Dr. Steven LeBoeuf, President and Co-Founder of Valencell, presented these slides at IDTechEx 2016. Here's a quick summary: - Wearable biometric technology (optical heart rate monitors) has accelerated to the point where it is accurate enough for at least some medical purposes - In some ways wearable biometric technology is actually outpacing medical technology - With lower costs, better form-factors, and new features, advanced wearables are now enabling ambulatory mobile healthcare, with a focus in prevention, screening, and disease management - One point of friction is merging the rather chaotic exploration and rapid innovation of fitness wearables with the methodical discipline of clinical validation - Companies that can apply medical-style validation to these innovative wearable sensor technologies are best-poised to find success in the marketplace

1. How consumer wearable
technology is driving innovation in
healthcare and medical devices
IDTechEx Sensors USA
November 17th, 2016

2. ©2016 Valencell. Inc
Outline
• Historical timeline of the wearables market
• The effect of disruptive advances to wearable sensors
• Current B2B market pull in health/medical wearables
• Challenges and optimism in merging consumer tech with medical use
cases
• Summary – key take-ways

3. ©2016 Valencell. Inc
Heart Rate
Chest Straps
Activity
Trackers
GPS
Armband
Calorimetry
Wireless vital
signs monitors
Integrated
solutions/
smart-
devices
1980 2000 2006-09 20122010
Mobile
Tracking Apps
2013
Wrist/arm
activity trackers
2014 -16
Compelling
use cases
2017-18 2019-20
Health/medical
wearables
Wearables are trending towards familiar form-factors,
and more compelling user cases (including health)

4. ©2016 Valencell. IncVALENCELL CONFIDENTIAL INFORMATION
Disease management
Guided fitness training
Prevention
Sleep quality
Diet management
Stress Management
Health diagnostics
Wearable optical sensor systems are now demonstrating
performance levels suitable for medical use cases

5. ©2016 Valencell. Inc
Atrial fibrillation identification has been demonstrated using
optical sensor systems embedded in audio earbuds & wristbands
VALENCELL CONFIDENTIAL INFORMATION, PATENTS GRANTED & PENDING
Valencell OHRM
ECG
Valencell OHRM
ECG
Normal Poincaré Plot Atrial Fibrillation Detected

6. ©2016 Valencell. Inc
-40
-30
-20
-10
0
10
20
30
70 80 90 100 110 120 130 140 150 160 170
DiffSBP
Mean SBP
Bland-Altman SBP
-30
-25
-20
-15
-10
-5
0
5
10
15
20
40 50 60 70 80 90 100
DiffDBP Mean DBP
Bland-Altman DBP
R² = 0.7106
70
80
90
100
110
120
130
140
150
160
170
70 80 90 100 110 120 130 140 150 160 170
BenchmarkSBP
Model SBP
SBP Regression Analysis
R² = 0.5453
40
50
60
70
80
90
100
40 50 60 70 80 90 100
BenchmarkDBP
Model DBP
DBP Regression Analysis
Error = -0.1 ± 9 mmHg (mean ± SD) Error = 0.0 ± 8 mmHg (mean ± SD)
Systolic & diastolic blood pressure tracking has been demonstrated
via finger & earbud-based optical sensor systems
VALENCELL CONFIDENTIAL INFORMATION, PATENTS GRANTED & PENDING

7. ©2016 Valencell. Inc
Commercial innovation in consumer biometric wearables is beginning
to outpace that of medical monitoring technology
$10,000 clinical biometric
data collection system
$500 consumer biometric data
collection system

8. ©2016 Valencell. IncVALENCELL CONFIDENTIAL INFORMATION
Market pull for wearable biometric sensors in 5 key categories
Personal
Health
(Prevention)
Clinical
Research
Disease
Management
Disease Diagnosis Therapeutics
Description General fitness
and wellness
sensors having
prevention-based
UX
Sensors for
measuring
biometrics and
activity used in
clinical research
Sensors for chronic
disease management,
such as COPD,
asthma, diabetes, and
cardiovascular
disease
Sensors for screening or
diagnosing diseases,
such as sensors for atrial
fib, arrhythmia, and
hypoxia
Sensors that provide
active feedback for
controlling therapeutic
medical devices
Example
Products
Omron Wellness;
HealthKit
Actigraph
products; BIOPAC
products;
ResearchKit
Philips HealthSuite iRhythm atrial fibrillation
sensors; Omron
hypertension screening
Medtronic insulin pump
systems &
neurostimulators
FDA
Regulated
No Typically not Yes Yes Yes – very highly

9. ©2016 Valencell. Inc
Moving from consumer to medical wearables requires
partnerships… but these two markets tend to clash
VALENCELL CONFIDENTIAL INFORMATION, PATENTS GRANTED & PENDING
Consumer fitness wearables
• Crowdfunded + light VC
• Glam marketing
• Accuracy not a top priority
• Loose on validation
• Roman personality
• Looks for ways to avoid FDA
• 2-year timelines
Medical wearables
• Heavily venture-backed
• Conservative B2B marketing
• Accuracy is critical
• Heavy on validation
• Greek personality
• FDA approval is critical to success
• 7+ year timelines

10. ©2016 Valencell. Inc
FDA regulation is not the bottleneck with new medical wearables…
Use case validation is the key obstacle
Prototyping
(~2 - 5 weeks)
Use Case Validation
(~year)
Feasibility Testing
(~1 - 2 weeks)
Accuracy Validation
UX Validation
Independent
Clinical Validation
FDA Approval
(510K)

11. ©2016 Valencell. Inc
Success in the medical wearables market will require both an
understanding of the consumer market and clinical validation
VALENCELL CONFIDENTIAL INFORMATION, PATENTS GRANTED & PENDING

12. ©2016 Valencell. Inc
Key take-aways…
VALENCELL CONFIDENTIAL INFORMATION, PATENTS GRANTED & PENDING
• Mobile fitness technology has accelerated to the point where it is accurate enough for at
least some medical purposes
• In some ways mobile fitness technology is actually outpacing medical technology
• With lower costs, better form-factors, and new features, advanced mobile fitness
technology is now enabling ambulatory mobile healthcare, with a focus in prevention,
screening, and disease management
• One point of friction is merging the rather chaotic exploration and rapid innovation of
fitness wearables with the methodical discipline of clinical validation
• Companies that can apply medical-style validation to these innovative wearable sensor
technologies are best-poised to find success in the marketplace

13. Thank You!