Hearing Testing Systems Business Plan

Products

To summarize, the CRISP test is:

• A method and system for clinically evaluating speech intelligibility in children in such a way as to link the child's normal environmental noise experience to the audiology clinic.
• A rapid and reliable method and system for testing the speech intelligibility of a child, that is adapted to engage children so as to enable a tester to determine what auditory factors are contributing to the child's speech intelligibility level.
• A method and system for simulating a child's normal classroom environment by providing a variety of types of competing noises so as to determine their effect(s) on the speech intelligibility of the child.
• A method and system for testing the effects of location of competing noises relative to a target word source and the child so as to determine the spatial release from masking potential of said location.
• A system for computerizing the method so as to enable a clinical user to more accurately control the presentation of sounds, the storage and analysis of results, and by which the child may interactively make choices and receive reinforcement.

The CRISP test will allow audiologists to offer better service, which will become an additional source of revenue for their clinics. For example, depending on the complexity of the tests, audiologists typically charge anywhere from $35 to $200 per test for the new service. The beta version of CRISP is currently being sold and used by both independent audiologists/speech therapists and researchers as part of a clinical trials study for cochlear implants. These individuals are also providing additional feedback on the functionality and ease of use of the software. The audiologists who run the clinics and are beta-testing CRISP are considered to be significant influences within the field of audiology. Key beta-test audiologists include:

Jane R. Madell, Ph.D.
Director: Hearing and Learning Center
Beth Israel Medical Center
[Proprietary and confidential information removed.]

Patricia Chute, Ph.D.
Mercy College
[Proprietary and confidential information removed.]

Richard Tyler, PhD.
University of Iowa
[Proprietary and confidential information removed.]

In addition to these key beta-test sites, the CRISP test is also being beta-tested in many other clinics across the United States, including Texas (four different clinics), California (three different clinics), Alabama, New Mexico, Wisconsin, and Michigan.  The valuable feedback from these beta-test sites will be incorporated into Version 3.0 of the CRISP test.

 

Testimonials
Auris Solutions has received feedback regarding the CRISP test from many of its beta-test sites. The feedback Auris has received has been overwhelmingly positive. For instance, Dr. Richard Tyler says, "[CRISP] is a well-designed, easy to use, and clever test that provides lots of information and has the potential to attract lots of users."  In addition, Dr. Jane Madell says, "there is no other test like it available on the market today."  Finally, Dr. Patricia Chute says, "CRISP is very easy-to-use, and scores more rigorously than any other test available on the market."

The feedback we have received confirms our beliefs that the CRISP test solves a real problem in the clinics of audiologists and speech therapists.

3.1 Product Description

The CRISP test comprises target sounds as words that occur in the presence of competing sound(s), that are either spatially near or separated from the target. CRISP will enable the user to measure a child's ability to understand speech in the presence of competing noise or words, and the extent to which each individual child benefits from spatial separation of the target and competing sounds. In CRISP, the child is required to respond to the target word by selecting a picture representation of the target word from among several picture choices, thus providing an interactive aspect to the test. Animations and feedback will be employed to engage the child during the test as well as functioning as a form of positive reinforcement. CRISP provides a set of rules whereby the sound level at which target words are presented may vary adaptively according to the child's responses. The test repeats several target words under a variety of types and locations of competing sounds and records the child's responses in a results database. The results are available for further analysis by a user to produce a customized output. A computerized system enables provisioning the test in a controlled manner, analysis of the data, and further engagement of the child.

As shown above, the set-up requires an amplifier, a sound level meter, a minimum of two speakers (distanced 3 ft minimum from the patient), and a computer system with at least Windows 98 to perform the CRISP software test. Testing should take place in a professional soundproof audiology booth, which does not present a problem, as the booth is already a standard component of all audiology clinics. The price range for the software is $2,000 to $2,500.

3.2 Competitive Comparison

The Industry Analysis (section 4.3, below) contains a discussion of some hearing tests that attempt to mimic a realistic environment. These tests, however, are primarily designed for adults. A summary of how the CRISP hearing test differs from other currently available tests is detailed in the table below:

Test	Purpose	Age at which can be used	Problems with these tests
Connected Speech Test	Measure speech for sentence's intelligibility in "babble."	Adults	Can't be used with children Can't evaluate masking signals Doesn't provide speech reception thresholds, or percent correct scores for signal to noise ratio
Hearing in Noise test	Measure speech for sentence's intelligibility in speech-shaped noise. Does not use speech or other types of noise sources.	Adults; Children ages 8 and older	Can't be used with children Can't evaluate masking signals Doesn't provide speech reception thresholds, or percent correct scores for signal to noise ratio
Speech in Noise Test	Speech in noise for adults. Fixed signal to noise ratio.	Adults	Can't be used with children Can't evaluate masking signals Doesn't provide speech reception thresholds, or percent correct scores for signal to noise ratio
Word Intelligibility by Picture Identification (WIPI)	Speech in young children.	5-11 years	Can't be used with younger children (3-4) Can't test speech in noise, nor spatial separation between speech and noise (binaural hearing) Can't evaluate masking signals Doesn't provide speech reception thresholds, or percent correct scores for signal to noise ratio Has a limited number of uses
Northwestern University: Children's Perception of Speech (NU CHIPS)	Speech in young children	3 or older	Can't test speech in noise, nor spatial separation between speech and noise (binaural hearing) Can't evaluate masking signals Doesn't provide speech reception thresholds, or percent correct scores for signal to noise ratio Has a limited number of uses

3.3 Strengths and Challenges

Barriers to Entry Against Competition
Auris Solutions' CRISP hearing test system is protected under United States patent #6,584,440: Method and System for Rapid and Reliable Testing of Speech Intelligibility in Children. The patent was granted on June 24, 2003. The invention was disclosed to the Wisconsin Alumni Research Foundation of the University of Wisconsin at Madison (WARF); The Company is currently negotiating the terms of an exclusive licensing agreement with WARF. In addition, CRISP, as well as any name for each future system, are secured under trademarks. We believe that the patent as well as the trademark will provide significant barriers to entry with respect to competitors copying the CRISP hearing system and method.

Auris Solutions' Challenges
There are two main challenges Auris Solutions needs to address when formulating its marketing strategy:

Establish brand equity – Because the CRISP hearing test is a new product that will be introduced from a new company, the test and company will have no brand equity established in the marketplace. Consequently, it will be important to establish a brand name as soon as possible through different marketing efforts. This weakness will be mitigated through advertising in an effort to increase awareness. However, within the hearing care industry, credentials are key, as stated above. Therefore, with CRISP, brand equity problems will also be mitigated through Dr. Litovsky's own credibility and status within the hearing healthcare industry.

Overcome reasons not to buy the test – Many audiologists and speech therapists use audiometers for hearing tests and stop there. The problem with this is that the healthcare professional will not know how well the patient will hear in a realistic environment following surgical implantation of a cochlear implant or fitting of a hearing aid. Therefore, it will be important to demonstrate to these audiologists how the CRISP hearing test can offer additional functional benefits to complement the use of the audiometer. In addition, it will also be important to make the healthcare provider aware that administering the CRISP hearing test will be a revenue generator. This will be mitigated through our integrated marketing communications plan.

In addition, within the hearing care industry, credentials are key; researchers, such as Dr. Litovsky, who have deep industry experience and knowledge, are very well respected. This has enabled them to develop an extensive network of contacts within the industry. Therefore, products that such researchers develop have more credibility due to the researcher's own brand equity, in terms of the underlying basis of trust and respect that has already been painstakingly established over many years. Therefore, with Auris' current and future systems solutions, a key barrier to entry is through Dr. Litovsky's own credibility and status within the hearing healthcare industry and the significant learning curve advantage of developing such a comprehensive test.

3.4 Sales Literature

Once funding has been secured, we will spend not more than a month in developing a comprehensive company brochure, software demos, and a CD case for our first product. The brochure will describe our company, as well as its product offerings, along with some other product information for the same target customers. We will also incorporate the same brochure into our web page.

3.5 Technology

Auris Solutions' CRISP hearing test system is protected under United States patent #6,584,440. As a brief description of the technology, CRISP hearing test is a method and system for testing the speech intelligibility of a child comprises providing a set of target sounds as words in the presence and absence of competing sound(s) of a variety of types so as to enable an analysis of the aspects of competing sounds and their respective effects on the speech intelligibility of a child. CRISP varies the locations at which competing sound(s) is provided, to enable an evaluation of the sounds' effects on the spatial release from masking.

The target words used in the test are first determined to be within the vocabulary of the child. The child is required to respond to the target word by selecting a picture representation of the target word from among several picture choices, thus providing an interactive aspect to the test. Optionally, a positive or negative reinforcement may be provided. The sound level at which the target words are presented may vary adaptively according to the child's responses, the change in sound level being determined by a set of rules. The test is repeated over several target words and under a variety of types and locations of competing sounds, and the child's responses are recorded in a results database. Users may further analyze the results to produce customized output. The computerized system enables administering the test in a controlled manner, analyzing the data, and further engaging the child.

3.6 Future Products

In addition to CRISP, Auris Solutions also has several other products in the pipeline that will create a diversified portfolio of software testing solutions for the hearing care industry.  The new products are listed below, with current timelines.

Products Ready to be launched by 2005:

• Minimum Audible Angle (MAA): This test measures the smallest change in the position of a sound that can be reliably discriminated.  Typically, normal hearing adults can discriminate differences of 1-2º, and children ages 5-6 perform similarly. However, hearing-impaired people perform much worse, especially if they do not have binaural hearing.  The MAA test can be used to assess the benefits of having two cochlear implants, two hearing aids, or one of each, for both children and adults.  This product will be ready for launch in 2005, and targeted to the same customer segments as the CRISP test.  An owner's manual has been completed for this product. A price range has been established between $800 and $1,000. 

Products in the Pipeline: 

• CRISP Junior: A variation of CRISP for children of ages ranging from 2 to 3 years old.
• Sentence Materials:  A variation of CRISP where the child would repeat the sentence that s/he heard rather than responding to pictures in the screen. 
• Echo Suppression: The ability of the auditory system to process sounds in the real world depends on how well people can ignore echoes, which are abundant in every room.  The task is similar to the MAA test (above) except that a simulated echo is also presented from one loudspeaker in the center.  Young children are worse than adults at suppressing echoes, due to their immature hearing.  This test provides a very useful assessment tool for the maturation of the binaural hearing system, and can be used in children and adults.
• ERISP Test (Elder's Realistic Intelligibility and Speech Perception):  A variation of CRISP for the implementation of hearing tests that are easily used by the elderly population.  The test assists in determining the degree of hearing loss, ability to hear in noisy environments, and benefit of a hearing aid or cochlear implant for individual patients.
• Children with developmental disabilities (DD) and mental retardation (MR): Other measures of hearing are being developed that will help to assess sensory and cognitive deficits in children and adults with DD and MR. These tests would provide (1) tools for further evaluating and differentiating between affected individuals and (2) insight into development of appropriate tools for rehabilitation and training.