FDA clears J&J-WellDoc integration of BlueStar software with LifeScan Verio Flex BGM and Reveal app; US launch in 1Q17 – December 15, 2016

Executive Highlights

  • J&J announced yesterday that the FDA has cleared the integration between WellDoc’s type 2 diabetes management software, BlueStar (iOS and Android), and LifeScan’s OneTouch Verio Flex Bluetooth-enabled BGM and Reveal app. This product will save users manual BG entry, allowing the BlueStar app to directly accept values from the meter.
  • The integrated product will launch in the US in 1Q17 (pushed back from previous guidance for 2016), as soon as an updated BlueStar app is available through Apple and Google Play. The integration gives LifeScan clinically proven software to augment its BGM, while WellDoc gains an established player to launch the promising BlueStar app at a bigger scale. This is a big deal!
  • Reimbursement is the biggest unknown and talks are ongoing with payers. We’re not sure if patients will have one or two copays for the combined product, and of course, at what tier the integrated product will be covered. Could this product help J&J strengthen its position in the very challenged US BGM environment? Could it drive a change in the business model? Most importantly, we see real opportunity for patients to get more individualized care, which the field has been trying to do for years, mostly unsuccessfully.
  • J&J/WellDoc’s progress has been quick following the March partnership announcement.

Yesterday morning, J&J announced that the FDA has cleared the wireless integration between WellDoc’s type 2 diabetes management software, BlueStar (iOS and Android), and LifeScan’s OneTouch Verio Flex Bluetooth-enabled BGM and Reveal app. A launch is expected in 1Q17, as soon as an updated BlueStar app is available through Apple and Google Play. This is slightly behind the plans as of September to launch by the end of 2016, but fast development overall and FDA clearance following the initial March partnership announcement. We see this integration as a clear win for both companies and a definite product step-up for people with type 2 diabetes.

The prescription-only BlueStar app will now wirelessly receive blood glucose values from the Verio Flex meter (via Bluetooth), saving users manual BG entry. BlueStar will continue to provide users with real-time feedback, pattern recognition, and educational content based on a pre-specified treatment plan, and also offer clinical decision-support for providers (pictures below). If the BlueStar app is not open on the phone, the Verio Flex BGM will store recent glucose values and backfill upon the reopening of the app. BlueStar can also sync sleep, activity, and height/weight from Fitbit, Jawbone, and Misfit, adding more useful behavior context for patients and providers. BlueStar helps patients dose insulin based on their provider's orders and reminds them to take their medications (we assume this means it contains a simple bolus calculator), and also stores a user’s medication plan, allows logging of doses, and suggests dose changes to providers.

Use of J&J’s own paired OneTouch Reveal app (iOS and Android) will be optional – good to see users won’t have to juggle two apps (though the meter can work with both). Reveal has pretty positive reviews on Android (3.9/5, n=1,291) and weaker reviews on iOS (2.5/5, n=374). BlueStar has notably strong reviews on both Android (4.1/5, n=59) and iOS (4/5, n=11). We imagine there will be work to integrate patient feedback and the iOS reviews will improve.

LifeScan and WellDoc are currently working with health plans to maximize patient access for the integrated system. We imagine that, depending on the health plan and context, patients could have one copay for the bundled system (strips + app) or two separate co-pays, one for BlueStar and one for strips. We like the sound of the former – a single, all-inclusive payment is a simple way to reduce the hassle associated with a service like this. We wonder if J&J could change its US business model with this integrated offering, moving away from selling strips and more towards software-as-a-service.

As we have noted previously, we see this partnership as a win for both companies:

J&J gets...

WellDoc gets...

  • Augmenting its Reveal app and Flex BGM with the clinically proven BlueStar software – instead of just displaying a number, BlueStar gives patients real-time feedback and education that continuously adapts.
  • Setting itself apart from competitors selling just another meter (or just another connected meter with a paired data collection app).
  • Giving providers BlueStar’s useful tools, including clinical decision support and streamlined, automatic reporting.
  • Getting WellDoc’s expertise on software, which is not a strength for the hardware-focused LifeScan.
  • A clear path to reinvigorating the pipeline at a time of continued struggle in BGM.
  • Potentially new business models.
  • Expertise and vote of confidence from a major diabetes player (including an investment earlier this year).
  • A distribution network to accelerate BlueStar’s national commercialization (to date it’s been a regional launch).
  • J&J’s payer relationships to deliver BlueStar at scale.
  • LifeScan’s sales force (we assume) to drive awareness and educate providers on prescribing software.
  • A BlueStar user experience win: passive collection of blood glucose data via the wireless Verio Flex BGM.
  • WellDoc has mostly been in proof-of-concept mode, and we’re not sure how widely prescribed BlueStar has been to date. As of March, WellDoc had contacted almost 1,000 prescribers since BlueStar’s 2Q14 launch, and a striking 62% (!) had written a prescription. Wow! The company had also crossed the 10,000 prescriptions mark, notable for a digital health startup with a small sales force and a very different kind of therapy (a prescribed app). With this partnership, WellDoc will clearly move from its small regional focus toward national scale and growing the patient base.
  • We like the approach WellDoc and J&J are taking – augment BGM data with personalized smart algorithms and educational content, while giving providers some decision support on the reporting side. The BlueStar app also has an Ask an Expert section, presumably with a person at the other hand answering asynchronously. See some screen grabs of the BlueStar app on Android below.
  • Scalability, personalization, clinical effectiveness, and business model are the big questions as the field of glucose monitoring moves beyond selling meters/strips to doing something valuable with the data and driving clinical effectiveness. We’re noticing a nice balance of offerings that leverage human coaches and automated algorithms. BlueStar is more on the automated side of the spectrum, while purer coaching offerings like mySugr have a more component. Other products seem to be in middle, such as Livongo and One Drop Premium. All of these approaches have pros and cons (e.g., personalization vs. scalability), and we love seeing a spectrum of offerings.

Close Concerns Questions

Q: Will the wireless BGM integration make a huge difference for BlueStar’s clinical effectiveness?

Q: What is the go-to-market model – one or two copays? How widely accessible will this be? How compelling is this offering to payers?

Q: Will J&J sales reps detail BlueStar, along with Verio Flex?

Q: How open are providers to prescribing BlueStar, particularly those who are not early adopters? Will the value of BlueStar be clear to the average PCP?  

Q: How widely has BlueStar been prescribed to date? How quickly will J&J accelerate uptake?

Q: What is the right balance between human coaching and automated algorithms to drive the best clinical outcomes at scale?

Q: Might a business model with unlimited strips (à la Livongo and OneDrop Premium) be considered? What about incorporating a team of certified coaches to support the BlueStar capabilities?

Q: Will BlueStar ever be integrated directly into a next-gen LifeScan BGM?

Q: Will the integrated product be available outside of the US?

Q: Might J&J acquire WellDoc in the future?

More on Verio Flex and BlueStar

  • The Bluetooth-enabled OneTouch Verio Flex BGM and paired OneTouch Reveal app launched in the US in FebruaryThe BGM is priced at just $19.99 and will be available online and in pharmacies across the US. Aside from Bluetooth connectivity, the Flex’s key feature is an arrow that points to a color and adds context to glucose readouts – blue for hypoglycemia, green for in-range, red for hyperglycemia. J&J has clearly prioritized low-cost, so the screen is not color; we assume this was a clever workaround to capture some of the advantages of color recognition without adding a costlier screen or rechargeable battery. Otherwise, the meter is very basic, with the main advantage being its low price and Bluetooth connectivity. The Reveal app features iOS and Android compatibility, and the iOS version posts to HealthKit.  
  • BlueStar is an FDA-cleared, prescription-only therapy software for type 2 diabetes, which WellDoc originally launched in June 2013. We believe it is a unique product with potential to: (i) give patients ongoing feedback and support; (ii) make providers lives easier and practices more productive; and (iii) scale to help many people with type 2 diabetes. Here are some of the reasons that set it apart from other digital health offerings:
    • Medication management: WellDoc’s BlueStar is FDA-approved for all adults with type 2 diabetes, regardless of their medication/therapy regimen. The analytics engine educates patients about their medications and can suggest medication dosing changes to providers.
    • Proven efficacy and engagement (clinical trials and real world): Based on posters shared at DTM and ADA, real-world A1c reductions have been ~1%, maintaining the solid data from WellDoc’s published clinical trials. The two published two RCTs showed significant 1.2-1.4% reductions in A1c levels with WellDoc’s software – Quinn et al., Diabetes Care 2011(1.9% in the WellDoc intervention group vs. 0.7% in the usual care group; p <0.001 over 12 months) and Quinn et al., DT&T 2008 (2% in the WellDoc group vs. 0.7% in the usual care group; p <0.02 over three months). WellDoc had an enthusiastic session at AADE 2015.
    • Value for patients: BlueStar is powered by the proprietary WellDoc Automated Expert Analytics System, which analyzes trends in users’ data (i.e., blood glucose and A1c levels, diet, exercise, blood pressure, lipids, and foot exams) and makes recommendations based on behavioral patterns. Everything is highly personalized from the initial setup, with feedback and messaging adapting over time – each patient’s BlueStar is completely different. The algorithms are derived from evidenced based guidelines and the R&D implementation is overseen by expert diabetes clinicians and behavioral scientists, and as we understand it, every single message maps directly to standards of care.
    • Value for providers: WellDoc has thought very strategically about minimizing the time providers will need to spend on BlueStar. There is no set-up required by a patient’s healthcare provider; all different forms of training are now available, and the majority are done through short videos within the product. HCPs can choose to just prescribe BlueStar like a drug, or they can also choose to use WellDoc’s clinical decision support. The clinical decision support aspect of BlueStar is intended to make HCPs’ work flow more efficient; in a quick glance of WellDoc’s SMARTVisit report, providers can understand what has been going on with a patient and make smarter treatment decisions, as well as, better achieve Quality Measures (an increasing part of physician’s performance payments). WellDoc has found that putting the analyzed data in the doctors’ hands makes them twice as likely to make treatment changes (e.g., getting patients to the right therapies and doses faster).
    • Reimbursement: BlueStar has an NDC code and launched with reimbursement similar to other prescription products (adjudicated as a pharmacy benefit; i.e., copays that vary by insurance plan). This is a major win for patients, a rarity in digital health, and a testament to WellDoc’s strong focus on publishing solid clinical data. We understand that the FDA required the prescription-only distribution approach because BlueStar essentially helps patients adhere to their physician’s care and treatment plan – one could certainly imagine a scary scenario of a less controlled distribution scenario (e.g., open for download on the App store without the oversight and determination of medical necessity of a physician) would result in many patients using a product that might contradict his or her physician’s care plan.
    • A new class of therapy: Notably, ADA recognizes BlueStar on its website as the first and only in the new class of diabetes treatment known as “Mobile Prescription Therapy.”     

BlueStar Screenshots


-- by Brian Levine, Adam Brown, and Kelly Close