Back in 2015, the CDC estimated that more than a third of Americans had diabetes or prediabetes. That number is probably larger now and the cost for treatment and care is in the tens of billions per year. Fitbit (NYSE: FIT) wants a piece of this market. The fitness tracker company is researching diabetes, and it reportedly has invested $6 million in Sano, a start-up specializing in minimally invasive glucose monitoring. This is a super-cool technology, and is one more example of how Fitbit is getting beyond just selling fitness trackers and expanding into the healthcare market.
Sano and its tech
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Sano is a company founded by Ashwin Pushpala in 2011 that is working on a wearable patch that can provide continuous glucose monitoring (CGM). This can help diabetics manage the disease by providing real-time feedback and alerts on glucose levels to help stay in a safe range. What makes Sano's device different from other devices is that it doesn't actually penetrate the skin.
It has a patent on its device, which is made up of a silicon layer of microstructures similar to sandpaper that are chemical sensors. These sensors can be activated with enzymes to detect glucose or other molecules such as lactic acid, cholesterol, sodium, and a number of others.
This technology is built into a small sensor that can be worn on the skin, with its data sent to a mobile device. The company hasn't released its product to the market yet.
In a presentation by Pushpala at the Hyper Wellbeing summit in November 2016, one slide indicated the company was "starting with the preventive segment of the market unserved by products on the market today." Pushpala expanded on the statement in his talk.
Sano's website doesn't mention diabetes and the company hasn't shown any indications that it will pursue FDA approval for its device. It seems the device will act more like a fitness tracker, which doesn't require FDA approval, providing general feedback to its wearer that would help with behavior modification and insight into how food and activity affect glucose levels throughout the day.
Since Sano isn't a public company, it has been pretty secretive about its progress on product development. The only hint we have is from the Hyper Wellbeing summit. At the time, Sano was finishing a clinical trial of its prototype device and was targeting a consumer-focused product launch in 2017.
Fitbit isn't the only investor in Sano, but it's the only one that isn't a venture capital company. Fitbit's $6 million investment is actually the third round of investment the company has received, according to Crunchbase.
Given where Pushpala indicated the company was over a year ago, it's possible that its device could be ready for production. Partnering with an experienced manufacturer of consumer wellness devices, like Fitbit, could provide Sano with important insight about the manufacturing, marketing, and distribution of its product.
The payoff is a long way off
While Fitbit has its eyes on driving the tech-enabled healthcare revolution, the Sano investment isn't the magic bullet, for a number of reasons. First, Sano's technology is unproven. Even cash-rich tech giants Apple and Alphabet have reported working on noninvasive ways to do CGM, with neither having released products yet.
Even if Sano launches a product integrated with a Fitbit device, I see this as similar to Fitbit's current arrangement with Dexcom. There wouldn't be a significant advantage for users to receive CGM information on their Fitbit device or app versus Sano's smartphone app.
Lastly, some have questioned the effectiveness of a device like this for a nondiagnosed population. Gizmodo interviewed Dr. Mark Schutta of the Penn Rodebaugh Diabetes Center, who said that "there isn't really any merit to" CGM in nondiabetics, and he said that if you're at risk for diabetes, a primary care doctor should be screening you with the appropriate test.
Fitbit's investment is less than 1% of its available cash, so this long-shot bet isn't a large one for the company. While I don't see this making a difference for Fitbit in the short term, I like that the company is pushing the envelope in healthcare. With Sano's technology having the potential to monitor more than just glucose, this might be the beginning of something bigger.
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