Your app will see you now: How digital therapeutics are poised to change healthcare

By Nicole Witowski

In 1994, IBM released the world's first smartphone - the boxy but affectionately named Simon. The phone itself weighed two ounces above a pound. It came pre-loaded with 10 mobile apps, including an address book, calendar, notepad, sketchpad, and world clock. They were generally referred to as features back then.

Mobile apps have come a long way since Simon. Today, with the right app, you can hail a cab, order all the ingredients for dinner, or meet your future spouse. You can even get medical treatment from the palm of your hand.

These apps - called digital therapeutics - claim to help with issues as varied as addiction, diabetes, nightmares, and pain. But what exactly are digital therapeutics, and how is this new category of treatment poised to change healthcare? Let's dive in below.

What are digital therapeutics?

Thousands of mobile health (mhealth) apps claim to improve health, but not all are created equal. Digital therapeutics are a subset of mhealth apps that show clinical evidence or real-world outcomes. They are designed to prevent, treat, or manage a specific disorder or disease.

Digital therapeutics can be used as standalone treatments or work alongside medications and traditional therapy. Many rely on behavioral interventions like cognitive behavioral therapy as part of their treatment. These apps typically have a coaching component, a data tracking component, and an educational component. They are designed to give patients greater control over their care. Because these therapeutic interventions are software, they are often gamified with built-in rewards to encourage adherence.

Get to know the digital therapeutics landscape

Most current and pipeline solutions focus on chronic conditions like diabetes and psychiatric disorders, such as addiction, attention deficit hyperactivity disorder (ADHD), and depression. However, the range of indications addressed by digital therapeutics is rapidly growing. Below, we list the prescription digital therapeutics on the market currently, along with their indications.

Select prescription digital therapeutics by company and therapeutic area

Company	Product Name	Therapeutic Area
Akili Interactive	Endeavor Rx	Attention-deficit/hyperactivity disorder (ADHD)
Amalgam Rx	iSage Rx	Type 2 diabetes
AppliedVR	EaseVRx	Chronic lower back pain
Cognoa	Canvas Dx	Autism spectrum disorder (ASD)
Freespira	Freespira	Post-traumatic stress disorder (PTSD), panic disorder, panic attack
Glooko	Glooko Mobile	Type 2 diabetes
Hydieia	d-nav	Type 2 diabetes
LIVMOR	Halo AF Detection System	Atrial fibrillation
Luminopia	Luminopia One	Amblyopia (decreased eyesight)
Manhana	Parallel	Irritable bowel syndrome (IBS)
Nightware	Nightware	PTSD-driven traumatic nightmares
Pear Therapeutics	Reset	Substance use disorder
Pear Therapeutics	Reset-o	Opioid use disorder
Pear Therapeutics	Somryst	Insomnia
Renovia	leva Pelvic Health System	Urinary incontinence
Sanofi	My Dose Coach	Type 2 diabetes
Theranica	Nerivio	Migraine
Twill	Ensemble	Major depressive disorder (MDD) or generalized anxiety disorder (GAD)
Voluntis	Insulia	Type 2 diabetes
WellDoc	BlueStar	Type 1 and 2 diabetes

Table 1 Definitive Healthcare analysis

Developers seek FDA clearance to add credibility

To set themselves apart, some developers are gaining approval from the FDA for their products through a process designed for medical devices. Regulatory approval undoubtedly lends digital therapeutics credibility and is often a step toward reimbursement. These products are described as software as a medical device (SaMD) by the FDA, although their research and development paths are similar to that of conventional drugs.

Other developers further separate themselves by positioning their products as prescription digital therapeutics, meaning a doctor must prescribe these apps as they would a drug. In 2017, Pear Therapeutics landed the first FDA approval for a prescription digital therapeutic with claims to treat substance use disorders. Since then, various digital therapeutics have been cleared through the FDA's 510(K) pathway.

Paving the payment pathway for digital therapeutics

A cornerstone for the scalability of digital therapeutics is their ability to generate reimbursements from payors. The pace of payor adoption is slow but accelerating.

For example, Pear Therapeutics has partnerships with state Medicaid programs in Massachusetts and Oklahoma to cover its products for treating substance and opioid use disorders. Pear also partners with self-funded employers and health systems such as Northwell Health to offer access to its apps, by either listing on a formulary as a covered benefit or selling products in bulk.

In a significant step towards possible widespread coverage, CMS established a new set of HCPCS codes that makes it easier for payors to bill for prescription digital therapeutics as a medical benefit. Previously, they were primarily reimbursed as pharmacy benefits. The new codes went into effect on April 1, 2022.

And recently, Highmark became the first large commercial insurer to show its intent to pay for medical claims for the use of FDA-approved digital therapeutics when prescribed by a clinician. The payor's new policy names eight products, including those from Akili Interactive, Pear Therapeutics, and Nightware, among others.

Providers hold the key to patient access

While progress has been made in terms of regulatory clarity and reimbursement, the last barrier to adoption sits with patients and providers. In 2021, Pear Therapeutics reported 14,000 prescriptions for its three commercial products for insomnia, opioid use disorder, and substance use disorders - a little over half of which were fulfilled. To highlight the opportunity in the space, more than 38 million U.S. adults - or about 15% of Americans - had a substance use disorder in 2020.

Given the role physicians play in influencing uptake, the physician is central to the adoption of digital therapeutics. Even when a prescription is not required by regulation, providers have the power to impact patient acceptance and adherence. Educating providers on these new treatment options with reliable and accurate information on both clinical outcomes and cost-effectiveness will be important to achieving broader market acceptance.

Learn more

Digital therapeutics are poised to be influential in the way healthcare is delivered and consumed. But they need to get into the hands of patients to have a beneficial impact on patient care. Healthcare commercial intelligence can provide you with the necessary market context to have informed conversations with your prospects. Sign up for a free trial to learn how you can use Definitive Healthcare to create new paths to success.

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