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December 09, 2018

mhealth innovation and business

Many successful digital platforms are based on facilitated user networks, where the same people buy and sell and deliver and receive things to and from each other e.g. eBay. This is a business model that can deliver quality health care at a low cost for behaviour-dependent long term conditions [1]. Examples include dLife, Mumsnet and Patients Like Me These platforms incorporate online social networking but are also integrated with established health care [2]. These platforms also use established business model for sustainability, selling advertising opportunities or the data they collect from users. Venture capital enables many companies with innovative digital platforms to move into the market. Companies may establish service delivery and gain user data through working with employer organisations and run a charitable arm to allow reach into low resource settings. What are the other alternatives for sustainability that keep the ownership of the digital platform with innovators and users? For example, where individuals provide their data can they become part of the business – like a shareholder? Can a user fee be pitched low enough to encourage use by users from low socio-economic backgrounds? Can a payment be crowd-funding rather than a purchase? A small fee may increase user engagement with the platform.

In low and middle income countries private sector initiatives provide low cost, high quality health care where the public sector has failed to deliver[3]. Those which do not rely on donations and grants focus on delivery of specific treatments such as cataract or heart surgery [3] where they can achieve high volume for low cost [1]. What are the business models which would make digital health platforms sustainable in this context? Digital infrastructure is usually in place and platforms in other domains such as money transfers are sustainable. Where potential users of health care in low and middle income countries do not feel empowered to claim any health care that is available and don’t perceive the need for preventive health such as ‘check ups’ the business model needs to change non-users into users [4].

Academic spin-off companies with innovative technology for improving health often fail because of mismatch between technology design and business model[5]. Innovative business models can enable innovative technology to become established [1] but the process of stakeholder interaction about technology design and its value proposition leads to development of a business model that is often not innovative with (often negative) consequences for the spin-off [5]. How are value propositions aligned to allow for successful launch of innovations?

Written by Frances Griffiths 9th December 2018

1. Hwang J, Christensen CMJHA: Disruptive innovation in health care delivery: a framework for business-model innovation. 2008, 27:1329-1335.
2. Griffiths F, Dobermann T, Cave JA, Thorogood M, Johnson S, Salamatian K, Olive G, Francis X, Goudge J: The impact of online social networks on health and health systems: a scoping review and case studies. Policy and Internet 2015.
3. Bhattacharyya O, Khor S, McGahan A, Dunne D, Daar AS, Singer PAJHRP, Systems: Innovative health service delivery models in low and middle income countries-what can we learn from the private sector? 2010, 8:24.
4. Pels J, Kidd TAJIJoP, Marketing H: Business model innovation: Learning from a high-tech-low-fee medical healthcare model for the BOP. 2015, 9:200-218.
5. Lehoux P, Daudelin G, Williams-Jones B, Denis J-L, Longo CJRP: How do business model and health technology design influence each other? Insights from a longitudinal case study of three academic spin-offs. 2014, 43:1025-1038.

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