There is a potential legal dispute brewing between two of the largest telehealth companies over patent claims.
Teladoc has accused competitor Amwell of infringing on its patents related to a digital scope and stethoscope, according to a letter the company sent on Sept. 14.
In the letter, which Stat first obtained and reported on Monday, Teladoc’s intellectual property attorneys allege that several products, including certain telemedicine carts, “directly and indirectly infringe” on a number of Teladoc's patents.
The letter, addressed to Amwell’s CEOs Ido and Roy Schoenberg, demands that the company immediately stop selling, making, using and importing the products. Teladoc also threatened to “move forward with enforcement of its patents against Amwell" if the company did not comply by Friday, Sept. 18.
Teladoc acquired telehealth startup InTouch Technologies in January, which included the company's "extensive patent portfolio covering various aspects of telemedicine, such as the use of robots and telemedicine carts," Teladoc's attorneys said.
Amwell, which went public last week, said in a filing last Tuesday with the U.S. Securities and Exchange Commission that "these claims lack merit." The company also said if Teladoc attempts to bring the claims to court, it "intends to defend against them vigorously."
The company added it can provide "no guarantees about the outcome of any potential dispute."
"Even if we were found to infringe upon any valid claim of these patents, our revenues from the Carepoints products approximated 5% of our revenues in 2019," Amwell said in the filing.
In its S-1 prospectus to prepare to go public, Amwell pointed to third parties challenging the validity of its patents and trademarks as one risk factor facing the business.
"We may not be able to obtain and enforce additional patents to protect our proprietary rights from use by potential competitors. Companies with other patents could require us to stop using or pay to use required technology," the company said.
Amwell also said it could incur substantial costs as a result of any claim of infringement of another party’s intellectual property rights.
It's the latest skirmish between the two prominent telehealth companies after they were embroiled in an earlier legal dispute over intellectual property rights.
In 2015, Amwell filed a lawsuit against Teladoc accusing it of infringing on a 2007 American Well patent. The suit asked for triple damages plus court fees, as well as an injunction against Teladoc continuing to do business, according to MobiHealthNews.
A year later, a federal judge in Massachusetts threw out the patent infringement lawsuit and invalidated the patent itself. At the time, Amwell immediately fired back and said it would appeal the decision.
Ido Schoenberg said in a press release that a decade of sustained investment in technology and know-how has made American Well "undeniably the most robust and capable platform on the market today."
"This is Borders versus Amazon for healthcare," Schoenberg said.
"American Well invented the brokerage engine that underpins modern online video telehealth, along with a host of ancillary technologies that enable doctors to connect remotely with patients for highly-informed, medically-appropriate consults," the company said in a press release.
Amwell has a patent portfolio that includes 28 issued patents and 22 pending patent applications covering various aspects of this field. No other competitor holds a single patent for telehealth.