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Mobile Health App Revenue Perks Up


Despite regulatory and reimbursement questions, big opportunities remain for health-related apps. It's expected that revenue from mHealth apps will build strongly in the U.S. and even in Africa and Southeast Asia.

This article published with permission from The Burrill Report.

Mobile health app revenue rose to $718 million in 2011 as smartphone sales and developers doubled the number of health-related apps in the market, says a new report from research2guidance.

“In 2011 we saw the quality of the solutions has increased quite dramatically,” says Ralf-Gordon Jahns, research director at research2guidance.

The rise of sensor-based applications capable of monitoring things like blood pressure, temperature, and blood glucose levels has raised the level of sophistication in the market, he says.

The market’s model has also evolved. Once built mostly on paid downloads, it is now moving toward being tied to consumer-purchased hardware paired with free apps or paid medical monitoring and analysis services, says Jahns.

Despite growing recognition of the value provided by smartphone-based mobile health apps, don’t expect hospitals and insurers to pick up the tab any time soon. Patients remain motivated enough by the convenience of mobile health apps today that they’re willing to pay for products themselves.

“How long that will last is hard to predict,” says Jahns. “One day or another, health insurers will see the benefits and then they will start paying for those solutions and then things will change. But that could take five years or more.”

Jahns is less optimistic about regulation of the mobile health applications industry

“I talk to quite a few players in the market and they tell me that regulators say, ‘You have to find out what is possible in the market and what is not.’” he says. “They’re not going to push having a framework of what’s allowed and what is not. They’ll do it case by case.”

During the next three years, research2guidance expects that revenue from mHealth applications will continue to build strongly in the United States due largely to the sheer size and growth of the country’s smartphone market. But the unique character of non-Western markets may make them more likely harbingers of the future of the mobile health market.

Africa’s sheer number of mobile devices and scarcity of fixed-internet connections are likely to drive innovative and life saving uses of mobile health applications. Already, African nations boast the highest percentage of mobile phone-based disease surveillance programs among those surveyed by the World Health Organization (WHO).

Southeast Asia, where WHO found the highest proportion of member states initiatives geared to providing health information to mobile devices at the point-of-care, may also drive the creation of innovative mobile health apps. Because of the size of countries such as India, with its strong IT industry but limited number of doctors serving vast rural areas, we could see tremendous growth there, says Jahns.

Copyright 2012 Burrill & Company. For more life sciences news and information, visit http://www.burrillreport.com.

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