They are undisputedly the stars of the digital health scene right now – apps in the area of preventive health care. Especially in Germany, they have received a lot of attention from the public over the past few months. This is primarily due to the new Digital Health Care Act (DVG), which paved the way for digital health applications to be reimbursed by health insurers. Until March 2020, 11 apps have completed the certification process and can be prescribed by doctors all over the country.
They have been met with a highly positive response from patients. A representative study by Statista from July 2020 revealed that 59 percent of respondents could well imagine using a medically prescribed application(1). In line with this, a survey of 18 participating health insurances shows that only three months after the start of statutory reimbursement, more than 3,000 digital health applications (DiGA) have already been prescribed by doctors(2). All of this suggests optimal conditions for providers in a rapidly growing market – and further studies reinforce that there is an immense opportunity. Global consulting company Roland Berger estimated the global revenue potential for digital health applications at 979 billion EUR by 2025, 57 billion of which will be generated in Germany (by comparison: the European Union will account for 232 billion euros)(3). Insight Partners predicts a worldwide potential of 203.62 billion for mobile health alone by 2025(4). Let's briefly recall where we're coming from: In 2017, revenue in this segment was 18.73 billion EUR worldwide.
Only the apps that offer the most value to the user will win
Will this mean endless market opportunities for existing and new players? Unfortunately, it is not quite as straightforward. More likely, it can be presumed that the market will consolidate to just a few apps over the next two to three years. This assumption is based on the fact that only a few different apps will be prescribed for each medical indication. Therefore, the best – in other words, the most effective – apps that can deliver the most significant value will prevail. Many digital health interventions exist in the form of "app content." Here a trend toward "the winner takes it all" can be expected, as can already be observed in the meditation apps market. Particularly the applications Calm and Headspace have maintained substantial market share in this field.
The structure of a digital health solution can essentially be broken down into a few main components:
- Anamnesis/Onboarding.
- Interpretation of anamnesis and (in some cases) complementation of such through additional data recorded within the app.
- Interventions in the form of content.
- (In few cases) continuous data points recorded within the app in order to individualize programs and review the user's progress.
The biggest challenge for digital health applications will be to demonstrate that their content provides significant value for users – more value than the competitors' apps. Solely referring to successfully completed clinical studies will no longer suffice as a unique selling point, neither towards consumers nor towards health insurances. The latter is especially true for the German context – certified digital health applications (DiGA) directly enter into price negotiations with the National Association of Statutory Health Insurance Funds (GKV-SV). Arguably, digital health applications can provide the most value if they are able to interpret each user's unique characteristics and offer individually tailored interventions. However, this requires a sound understanding of relevant vital data and biomarkers; in order to individualize offerings, relevant data points like such must be analyzed on an ongoing basis (see app components 2 and 4 as mentioned above). Many digital health applications are currently exploring technical functionalities to realize this, yet most providers are still in the early stages of implementing respective functionalities. Nevertheless, it can be expected that a general trend towards precision medicine will prevail.
Conclusion: vital data and biomarkers will be necessary to succeed
Digital health providers who want to establish themselves on the market in the medium and long term must offer effective solutions. Effectiveness can be achieved in a transparent manner if relevant vital data and biomarkers are continuously observed. The capture and evaluation of this data help to individualize the solutions and has the great potential to allow patients to accompany the progress of their therapy at any time on the basis of quantitative evidence. From a psychological point of view, science has shown that a better understanding of one's own status quo and progress helps users stay on track longer. Additionally, continuous generation of quantitative evidence showing the positive effect of digital health applications will also promote the public's confidence in them in the long term.
So, where does this leave app developers? A significant step will be integrating the measurement and analysis of relevant vital data and biomarkers. Cardiovascular vital data, for instance, could provide considerable added value to a range of applications. Remarkably the scientifically proven biomarker "heart rate variability" (HRV), reflecting the physical stress on the autonomous nervous system, has immense potential. The range of use cases for HRV is very diverse and extends from mental health, pregnancy, and nutrition/obesity to cardiovascular diseases, chronic diseases, and telemedicine platforms.
Moreover, (health) insurance companies are likely to be interested in a "vital data building block" for their own and third-party solutions as a quality indicator. Appropriate software development kits (SDKs) are already available on the market, enabling such measurement and analysis functions to be integrated into the developer's app without the need for additional wearables. Without question, digital preventive healthcare is about to leap to a new, groundbreaking level. This next-level will likely only be reached by solutions that can record and interpret relevant vital data and biomarkers and use them to control their therapeutic success.
Sources:
(1) Statista, Umfrage zur Nutzung von Gesundheits-App in Deutschland 2020
(2) www.digital-ratgeber.de "Das sind die erfolgreichsten Gesundheitsapps auf Rezept"
(3) Statista, Umsatz auf dem Markt für Digital-Health in Deutschland und weltweit bis zum Jahr 2025
(4) Statista, Weltweiter Umsatz mit Mobile Health (mHealth) in den Jahren von 2017 bis 2025
Matthias Puls is the managing director of the health-tech startup Kenkou. In addition to a stress management app, which is reimbursed by a range of German health insurances, Kenkou provides digital health applications with an utterly integrable software package for recording cardiovascular vital data via smartphone camera. Matthias Puls is also the editor of the book "Digital Business Models in Healthcare, " published in April 2020.
