By Harry Wang
According to Parks Associates estimates, about two-thirds of the American population is either overweight or obese. Additionally, 26 million Americans suffer from type I or type II diabetes, almost 14 million have severe chronic respiratory problems such as COPD, and 68 million have been diagnosed with hypertension.
These chronic health problems degrade consumers' quality of life and add significant cost burdens to the U.S. economy. However, modern wearable technologies have opened the door for consumers to better understand and monitor their personal health. Connected weight scales, blood pressure meters (BPMs), and glucometers--the top three home health monitoring device categories--represent an accelerating market where consumers benefit from the data these devices provide.
The glucometer market has seen many innovations in recent years. Because diabetes is a high-cost, high-incidence chronic disease, health insurers usually reimburse for the cost of glucometer and test strips/lancets. Previously, four brands--Johnson & Johnson, Bayer, Roche, and Abbott--dominated the glucometer and test strip market with a collective 80 percent of market shares.
However, the wide profit margin on glucose test strips has lured new entrants into this multi-billion dollar industry. These new players offer innovations that make the glucose testing experience either more affordable or more convenient. Walmart, Target, and Kroger all have introduced their respective store-brand glucometers and test strips, undercutting branded products by more than 50 percent.
Other innovators focus on more portable form factors and more intelligent software features. For instance, traditional glucose testing requires a diabetic patient to carry three items--a meter, one bottle for lancets and one for test strips--and involves up to 10 steps to complete the task. Intuity Medical's POGO Automatic System adopts an all-in-one meter design with an embedded cartridge that integrates both strips and lancets, condensing the process to a single step.
On the software side, many meter makers realize that knowledge of glucose data alone is not enough for patients to effectively keep their blood glucose in a safe range; diabetic patients need a care management solution to turn data into insights that guide their daily care tasks. This recognition is also motivated by reimbursement policy changes implemented first by the Centers for Medicare & Medicaid Services in 2013 and quickly followed by private health insurers. Since 2013, the diabetic management solution market has come to life with a bevy of startups and a string of M&A/venture funding and partnership announcements, such as Livongo Health's $20 million funding led by Kleiner Perkins Caufield & Byers, and WellDoc's integration partnership with Samsung Health.
While the diabetic care monitoring market is experiencing both hardware and software-driven innovations, the weight scale and BPM market benefits from a larger addressable market, respectively. Collectively, the weight scale and BPM categories registered about 21 million unit sales in the U.S. in 2014, but connected models--those with built-in Wi-Fi, Bluetooth, or ANT+--account for a small proportion of those sales. In total, connected weight scales and BPMs reached 4.6 million unit sales in the U.S. in 2014, an impressive 48 percent year-over-year growth.
Weight scales, BPMs, and glucometers may be the low-hanging fruits in the home health monitoring sensor market, but this market is welcoming new categories, as well. Players from existing categories that traditionally target the care professional market are now entering the consumer/retail market. Though adoption for these devices is generally low (less than 1 percent), new home-based use cases have emerged: pulse oximeters for blood oxygen monitoring, ECG monitors for heart health tracking, spirometers for lung function, fetal monitors for pregnant women and sleep diagnostic machines.
Parks Associates projects that five of these categories--weight scales, blood pressure monitors, glucometers, pulse oximeters, and insulin pumps--will collectively generate nearly 17 million connected unit sales in 2019.
The wearables market for health and wellness is on the cusp of a significant stride forward. This is due to modern technologies that provide the means to collect and manage health and wellness data in a more convenient and automated fashion. An increasing number of U.S. consumers are beginning to adopt healthy lifestyles to combat and proactively prevent chronic health problems, and connected wearable devices serve to help improve traditional wellness and care. As consumer interest in wearables continues to increase, adoption will increase for wearable technologies that focus on areas critical to specific health and wellness needs.
Harry Wang serves as director of health and mobile product research at Parks Associates.