“Autism represents an obvious area where innovation is going to transform the efficiency, the outcomes, and some of the other challenges with respect to how care is delivered today,” Friedland said.
On April 2, Cleveland Clinic invested an undisclosed amount in startup Floreo, which has developed a virtual reality software platform providing behavioral therapy for neurodiverse people, including those with autism spectrum disorder. The investment gave Cleveland Clinic an equity stake and the right to observe Floreo’s board.
As part of the deal, Floreo acquired Autism Eyes, an autism diagnostics and assessment company that had been incubated and spun off by Cleveland Clinic Innovations.
About 1 in 36 8-year-old children were estimated to have autism in 2020, up from 1 in 44 in 2018, according to the most recent data from the Centers for Disease Control and Prevention. While autism treatment has been a frequent area of disruption for traditional venture capital and private equity firms, it’s less common to see a health system's innovation and venture arm wade into the space.
Cleveland Clinic’s Children’s Center for Autism, however, offers insight into the challenges related to autism care, Friedland said.
Cleveland Clinic Innovations developed Autism Eyes in concert with clinicians from the center starting eight years ago, Friedland said. The aim was to provide screening tools for autism that could be more effective and efficient than traditional, pen- and paper-based tests, which can lead to months-long waits for assessments and diagnoses.
Autism Eyes developed a diagnostic tool that uses artificial intelligence and eye-gaze tracking technology to assess if someone is at risk for autism spectrum disorder. In studies published in Autism Research and the Journal of the American Academy of Child and Adolescent Psychiatry, Cleveland Clinic researchers found the eye-gazing technology could generate a diagnosis with 80% accuracy in less than 10 minutes.
“It’s a large market with a huge unmet need and a lot of dissatisfaction with the current standard of care,” Friedland said. “And there’s a clear positive impact on the lives of patients by getting them diagnosed for proper treatment earlier.”
Autism Eyes was spun off in 2019.
Related: Top digital health funding: Autism Impact Fund, Rightway
Friedland said Floreo CEO Vijay Ravindran began a conversation with Cleveland Clinic Innovations 18 months ago about pairing the Autism Eyes eye-gaze tracking capabilities with Floreo’s virtual reality technology. Floreo, which offers its software to both autism therapy providers and school systems, will bring Autism Eyes to more users, Friedland said.
Cleveland Clinic's investment will give Floreo added credibility with potential clients, Ravindran said.
The transaction reflects Cleveland Clinic’s strategy of building, investing in and eventually finding buyers for its incubated companies.
“As a company becomes commercial … other hospitals might not want to buy a product from someone they perceive to be a competitor,” Friedland said. “So when a company matures, it makes sense for us to own smaller and smaller stakes of it."