristaltic wave wrapping around ingested material, all kind of solutes, and that squeeze literally piledrives the glucose into the capillaries. So your data is , like, cinema verite, basically, it’s hyper-real. It’s realer than real! It’s wonderful.

Phil Bosua

Yeah. It’s funny on that on that point, what we feel is we have solid repeatable tests using specific algorithms to find different molecules. The science all adds up and it adds up practically and like you just said that’s what we’re measuring, there’s no other way to look at it. So we’re super confident and excited about where we are right now and where we’re going to be in the future.

KSS

Could your device fall into the hands of a malicious Chinese technical expert and be dismantled, and then someone come up with a hacked variant of it? Could it be emulated that way?

Phil Bosua

Well, my binary answer’s yes. I mean, it’d be foolish to think that couldn’t happen. But we’re going to be very clever about that. We’re going to hide things as much as we can and as clever as we’ve been with figuring all this out, I think we’re going to apply that same cleverness to disguising a few things. So I would say, my realistic expectation is maybe within three to four years, we may see another player, but we’ll be three or four years in front of where we are right now by then. So it’s a cat and mouse game, and I expect we’ll stay well ahead of it for the foreseeable future.

Jonathan Coulborn

On that note, manufacturing. Obviously, you would intend to not have that in China, but my expectation would be if you’re worried about intellectual property theft and you know the real concerns there, I would assume that you’re not gonna be manufacturing in China should you get to mass marketing there.

Phil Bosua

We’re open to China but it’s not where we’re first going. I spent three months in Shenzhen (China) myself from my previous projects, so I’ve got a more personal understanding of that. I don’t think it’s quite as bad as everything you read, but there’s a reason for that stereotype, I guess. So at first we’re going to be looking at manufacturing out of Singapore and then whether the actual factory’s in Malaysia or Taiwan… So that’s where we’re initially looking to manufacture. What I’ve learned in other projects is to protect your intellectual property from a manufacturing point of view and that’s by splitting the manufacturing across different manufacturers. So you might get one part of the board made at Factory A, another part of the board made a Factory B, the firmware might get uploaded at Factory C and Factory D may assemble. So there are ways and means to put in reasonable balances and checks, but I’m not worried about it because we’re approaching it in the right way. But at some point in time, someone’s going to figure this out. But then, I hope to be so far down the track by the time they figure out the basics that we’ve got market share, and we’ve got mindshare, as well.

KSS

One comment I was going to make, just in terms of doing a little research on this space, nothing that dissuaded me, but wondering if you had any remarks. There are a couple medical gizmo makers who are supposedly trying to advance into clinical use, things that may almost come closer to being the hypothetical Star Trek tricorder device than yours because they are outrigged with sensors and things that look into bowel sounds or track pulse and they’re really like those kind of one-handed single entity weather stations that we all had as high school students. It purports to assess the patient and may only give gobbledygook information, while yours is focused on one set of parameters, blood concentrations of solutes. I mean, how do we, when presenting this to people, help them not get confused by those gadgets, those gizmos, that pack of people? Make them see that yours is the device on a different plane, far more sophisticated, for more focused, far more relevant. I think that those contraptions that the other people are coming up with are just going to create confusion and make it very plain that there really is a place for  human clinical judgment in terms of physical exam and putting the total package of a patient together. You’re not purporting to hand out medical diagnoses, you’re only doing helpful non-invasive laboratory testing. What do we say? How do we navigate through that so that people aren’t dissuaded? There’s three or four of these kinds of things coming to market, why should they invest in yours?

Ron Erickson

Yeah, I hear you. The way I think about that is we never set out to invent the Star Trek tricorder. We set out to ascertain blood glucose levels non-invasively. By achieving that, we realized we could also see other molecules and compounds above one milligram per deciliter. Any tricorder comparisons I feel flattered by them, and I like them, but it’s not what we’re trying to do. We’re just trying to do what our vision is and in the way we think we can help people live healthier, better lives. So yeah that’s probably how I’d answer that.

KSS

Okay, that’s a good answer. The others seem they will undermine their own paradigm, they will quickly disclose limitations in their purported approach, such that I think they’re going to get tossed aside whereas yours is going to soar meteorically as I see it. I think there will be a little bit of an uptake barrier and there will be hard-headed physicians insisting on the waiting game of “well that’s just a contraption that plucks numbers out of the air, we need to do it the old fashioned way and stick a needle in and get some blood and see what it really shows.” They’ll get beyond that, but I don’t know how long it’ll take. It might take a year or two for that barrier to be overcome and then start to accept that it’s really a clinically legitimate device. But I really think that’ll come with time. I think that many of them would, with what their knowledge base is, doubt that what you claim is possible, and we’ll have to educate them around that. You’re asking them to kind of accept new ideas and new concepts but that’s okay.

Phil Bosua

Yeah, the way I thought about it was a lot of medical lab diagnosis and measurements of compounds molecules is already done using electromagnetic spectroscopy. They just typically use light waves, and what we’ve done is shifted it to the radio frequency range and applied similar technique. So in practice, you’re right. You know, it amazes me how many people who are medical professionals doubted it and I’m like, well we’re not really doing that much different than what’s already happening. But we’ve found the way, you know, to do that non-invasively in vivo in real time.

KSS

And you’re right. I would actually gently say many of them really think those multi-channel analyzers are doing microscopic organic chemistry lab benchtop reactions to quantify substances and they’re not. But a lot of people don’t know that and so there’ll be an activation energy of acceptance that has to be overcome. I think it will really take care of itself as people start to realize that device output and what we’re getting here is “the right way” to do it, they’re identical and indistinguishable. Jonathan, did you have anything else from your corner?

Jonathan Coulborn

I guess battery life would be a question.

Ron Erickson

Yeah, we’re not putting a screen on the device because the amount of information we’re going to try and convey really suits the real estate of a smartphone screen. So we will just be a Bluetooth link from the device to the app. There will be some basic feedback from like vibration and a little light on the actual device, but because we’re not putting on a screen, on our expectations is a 30-day battery life between charges.

KSS

That’s amazing. That’s fabulous.

Allan Lee

Just one last thing. Personally, I’m super excited for your Kickstarter campaign Phil, and I’d love to purchase one! Now your Kickstarter is critical, but you’re a legend among the Kickstarter community after you running one of the most successful campaign ever with the Wi Fi light bulb, so maybe you could just shed some light on how you plan on doing the KNOW Kickstarter? What does it take to be successful on Kickstarter? It’s obviously a different audience.

Phil Bosua

Yeah, we’re planning an April Kickstarter launch and we want to go big, so we’re planning a full page New York Times ad to launch our Kickstarter

KSS

Impressive.

Phil Bosua

Amongst other things, yeah, hopefully that illustrates how big we want to go with this

Allan Lee

If this blows past all your expectations, would you be able to ramp up manufacturing easily?

Phil Bosua

Yeah. The manufacturers that we’re starting to talk to can handle up to a million units very comfortably. So yeah, we will feel like terrific the capacity to it.

Jonathan Coulborn

I think it’s a very interesting game plan, you’ve got the equity or the bridge loan that would convert to equity and then you can kind of get your almost like a soft launch kind of thing. If you get the Kickstarter, however much money, each one of those is a kind of a pre-made sale depending on how you have it set up and then assuming you hit the threshold you need and you’ve got the manufacturing in place and you’ve got your first set of sales which will be still more money. I think it’s very clever.

Phil Bosua

Thanks, you know, that stuff doesn’t happen by accident, we spent many hours.

Jonathan Coulborn

I don’t doubt it.

KSS

I mean naturally we saw a lot of cool stuff at JPM week but I really do have to hand it to you all for having a presentation that just literally smoked and blew out of the water everything else we heard and saw there. I’m really serious, that presentation alone was worth getting on a plane to California for, so we’re grateful. We hope we can communicate on a fairly regular basis.

Phil Bosua

Same here—your support is very motivating. Thank you!

KSS

We really appreciate your time. Have a terrific day guys, thanks very much.