A medical device right out of science fiction

By Richard Nieva, contributor

FORTUNE — There will be no robot doctors in the future — at least not if Scanadu can help it. Even as hospital rooms become more high tech, the Mountain View, CA-based startup wants to make sure the future of medicine remains a human-centered experience.

The company is vying to be the first to create a device that can scan a patient’s body and return a medical diagnosis. The device, known in medical design lore as the “tricorder,” is one of the elusive holy grails of health engineering. (Star Trek geeks will recognize the name from the fictional device from the show used for sensor scanning, recording data, and analyzing it.) Engineers have been talking about such a device for years, but the race intensified last May, when the X Prize Foundation, a Southern California-based nonprofit, and Qualcomm (QCOM) announced a contest promising $10 million to the first team to create one.

The ubiquity of smartphones, and rapid developments in artificial intelligence and cloud computing have turned the tricorder into more than a pipedream. “We launch X-Prizes when we think the technology is at a tipping point,” says X Prize CEO Peter Diamandis. (One of the organization’s past contests generated the first privately-built spacecraft.) This contest officially launched last week at the consumer electronics trade show CES.

The market for consumer health products is beginning to ripen. This fall the consumer electronics firm Jawbone released UP, a personal medical bracelet that monitors the user’s daily routines. But the untested market is rocky. Jawbone has recently started offering “no questions asked” discounts to unsatisfied customers. While numbers for the forward thinking market are hard to pin, the medical imaging market is worth almost $6 billion, according to analysts Frost & Sullivan.

Scanadu — the name comes from a favorite poem of CEO Walter de Brouwer — has its work cut out for it. The company is tackling the contest in waves. The first iteration of the product is expected in 2013 and will be basic, providing a thermometer, suggestions from medical websites, and GPS functions that can lead you to a nearby hospital. A neck patch worn by users gives the device information on vital signs. The product works with “hyperspectral camera” technology, meaning it organizes visual data by color. For example, says de Brouwer, the scans of people with lung cancer might show up the same color, and the device essentially analyzes the patterns.

But the company already has a concrete vision for advanced versions. De Brouwer sees an entirely new medical infrastructure around the device in the future. He says it will look a bit like the OnStar service, a system from General Motors (GM) that helps drivers during road disasters. The device will collect internal information from a user who is ill, and, like OnStar, will send the user to a tracking agent, who can then connect to a doctor for the diagnosis. While this preserves the role of the doctor, it will eliminate the need for doctor’s offices, says de Brouwer.

De Brouwer also said the success of the device is contingent on people becoming more open through social networks. So when someone shares his eating patterns, the machine can analyze his diet. “The more people share, the more the device can rule out,” he says. “No privacy will be sustainable — and that’s a good thing.”

The product’s creators never wanted to divorce the human element from the diagnostic process, just its infallibility. In fact, the first version of the product embraces it, taking an earnestly human approach: What do you do when it is the middle of the night, and your child is ill? For a parent, it’s one of the most helpless feelings in the world. “This will let you know if it’s a mountain or a molehill,” says David Webster, a designer at the legendary design firm IDEO, who is working with Scanadu to hatch the product.

For de Brouwer, the situation is far from hypothetical. He conceived the idea while in an intensive care unit waiting room. His 5-year-old son had jumped out of a window and suffered severe head trauma. De Brouwer could only guess as to what his son’s condition might be. After spending three months in the ICU, he felt he needed to do something for parents waiting cluelessly. “We need to empower them,” he says.

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