May 06, 2021
By Soumya Vishwanath, PharmD, University of Massachusetts Medical School
The next wave of patient care is upon us: digital therapeutics (DTx)–evidence-based, clinically evaluated software products that treat, manage, and prevent diseases.1 The Food and Drug Administration (FDA) estimated that 325,000 health care applications were available in 2017, resulting in approximately 3.7 billion mobile health application downloads over one year worldwide.2 With the global DTx market expected to grow between $6 and $9 billion by 2025, many major pharmaceutical companies have created in-house digital health teams or teamed up with digital health manufacturers to consider how DTx products can be integrated into disease management and provide an alternative form of therapeutic intervention for patients.2-5
A subset of digital health, DTx delivers therapeutic interventions directly to patients via different domains (eg, virtual reality technologies, mobile applications, and artificial intelligence-powered assistants). Unlike digital health, DTx products require clinical evidence and clearance by regulatory bodies, such as the FDA. Most DTx products on the market are mobile applications and/or wearable devices for various indications, including major depressive disorder, insomnia, and substance use disorder. With an increasing number of DTx products available, it’s essential to assess how these products may play a role in clinical therapy and evaluate their impact on key stakeholders.1
Digital Therapeutics’ Impact on Stakeholders
Key stakeholders in the DTx landscape include patients, providers, payors such as health insurance companies, and product developers, including DTx companies and pharmaceutical manufacturers.
As the primary end-users, patients are at the core of the DTx landscape. Most therapies are delivered via patients’ smartphones or tablets, increasing access to care compared to traditional therapies and lowering stigma by offering privacy. Additionally, with therapies available in multiple languages, DTx products have the potential to address health inequities, especially for underserved populations.1
Some DTx products may require a prescription from a provider. In this instance, providers will work with manufacturers to prescribe and orient the patient in utilizing the therapy. Both the patient and the provider can track the patient’s progress and view critical insights and outcomes. Real-time data allows the provider to assess the patient’s progress and incorporate any changes to the DTx or traditional therapies prescribed.1 Furthermore, aggregate data detailing progress among a population can provide important insight on the impact of DTx and its place in disease management.
As a result of a continued rise in digital health products, multiple large pharmacy benefit managers (PBMs) have launched exclusive digital health formularies with preferred and alternative products for various disease states. Some PBMs have incorporated DTx products as well.7-9 Surveys note that most payors–44 to 56 percent–are interested in covering DTx products; however, only 22 to 31 percent currently do.5 With a rise in PBMs launching digital health formularies and an increase in interest from payors, it’s predicted that DTx products will soon be integrated into formularies, thus increasing patient access. Covering DTx products can provide payors insight into disease management, aid in reducing overall costs, and open further collaborative opportunities with providers and manufacturers.
With increased funding and interest from multiple stakeholders, the DTx landscape is expected to grow exponentially in the next five to 10 years, creating ample opportunities for portfolio expansion and potential mergers and acquisitions between pharmaceutical manufacturers and DTx companies.5 Additionally, adopting DTx products allows for increased collaboration and can open the door to alternative reimbursement strategies between pharmaceutical companies and payors.
Embracing the Wave of Digital Therapeutics
DTx products have the potential to provide significant health benefits and increase access to patient care. They also allow for increased collaborative opportunities among manufacturers, payors, and providers to create innovative solutions in advancing patient care. As the wave of digital therapeutics continues to flood medicine, all stakeholders must start to educate themselves about the products and implement methods to embrace an alternative therapeutic approach in patient care.
This article was written and originally posted by the Clinical Pharmacy Services team (CPS) of Commonwealth Medicine, the consulting division of UMass Medical School. CPS pharmacy experts leverage their in-depth knowledge of medical and pharmacy analytics, policy, and pharmacy benefit constraints to generate customizable solutions for their clients’ pharmacy benefit programs, providing clinical integrity, independence, and transparency. CPS programs include budget impact forecasting, drug utilization review, prescriber outreach and education, call center services, and drug formulary and prior authorization criteria. Click here to learn more about Commonwealth Medicine Clinical Pharmacy Services.
- Digital Therapeutics Alliance. Understanding DTx: A New Category of Medicine [webpage on the internet]. Arlington (VA): Digital Therapeutics Alliance; 2021 [cited 2021 Mar 23]. Available from: https://dtxalliance.org/understanding-dtx/.
- Business Insider Report. Digital Therapeutics Report: Latest DTx market trends and companies in growing digital health sector [webpage on the internet]. New York (NY): Business Insider Report; 2020 [cited 2021 Mar 23]. Available from: https://www.businessinsider.com/digital-therapeutics-report.
- Research and Markets. Global Digital Therapeutics Market (2020-2025) By Application, Product and Sales Channel and Geography and the Impact of Covid-19 with Ansoff Analysis [webpage on the internet]. Dublin (Ireland): Research and Markets; 2020 [cited 2021 Mar 23]. Available from: https://www.researchandmarkets.com/reports/5137778/global-digital-therap....
- Ernst & Young. Digital therapeutics are redefining the digital health market [webpage on the internet]. New York (NY): Ernst & Young; 2021 [cited 2021 Mar 23]. Available from: https://www.ey.com/en_us/health/digital-therapeutics-are-redefining-digi....
- BioPharmaDive. Pharma, late to digital game, rushes to catch up [webpage on the internet]. Washington DC (USA): BioPharmaDive; 2019 [cited 2021 Mar 23]. Available from: https://www.biopharmadive.com/news/pharma-late-to-digital-game-rushes-to....
- Food and Drug Administration. Device Software Functions Including Mobile Medical Applications [webpage on the internet]. Silver Spring (MD): Food and Drug Administration; 2019 [cited 2021 Mar 23]. Available from: https://www.fda.gov/medical-devices/digital-health-center-excellence/dev....
- Express Scripts. Evernorth Digital Health Formulary [webpage on the internet]. St. Louis(MO): Express Scripts; 2020 [cited 2021 Mar 23]. Available from: https://my.express-scripts.com/digital-health-formulary.html.
- CVS. Point Solutions Management [webpage on the internet]. Woonsocket (RI): CVS; 2020 [cited Mar 23]. Available from: https://payorsolutions.cvshealth.com/point-solutions-management.
- Parcher B, Coder M. Decision makers need an approach to determine digital therapeutic product quality, access, and appropriate use. J Manag Care Spec Pharm, 2021 Apr;27(4):536-538.