Unlocking the value in the DTx
Digital therapeutics (DTx) have been long promised. From 2020 onwards we saw a burst of investment into this area – global VC funding in DTx has increased x4 since 2017, to $1.2B in 2022. Quite an impressive number; in fact, the combined enterprise value of DTx start-ups has grown x8, totalling at $31B. Despite the staggering numerical value on DTx, 2022 proved underwhelming for non-numerical value to materialize. Our industry, up to this point, has failed in adapting business plans that tangibly incorporate the opportunity of DTx to positively impact the crisis patients are facing globally – be it through chronic care backlogs, remote healthcare services, or delayed diagnoses. So, I am challenging you – be a leader in 2023; put your money where your mouth is and create action-orientated plans that truly unlock the potential value of DTx and create better standards care for patients globally.
2022 highlighted the clear need for an established reimbursement and access model to enable the adoption of DTx. Currently, Germany, France and the UK are European frontrunners providing the blueprint for what DTx reimbursement schemes can look like. Great – but we still have a huge mountain to climb, and right now, many markets have the wrong gear in their backpack. 2022 proved we need real-world evidence (RWE) – reimbursement prices are significantly impacted once RWE has been considered and a balanced economic assessment is made, making approval easier. But this begs the question – what comes first, the chicken [RWE] or the egg [reimbursement]? Right now, neither. We’re at a cross-roads; 2023 is a crucial year where we will need balance the speed of ambition with the arduous clinical validation to prepare for market entry, secure large-scale adoption and generate what is needed to prove real patient impact – RWE.
Activation and adoption of DTx has been murky this year – in large part due to the challenges in access. But, in 2023, we’re likely to see a shift in perceptions of DTx from siloed digital health solutions to collaborations which create valued integrative therapies, particularly within chronic care, oncology and mental health. We’ve seen examples of this as Novartis partnered with Anumana which use AI to detect ventricular dysfunction in cardiology. Older than this, UCB and Nile partnered, showcasing the potential in collaboration as they joined forces to create an epilepsy care management platform to optimize paths to treatment. During 2023 we will see more of this; DTx moving towards a positioning of digitally-enabled therapies that do not need to be end-solutions in and of themselves, but those that are used in a collaborative manner with traditional medical interventions. Let 2023 be the year of partnership so we can create true value and re-define what optimal patient outcomes look like.