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Before we get into the rest of the week’s news, we’d like to bring you an inside look at the goings on at Neuralink, Elon Musk’s super secretive, super ambitious brain implant startup.

For years, the eccentric CEO has used Twitter to draw attention and hype to the company, whose transformative ambitions range from helping restore mobility to people with paralysis to creating a new race of AI-augmented humans. The hype has intensified in the last few weeks ahead of a company event set for this Friday during which, Musk teased, Neuralink would “reveal the matrix in the matrix,” or peel back the curtain on our collective reality.

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Ahead of Friday’s event, Erin and Rebecca investigated the company’s efforts. They spoke to five former employees, reviewed several public documents, and talked to four outside experts who specialize in building the kinds of devices Neuralink aims to produce, also known as brain-machine interfaces.

The insiders were not optimistic about the probability of Musk presenting us with a red pill to end all red pills by the end of the week. Instead, they described a noxious company culture where pressure from higher-ups pitted academic neuroscientists against mechanical engineers, and where there was a sometimes haphazard rush to carry out projects and, just as quickly, to kill them. 

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To be fair, it’s an approach that has worked well for Musk’s other companies. And Neuralink has already demonstrated some impressive feats of engineering, including a “sewing machine” robot capable of implanting electrodes into animal brains.

But Neuralink is not a car company or a rocket company. It is a medical device company — and its ultimate target is none other than the human brain, our most complex and most mysterious organ. The challenges the company faces are therefore extreme, and Neuralink’s progress depends upon major scientific and medical advances that, so far, the company has not yet shown it is capable of achieving.

So while we can’t predict what will happen on Friday, one thing is certain: Brain science is hard, even when a billionaire pours in tens of millions of dollars into research. 

Read Erin and Rebecca’s deep dive, and tell us what you think.

IPO watch: 

A PLANNED IPO SHINES LIGHT ON THE FINANCES OF TELEMEDICINE — Virtual care provider Amwell this week filed paperwork to go public — offering an unprecedented window into its finances. The upshot of Amwell’s S-1 filing: While the company is building an impressive business, it’s still much smaller on most metrics than telemedicine leader Teladoc. Amwell brought in $122 million in revenue in the first six months of this year and lost $113 million in that period.

In a remarkable sign of how the pandemic has boosted demand for virtual care, Amwell reported that more than half of its 5.6 million telemedicine visits since launching in 2007 have come in the first six months of this year.

The talk of health tech: 

A NEW BUSINESS LINE FOR ALPHABET — The life sciences company Verily is forming a subsidiary, backed by the Swiss Re Group, to provide insurance to self-funded employers. The venture, dubbed Coefficient Insurance Company, aims to use data and analytics tools to predict unforeseen medical expenses and offer better stop-loss coverage, which reimburses employers for costs above a certain threshold. The idea: Alphabet-backed Verily will be able to use its data science expertise to ferret out those costs and write more precise policies. Coefficient plans touse Verily’s devices down the line to help predict and manage health costly health problems.

FITBIT TAKES YOUR TEMPERATURE — Fitbit on Tuesday debuted two new smartwatches, one of which, called the Sense, comes equipped with sensors capable of detecting your skin’s temperature, something the company says might be useful for gauging stress levels. Pending FDA approval, the new $329 device will also come — like the Apple Watch — with a built-in EKG that lets users view detailed heart data, including signs of the heart condition atrial fibrillation, or AFib.

HAILING A PRESCRIPTION — Rideshare giant Uber is getting into the prescription delivery business through a partnership with NimbleRx, an online filler of prescriptions that works with about 700 pharmacies in 34 states. The companies said they will first roll out delivery service in Seattle and Dallas, and then expand over the coming months. The move intensifies a national arms race in drug delivery as chains such as CVS and Walgreens expand home delivery following Amazon’s acquisition of PillPack. The question is whether the sought-after baby boomer market is big enough to support all these businesses, especially after the pandemic recedes.

ONCE VALUED AT $1.5 BILLION, NOW SELLING FOR $15 MILLION — In the latest chapter of the saga around Proteus Digital Health, a judge in bankruptcy court last week approved the Japanese drug maker Otsuka’s bid to buy the smart pill maker’s assets. The thing to watch next: As Otsuka takes possession of the ashes of Proteus, it will face the task of resurrecting a business around promising technology that failed to make enough money.

Chart of the week: 

(EPIC HEALTH RESEARCH NETWORK)
(EPIC HEALTH RESEARCH NETWORK) (EPIC HEALTH RESEARCH NETWORK)

IS THE TELEHEALTH SURGE BEHIND US? — A new chart from Epic Health Research Network, a website maintained by the medical record vendor, suggests that the pandemic-era boom in virtual doctor’s visits is starting to fade. While telehealth appointments peaked in mid-April — coming to account for 69% of people’s overall medical visits — the figure has steadily declined since then, dropping last month to just 21%.

Regulatory watch: 

A WARNING FOR MEDICAL PRESENTERS — Be sure to scrub images embedded in online medical presentations carefully, because search engines are getting better at extracting identifiable patient information. The American College of Radiology has issued a warning about the advanced web-crawling techniques of search engines such as Google and Bing, advising members to use screen-capture software or an anonymization algorithm to ensure that only the region of interest — not protected health information — is included in online posts or presentations. Simply cropping the image does not permanently remove such information.

COVID RELIEF TIED TO PRIVATE DATA VENDOR — Instead of using a decades-old reporting infrastructure established by the CDC, the Trump administration told hospitals they would only get access to a $100 billion pool of Covid-19 relief funds if they sent data on their coronavirus cases to the Pittsburgh company Teletracking Technologiesreports the New York Times. Trump has no obvious ties to the private data collection company, but has increasingly involved industry in the collection and analysis of coronavirus data, including another deal with Minnesota-based 3M.

Personnel file:

A VIDEO GAME EXECUTIVE MOVES TO CONSULTING — With Akili Interactive Labs fresh off a landmark FDA approval for its prescription video game, an executive who has held leadership roles at Akili in market access, trade, and commercial is leaving. Jeffrey Abraham will join the digital health and health IT practice at the consulting firm Health Advances.

A PROTEUS COMPETITOR NAMES A NEW CEO — EtectRx, a smart pill startup trying to succeed where Proteus failed, brought on a new CEO: pharma veteran Valerie Sullivan. The Gainesville, Fla., company’s founding CEO, Harry Travis, will stay on the company’s board of directors. A key difference between EtectRx and Proteus is the way their sensor technology works: EtectRx relies on a lanyard that patients put on for a few minutes when they’re taking their pill, while Proteus’ technology required patients to wear a patch that was changed once or twice a week.

M&A watch: 

AN AUTONOMOUS AI PIONEER EXPANDS — Digital Diagnostics, the company formerly known as IDx, is acquiring Boston-based 3Derm in a bid to broaden its reach into dermatology. Digital Diagnostics developed the first autonomous AI system approved by the U.S. FDA, a tool that can diagnose diabetic retinopathy on eye images. Snapping up 3Derm, a dermatology telemedicine provider, gives it control of a product known as 3DermSpot, a platform for skin cancer detection that received a breakthrough device designation from the FDA in January.

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