Many people forget to take their pills or don't take them correctly--expensive and dangerous mistakes. According to the Altarum Institute, patients or their insurers spend more than $500 billion annually on prescriptions, but many don't fully benefit from them. But that's not the patients' fault, says Andrew Thompson, who co-founded Proteus Digital Health in 2001; it's the industry's. There's a huge gap between medications' "potential effectiveness and what is actually realized," he says.

His company's solution: Don't swallow just medication; swallow a sensor along with it--an ingestible event marker, or IEM, in Proteus parlance--that, along with a wearable sensor patch, tracks how you and your pill are getting along. That sensor and patch record when the pill was taken and how your body responds, as measured by your heart rate, respiration, body angle, temperature, or even how many steps you've taken. The  data is transmitted to your phone or a website. Or, if you choose, it can be sent directly to care­givers, who can then fine-tune the dosage or change the meds, provide coaching, or respond to changes in your body--an irregular heartbeat, say--that demand immediate attention.

Proteus's IEMs are being tested among patients suffering from cancer, infectious diseases, or mental health disorders. The company offers a bargain that's familiar in the digital world--convenience or extra features in exchange for personal data, in this case about your health. But unlike most such transactions, Thompson argues, this tradeoff could be lifesaving for those with medical conditions. "One of the things that people need to understand," he says, "is that privacy in health care is lethal."