By Christina Farr and Malathi Nayak
SAN FRANCISCO, Aug 14 (Reuters) - A group of ex-gaming industry executives say they can use their design chops to solve a major health challenge: Sick patients neglecting to take their medication and costing employers and insurance providers billions of dollars.
Jason Oberfest began thinking about applying game design tricks to complex medical problems in 2011, while at mobile game company ngmoco.
Oberfest built the app to engage users in their health, but he maintained some of the most viral aspects of mobile games, such as gifts, and a feature to see how friends are faring in their treatment. The app also includes a drug database and sends refill alerts to patients.
"Drug adherence may not be sexy, but it's a $300 billion-a-year problem," said Oberfest. An analysis in the Annals of Internal Medicine found that Americans are failing to comply with prescriptions and it is costing the U.S. health system between $100 billion and $289 billion annually. The study found that up to 50 percent of medications for chronic disease are not taken as prescribed.
Mango Health has raised more than $8 million from prominent investors, including Kleiner Perkins partner Bing Gordon and Zynga cofounder Mark Pincus.
From smart pill bottles to smartphone apps, entrepreneurs have been experimenting for years with ways to motivate patients to take their meds.
Vancouver, Canada's Ayogo Health draws tactics from game design by using points as indications of progress. One of its games, "Monster Manor", is targeted to children with diabetes.
Omri Shor, chief executive of MediSafe, an Israeli medication management company, focuses on keeping patients on track by making them accountable to family-members.
Oberfest expects to see a spike in health apps in the wake of Apple Inc announcing its HealthKit service this June.
"No one has cracked the code -- yet," said Carla Brenner, a former consultant for pharma companies such as Eli Lilly and Gilead Sciences. But Brenner said drug companies are optimistic about these new smartphone apps.
"Medication adherence is a big issue for pharma," she said.
For game makers, entering health care means navigating privacy and regulatory requirements, as well as occasionally conflicting demands of payers, providers and pharmaceutical companies.
Moving forward, Oberfest will collaborate with drug makers, but he is "cautious" to take their money. The company is amassing information about health, but claims to meet the standards of the Health Insurance Portability and Accountability Act, meaning that personally identifiable health information isn't shared with a covered entity, like a health provider.
Instead, Oberfest is reaching out to employers and hospitals to potentially sell them custom or premium versions.
But while game-like health apps may work with women, who make up the largest group of mobile gamers, and youth, Skip Fleshman, a health investor at Asset Management Ventures, warned that they may fail to reach a majority of other patients.
"I doubt this would be effective for people who can't afford to take drugs or suffer from side effects," he said. (Reporting by Christina Farr, Malathi Nayak; editing by Andrew Hay)