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Business models for prescribed apps

Senior Director, Social Media

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The talk of mobile medical apps that can be used by prescription, and even compensated on benefits plans, has been around for over a year as a serious possibility. This week, WellDoc has released Bluestar, it’s diabetes treatment that happens to be an App. This Rx-only app is being made available to employees of some of the larger Fortune 500 companies if they have diabetes. The app is added to their prescription benefits plan for patients who get a prescription.


Image from MobiHealthNews

This news highlights the progress being made by different players as they race to become the dominant model for prescribed apps. The risk for WellDoc is that they are playing in an environment where free is the price of choice, and $4.99 is considered extremely expensive. The fact that they reportedly get $100 per month per patient puts them outside of the normal app ecosystems of Apple and Google.

There are three business models that we have seen so far, and these models have different strengths and weaknesses:

Prescribed apps with limited access

WellDoc works in this model, when a patient is prescribed the app a WellDoc clinician needs to perform the install for them because it is not available in the app store. Now, WellDoc doesn’t call it an app, they call it “mobile integrated therapy” and the big difference for this app is that it’s in the same database that allows physicians to prescribe drugs which makes it possible for EHRs to support it and insurers to pay for it.

The injection of apps into the traditional drug therapy process makes the app compatible with all existing processes and technologies. This is a big advantage in the short term in that WellDoc can play in the same space as the drug therapies.

Because they are positioning the app as a prescription therapy, they have generated a number of clinical papers published in peer-reviewed journals:

Traditional apps with protected HCP functionality

An app that makes no bones about what it is has to be Sway Balance. This app is used to measure balance using a smartphone’s motion sensors. The prescription element is the use of “in-app purchase” where physicians can buy an annual access for $199.

Currently, the app is being promoted to screen for concussions. Other potential uses of the app is to assess:

In this case the tool is more of an in-clinic tool rather than a prescribed health app that is used by the patient themselves. There is nothing to stop app developers from creating more of these apps where the patient can download and install it and the physician can unlock it so that the prescription functionality is available to the patient.

Curation platform over public apps

The current leader in health app curation is now HealthTap’s AppRx, taking over from Happtique as they seem to be exiting the market. AppRx is a tool that allows HealthTap’s claimed population of 40,000 physician to review apps from both Apple’s App Store and Google’s Play Store. The reviews are planned to be available to non-physician users.

There is the potential that physicians could issue the prescription for a “wrapper” app such as HealthTap to get access to the free, or almost free, app that was created without Rx in mind.

The advantage of this model is that there are 40,000+ health apps on the market already so there is a healthy population of potential apps to be prescribed for almost every condition.

Lack of clinical proof barrier to prescription

When physicians really start to look at apps as a target for prescriptions they will begin to apply the same scrutiny that they do for drugs. This scrutiny will be against two aspects of the apps:

Potential benefit

The first thing that physicians will want to see are clinical studies that prove a therapeutic outcome of using the app they are considering prescribing. If an app has the goal of helping a diabetic control their glucose then any physician will need to see study data proving this benefit before they will be willing to require their patient use it. Vague promises may work for consumers, but they won’t fly for physicians.

For this reason, the WellDoc model of fitting into the existing drug and medtech industry structure has a good chance of succeeding, but the question will be whether the high investment needed to get through the clinical studies can be paid back from higher app prices in market.

Potential risk

Physicians do not want to put their patients at risk unnecessarily so any studies must also include the traditional risks and fair balance / important safety information for the apps. For example, if a diet app miscalculates calories or is used incorrectly and under-reports to the user the outcome could actually be weight gain rather than loss. Physicians will want to see evidence that the app they are prescribing has a track record of safety.

The next year should see the three business models continue to battle it out for dominance in the nascent prescribable app space. We’ll be sure to stay on top of it and report back on everything we find.

More About the Author

Brad Einarsen

Brad is Klick's Senior Director leading the social practice. His group ensures that clients get the best bang for their buck on the social platforms.

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