ATA Forum's China-US Healthcare Dialogue Special Session Files Confidential IPO Prospectus

The 2nd China International Telemedicine Summit was successfully held on October 31. The “China-US Healthcare Dialogue Session” served as a key component and highlight of the summit. Organizers of the summit included the Tianjin Hi-Tech Industrial Development Area, while co-organizers of the sub-forum included VCBeat and the US-based Vesalius Tianjin Cross-Border Business Incubator.

Guests invited to this sub-forum include Wang Wei, Deputy Director of the Tianjin High-Tech Industrial Development Zone Administrative Committee; Tobias Barker, Vice President of Medical Operations at CVS MinuteClinic; the CEO of Curely; Milton Chen from VSEE; Babak Movahedi from 2nd MD; Yang Yun from DynoSense; Ms. Liu Yu, Co-founder of Chunyu International; Wu Xinhua, CEO of Aipeike; Long Ruqian, CEO of Xiaoai Technology; and Tad Ferris, Partner at Foley & Lardner LLP.



Below is an excerpt from the speech:

Mr. Tobias Barker, Chief Medical Officer of CVS MinuteClinic

Mr. Tobias Barker introduced CVS’s MinuteClinic, a network of nearly 1,000 mini-clinics operating 24/7 across 34 U.S. states. These mini-clinics provide only basic medical services, such as treatment for ear infections and sore throats, as well as immunization injections.

The core of the entire system lies in the fundamental workflows and algorithms of the Electronic Medical Record (EMR) system, ensuring that patients presenting with the same symptoms receive consistent diagnoses regardless of the state in which they seek care. CVS Health patient charges are primarily covered by insurance. Additionally, the U.S. healthcare system includes Medicare and Medicaid, with Medicaid serving low-income individuals, pregnant women, and infants. CVS Health collaborates with 60 hospitals across the United States to share medical resources. Consequently, if a patient has prior insurance coverage or has visited other hospitals, their relevant information is shared among clinics.

We have just introduced mini-clinics; next, we will discuss telemedicine. Typically, if patients at mini-clinics wish to avoid waiting in line, they can opt for virtual clinics, such as those available in California or Texas. Virtual clinics are equipped with high-definition video capabilities, digital stethoscopes, and devices for examining the ears or throat, allowing diagnostic instruments to capture images.

There are also devices capable of testing biochemical indicators, such as blood glucose and other parameters. Patients are highly satisfied; approximately 95% of them believe that telemedicine can achieve outcomes comparable to in-person consultations with physicians. Thus, both providers and patients can participate from any location, which represents the true model of telemedicine. This approach may hold particular significance for rural areas and remote markets in China.

Dr. Paul Lee, CEO of Curely

Our data survey reveals that patients use various methods to contact physicians, with three being their preferred options: email, messaging, and video calls. However, the adoption rate of video consultations is very low. Our platform primarily focuses on this last modality. A key challenge in facilitating doctor-patient video interactions lies in cross-border and cross-regional technical barriers. Moreover, it is extremely difficult for physicians to hold their mobile phones steadily for a continuous 15-minute duration.

At Curely, we aim to expand our reach to 85% of the population, and technology dissemination is a crucial aspect in achieving this goal. As a partner of IBM, we help physicians make more accurate diagnoses while minimizing the risk of medical disputes arising from errors. Our approach involves directly entering the patient market, enabling doctors to conduct private online consultations where information remains confidential and inaccessible to others. We offer applications on both mobile and desktop platforms. Patients can choose their preferred physicians based on language and personal preferences. We provide two primary service models, one of which is text messaging with real-time responses, similar to WeChat.

First, physicians must register on the platform, after which they can create their professional profiles and provide their email addresses. Consultation fees are set at the physicians’ discretion, and they have the flexibility to toggle their online status based on their personal schedules. Through this platform, physicians can access comprehensive patient information, including both imaging and textual data, with the ability to zoom in on images for detailed review. After completing their responses to patient inquiries, physicians can publish them with ease. The interface is as intuitive as WeChat, supporting multi-party consultations that enable patients to see and communicate directly with their physicians via video call.

Dr. Milton Chen, CEO of VSee

I am the CEO of VSee. Hillary Clinton has used VSee software for medical consultations, and one of our doctors took our VSee portable kit to Africa. Our kit is highly portable and can be taken to many locations. For example, I have traveled to Iraq twice in the past year. While telemedicine equipment is often perceived as expensive, VSee can transform a standard operating room into a telemedicine-enabled operating room at a very low cost. Here is another example: three high-definition cameras combined with a MacBook can be set up as a neonatal intensive care unit (NICU). We have now designed a portable telemedicine consultation kit that can be easily carried on an airplane, enabling remote medical consultations from anywhere.

In fact, VSee is a provider of telemedicine backend technology. Currently, there are many telemedicine companies in China developing their own apps, but we provide the underlying technology that can integrate a wide range of resources, including various imaging data and wearable devices, all consolidated onto our platform. I am involved with two companies: one is VSee, which focuses on core technology, and the other is MD.com, a company I founded myself. MD.com has an application featuring 880,000 physicians on its platform, offering services similar to those of Guahao.com.

MD.com aims to be a one-stop physician platform, enabling not only patient consultations but also payment processing, with many operations seamlessly completed on the platform.
Let me share a truly exciting technology: a camera developed jointly by Intel and a university in California that can measure a patient’s temperature and heart rate without any physical contact. Referring back to the case of Hillary Clinton mentioned earlier, the key point I want to emphasize is that VSee’s backend operates on a highly stable and secure system. Such certified systems are exceedingly rare in the United States, which constitutes the core strength of VSee.

Mr. Babak Movassaghi, President of International Business at 2nd.MD

Let me begin by introducing the history of 2nd.MD. The founder’s daughter suffered a neonatal stroke shortly after birth, a very rare condition. They consulted numerous pediatric neurology specialists locally, but at that time, the experts told him that his daughter had little hope for recovery. However, he obtained professional medical opinions online, and thanks to this, his daughter is still alive and healthy today. This experience inspired him to create an online platform where people can access expert opinions from top-tier physicians.

The company’s goal is to enable people to receive medical advice from a doctor within three days. Therefore, our primary mission is to provide access to the best medical recommendations via video consultations. We have engaged 300 physicians online who are not direct employees of our company but serve as consultants for us. However, we initially struggled to attract individual customers because people in the United States are not accustomed to paying out-of-pocket for such services; typically, these costs are covered by insurance companies. As a result, 2nd MD has shifted its business model in the U.S. Our clients are no longer individual patients but rather corporations, such as Starbucks. This is because employers adopt 2nd MD to reduce healthcare costs by helping employees avoid unnecessary surgical procedures.
We extract patients’ medical records and then convene joint consultations with physicians. In the United States, patients are generally indifferent to whether the consultation is conducted via video or telephone; given the simplicity of phone calls, most people prefer this modality. It is important to emphasize that all physicians on this platform are specialists, not general practitioners. Many materials on the platform need to be digitized, including imaging studies such as CT scans, X-rays, and MRI.

2nd.MD’s distinctive feature is its employer-focused model. A significant effort is required to educate employees at each company about utilizing this service. Previously, I served as Chief Operating Officer at 2nd.MD, but my responsibilities have gradually shifted toward international business, driven by substantial patient demand from around the world. However, collecting comprehensive medical records from all patients is highly cumbersome. Therefore, our initial step is to focus on the Chinese market. The dynamics in China are somewhat different: rather than actively seeking out patients, we respond to inbound inquiries from patients who have a need for our services. These consulting firms currently operate confidentially; through them, we can obtain patients’ medical records. We then connect patients with physicians, ultimately enabling patients to receive a medical report.

Yang Yun, Vice President of Engineering Design and China Market at DynoSense (USA)

We are a startup based in Silicon Valley, USA, founded in March 2013. We are dedicated to developing a multifunctional, personalized health monitoring device.
We aim to help you monitor various health conditions through a small device. What you see here is our first-generation product. It features a base station that houses this compact unit, which is actually a very simple device. Hold it in your left hand and place it in your mouth while breathing naturally. Within 30 seconds to one minute, it can measure approximately 33 health indicators using nine sensors.

This is a display screen we use for our demo. From here, you can see that we can record electrocardiograms (ECG), vascular changes, pulse transit time (PTT), and respiratory rate. Based on these data, we can calculate pulse rate, blood oxygen saturation, and respiration rate. Additionally, our wearable-free blood pressure monitor provides systolic and diastolic blood pressure readings, along with body temperature. Essentially, we can measure five key physiological parameters within one minute. Furthermore, by evaluating your personal status, occupation, and age, we can generate an assessment of your overall health condition.

As previously mentioned, among the 33 health indicators, only a few examples are listed here. For instance, in terms of electrocardiogram (ECG) monitoring, it can detect arrhythmias or premature ventricular contractions; based on blood oxygen levels, it can provide an index for arteriosclerosis; and regarding respiratory function, it can indicate whether there are signs of chronic obstructive pulmonary disease (COPD). These are all medical-grade data, and our product will obtain certification from both the U.S. FDA and China’s NMPA (National Medical Products Administration).
We transmit human physiological data to the cloud via medical devices. Our sophisticated cloud infrastructure is responsible for monitoring, analysis, and alerting. Additionally, these data can be transmitted to third-party partners through APIs, enabling them to leverage the information to provide diverse services. From a cloud implementation perspective, we comply with HIPAA regulations in the United States. Key challenges include ensuring high availability and managing disaster recovery, as the system must maintain operational continuity through redundant backup systems during catastrophic events. Furthermore, a rigorous authorization protocol is essential.

The market we face comprises several segments. One is post-discharge patient follow-up, where patients with chronic diseases require further care and conditioning at home or in nursing facilities after hospital discharge. In this process, the aim is to use this device to provide physicians with patient data collected outside the hospital setting. Additional segments include elderly care and the prevention of chronic diseases.

The remote monitoring market is projected to reach $30 billion by 2020, representing a substantial market size. Headquartered in Silicon Valley, we also maintain a small R&D team in Shanghai. We have established partnerships in China, where our partners are responsible for selling our products and integrating their services. Consequently, we secured orders for approximately 200,000 units in 2016 and anticipate achieving total revenues of $100 million by 2018.

Tad Ferris, Partner at Foley & Lardner LLP

(Mr. Tad Ferri is also a member of the firm’s Government & Public Policy Practice and its Life Sciences & Healthcare Practice, and serves as Chair of the International Regulatory Practice Group. As a member of the Healthcare Practice, Mr. Ferri collaborates with colleagues across the law firm to structure and implement cross-border healthcare initiatives. With respect to China-related matters, Mr. Ferri has handled numerous projects involving compliance for telemedicine initiatives, as well as issues such as cross-border risk management, institutional and professional licensing, and data privacy and cross-border data transfer restrictions.)

Today, we will primarily discuss the hot topics surrounding telemedicine in the United States, starting with cross-border licensure. This includes variations in laws not only between different U.S. states but also across different legal systems. Telemedicine is currently in a growth phase, and many collaborating companies—including numerous attendees present today—are still in their early stages of development. These companies possess significant potential for future expansion and strengthening.

From one perspective, telemedicine is borderless in terms of physical location, making cross-border licensing and patents a critical component of the overall business model. The challenge with telemedicine lies in the fact that it ultimately involves numerous diagnoses, treatments, and prescription issuances, which in turn raise significant legal issues.

One example lies in the field of consultations. We have previously conducted extensive business in areas such as radiology and pathology, particularly in slide interpretation. Under U.S. law, providing only these services does not constitute the practice of medicine, which has a specific legal definition. There are two illustrative cases: some companies have built platforms that facilitate multi-party consultations; however, these platforms themselves do not deliver substantive medical services. Additionally, patients seeking cosmetic or other surgical procedures may use certain platforms for preliminary assessments, and these platforms are also among our clients. A key distinction is that the provision of actual medical services requires appropriate licensure and entails corresponding legal liabilities. In China, there is currently a model that provides abundant medical information but explicitly refrains from offering so-called diagnoses, treatments, or prescriptions.

In addition, our current business model involves technology companies, tech firms, or platform providers selling their technologies to hospitals. Another existing model, as mentioned earlier, is the sale of platform technologies to hospitals, enabling physicians to use such platforms for remote treatment of their existing patients or for post-discharge follow-up. This model is also in practice.

We will now discuss remote medical prescriptions and their applications, and we welcome your questions after the session. We currently offer a range of services related to telemedicine prescribing, tailored to the unique characteristics of the U.S. healthcare market, where there is growing patient demand for remote prescription services. In most cases, physicians are required to conduct a consultation before issuing a prescription. Regulatory authorities also maintain that the same standard should apply in telemedicine: a consultation must precede any prescription. Regulations vary by state; in some states, even if a physician conducts a video consultation with a patient and makes a diagnosis, they are not permitted to prescribe medication, while other states may allow it.

We have just discussed mental health conditions. In the United States, there are now platforms that provide remote consultation services to patients. Unlike other medical conditions, mental health disorders can often be adequately assessed through camera-based video interactions. Consequently, legislative bodies are currently coordinating various efforts to determine the appropriate regulatory framework, particularly regarding the direct prescription of medication by physicians following remote consultations.Another prominent area of interest is IBM’s big data platform, known as Watson Health. Current research focuses on how the Watson model can be effectively integrated into clinical practice for use by physicians. These systems leverage extensive backend big data and algorithmic development to optimize application. The emergence of such intelligent platforms can assist physicians in diagnosing patients. In the future, we may even see robots or computer systems providing diagnoses directly. However, this approach raises numerous legal issues in practical implementation, which are currently under exploration.