Apple iPhone Calling Big Pharma: We Can Help You Develop Better Drugs

By Markets

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Apple's (NASDAQ: AAPL) iPhone just scored its first big drug deal. Okay, I'm kidding, but not really. Through an app called PARADE -- short for "Patient Rheumatoid Arthritis Data from the Real World" -- global healthcare company GlaxoSmithKline (NYSE: GSK)became the first big drug company using Apple's iPhone and its software platform ResearchKit.

It's a moment of truth for Apple's ResearchKit platform, and it could open multiple possibilities for both Apple and big pharma down the road. Assuming Glaxo's efforts succeed, ResearchKit could whet big pharma's appetite for using Apple products, including its iPhone and Apple Watch.

Why? For one thing, conducting research through virtual "at home" trials could save a staggering amount of money for big pharma. Drug companies must run costly studies, known as clinical trials, to prove their drugs work and gain FDA approval. In fact, Phase 3 trials reportedly eat up roughly 40% of the R&D budgets of pharmaceutical companies.

To streamline clinical trials, the PARADE study will allow arthritis patients to use their iPhones to send in data without setting foot in a lab. Using an app based on ResearchKit, participants will perform a guided wrist exercise and the iPhone's movement sensors will detect their progress. The need to set up costly trial sites, and hire nurses to make measurements and record data, will be avoided. In addition, since the data is already digitized, researchers will spend much less time sorting through it for analysis.

Pfizer's virtual trial with a patchwork of technology failed

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How much the iPhone and ResearchKit could streamline the drug research process can be seen in how Pfizer (NYSE: PFE) failed in its virtual-drug research trial a few years ago. In 2011, Pfizer started a trial called REMOTE that used a patchwork of awkward and unfamiliar technologies to enroll and evaluate healthcare outcomes for its participants. Glaxo, by contrast, plans to do all enrollment and evaluation on the ubiquitous iPhone.

In large part, the Pfizer virtual trial failed because the drugmaker was unable to find and keep participants, which is one of the most difficult steps in any study. Faced with technologies they weren't familiar with and a digital ecosystem they didn't understand, people didn't want to risk the privacy and security of their personal health information.

While Apple will need to make extra effort to ensure that medical data is secure, the familiarity of its technology and ecosystem should reduce some of that anxiety, which could be a significant boon to medical research. For instance, when ResearchKit was released last March, five new healthcare-study apps were immediately featured at the top of the the company's App Store. Within seven days, more than 2,500 people readily signed up for asthma research, 5,500 people joined a Parkinson's disease project, and over 22,000 enrolled in a heart-disease study.

While the response was heartening, these kinds of informal research apps have yet to prove useful for serious medical research. For one thing, there was no way of telling who actually signed up for these studies, or if they were telling the truth. In person, it's easy to demand an ID, like a driver's license. But the initial ResearchKit-based apps merely asked questions to see who was eligible. As we all know, it's easy to lie on those questions. (Are you over twenty-one? Yes. But... is your teenager actually answering these questions? Maybe. How about your dog? Perhaps. You know how it goes.)

Duke screens for autism, IBM studies sleep habits

On the other hand, ResearchKit has since been used in much more controlled studies with U.S. medical centers and other big tech companies. My favorite has to be Duke Medicine's "Autism & Beyond" study, which uses iPhone's front-facing camera to detect a child's reaction to videos shown on the device. The goal is to develop an automated method of screening for the developmental disorder. If it works, it could be great news: Autism is difficult to detect, but early diagnosis means a chance to begin treatment as soon as possible, which can greatly improve a child's life.

Those who suffer from insomnia, a group that includes 1 in 4 Americans, may find some help from IBM's (NYSE: IBM) first iPhone-dependent sleep study. By using a ResearchKit App on Watson Health Cloud, IBM is studying connections between sleep habits and outcomes such as alertness, productivity and general health. The iPhone and Apple Watch are used to gather data, which researchers will analyze to discover patterns and connections.

Despite limitations, ResearchKit could stake out new territory for Apple

So do studies like Glaxo's and IBM's start the trend of iPhones and Apple Watches becoming handheld and wearable gatherers of clinical data? Perhaps, but questions remain. For instance, the face-to-face interaction that keeps such things as drug trials from being cold and dehumanizing can be a challenge to replicate with technology. In addition, the FDA could take a dim view of a bias possibly introduced when a trial is strictly limited to those owning iPhones.

However that turns out, Apple won't immediately and directly profit, since ResearchKit is free, open-source software. But the iPhone and the Apple Watch, with their built-in sensors, could bring exciting improvements to pharmaceutical research. And if PARADE shows that ResearchKit is at least a feasible platform for drug research and development, Apple will have taken a big step toward staking out new turf in healthcare. Looking down the road, the payoff could be huge.

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Cheryl Swanson owns shares of Apple. The Motley Fool owns shares of and recommends Apple. The Motley Fool has the following options: long January 2018 $90 calls on Apple and short January 2018 $95 calls on Apple.

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