While recent news of international product launches and recent M&As might suggest a cutthroat market, new data released this week by Research2Guidance suggest that there is still plenty of room in the digital respiratory health sector for both existing and new market players.
According to “The Global Digital Respiratory Solutions Market 2009-2023” report, roughly 210 million asthma and COPD patients across the globe own a smartphone, tablet or smart watch — many of whom are still untapped by digital health companies developing connected spirometers, coaching apps, software-based clinical tools or other digital offerings.
“We’ve looked at the different segments of the health market, and we think that the combination of lung disease and digital-enabled treatment is a very promising area,” Ralf-Gordan Jahns, cofounder and managing director of Research2Guidance, and one of the reports coauthors, told MobiHealthNews. “We’ll see how the market catches this potential by bringing out best-in-class companion-like digital service offerings, or by learning from the other [markets].”
The report reviewed current market data and those from the past decade to construct two potential growth scenarios for the digital respiratory health, Jahns and coauthor Oleksiy Danilin, a senior analyst at Research2Guidance, explained. The first, a “baseline scenario,” anticipates an expansion of services that will be similar to what was already observed within the digital diabetes industry. This model places the global digital respiratory health market at a total value of $216 million by the end of 2023.
However, a second model works off an assumption that digital health companies in the respiratory space have learned from their peers in other markets, and as a result predicts a total market value as high as $557 million by year-end 2023.
“There are differences today compared to 2012,” Jahns said. “Companies outside of the respiratory market are very much aware of what constitutes a digital service offering and what sort of components are there, [meaning that] there are many, many more best practices that players in the respiratory market can look outside and learn. And on the payer side, we think that the payers are much more advanced in working together with those players. So, this has allowed us to create a scenario that’s much more favorable.”
Jahns and Danilin said that their analysis identified more than 400 digital respiratory offerings on the market. While roughly half of these were recreational apps with few downloads, Danilin highlighted the steady rise of “progressive management apps” released on the Apple and Google storefronts over the past few years, “but they still don’t generate enough downloads either because they don’t create enough benefit for end users.”
While these apps and other connected asthma and COPD devices can look to diabetes or other major digital health markets for guidance, Jahns and Danilin did note one specific roadblock that could stymie market players’ immediate success.
“For diabetes, on average the patients are requested to check [blood sugar] three times a day, so they use a device that is connected to a digital service three times, at least, a day. That’s a benefit for them, so they can read the data that’s in the display, they can see all the patterns,” Jahns said. “In COPD, with the connected devices, … the patient might use them, I don't know, four times a year? Two times a year? They use it and they are connected to the digital layer, and we think that’s a really tough thing to overcome.”
“When you have no necessity of daily use on the device side, you have to create that from the service side. What that means is that [digital respiratory health players] have to enrich their service offering; they can’t just stay at the level where they connect their sensors and spirometers to a digital service offering just for the purpose of display … leveraging on just connectivity won’t be successful in the future.”
Historically, many of the companies now leading digital respiratory health made their entrance by linking connected inhalers, spirometers and other devices with a digital companion service, Jahns and Danilin explained. While this kind of approach is still valid due to the size and needs of the untapped market, the analysts said that they would encourage digital respiratory health hopefuls to consider non-device entrance strategies exclusively focused on providing valuable services to asthma and COPD patients.
“Today, what we see is that players follow this device strategy [of] linking a digital service to a device and generating revenue on the device sales,” Jahns said. “But we also think that by learning from other markets, there’s also a chance for a pure service play market entry strategy, so that you create this companion app and be of such a great value for the patients and the doctors that you are able to generate revenues and be device agnostic. … We think that there’s a lot to gain in this market — there’s still room, and we would urge players to have a look and find out how they can position themselves.”
