Virtual reality (VR) has always been seen as an answer in search of a problem. This has never been clearer than Meta’s recent stumble into the metaverse, which has cost the company more than two-thirds of the stock’s valuation at the time of writing. For a technology that has always seemed to focus on its strengths as a gaming device, it seems like it could be disappointing. However, with Penumbra’s recent announcement of its REAL-y Virtual Reality platform, VR could get a second wind in the renaissance segment…with video games.
Last Tuesday, Penumbra announced the world’s first hands-free and untethered VR solution, with the ability to fully regenerate the body. GlobalData estimates that there are as many as 52 million potential reversible patients in the US, which means that VR technology has a large patient population that must grow to be able to adopt it. In addition, GlobalData expects the VR market to grow to $80 billion by 2030. If the REAL-y platform can prove its worth, Penumbra could capture a large portion of this market. But how does it work? Penumbra CEO and GM Gita Barry was quoted as saying: “The two biggest challenges in rehabilitation are maintaining patient motivation and lack of communication.” By ‘gamifying’ therapy, it is thought that patients are more likely to participate and complete their exercises.
Whether or not this gamble pays off remains to be seen, as the market does not yet have a fully developed hardware and software ecosystem to support a REAL-y system. Things look promising, however; if the REAL-y program proves it can overcome the engagement and motivation issues that have plagued the field of physiotherapy, it may begin to see more participation. Another important question is the refund status of these devices. In the US, reimbursement strictly controls whether the device is taken up by the healthcare industry, as it significantly lowers the cost to the client. In order to secure a refund, Penumbra will have to prove the value of its device.
However, GlobalData believes there are a few tailwinds that Penumbra and ‘VR as a market revitalization tool’ will enjoy. The number of elderly people continues to grow, and with it, the need for rehabilitation. Since these patients also tend to be wealthier than their younger counterparts, the rehabilitation industry can expect to see an influx of wealthy patients in the coming decades. In addition, the increasing adoption of software and devices as medical tools means that these devices are becoming commonplace. This may strengthen the FDA’s chances of approving the reimbursement status, as happened with health devices during the Covid-19 crisis.