Taking the right amount of medication at the right time is crucial for medical patients. Proteus Digital Health of Redwood City, California, has created a "smart pill" system that helps patients and caregivers monitor dosages. The pill contains a sensor that interacts with stomach fluid and sends a signal to a patch on the torso. The patch transmits information about the type of pill and when it was ingested to a nearby smartphone, along with physiological data, including heart rate and activity level. Patients can access the information on a mobile app and share it with others. Proteus, which has raised more than $125 million in private equity and venture capital financing, plans to introduce the Helius system in the United Kingdom this year, initially pairing prescription pills with sugar pills containing sensors. Now, the roughly 100-employee company is working with pharmaceutical partners to embed the sensors, which recently received approval from the U.S. Food and Drug Administration, directly in prescription pills. It hopes to launch in the U.S. as early as 2013, focusing on patients with diabetes and central nervous system disorders.

1. Patient swallows pill.

Each pill contains a sensor made of copper, magnesium, and silicon. The sensor, 1 mm square, contains a binary code indicating the type of medication and where it was manufactured.

2. Stomach fluid activates sensor.

Instead of a battery, the sensor is powered by stomach fluid. It sends an electrical signal indicating the time of ingestion and type of pill to a disposable patch worn on a patient's rib cage. The sensor deactivates after five minutes and later passes naturally through the digestive system.

3. Patch collects data.

In addition to tracking information about the pill, the disposable, stick-on patch gathers data about a patient's temperature, heart rate, respiration, and activity level.

4. Patch sends data to smartphone.

Every 30 minutes, data from the patch is transmitted via Bluetooth to a patient's smartphone. Patients can share the information, which is stored on Proteus's website, by text or email.