It is almost certain that the iWatch will be a standard activity tracker using an accelerometer to count steps, which can be converted into an estimate of calories burned or even into a NikeFuel score (Apple CEO Tim Cook sits on the board of Nike). Then the iPhone can transmit this information to iCloud where it will be stored in a special app named Healthbook (which will be built into iOS8) that will collect a person's health information. However even more intriguing are rumors that iWatch will also measure a variety of vital signs through special sensors:
"Besides fitness tracking, a marquee feature of “Healthbook” will be the ability to monitor a user’s vital signs. The application will be able to track a person’s blood pressure, hydration levels, heart rate, and potentially several other blood-related data points, such as glucose levels, according to our sources."I have previously written about the Scanadu "medical tricorder" which can monitor your heart rate (as can the Xbox One). However I had never heard of a device that could measure blood glucose (sugar) non-invasively i.e. without accessing your blood directly. Such a capability is relevant for those with diabetes who need to be vigilant against hypoglycemia (which can be fatal), but it would also be helpful to the broader population many of whom struggle with obesity. How would the iWatch measure blood glucose?
Over the last 25 years, there has been extensive work on non-invasive blood glucose monitoring. The research has coalesced around several basic technologies but the most popular is to use near-infrared spectroscopy (NIRS). The near IR refers to the light that illuminates the sample; near infrared wavelengths (800 nm to 2500 nm) are just above the visible spectrum (390 nm to 700 nm). The key concept is that different molecules (e.g. glucose, insulin, hemoglobin) will absorb light at different wavelengths, letting a specific pattern of wavelength intensities to be transmitted through the sample. In other words, different compounds will absorb different wavelengths of light to different extents creating a distinctive spectroscopic "fingerprint." Using this technique one can identify and quantitate a specific compound.
The challenge is that blood is a complex mixture of compounds. However, one can determine the spectrum of blood without glucose and then subtract this from a sample of blood with glucose to create the glucose "difference spectrum" which can be quantitated against some standard.
The choice of near-IR spectrum is because these wavelengths are better able to penetrate the skin. An LED can be used as the IR light source, and the detector can be a light sensor such as the one used in the iPhone camera. In between would be a diffraction grating to select the appropriate wavelengths. The light is not transmitted all the way through the wrist (which is too opaque), but instead will penetrate a certain distance into the skin encountering interstitial and blood glucose, and then the non-absorbed light will scatter back to the surface of the skin where it can be detected.
All of this sounds difficult and it is. Despite the efforts of many companies, not a single product that performs non-invasive blood glucose monitoring has been approved by the FDA. I suspect accuracy and cost are significant issues.
Thus, my prediction: the iWatch will not have a blood glucose sensor when it is released this year. Perhaps future versions will possess this capability. Regardless non-invasive blood glucose monitoring is an exciting technology to follow.
Figure 1. Will the iWatch measure blood sugar? No (at least not initially).

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