Therapeutics has a wide range of products and services that are used in the medical treatment and remediation of a diagnosed health problem. Traditional therapeutics are a part of the analog process, even though these treatments can be safe and effective it can also be difficult to customize to specific needs of the patients, also difficult to gauge outcomes in real time.
Emerging digital therapeutics (DTx) works on software and data which consists of products and services to provide health treatments. It represents a completely new approach for treatments and supplements. This new approach helps to minimize the gap with traditional therapeutics by providing data driven treatments that are scalable and monitored in real time, able to provide more patient-centric approach to healthcare. DTx treatments are also evidence based, clinically validated and regulated. These are distinct from diagnostic and telehealth products; however, they have similar features such as ability to integrate with mobile health applications, electronic prescribing systems, medical records and biometric devices.
DTx are attracting significant venture capital investments and are expected for several companies to be developing DTx to grow at a rapid pace.
Investments in this space have increased from about $124.3 million across 22 deals in 2015, to $1.2 billion across 52 deals in 2019. In August 2020 $709.7 million was seen invested across 32 DTx deals. The global DTx market is expected to reach $6.9 billion by 2025, currently valued at $2.1B.
DTx concentrates on all 3 groups in the health industry:
a). Healthcare providers and health systems
b). Public and Private partners
c). Patients and Caregivers
Big Technology Potential to Enter Market:
With large sets of data gathering and analytical capabilities the big tech firms are increasing the possibilities of entering the HealthTech markets and to develop distinct healthcare infrastructure. As we can see in the current era, we have many technically developed devices which have inbuilt healthcare apps, platforms and services to help patients monitor their health and keep a track on their health, also communicate with their care team. For example we have Apple watch developed by apple, Amazon has acquired many healthcare startups and partnered with JP Morgan and Berkshire Hathaway to create Haven healthcare, the ability for their Alexa to diagnose health problems. With the current progress it is more likely for these tech firms to partner with or acquire DTx startups in the coming future.
Key Opportunities for DTx Products:
User experience and satisfaction plays a major role in digital therapies as they tend to fall short compared to other digital products such as traditional mobile apps. As Dtx products are point solutions used only during the patient’s healthcare journey, providers should include more options and to integrate the data with other products used by the patient. A positive user experience is important for consumer engagement and improves adoption among physicians and payers. There has been some research on adopting gamification as a prescription treatment, FDA approved Alkili’s video game-based ADHD DTx EndeavorRx in June 2020 making it the first game-based Dtx.
By adopting to better strategies to integrate DTx products into existing physician workflows, it is expected physicians to willing adopt to DTx. With early engagement with the hospitals and clinicians may have an edge in the market for close cooperation with distribution partners to ensure a more seamless integration with clinical management systems.
There have been around 80% spending deals on healthcare for chronic health issues in which a very significant proportion can be address with cognitive-behavioral therapy. DTx products could present a compelling solution with potential large market opportunity given the costs associated with chronic health issues.
DTx products can be very helpful in cases where high level of patient monitoring is required, for example a therapist cannot be with the patient at all hours of the day but a digital therapeutic can monitor using the product developed by Mindable to help patients overcome anxiety. Its application supports the therapy process by combining scientifically proven method with user experiences based on cognitive-behavioral therapy.
The presence of technologically advanced countries and big firms along with influx of new startups in the Dtx space. The market is growing rapidly. We at Bridge Point Capital believe with the awareness and understanding of digital therapeutics for patience healthcare is expected to significantly influence healthcare delivery and consumption across the globe. With advanced technology there will be changes on electronic devices such as mobile phones, tablets and watches which are regularly used by patients introducing different levels of services and apps from which the patients’ healthcare can be monitored. Although the efforts of DTx companies, stakeholders, and regulators are still in the preliminary stage, growing R&D investment will undoubtedly show the enormous potential impact of DTx very soon.