It’s getting harder and more expensive to develop a health app that gets lots of downloads and has a long shelf life, says new research from health research group Research 2 Guidance.

Less than 4% of health app publishers manage to get more than 1 million downloads annually for their app portfolio. Companies in this group mainly publish running, exercise, diabetes, women’s health or weight loss programs, says Research 2 Guidance.

55% of mHealth app publishers report less than 5,000 downloads for their complete app portfolio in one year. There is also a smaller group of companies (15%) who generate midrange download numbers between 50,000 and 250,000 downloads. Top ranked app publishers of chronic condition management or adherence apps are examples of this category, says Research 2 Guidance.

The data also reveals that mHealth app publishers from North America, or companies with large portfolios (more than 10 apps) are more likely to generate higher download numbers than their counterparts.

“Getting significant reach with mobile health apps is still hard – and unlikely,” says Research 2 Guidance.

The cost of developing health apps has significantly risen over the last few years. Currently the average total cost for developing a health app is $425,000 with some top apps costing several million dollars. “Almost half (47%) of total development costs are outsourced to third-party app development agencies or freelancers, translating to costs of $200,000 with 11%, or $47,000, of the total budget is spent on marketing,” says Research 2 Guidance.

Other research findings include:

• About 80% of health app portolios have limited reach while 20% have more successful portfolios.
• 83% of app publishers report less than 10,000 active users.
• 48% of digital health decisionmakers rate partnerships with organizations like American Diabetes Association or The Obesity Society to be the most efficient way to target their customers.
• Only 11% of health app publishers generate more than $1 million per year.
• On average, the time needed to develop a mobile health app is 15 months.

“Health app publishers with higher investments into app developers are more likely to generate higher revenue,” says Research 2 Guidance.

The research included a survey of 2,400 health apps.

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