The Rise and Fall of Happtique, mHealth’s First App Prescribing Platform

12-15-2013 4-51-25 PM

Today Happtique announces that it has been acquired by Las Vegas, NV-based digital health company SocialWellth for an undisclosed amount. Happtique launched in 2010 and for a period was a big name in the mHealth space, though it never actually managed to accomplish anything meaningful for the industry. Happtique launched as a spinoff from the Greater New York Hospital Association, and had financial backing from GNYHA Ventures, the for-profit investment arm of the Greater New York Hospital Association. In 2010, the mHealth app market was unregulated and there was growing consensus that something had to be done about the ridiculous medical claims being made by some app developers. It was not at all uncommon to hear people charge mHealth app developers with being snake oil salesmen.

While many took these complaints directly to the FDA, the government did not issue regulatory guidance on the mHealth market until late 2013. In the interim, Happtique launched with the goal of developing a rigorous certification program for mHealth apps that would convey to potential users that it was a safe and legitimate app. The company’s monetization strategy involved building a library of clinically-vetted apps, and then sell access to this library to health systems so that providers could “prescribe” mHealth apps to support disease management, improve medication adherence, and help patients make healthy lifestyle changes.

The idea struck a chord within the industry, and the launch and subsequent ramp-up of Happtique was closely followed by digital health media outlets. For its first few years, Happtique worked to develop and test its app certification program. It looked to the industry for input, and in March 2013 published its final certification standards. Two months later, turmoil was brewing between then CEO Ben Chodor and Happtique’s parent company GNYHA Ventures. The company had just spent three years developing a certification program and now that it was ready, app developers were not lining up to apply for certification in the volumes that they’d hoped for. The spat led to Chodor’s resignation, and GNYHA executive Lee Periman taking over the company.

For the rest of 2013, Happtique was quiet, purportedly working with app developers to certify mHealth apps and build out its app library. What we know now is that for whatever reason, perhaps the $3,000 certification fee, mHealth app developers had little interest in pursuing Happtique certification. In December 2013, after three years of work and nine months since it started taking certifiation applications, the company triumphantly unveiled its first batch of certified apps. The list was immediately disappointing. There were only 19 apps in the library, most were from questionable and largely unknown app developers, and many were nothing more than fitness apps, like “Amazing Abs,” an actual Happtique certified app. There were very few apps focused on supporting actual medical treatments or managing diseases. For a company that spent three years trying to separate snake oil apps from legitimate medical apps, the final list looked no different than the unregulated app store.

The apps on Happtique’s list were subject to immediate scrutiny. Within two weeks several of the apps were hacked, and consumer data was exposed in an attempt to expose Happtique’s certification process as inadequate. Happtique had assured consumers that security was independently tested and verified as part of the certification process, so the news was embarrassing for them and just two weeks after launching, they shut down the app library.

Since then, Happtique has gone quiet, until today’s announcement that it had been acquired. SocialWellth should be a good fit for Happtique. SocialWellth offers a number of white-label products to payers and health systems, one of which is a curated list of clinically-vetted mHealth apps.

Aside from Happtique’s failed launch, the company may have just been before its time. In 2010, doctors had very little interest in prescribing apps. Today even, there is very little interest in prescribing apps. However, there is a growing interest in allowing patients to contribute fitness data to their medical records, and the infrastructure to securely move that data from apps to EHRs is in place thanks to Apple, Google, and Samsung’s recent health initiatives. It is conceivable that in a few more years, if health and fitness data does begin to flow from apps to medical records, doctors and health systems will see the value in having a library of clinically-vetted apps that they could “prescribe” to their patients.

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