Microsoft Partners With Implantable RFID Chip Maker VeriChip

Thanks to the VeriChip-Microsoft agreement, VeriMed Health Link customers can open a HealthVault account and use it to access and manage their personal health records and data that are stored in the VeriMed database. "VeriMed adds an exciting RFID-based option for HealthVault users trying to keep themselves and their families safe," Nolan says.

Despite the Microsoft partnership, the future of VeriChip—and its VeriMed Health Link business—is uncertain. In May 2008, VeriChip announced it had hired investment banking firm Kaufman Bros. to assist in the sale of the VeriMed Health Link business, as well as the possible sale of the entire company (see VeriChip to Place Implantable Division on Block). At that time, the firm also announced it was selling its Xmark division—which sells RFID-based products and services designed to help track infants in hospitals, as well as other patients and physical assets—to Stanley Works. That $45 million deal was finalized in July (see Stanley Bolsters RFID Portfolio With VeriChip's Ex-Subsidiary).

Last month, VeriChip announced that private investment and business consulting company R&R Consulting Partners, owned by VeriChip's former chairman and CEO, Scott R. Silverman, purchased 5.4 million shares of VeriChip common stock, held by Digital Angel Corp. Digital Angel manufactures RFID tags that are implanted in pets and wildlife for tracking purposes, as well as active transponders used as emergency location beacons to find people during search-and-rescue applications (see Personal Location Beacons Usage Grows). The deal provides Silverman, who had existing holdings of 861,000 shares, with control of 6.2 million shares—or 53 percent—of VeriChip.

In a separate transaction, VeriChip also purchased from Digital Angel all patents related to an RFID-enabled sensor tag that could make it easier for diabetics to monitor their blood-sugar level. Digital Angel, VeriChip and Receptors had been working together on this tag (see VeriChip, Digital Angel Partner With Receptors LLC to Develop Glucose Sensor). Receptors is a company in the field of proteomics (the study of proteins) and the development of artificial receptors.

VeriChip's difficulties do not worry Nolan, however. "Innovation can be hard—and innovation in health care all the more so, especially given the nature of the economy today," he says. "We've created HealthVault as an open ecosystem so that the market can ultimately decide which new ideas will succeed, and which will not. VeriChip's business is all about new ideas, and we are excited they've chosen to work with HealthVault."