2018 Global Smart Rehabilitation Enabling …...The NEOFECT RAPAEL Smart Glove uses a virtual reality (VR)-based hand rehabilitation therapy solution that helps patients carry out

2018 Global Smart Rehabilitation Enabling Technology Leadership Award

2018

BEST PRACTICES RESEARCH

© Frost & Sullivan 2018 2 “We Accelerate Growth”

Contents

Background and Company Performance ........................................................................ 3

Industry Challenges .............................................................................................. 3

Technology Leverage and Customer Impact ............................................................. 4

Conclusion........................................................................................................... 6

Significance of Enabling Technology Leadership ............................................................. 7

Understanding Enabling Technology Leadership ............................................................. 7

Key Benchmarking Criteria .................................................................................... 8

Best Practices Award Analysis for NEOFECT ................................................................... 8

Decision Support Scorecard ................................................................................... 8

Technology Leverage ............................................................................................ 9

Customer Impact ................................................................................................. 9

Decision Support Matrix ...................................................................................... 10

Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices ................................................................................................................. 11

The Intersection between 360-Degree Research and Best Practices Awards ..................... 12

Research Methodology ........................................................................................ 12

About Frost & Sullivan .............................................................................................. 12



Background and Company Performance

Industry Challenges

Musculoskeletal diseases affect bones, joints, and muscles, and neurological diseases

affect the central and peripheral nervous system. These disorders can be painful and

debilitating, thus affecting the patient’s quality of life, activity, and productivity.

Millions of people worldwide suffer from musculoskeletal disorders. In the United States

alone, one in three people, or 75.7 million adults, suffer from back and neck pain, and

osteoporosis affected more than 10 million people in 2016. In the United States in 2015,

musculoskeletal disorders were among the leading cause of Disability-adjusted Life Years

(DALYs), second to mental health conditions. The burden of musculoskeletal conditions is

significant in terms of treatment and care as well as in terms of the impact on patients’

quality of life, mobility, and productivity. These conditions cost the US health system an

estimated $213 billion in annual treatment, care, and lost wages.

Neurological disorders and mental disorders were ranked as the leading causes of DALYs

in 2015 and contribute the most to the global disease burden in Europe. In the United

States, more than 100 million people suffer from neurological diseases, such as

Alzheimer’s, multiple sclerosis, migraines, epilepsy, and spinal cord injury, costing the US

health system $800 billion annually. Stroke, now recognized as a neurological disease by

the World Health Organization (WHO), is an extremely common condition that impacts the

patient’s overall quality of life. Every year, about 15 million people worldwide suffer from

a stroke, according to WHO. In the United Kingdom, about 100,000 people suffer from a

stroke every year. The National Health Service (NHS) and social care costs for stroke

patients are about £1.7 billion each year in England alone.

Health systems are straining to manage the burden of musculoskeletal and neurological

diseases worldwide, with rehabilitation as the common therapy for managing these

disorders. However, rehabilitation programs have an 85% dropout rate; therefore, the

following market needs must be addressed to achieve better adherence and success:

• Monotony—Rehabilitation can be extremely mundane as it involves repetitive

exercises that can become boring and demotivating for patients undergoing this

routine on a regular basis, sometimes for days or months.

• Cost—Rehabilitation involves high spending by insurance companies and

individuals.

• Convenience—Patients need to visit the rehab clinic often, sometimes three times

per week, which can be tiresome for patients already suffering from the loss of

basic mobility.



• Personalization—Physical rehabilitation is currently limited to repetitive 45-minute

sessions with a physical therapist. These sessions are time bound and wide-ranging

and sometimes do not change with the progress and efficacy of treatment.

As with other fields, technological innovation in healthcare rehabilitation could be the key

to transforming the lives of thousands of people suffering from neurological and

musculoskeletal disorders, in addition to stroke survivors, by helping them normalize basic

actions and become independent. By tapping this opportunity and meeting market needs,

digital health is finding applications in this area as well. Digital health (e.g., tele-rehab)

can be extended to patients’ homes and made a part of their daily routines in a

convenient, more cost-effective way, to reduce the overall burden of the disease.

Technology Leverage and Customer Impact

Commitment to Innovation

Since 2010, NEOFECT has shown exemplary innovation in using digital health to increase

the efficiency and continuity of rehabilitation. The company’s RAPAEL Smart Rehabilitation

Solutions, both hardware and software, are cleverly designed biofeedback gaming systems

that motivate and empower recovering patients throughout their rehab programs.

The NEOFECT RAPAEL Smart Glove uses a virtual reality (VR)-based hand rehabilitation

therapy solution that helps patients carry out muscle strengthening exercises in an

enjoyable manner using games and in the convenience of their homes, which are two

critical needs in the market. This solution has an added advantage over competing

solutions as it is available as a wearable device with artificial intelligence (AI) and Big Data

analytics capabilities.

NEOFECT’s latest product, RAPAEL Smart Pegboard, is a digital pegboard developed for

stroke rehabilitation and is a fun and interactive tool with about 30 games that keep

patients engaged and motivated to continue their therapy.

Commitment to Creativity

Healthcare gamification is a fitting tool to motivate patients to complete rehabilitation

sessions with some token of appreciation and accomplishment in the end. In addition, the

different types of available games eliminate a major challenge of rehabilitation: monotony.

To ensure the patient adheres to therapy and receives effective treatment, NEOFECT

continues to launch products that display creativity and resourcefulness. Most products in

the market use digital health in the form of mobile devices and apps that instruct the

patient through exercises. NEOFECT is the only company that uses games as a mode of

rehabilitation and uses game boards. The company’s latest product, NEOFECT Pegboard, is

a disruptive leap in this direction because most smart rehabilitation products in the market

are bulky and immovable; however, the NEOFECT Pegboard is small and portable.



With its smart wearable gloves for stroke patients and children with developmental

disorders, wearable hand robots for paralyzed patients, and game boards that enhance

the therapy experience, NEOFECT has brought effective treatment to demotivated rehab

patients in the form of gaming.

Commercialization Success

With its innovative products, NEOFECT manages all key concerns regarding rehabilitation.

The company’s products are available for use by clinics/hospitals and individuals in Korea,

Europe, and the United States. The company has been expanding its footprint since its

inception in Korea in 2010. Moreover, NEOFECT and has over 15 sales partners worldwide

(the Americas, Europe, the Middle East, and Asia) and is looking to expand to match its

growing demand.

NEOFECT’s revenue in 2017 were over $4 million, and the company has attracted the

attention of global investors. Furthermore, NEOFECT has earned over $25 million in

investments since 2010, which clearly indicates the company’s commercial potential for

investors.

Application Diversity

NEOFECT’s rehabilitation solutions primarily target patients suffering from musculoskeletal

and neurological diseases, such as stroke. While all the exercises and games work to

normalize movements by invigorating muscles and stimulating visual and auditory senses,

variations can be incorporated to cater to patients’ preferences and progress, thereby

delivering customized, optimal therapy by leveraging AI.

For example, by using AI and Big Data capabilities, RAPAEL’s learning algorithm

automatically adjusts the difficulty of the rehabilitation games based on the patient’s

range of motion and goals; therefore, the patient’s therapy remains positive, motivating,

and progressive.

While the company’s competitors do not differentiate their products for different

demographics, NEOFECT has a product for children suffering with developmental

disabilities: RAPAEL Smart Kids. This device is an exo-glove that uses sensors and

biofeedback mechanisms to provide cognition therapy and physical therapy.

Price/Performance Value

A key deterrent for continuing rehabilitation is the high cost. NEOFECT has successfully

mitigated this issue by launching the RAPAEL Smart Glove as a business-to-consumer

(B2C) rental model, which is not a common model in the smart rehabilitation market.

For $99 a month, patients can rent the US Food and Drug Administration (FDA)-approved

smart glove and companion Android tablet to rehabilitate their hands and wrists at home.



This payment model removes the burden of having to pay the full amount up front,

thereby making the cost of treatment more affordable.

Furthermore, the NEOFECT Pegboard is priced at $2,000, which makes it an affordable

purchase for smaller outpatient clinics and individuals. Even though this cost appears

high, the closest competing solution is priced at approximately $15,000, thereby providing

the same rehabilitation experience at one-tenth the price.

Customer Ownership Experience

Patients suffering musculoskeletal and neurological disorders often experience poor quality

of life, with their disabilities affecting their independence. NEOFECT’s rehab gaming

products provides users with much-needed enthusiasm and encouragement. Unlike other

home rehab devices, NEOFECT’s flagship product, RAPAEL Smart Glove, is available on a

monthly rental model, making the limited ownership worth the money.

In addition, while competing smart rehab devices typically offer repetitive exercises and

tele-consultation, NEOFECT’S products offer interesting virtual games, such as squeezing

an orange, pouring a cup of coffee, or piloting an airplane, thereby making the

rehabilitation process more exciting and positive.

Conclusion

With thorough market research and by accurately identifying market needs, NEOFECT has

made a mark in the rehabilitation market using digital health and gamification. The

company’s products achieve adherence to rehabilitation, which otherwise has a high

dropout rate, without compromising on the efficacy of treatment in the patient’s home.

The low cost and the rent-for-use model are key drivers for use as they make treatment

more affordable. In addition, NEOFECT’s product range caters to different age groups

suffering from stroke and other musculoskeletal and neurological diseases, thereby

providing customers with unparalleled value for their money.

For its strong overall performance NEOFECT has earned Frost & Sullivan’s 2018 Enabling

Technology Leadership Award.



Significance of Enabling Technology Leadership

Ultimately, growth in any organization depends upon customers purchasing from a

company and then making the decision to return time and again. In a sense, then,

everything is truly about the customer—and making those customers happy is the

cornerstone of any long-term successful growth strategy. To achieve these goals through

enabling technology leadership, an organization must be best-in-class in three key areas:

understanding demand, nurturing the brand, and differentiating from the competition.

Understanding Enabling Technology Leadership

Product quality (driven by innovative technology) is the foundation of delivering customer

value. When complemented by an equally rigorous focus on the customer, companies can

begin to differentiate themselves from the competition. From awareness, to consideration,

to purchase, to follow-up support, best-practice organizations deliver a unique and

enjoyable experience that gives customers confidence in the company, its products, and

its integrity.



Key Benchmarking Criteria

For the Enabling Technology Leadership Award, Frost & Sullivan analysts independently

evaluated two key factors—Technology Leverage and Customer Impact—according to the

criteria identified below.

Technology Leverage

Criterion 1: Commitment to Innovation

Criterion 2: Commitment to Creativity

Criterion 3: Stage Gate Efficiency

Criterion 4: Commercialization Success

Criterion 5: Application Diversity

Customer Impact

Criterion 1: Price/Performance Value

Criterion 2: Customer Purchase Experience

Criterion 3: Customer Ownership Experience

Criterion 4: Customer Service Experience

Criterion 5: Brand Equity

Best Practices Award Analysis for NEOFECT

Decision Support Scorecard

To support its evaluation of best practices across multiple business performance

categories, Frost & Sullivan employs a customized Decision Support Scorecard. This tool

allows our research and consulting teams to objectively analyze performance, according to

the key benchmarking criteria listed in the previous section, and to assign ratings on that

basis. The tool follows a 10-point scale that allows for nuances in performance evaluation.

Ratings guidelines are illustrated below.

RATINGS GUIDELINES

The Decision Support Scorecard is organized by Technology Leverage and Customer

Impact (i.e., these are the overarching categories for all 10 benchmarking criteria; the

definitions for each criterion are provided beneath the scorecard). The research team

confirms the veracity of this weighted scorecard through sensitivity analysis, which

confirms that small changes to the ratings for a specific criterion do not lead to a

significant change in the overall relative rankings of the companies.



The results of this analysis are shown below. To remain unbiased and to protect the

interests of all organizations reviewed, we have chosen to refer to the other key

participants as Competitor2 and Competitor3.

Measurement of 1–10 (1 = poor; 10 = excellent)

Enabling Technology Leadership

Technology Leverage

Customer Impact

Average Rating

NEOFECT 10 10 10.0

Competitor 2 8 7 7.5

Competitor 3 7 7 7.0

Technology Leverage

Criterion 1: Commitment to Innovation

Requirement: Conscious, ongoing adoption of emerging technologies that enables new product development and enhances product performance

Criterion 2: Commitment to Creativity

Requirement: Technology leveraged to push the limits of form and function in the pursuit of “white space” innovation

Criterion 3: Stage Gate Efficiency

Requirement: Adoption of technology to enhance the stage gate process for launching new products and solutions

Criterion 4: Commercialization Success

Requirement: A proven track record of taking new technologies to market with a high rate

of success

Criterion 5: Application Diversity

Requirement: The development and/or integration of technologies that serve multiple

applications and can be embraced in multiple environments

Customer Impact

Criterion 1: Price/Performance Value

Requirement: Products or services offer the best value for the price, compared to similar offerings in the market.

Criterion 2: Customer Purchase Experience

Requirement: Customers feel they are buying the most optimal solution that addresses both their unique needs and their unique constraints.

Criterion 3: Customer Ownership Experience

Requirement: Customers are proud to own the company’s product or service and have a

positive experience throughout the life of the product or service.

Criterion 4: Customer Service Experience

Requirement: Customer service is accessible, fast, stress-free, and of high quality.



Criterion 5: Brand Equity

Requirement: Customers have a positive view of the brand and exhibit high brand loyalty.

Decision Support Matrix

Once all companies have been evaluated according to the Decision Support Scorecard,

analysts then position the candidates on the matrix shown below, enabling them to

visualize which companies are truly breakthrough and which ones are not yet operating at

best-in-class levels.

High

Low

Low High

Customer Impact

Technology Leverage

Competitor2 Competitor3

NEOFECT



Best Practices Recognition: 10 Steps to Researching,

Identifying, and Recognizing Best Practices

Frost & Sullivan analysts follow a 10-step process to evaluate Award candidates and

assess their fit with select best practice criteria. The reputation and integrity of the

Awards are based on close adherence to this process.

STEP OBJECTIVE KEY ACTIVITIES OUTPUT

1 Monitor, target, and screen

Identify Award recipient candidates from around the globe

• Conduct in-depth industry research

• Identify emerging sectors

• Scan multiple geographies

Pipeline of candidates who potentially meet all best-practice criteria

2 Perform 360-degree research

Perform comprehensive, 360-degree research on all candidates in the pipeline

• Interview thought leaders and industry practitioners

• Assess candidates’ fit with best-practice criteria

• Rank all candidates

Matrix positioning of all candidates’ performance relative to one another

3

Invite thought leadership in best practices

Perform in-depth examination of all candidates

• Confirm best-practice criteria • Examine eligibility of all candidates

• Identify any information gaps

Detailed profiles of all ranked candidates

4

Initiate research director review

Conduct an unbiased evaluation of all candidate profiles

• Brainstorm ranking options • Invite multiple perspectives on candidates’ performance

• Update candidate profiles

Final prioritization of all eligible candidates and companion best-practice positioning paper

5

Assemble panel of industry experts

Present findings to an expert panel of industry thought leaders

• Share findings • Strengthen cases for candidate eligibility

• Prioritize candidates

Refined list of prioritized Award candidates

6

Conduct global industry review

Build consensus on Award candidates’ eligibility

• Hold global team meeting to review all candidates

• Pressure-test fit with criteria • Confirm inclusion of all eligible candidates

Final list of eligible Award candidates, representing success stories worldwide

7 Perform quality check

Develop official Award consideration materials

• Perform final performance benchmarking activities

• Write nominations • Perform quality review

High-quality, accurate, and creative presentation of nominees’ successes

8

Reconnect with panel of industry experts

Finalize the selection of the best-practice Award recipient

• Review analysis with panel • Build consensus • Select recipient

Decision on which company performs best against all best-practice criteria

9 Communicate recognition

Inform Award recipient of Award recognition

• Announce Award to the CEO • Inspire the organization for continued success

• Celebrate the recipient’s performance

Announcement of Award and plan for how recipient can use the Award

10 Take strategic action

Upon licensing, company is able to share Award news with stakeholders and customers

• Coordinate media outreach • Design a marketing plan • Assess Award’s role in future strategic planning

Widespread awareness of recipient’s Award status among investors, media personnel, and employees



The Intersection between 360-Degree Research and Best

Practices Awards

Research Methodology

Frost & Sullivan’s 360-degree research

methodology represents the analytical

rigor of our research process. It offers a

360-degree-view of industry challenges,

trends, and issues by integrating all 7 of

Frost & Sullivan's research methodologies.

Too often companies make important

growth decisions based on a narrow

understanding of their environment,

leading to errors of both omission and

commission. Successful growth strategies

are founded on a thorough understanding

of market, technical, economic, financial,

customer, best practices, and

demographic analyses. The integration of

these research disciplines into the 360-

degreeresearch methodology provides an

evaluation platform for benchmarking

industry participants and for identifying those performing at best-in-class levels.

About Frost & Sullivan

Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth

and achieve best-in-class positions in growth, innovation and leadership. The company's

Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined

research and best practice models to drive the generation, evaluation and implementation

of powerful growth strategies. Frost & Sullivan leverages more than 50 years of

experience in partnering with Global 1000 companies, emerging businesses, and the

investment community from 45 offices on six continents. To join our Growth Partnership,

please visit http://www.frost.com.

360-DEGREE RESEARCH: SEEING ORDER IN THE CHAOS

Documents

2018 Global Smart Rehabilitation Enabling …...The NEOFECT RAPAEL Smart Glove uses a virtual reality (VR)-based hand rehabilitation therapy solution that helps patients carry out