Clinical health apps outpacing fitness trackers among investors and innovators, study finds
New research determined that health apps and devices with a clinical focus are more likely to grow in popularity this year than consumer-focused products. And that applies to innovators and investors, according to the study by Silicon Valley Bank.
Of the 122 executives and investors in health-tech companies interviewed for the survey, in fact, 45 percent indicated clinically-driven health programs will have the biggest growth sector, compared to just eight percent selecting mobile health apps and seven percent naming wearables.
“Investment trends in digital health are shifting from consumer wellness applications to clinically driven solutions that drive better health outcomes at lower costs,” the report said. “This next wave focuses on encouraging consumers and patients to change health-related behaviors, underscoring the greater opportunities for companies with solutions that create value for payers, providers, employers and consumers.”
The report found that, generally, about 55 percent of all digital health investments since 2011 have been in companies that provide consumer-facing tools. Investors have recently targeted clinically focused startups, however, with the understanding that tools designed to affect patient behavior can generate better health outcomes and cost savings.
In 2015, for instance, there were 60 early stage funding deals in clinical enablement, totaling $600 million, and in 2016, there will be more than 70 deals amounting to more than $850 million. In contrast, for consumer activation involving fitness and wellness, there were 45 deals involving $550 million in 2015 and in 2016 there will be 10 deals at less than $20 million.
Disease management and remote monitoring companies, likewise, are shifting to focus on a specific disease to help patients and providers better manage a particular condition rather than providing general solutions aimed at patients facing multiple conditions, according to the report.
“Now the focus is on digital solutions for disease management,” the report noted. “Going forward, clinically proven software and hardware will be integrated to drive better health outcomes and cost savings.”