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Apple Inc. AAPL -0.64% CEO Tim Cook said the company’s biggest contribution to humanity would be in health. So far, some of Apple’s initiatives aimed at disrupting the healthcare sector have struggled to gain traction, according to people familiar with the matter and documents reviewed by the Wall Street Journal.
Apple has envisioned a bold healthcare plan, offering its primary healthcare service with doctors working at Apple in its clinics, according to people familiar with the plan and documents. To test this and other bold healthcare ideas, it acquired clinics that cater to their employees and created a team that includes dozens of doctors, engineers, product designers, and more.
Today, those ambitions, not widely known, have largely come to a halt as Apple has shifted the focus of its health unit to something it knows best: selling devices, specifically the Apple Watch, according to people familiar with its strategy.
The new primary care service hasn’t actually started, people familiar with it say. A digital health app that quietly launched this year has struggled to keep users engaged, say people familiar with the app and documents seen by the magazine. Some employees have raised internal questions about the safety of health data from company clinics that has been used to support product development, according to people familiar with their concerns and the documents.
An Apple spokesperson said data integrity is the foundation for all of the company’s innovations. Noting the achievements of its health team, he said the company is still in its infancy in the healthcare field, adding that new technology such as heart rate notifications in products like the Apple Watch has improved users’ health. He said the data collected by Apple devices enables new research that has the potential to improve care.
“Many of the assertions made in this report are based on incomplete, outdated and inaccurate information,” the spokesperson said.
When searching for new markets where technology can improve efficiency and results – and boost sales growth – the technology sector has viewed the healthcare as an untapped opportunity. Some of the technology’s biggest efforts, including Haven, Amazon.com’s high-profile partnership with other companies aimed at reducing healthcare costs, have failed. Today, Amazon is making a new effort to sell prescriptions and a plan to launch virtual care across 50 states.
Under Mr. Cook’s leadership, Apple has increased its research and development budget eightfold to $20 billion a year, according to its public filings. Besides the smartwatch, the company has released wireless headphones as well as new services. It has also invested heavily in health, autonomous driving, and augmented reality, all of which are technically complex and fraught with risks, meaning game-changing offers may take years or never to come.
Apple can study markets for years before rolling out its own offerings, sometimes working extensively on new projects or technologies that they don’t ultimately bring to market.
One of its most ambitious healthcare ideas was a plan to deliver primary care medicine, drawn up in 2016, according to documents and people familiar with the plan. People said a team at Apple spent months trying to figure out how the stream of health and wellness data collected from users of its smartwatch, first released in 2015, could be used to improve healthcare.
Jeff Williams, Apple’s chief operating officer, who oversees the health team, urged employees to think bigger. He said Apple should disrupt what he called a “363” and “breaking fix” form of care in the United States, where patients may not see their doctors 363 days a year and only visit when something goes wrong, according to people familiar with his thoughts.
Apple’s chief operating officer, Jeff Williams, in 2020. Photo: Apple / Associated Press
The team decided that one of the best ways to achieve that vision was to offer its own medical service, people familiar with the plan said, and to connect data generated by Apple devices with the virtual and in-person care provided by Apple doctors. Apple will provide primary care, but also ongoing health monitoring as part of a subscription-based personal health program, according to those people and the documents.
If Apple can demonstrate that its suite of sensors, software and services can improve people’s health and reduce costs, the company can franchise the model for health systems and even other countries, according to the documents.
To start, Apple chose to test the service on its employees. Apple has acquired employee health clinics near its headquarters that were operated by a startup and turned them into test beds for new health services, people familiar with the changes say. In 2017, it hired Stanford University’s Dr. Sombel Desai to manage the effort, codenamed Casper, people familiar with the plan said.
The effort continues today, but Apple has struggled to move Casper beyond an initial stage, say people familiar with its operations.
Dr. Desai’s unit in particular has seen multiple departures of employees who say its culture discourages critical feedback, which would likely be a problem for a unit focused on products and services related to personal health, according to people familiar with its culture and documentation. Some employees expressed concerns that internal data about clinics’ performance, and data that was recently used to support the rollout of a new digital health app, was inaccurate or randomly collected, according to the documents and people familiar with the data.
These issues have been repeatedly voiced to Messrs. Cook and Williams, according to documents and people familiar with the issues.
An Apple spokesperson said such criticisms are inaccurate.
Dr. Sombel Desai in Cupertino, California, on June 7. Photo: Apple Bulletin/Shutterstock
Culture employees recalled a 2019 meeting in which a mid-level manager asked questions about the data, according to people familiar with the meeting and the documents. Dr. Desai responded angrily, leading some of those present to conclude that critical questions are not welcome, according to the people and documents. Documents show that the manager left Apple weeks later and the episode contributed to her departure.
An Apple spokesperson said Dr. Desai spoke about the importance of data integrity at the meeting. “This matter was thoroughly investigated and the allegations could not be substantiated,” the spokesman said. Apple declined to comment on the circumstances of the employee’s departure.
The spokesperson said the company is proud of Dr. Desai’s work and that she has played an integral role in much of her work in healthcare.
Mr. Williams and Dr. Desai did not respond to a request for comment and Apple declined to make them available.
In addition to overseeing the clinics, known as AC Wellness, Dr. Desai ties in with regulators, leads research collaborations and provides clinical expertise in other Apple health products.
Desai’s team’s recent initiative, a digital health app called HealthHabit being tested on Apple employees in California, has struggled with low engagement since the app launched nearly six months ago, according to documents and people familiar with the app.
HealthHabit offers to connect people with doctors via chat and encourages them to identify health challenges like “I’m going to exercise more this week.” Those with a history of high blood pressure can be linked with health coaches who can send them a sphygmomanometer, measure their blood pressure, and advise them on healthy habits.
Screenshot showing the HealthHabit app from Apple. Photo: Apple
Half of the people who downloaded it as of May had not signed up and interaction among many of those who signed up was low, according to documents and people familiar with the app.
Some people said that data supporting the app’s hypertension software has caused new concerns among employees about the safety of internal data and analytics.
During a presentation to all Apple health employees in March, Mr. Williams praised clinic results in treating high blood pressure and cited them as evidence supporting the capabilities of the HealthHabit app, according to people who watched the presentation. He noted that the company may have broader ambitions for the application if it is successful, they said.
At the meeting, Mr. Williams showed data that 91% of patients at Apple clinics with more severe stage 2 hypertension improved to healthier or normal stages, according to documents reviewed by the journal, a number some employees fear may be exaggerated. At the discretion of clinics. “Success, according to the people who attended the meeting and the documents.
Competing companies offering high blood pressure apps have revealed low success rates. Hello Heart Inc. reported. 23% of stage 2 patients experienced a significant improvement in blood pressure at 6 weeks. Livongo claimed that a third of patients with stage 1 hypertension or worse improved to a high or normal level in 6 weeks. According to the documents, Mr. Williams’ statements did not include a time frame.
An Apple spokesperson said other companies analyze their high blood pressure data differently and that the data Mr. Williams cited in the meeting was for an indoor pilot rather than a product.
Write to Rolf Winkler at [email protected]
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