Digital therapeutics gaining traction in the market

Digital health funding

Digital health funding has grown exponentially over the last few years and fuelled significant investment. Payers, healthcare professionals (HCPs) and patients recognise the positive impact these digital tools can have either standalone or in conjunction with therapeutic intervention. For instance, earlier last month Pfizer and Sidekick Health launched a new dermatitis app aimed at improving medication management of patients with skin diseases and Akili partnered with Robolox expanding children’s access to EndeavorRx, a novel ADHD digital therapy.

Greater harmonisation will increase market access

Changes in reimbursement and coverage in the US and Europe during the COVID 19 pandemic have accelerated the adoption of DTx and the Digital Therapeutic Alliance (DTA) recently published guidance to help DTx manufacturers navigate the complex pricing and reimbursement (P&R) environment.

“The guide is a conversation starter and provides some degree of harmonisation regarding scientific rigour, and data governance,” Megan Coder, chief policy officer at DTA, told pharmaphorum. “It shows how far the industry has come regarding patient centricity and usability and helps DTx manufacturers to engage in discussions with payers to enable the right patient access, at scale.”

Currently, each country has its own criteria for P&R assessment of DTx and reimbursement drivers vary across continents (Table 1). Pierre Leurent, founder and CEO of Voluntis and president of digital health at Aptar Pharma notes that “the [DTA] guidance is a valuable tool for engaging dialogue with payers about the reimbursement framework and for sharing methodologies that impact reimbursement criteria. It will help to ‘connect the dots’ between different stakeholders and facilitate the emergence of common frameworks.”

Table 1: P&R assessment criteria Germany, UK, France, and the USA

Requirements Germany UK France USA
Regulatory approval or CE mark
Clinical effectiveness
Cost-effectiveness/budget impact X
Data protection
Generation of real-world-evidence (RWE)

√ - mandatory; ≈ - nice to have; X - not required

Source: Danve et al., 2021

Europe is leading the way in DTx access

Many argue that Europe is leading the way in DTx. Germany has introduced a DTx-specific P&R framework for digital health applications (DiGA) and has evaluated 33 products since it was introduced in 2019.

“Germany has adopted a national level of access for DTx but one important lesson learned is clinicians need to be involved much earlier in the decision-making process,” Coder said. “France is rolling out their framework and I imagine they will take Germany’s and Belgium’s learnings into consideration; alliances are working to see how we can improve the DTx framework moving forward.”

France is due to release details of its DTx framework later this month and other European countries including Italy and Spain are expected to follow suit before the year end.

“There are examples where DTx’ have been reimbursed but we need to work to get it more mainstream,” Leurent said. “We should not just think about the DTx reimbursement but also reimbursement of the healthcare professionals that prescribe them, to ensure DTx are adopted.”

US legislation encouraging the adoption of new digital technologies

In the US, the Centers for Medicare and Medicaid Services (CMS) have yet to develop specific guidance for DTx reimbursement.

“CMS is looking at HCPCs codes and there is a movement to get Medicare to design a new benefit category for DTx with appropriate coding,” Coder said. “This will provide more consistency in the future, but for now reimbursement in the US is based on individual contracting.”

As part of its National Drug Control Strategy report, the Biden Administration is encouraging the adoption of new digital therapeutics reimbursement strategies in both the public and private sector.

“Coverage for the provision of motivational incentives could be considered within health plans,” highlights the report. “This will require considering billing codes and setting reimbursement parameters.”

Senators Shelley Moore Capito and Jeanne Shaheen are pushing to introduce the Access to Prescription Digital Therapeutics Act of 2022 which would establish separate benefit categories for DTx and create a coverage and reimbursement framework with product-specific codes.

According to Pierre Leurent, “pricing and reimbursement frameworks are emerging but they are still not harmonised. Payers and regulators are facilitating the introduction of DTx but there is still a long way to go.”

In the meantime, several health plans such as CVS Health, Express Scripts, and Kaiser Permanente have established digital formularies and others are following suit. Recent market research suggests that consumers want access to DTx and are increasingly likely to choose medical providers that offer digital capabilities over those that don’t.

The DTx reimbursement model is evolving

The DTx reimbursement model is evolving and as the market matures. DTx developers are migrating from an online business-to-business-to-consumer (B2B2C) towards value-based contracts, more attuned to the pharma model. According to Pierre Leurent,

“There is no one single reimbursement approach that manufacturers are using today,” Leurent said. “It depends on the product and disease area, and requires a careful assessment of the reimbursement pathways in each country. Some companies have worked with existing frameworks to establish reimbursement like medical devices and national codes.”

For the full benefit of DTx to be realised, DTx manufacturers will need to work closely with other stakeholders – government, public and private payers and providers – to help streamline the P&R processes, drive access and reduce barriers to adoption.

“Digital therapeutics need to be integrated with healthcare at a mass market level to allow patients access to therapies, whether it’s medical, digital, pharmaceutical, or any combination of these therapies,” Coder said. “We are heading in the right direction and the DTA guide is one component that will get the conversation started regarding the value of DTx.”

About the author

cherylDr Cheryl L Barton is director of PharmaVision,

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Dr Cheryl L Barton