Deep brain stimulation therapies have been around for decades, but a wave of at-home wearable devices has emerged, forging a pathway toward a new era of electrical brain stimulation that could enhance consumers’ everyday lives — not just treat severe disorders. “Until now, the use of brain stimulation techniques has been relatively restricted to treat severe movement and mental disorders. But moving forward, there is growing recognition and excitement that these techniques can be used to enhance broader cognitive function,” Bernstein analyst Lee Hambright wrote in a note earlier this year. “The next frontier of innovation could be using brain stimulation techniques to change brainwave activity to stimulate growth and potentially improve the brain’s neural networking,” Hambright wrote. The market for deep brain stimulation devices was an estimated $1.2 billion in 2022 and is set to reach about $3.2 billion by 2032, according to a report from research and consulting firm Precedence Research. Several Food and Drug Administration-approved deep brain stimulation therapies exist for severe movement disorders such as Parkinson’s disease, essential tremor, and dystonia, as well as mental disorders such as obsessive-compulsive disorder and treatment-resistant depression. These forms of deep brain stimulation require a surgical procedure during which electrodes — which generate electrical impulses to control any abnormal brain activity — are implanted into certain areas of the brain. The stimulation is then controlled by a neurostimulator implanted under the patient’s skin in the chest area. With enough advancement in the field, doctors expect brain stimulation techniques for both severe disorders and health-and-wellness purposes will ultimately become noninvasive. Analysts also share a burgeoning excitement that cognitive function can be enhanced. Several smaller, private companies are developing technologies that can treat individuals through brain-computer interface, or BCI, systems and other minimally or noninvasive methods. “The potential use cases for brain hacking devices are extensive, and a lot of companies are in the race to serve this ‘consumer’ market related to improved daily brain health,” Hambright said. “However, a lot of questions remain unanswered with respect to safety and effectiveness.” Three major players There are only three companies with FDA-approved deep brain stimulation, or DBS, treatments: Medtronic , Abbott Laboratories and Boston Scientific . “These three are the major players in the world of deep brain stimulation,” said Dr. Ali Rezai, executive director of the Rockefeller Neuroscience Institute at West Virginia University and former president of the North American Neuromodulation Society. “Medtronic and Boston Scientific and Abbott, in my opinion, they’re improving on their technology. They’re improving their hardware … they’re improving the battery technology, they’re improving the stimulation paradigms using AI to optimize benefits versus side effects.” Medtronic, which reported fiscal second-quarter results Tuesday, has five DBS neurostimulators that treat conditions such as epilepsy, Parkinson’s disease and obsessive-compulsive disorder. In August, the company received approval for its Inceptiv closed-loop rechargeable spinal cord stimulator , which sends mild electrical impulses to the spinal cord to disrupt an individual’s pain signals before they reach the brain. Closed-loop neurostimulation is an “important area for future advancement in the world of DBS,” Rezai said, as he called out Medtronic’s leadership. Shares of Medtronic have shed 3.2% this year, but were up more than 6% so far this month. Analysts, on average, rate the company an overweight with an $89.83 price target, implying nearly 20.2% upside from Friday’s close, according to FactSet. “If an investor is at all interested in medical devices, this is a company that I wouldn’t necessarily bet against,” said Morningstar senior health care equity analyst Debbie Wang. “If we hone in on neuromodulation in particular, our thesis has been Medtronic has the most attractive, expansive portfolio out there. The spinal cord stimulation, or SCS, business is a hotbed of innovation right now, deep brain stimulation also is a key area.” Wang pointed to Medtronic’s recently launched differential target multiplexed SCS technology to treat patients with chronic, intractable back and leg pain. Medtronic on Nov. 10 announced successful results from its 12-month study on the therapy. Shares of Boston Scientific and Abbott, meanwhile, are up 8.6% and 2.9% over the past month, respectively. Boston Scientific has gained more than 17% this year, while Abbott has lost 9.3%. Boston Scientific offers DBS systems to treat Parkinson’s and dystonia, among other conditions that can be customized to a patient’s needs. Abbott also develops DBS therapies to aid with Parkinson’s and essential tremor, as well as other neuromodulation technologies, such as spinal cord stimulation. Depression, according to Rezai, will likely be one of the next major DBS applications. Abbott has fast-tracked the development of its DBS system for treatment-resistant depression through a “breakthrough device designation” from the FDA. The major depressive disorder affects an estimated 2.8 million of the total 16.1 million U.S. adults living with depression. The illness costs the U.S. about $44 billion a year for health care as well as unemployment and lost productivity, according to Abbott. About 71% of analysts hold an overweight rating on Abbott, according to FactSet, with an average price target of $115.36, or about 16% upside from Friday’s close. The company, which derives the majority of its revenue from medical devices and diagnostic tools, is expanding into a new market of consumer wearables as it sees its Covid test sales decline. Boston Scientific is also rated overweight by the vast majority of analysts polled by FactSet. Shares could jump about 11% over the next 12 months based on its $60.33 average price target. The new coffee? Bernstein’s Hambright sees a future where brain stimulation could become as mainstream as consuming caffeine to become more alert. There is still plenty of doubt, however, about the efficacy of at-home brain stimulation devices, which offer a less direct approach to brain stimulation and don’t always require FDA oversight. Scientists are already worried that these technologies seem to be growing at a faster rate than their ability to determine how well they work, Hambright noted. Some neurosurgeons worry the devices overpromise and underdeliver. A number of private companies are racing to develop ways to improve attention, memory, language and visuospatial skills, among other brain functions. Among them are Elon Musk ‘s Neuralink and Precision Neuroscience , which are making implantable brain-computer interfaces, and Wave Neuroscience , which uses digital brain imaging and neuromodulation (electrical impulses sent to the brain) to improve overall function. They hope to improve patient outcomes by using techniques like transcranial magnetic stimulation (TMS), ultrasound and magnetic energy to avoid surgery. “It’s a whole slew of companies out there that are doing the noninvasive approach towards what we call broadly the field of neuromodulation,” said Rezai, who holds 60 U.S. patents related to medical devices and neuromodulation technologies. “These companies — whether it’s Elon Musk’s Neuralink, Precision Neuroscience or others that are doing good work recording the brain and mapping out the neural activities in the brain with respect to a function — have not closed the gap, which is now [to develop] therapeutics.” Still, Rezai noted that the rate of FDA-approved brain stimulation therapies have slowed down in recent years, making the growing field of these largely noninvasive BCI developers an exciting innovation once their potential is realized. Clinical trials are a necessary step to demonstrate the efficacy of their approaches — and ultimately develop actionable outcomes for patients — he said, particularly as these noninvasive, mostly use-at-home approaches are less precise than brain surgery. Dr. Casey Halpern, the chief of stereotactic and functional neurosurgery at the University of Pennsylvania, is similarly enthused by the prospect of at-home brain stimulation therapies. Many are “door openers” for less invasive therapies for diseases such as Parkinson’s if they’re proven to work, he said. “The vision of brain stimulation is not that it’s invasive. To me, it’s getting noninvasive. As a field, we really need to embrace this technology because it actually will get us out of the brain,” Halpern said, adding that he expects these devices to become more mainstream. “There’s a lot to go in terms of trying to make that consistent intervention and one [device] that people are willing to embrace as a therapy versus an enhancer.” The ‘dream case’ Although brain stimulation therapies are typically used in medical settings, like hospitals, Hambright said that at-home brain stimulation devices are growing more popular among individuals who say these machines enhance their mental state or clarity. These devices are available online and can cost as little as $40 to around $500, he said. Rezai cited several electrical brain stimulation companies, including Insightec , which provides minimally invasive focused ultrasound treatment, as well as medical device maker Cordance and Taiwan’s NaviFUS , which is making ultrasound brain systems. Cordance is an example of what excites neurosurgeons about the field: the possibility that one day deep brain stimulation could be noninvasive and effective at a large scale. The company’s device looks to track brain diseases by reversibly opening the blood-brain barrier using noninvasive, low-frequency focused ultrasound. With this technology, Cordance plans to develop applications for patients with brain cancers and movement disorders such as Alzheimer’s, Parkinson’s and epilepsy. Several at-home devices use noninvasive electrical brain stimulation such as TMS or transcranial direct current (tDCS) to improve cognitive function, relieve brain fog, and decrease cravings among people with drug addiction and more. TMS can even be used as a potential weight loss treatment as it improves self-control and can result in healthier eating habits. Flow Neuroscience makes a brain-stimulating headset for depressive symptoms that is being reviewed for FDA approval after receiving breakthrough designation in 2022, Hambright said. Another example is BrainsWay, which uses FDA-cleared deep TMS technology to treat depression, obsessive-compulsive disorder and smoking addiction. Vielight Neuro’s technology stimulates the brain to improve cognitive processing, strength and reaction time, which makes it particularly applicable for high-performance athletes. Hambright pointed to Wave Neuroscience as a leader in the developing field of TMS. The company has two neuromodulation devices, one of which is approved by the FDA and used only in clinical settings. The other is an in-home portable headset called Sonal that is designed to improve symptoms of traumatic brain injury and post-traumatic stress disorder by aiding sleep, focus, mood, cognition and self-control via neuromodulation. “Essentially, Sonal is a shot on goal at the ‘dream case’ of brain stimulation — a device which augments a variety of cognitive functions for healthy consumers,” Hambright said. “Wave intends to go public once it receives FDA approval for its EEG-guided TMS therapy, which management expects to occur in 2024.”
