Some Health Apps Seem To Be Getting Very, Very Expensive!

They would sure want to make a real positive difference – and fast!

Here is an article discussing some of the newer ones!

Would you pay $1500 a month for a health app?

By David Swan

September 29, 2024 — 5.00am

A cohort of buzzy digital health start-ups is jostling for a piece of the nation’s lucrative healthcare market but are facing questions over their strategies, pricing and efficacy, with some charging nearly $1500 a month before they’ve publicly launched.

The preventative health sector has taken flight over the past 12 months, spurred by high-profile American figures like Andrew Huberman, Joe Rogan and Dr Peter Attia, who espouse the benefits of “biohacking” and the use of technology to help become “superhuman”.

The excitement surrounding so-called health super apps has now spread to Australia. A crop of start-ups is winning millions of dollars in venture capital funding as they race to onboard local users, promising comprehensive diagnostic testing, coaching, and performance optimisation.

Some consumers have reported early positive results from the highly personalised, data-focused apps. But medical groups, including the Royal Australian College of General Practitioners, are concerned that several of the platforms offer few health benefits and may, in fact, be causing harm.

In some cases, customers are paying a hefty premium for a product not yet ready for public launch. One health app, Compound, was charging users $995 a month (or $1495 with medication) – more than 10 times the cost of a typical gym membership – before it hit pause on its operations last week.

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Compound is the men’s longevity arm of telehealth provider Eucalyptus. Last year, it was valued at $520 million and has received financial backing from venture capital firms Blackbird and AirTree, which declined to comment for this piece. More than 4000 Australian men had registered their expression of interest in its all-in-one men’s health app, which encompasses diagnostics, nutrition, and training.

This month, Compound suspended operations, however, informing its customers via email that the platform required an overhaul. Its executives and engineers are now rebuilding it from scratch.

Eucalyptus chief Tim Doyle said that the issues stemmed from scaling up what was a very labour-intensive, manual offering.

“Scaling this has been really hard. It’s a concierge service. Really fundamentally, our members get feedback on how they’re doing their gym routines and workouts at a granular level,” Doyle said.

“They might say ‘hey I’m struggling with a sore shoulder, and I’m travelling for a week, how should I modify my gym routine?’ – and that is not an easy thing to scale.

“The best care is very human and manual, and that is hard to scale and expensive to scale, so we need to find a way to do that.”

Compound’s program architect, Dan Cable, wrote in an email to customers that it had been a “challenging launch period” for the start-up.

“We are extremely grateful that you joined Compound so early while much of our offering was still a prototype,” the email said.

“There’s a tension between launching early and delivering a high bar with a very manual experience while also rebuilding the underlying op-model, so we’ve decided to pause operations by the end of the year so that we can set up for relaunch in H2 2025.”

That tension between taking the time to deliver a reliable product and not missing the boat is not unique to Compound and is persistent throughout the health app sector.

Another Australian app, Bright, said it had sold more than 2500 “early access” passes to users globally, half of whom are based in the US. Described as the “last health app you need”, it connects meal logging, sleep tracking, heart monitoring and more into one subscription. Bright is charging $99.99 for its early access pass, which gives users lifetime access, and it will cost $299.99 a year at public launch.

Described as the “last health app you need”, the Bright app connects meal logging, sleep tracking, heart monitoring and more into one subscription.

Bright was slated to debut in the App Store this month, but founder and chief Bryan Jordan said it would now come in October after a few more weeks of “adding some final polish.”

“Bright is a super app for health for everybody that’s affordably priced,” Jordan said. “First impressions count on the App Store, and if we want to be the ‘last health app’ then we have a high bar to cross at the start.

“We’ve mostly self-financed the $3.5 million we’ve brought in because we haven’t been satisfied with terms made by venture capitalist investors ... Self-financing means our development has been slower than we’d like as we ran a software agency in parallel and reinvested the $1 million in profit to develop Bright.

“‘Moving fast and breaking things’ is appropriate if you’re first to market, but if you’re last to the party, then we need to make sure the party only starts when we arrive.”

In what is already shaping up as a highly competitive space, Jordan said he remained sceptical of the business model of the likes of Compound, given how expensive its subscription is.

“I’ve yet to hear from independent doctors, surgeons or specialists advocating for consumers to spend $1000 per month to monitor their health, and I’ve yet to read any supporting literature from reputable medical journals,” he said.

“I find it surprising that with these programs, there isn’t a discussion on the consequences of ‘too much medicine’... Following the science and not the trend has always brought better patient outcomes.”

Doyle responded that Compound’s $1000 monthly price tag could be attributed to its extensive diet planning and exercise regimes.

“People do spend $1000 per month on those things,” he said, adding that once Compound scales up, it would more likely cost about $200 a month without medication.

“If we can build it for the first 10,000 people over the next year, then for a million people after that, I think the cost of delivering the service is going to come down as AI agents and [large language models] play a greater role. I see this as something we can scale to millions of patients over the next five years.”

Another high-profile player is Everlab, which has received $3 million in venture capital funding from European fund b2 Ventures, as well as local funds Ten13, Flying Fox, and AfterWork Ventures.

Everlab’s business model is an annual subscription of $250 a month, or $3000 a year, for its “preventative health membership”, billed upfront. The company also takes a deposit of $299 to experience the program before committing.

The start-up said it had worked with 300 customers to date. It pairs customers with doctors, consolidates the customer’s historical health data, and then uses AI models to assist clinicians with a diagnosis.

Everlab chief Marc Hermann said the combination of rising chronic disease rates alongside an ageing population was placing immense pressure on the healthcare system.

Hermann said where Compound had largely marketed to young men who could be described as “tech bros” interested in optimising their performance, Everlab’s focus had been on targeting ordinary middle-aged individuals.

”Most of our customers are middle-aged working professionals,” Hermann said. “This is a demographic that has seen friends and family struggle with their health. They’ve heard about friends having sudden heart attacks or receiving an unexpected cancer diagnosis. Or they’ve simply seen their parents grow old and their quality of life diminish.

“For this customer, there are many things we can do to intervene and course correct.”

One Everlab customer, Andrew, is 61 and a former managing partner of a consulting firm. He says he started the Everlab program six months ago, and it found disproportionately high levels of visceral fat. This led to recommendations including a personalised diet plan with calculated protein intake for body size and a sleep assessment.

“I now have someone who collects and analyses all my existing and future health data. From the analysis has flowed a set of additional tests that have led to a range of positive outcomes.” Andrew said.

While the race to build Australia’s “health app of the future” continues apace, Michael Clements, vice president of the Royal Australian College of General Practitioners, warns of several concerns.

The apps could provide false reassurance. If patients have made bad health choices and an app tells them they’re OK, it could lead to a false sense of security. He also warned of “incidentaloma,” a medical term in which patients find something they weren’t looking for in the first place, often leading to unnecessary testing and treatment.

“There certainly has been harm where people have had complications from surgeries or complications from biopsies and procedures looking at things that were never even being looked for in the first place,” Clements said.

“We actually already know what makes healthy people. We know that keeping physically active, keeping outdoors, keeping engaged with people and humans and social interaction, having a balanced diet heavy in vegetables, fibre and nutrients, these are what work.

“The evidence is clear that people get their best health care from a GP that knows them and that the longer you have a relationship with a GP, the longer you do live. And these businesses really do need to be accountable for the risk of harm that they’re giving to their patients.”

Here is the link:

https://www.smh.com.au/technology/would-you-pay-1500-a-month-for-a-health-app-20240926-p5kdr7.html

I wonder if the price here is being set at such a level that you would not follow all the advice for fear of financial loss?

I am sure many would find the cost a motivating factor for use once they had paid!

What do you think would be a fair maximum for an app subscription?

David.