mHealth is one of the big promises worldwide to reduce costs of healthcare and empower patients. The challenges in mHealth are roughly the same in the EU and US: watch Rock Health’s Halle Tecco’s speech in the Stanford Technology Ventures Program identifies systemic challenges facing healthcare in America and shares examples of companies working to address these opportunities for change. It struck me that the systemic challenges she identifies are remarkably similar between the US and the EU, which means that business models valid for the US can be ported to the EU with relatively few minor changes. As a result, it doesn’t really matter where you start your mHealth company.
Yet, in the EU considerable challenges remain with the regulatory landscape in full flux, as you can see in my recent presentation in the Mobile Medical Apps roadshow at various US universities:
Especially in the EU the mHealth sector faces major regulatory challenges that go beyond mere regulation in flux. These concern regulation that makes business models in mHealth prohibitively complex and are sometimes outright impossible to comply with. I was reading this very innovative blogpost about regulatory barriers to innovation in online services: Regulatory rubble: the confusing (and harmful) message Europe is sending its entrepreneurs. This blog argues that the regulatory situation in Europe has been nothing shy of incredibly confusing – and damaging – for entrepreneurs, despite all the innovation-friendly rhetoric. It struck me how what Roxanne Varza writes about online services in general is also completely applicable in the fledgeling EU mHealth market.
Stuck in the past
Entrepreneurs in the mean time complain about the general innovation climate in Europe, saying that the EU is stuck in the past too much, maintaining rules that make disruptive technology impossible. This was confirmed recently in Brussels at the Informa Medical Devices Revision conference, where companies and authorities alike agreed that current medical devices regulation leads to situations in which companies cannot possibly be compliant and the only solution is to not enforce certain rules. That is no way to provide a reliable basis for companies, large and small. to start business. In situations like this EU commissioners can be positive about the app market all they want, but this positive spin will not work for the mHealth market if they do not work to provide a regulatory framework that can lead to compliant apps in the first place. Yes, you can always mention some successes, but for a structural flow of those we should move from a scenario of EU successes “regardless” of EU regulatory conditions to a scenario of EU successes “because of” EU regulatory conditions. And that is nowhere on the horizon in the mHealth market.
The NO in innovation
I have described the most pressing regulatory issues affecting the mHealth market in more detail in an article in the newest issue of the new journal eHealth Law & Policy, and the publisher has kindly allowed immediate republishing of the article on this blog:
- paper labeling requirements for apps (I kid you not);
- a proposed new definition of medical device that is potentially all over the place by proposing to regulate anything with an “indirect medical purpose” and the Commission dragging its heels for considerable time now with publication of a Green Paper that should clarify this;
- the lack of a centralized EU qualification mechanism to determine for the whole EU if medical software as device or not; and
- data protection rules under development that seem likely to turn out very different every month (while these are crucial to any business model that involves health data)
As I conclude in the eHealth Law and & Policy article: the EU should put its regulation where its mouth is if it wants a viable ecosystem of mHealth app developing companies to develop in Europe. If there is one thing true about mobile health it’s that the companies in that field are mobile. They will pack up and leave to other places if they have to wait for years for the EU to clear its regulatory rubble that puts the NO in innovation, because as investors show: the business model is the same everywhere.