Currently, the drug development process is long and costly. It takes on average 12 years for the FDA to approve the drug and over $350 million to develop each drug, with some drugs costing as high as $5.5B.

The drug development process undergoes the following steps:

1. Researchers and scientists must discover a drug or treatment that is novel.
   
2. The drug then undergoes laboratory and animal testing.
   
3. After the green light from the FDA, the drug undergoes clinical research, which typically includes four phases of human clinical trials. Only 10% of the drugs started in human clinical trials becomes an official drug. 
   
4. FDA finally reviews the drug or device and decides to approve it or not, so it can be on the market. It may take 6-12 months before the drug is approved for prescription. 
   

The Opportunity

With technology, the process can be accelerated and made cheaper with a new category of “drugs” known as digital therapeutics. First established in 2012, digital therapeutics use digital tools to create treatments and programs that complement or replace clinical drugs. These programs typically combine telemedicine, wearables, smart gadgets, cognitive behavioral therapy, AI, and even AR/VR depending on the use case. Leveraging the features of the smartphone, other smart devices, and the benefits of technology, digital therapeutics can address issues that are poorly addressed by the healthcare system today, and deliver cheaper and more valuable outcomes.

So, how exactly is digital therapeutics better?

One word, data.

Smartphones and wearable devices have the power to collect continuous, non-invasive data about the user’s health. Activity count, patterns of texts and calls, heartbeat, and screen time on phone are various data points that can give providers and researchers key insights about a user’s profile outside of the infrequent clinical checkups and visits at the doctor’s. This enables remote patient monitoring and stronger patient engagement.

In treating chronic illness diseases for example, the end user (physician, therapist, coach) can monitor the patient’s activity and steps taken. In treating mental illness such as depression, metrics such as patterns of incoming or outgoing texts and calls and sleep patterns can help the therapist measure the patient’s progress in engaging with daily life activities and having a strong social support group.

Combined with AI and machine learning, digital therapeutics programs can create predictive analytics tools in behavioral change programs for mental illness, chronic illness, and lifestyle habits. Algorithms can collect the user’s data and analyze it to identify and target at-risk populations for particular diseases. In creating habit feedback loop changes, the algorithm can then predict triggers and create effective interventions to help the user change their behavior.

What this means for Key Stakeholders

Digital therapeutics has been key in driving patient engagement, which allows the patient to stick to a regimen and ultimately change their existing behavior. Patients can undergo faster and more targeted treatment programs with the inclusion of digital therapeutics as a tool to complement their treatment. For payors, especially insurance providers and employers that sponsor insurance plans, this leads to a lower cost because digital therapeutics allows sick users to get healthy faster, and identifies individuals at risk for a severe illness to get healthy before they become for example, diabetic, and cost the insurance providers more.

Digital Therapeutics for Chronic Illness

Using digital therapeutics for treating chronic illness is effective as a form of medication augmentation or replacement. Instead of treating individuals only when they are sick, with digital therapeutics, it is possible to identify those at-risk of developing illness, and change their course before their symptoms deteriorate. This would save payors’ costs as well by treating an illness earlier before it progresses to a more cost-heavy serious illness such as diabetes or stroke.  

Most digital therapeutics in this space begin by offering diabetes products. In the US, 86 million people are prediabetic, so there is a huge opportunity for software, either as a medical device or mobile app, to help users in this area. In the US, the Centers for Disease Control and Prevention launched the Diabetes Prevention Program (DPP), which is an initiative that works to prevent or delay Type II Diabetes. Various DPP programs are using technology to create lifestyle interventions that is proven by randomized clinical trials to decrease the incidence of diabetes.

Several startups are working in the preventative chronic illness space

• Omada Health: A behavioral medicine company with its own network of providers, Omada Health creates behavioral change programs for preventing and reducing chronic illness diseases, including type 2 diabetes, stroke, and heart disease. Their flagship product, Prevent, discovered that participants who engaged in regular exercise and diet changes for weight loss also substantially reduced their likelihood of developing diabetes. For participants going through the program, clinical trials showed that on average, participants lost 2.4% of their body weight. The program is currently reimbursed by Centers for Medicare and Medicaid Services (CMS), and the company is already one of the largest provider of diabetes prevention programs in the US, with over 45,000 enrolled patients already.

• Blue Mesa Health: Another diabetes prevention program startup, Blue Mesa Health’s program Transform targets prediabetic users’ existing lifestyle and intervenes to help them change before their symptoms deteriorate to contracting diabetes. The program integrates IoT (a smart scale), a social network for the support group, and a professional health coach, which is proven to boost patient engagement to the program, consequently increasing the likelihood of the user reaching its weight loss goals.

• WellDoc: WellDoc’s Bluestar program enables patients with Type II Diabetes to get healthier. It uses nudges and reminders to increase patient adherence to its tasks and lifestyle behavior changes. Its clinical trial demonstrated that patients reached 1.9% improvement in lowering average blood sugar, compared to 0.7% improvement with usual care.

• Voluntis: A company based in France, Voluntis released two digital therapeutics that addresses diabetes, and is in research to develop solutions regarding oncology and other areas. Its medical device, Insulia, gives patients insulin dose recommendations and has FDA clearance.

Generally, startups focusing in chronic illness use a combination of a smart device (ex. scale) and mobile phone or web app. Using technology, the “program” can send users reminders, nudges, and other interventions to drive change in their behavior, and lead to clinically-validated outcomes.

Some startups tackling mental illness include

• Joyable: A successful digital therapeutic that began with targeting social anxiety disorder specifically, which affects more than 6 million adults in the US. The digital therapeutic combines cognitive behavioral therapy with an individual coach to help the patient achieve the health outcome desired.

• Meru Health: Meru Health is targeted towards individuals needing milder forms of emotional support before being diagnosed with severe depression, especially at workplaces. Its eight week program, Ascend, is proven to decrease users’ symptoms of depression or anxiety by 75%.

There is a lot of potential in the mental illness space for more digital therapeutics tools. Using AI for predictive analytics to effectively intervene in a depressive and anxious episode would be very powerful for quicker and more personalized treatment.

Furthermore, current treatment for depression involves in-person (typically) cognitive behavioral therapy and drugs such as antidepressants that often leads to undesirable side effects or users’ tolerance on the drug. This can make it difficult for the patient to truly “recover” and find ways of coping with the illness outside of his or her reliance on the drug.

We also see many startups adding a remote clinician (licensed therapist) feature on their apps as a standalone feature. This is important in increasing care accountability and patient adherence to the programs as the professional will act on top of the smartphone’s reminders, and increase the frequency of check-ins, communication, and support tools to ensure the patient stays on track.

In a similar vein, there are also startups tackling the problem of substance abuse, particularly smoking cessation and some beginning to look into others such as opioid substance abuse.

Some startups tackling substance abuse include

• Digithera: Digithera is most well-known for its program, QuitGenius. Having undergone two years of research, Digithera determined that only 3% of smokers looking to quit are successful globally due to lack of behavioral support. QuitGenius uses a combination of audio, videos, analyzing to share personalized tips, and gamified challenges.

• Pear Therapeutics: Its popular FDA-cleared program, reSET, is for patients diagnosed with Substance Abuse Disorder. reSET nearly doubled the rate of abstinence for users compared to typical in-person therapy.  

Other areas

• Big Health: Big Health’s Sleepio program is a digital therapeutic for insomnia proven to cure and work effectively. Its solutions use cognitive behavioral therapy and are backed by clinical evidence and research displayed openly on their website.

• Mentia.me: Mentia’s Deva World program uses activities for users with dementia to engage and build meaningful connections.  

Issues with Digital Therapeutics

On the surface, digital therapeutics seem to be great. It can drive cost down for payers, and helps reach national population health goals. So, why aren’t these digital therapeutics more commonplace?

Digital therapeutics must be evidence-based and proven to be useful. Currently, companies typically prove them through conducting randomized clinical trials; however, patients in clinical trials are typically chosen to be specifically interested in the topic, and are rewarded by incentives. Real customers using the product may not have the same drive and engagement. Thus, these therapeutics require a long process of testing and approval from the FDA to prove a legitimate benefit. This is similar to the long timeline needed to develop a clinical drug and bring it to market.

There are also other problems with digital therapeutics, an important one being that there are too many wellness apps on the market. There are over 318,000 health apps on the market, and on average, 200 more apps added each day. It is difficult to discern which apps are proven to achieve tangible outcomes.

In addition, while more data on the patient is beneficial, the digital therapeutic must ensure processing and analyzing this data doesn’t increase clinicians’ time and nuisance. Many startups find it difficult to integrate their large amounts of data from its users’ wearables, apps, and other smart devices with the EMR. The provider must change its existing process to include digital therapeutics’ streams of more data. This may prove more difficult for the provider to integrate, and in the physicians’ view, the benefits may not outweigh the costs.