Durham, North Carolina-based health data platform company Validic announced this week that it had acquired its partner Mountain View, California-based Infometers for an undisclosed sum. Validic's CEO Ryan Beckland told MobiHealthNews that his company bought Infometers for its technology capabilities and for its team. All full-time Infometers employees have joined Validic, Beckland said, but the number of employees was not disclosed either. The former Infometers team will continue to work out of their Silicon Valley office, which gives Validic a strategic foothold there.
"What Infometers does is SDK integrations. What Validic has traditionally done is API integrations," Beckland explained. "The difference is API is server-side so the device, let's say an Omron Blood Pressure Cuff, would send data to a hub, which might be software on a phone, computer or Qualcomm 2net hub plugged into the wall. Then that hub, whatever it is, sends data to a server. Validic is integrated on the server side so we pull data off the server -- that's the API connection. Now the SDK connection, which is what Infometers does, pulls data directly from the device itself. What Infometers actually has is a piece of software -- a hub -- that grabs data directly from the devices and sends it to the Validic server. That's the technology that we've added to our portfolio that will allow us to rapidly expand into more classes of medical devices and quickly broaden our horizons into the types of things we can integrate."
Beckland said the vast majority of medical devices don't have server-side connections, or APIs, available, and so the Infometers acquisition enables Validic to expand the number of devices it integrates with. Once all of the devices Infometers has already integrated are added to Validic's portfolio, the company will have broadened its portfolio by 44 percent.
While Validic is in discussions with some of Infometers' former customers, Beckland said the acquisition does not include any customer wins.
Unlike many of the more recently announced health tracking platforms, Validic does not offer a consumer-facing portal or app. Instead it works directly with healthcare providers, including Kaiser Permanente, to help them more easily collect data from their patients' home health devices. Validic's platform is invisible to the end user, which is often the way providers prefer it -- not having a middleman between them and their patients. In keeping with that role, Validic's platform does not modify or analyze the data that it collects from the various health apps and medical devices its connects to, making it a medical device data system (MDDS) class I medical device.
Interestingly, a few weeks ago the FDA proposed to deregulate MDDS offerings like Validic's platform. Beckland said the proposal from the FDA came as a surprise.
"I'm generally skeptical of the idea that the government would de-regulate things on their own merit," he said. "In this case they did though, and it surprised me. It's a good thing because there is no reason that MDDS systems should be regulated. We are an FDA-listed MDDS, and one of the things that regulations do is that they protect incumbents. So, now that we have the MDDS listing it actually kind of hurts Validic, but this is a good thing for the industry overall. I am happy that it happened. It's the right thing to do and absolutely no reason in the world that systems like ours should be regulated."
While it may take some time, Beckland said if the FDA's proposal goes into effect no longer being listed as a class I medical device won't change Validic's operations very much. The company spends much more time focused on ensuring HIPAA compliance and security than it does on the FDA.
Looking further out, Validic believes that in addition to the technology acquisition, the Infometers deal and the new Silicon Valley location will be crucial, especially as startups out there become more and more clinically focused.
"One of the things that we are excited about with the Infometers acquisition is that now that we are opening up a Silicon Valley office, that's going to be a really important for where we go," Beckland said. "As a Switzerland-like marketplace to move data around, we play ball with everyone from the earliest, earliest stage of companies -- early startups -- to the Welch Allyns and Johnson & Johnsons of the world. This Silicon Valley office means having more access to the earlier stage, highly innovative companies that are doing things that have never been done in this space before, and we're going to do some really cool things out there over the course of the next year."