It’s too soon to say, definitively, whether digital medicine will be disruptive or adjunctive for drug developers or even the entire healthcare system. Even the business models are in flux. What is known, however, is that billions of dollars of deals involving digital medicine were signed in 2016, and that big pharma gradually is becoming involved.
To succeed, digital health solutions must solve a problem, speakers at Digital Medicine Showcase emphasized. Unlike the genome revolution, which gave access to data never before available, digital health solutions bring together existing technologies in new ways to help entities—pharmas, providers, patients and payers—do things better.
“Pharmas are looking beyond the pill to harness data to understand outcomes and control their story,” says Julia Belaya, director of corporate partnerships, healthcare innovation at Plug and Play. “Pharma is getting its feet wet.”
For example, pharma can use digital technologies to leverage new approaches to existing tasks, like recruiting for clinical trials, as well as to gain fresh insights into outcomes in real-world settings and develop digital therapies to augment or possibly replace certain drug therapies. Embracing digital health solutions could generate a new pipeline of products that, like companion diagnostics, may supplement existing therapeutics, but that can be developed faster and easier than pharmaceuticals.
“There’s an interesting convergence of traditional and non-traditional healthcare players,” Eric Elenko, exeutive VP, science and technology at PureTech, says. “Tech companies like Apple and Alphabet are working with pharmas to design digital strategies.”
Any projects are in their early days, though. “Whoever pays drives the technology, and we don’t see solutions being deployed,” Ulrich Mühlner, founder and managing director, GrowthCube Partners, points out. He predicts that pharmas’ won’t have a strong role in digital health.
Follow the cash
The big question for any company considering a digital solution is how that approach will help it make money. Start by understanding how the various healthcare parties are incentivized, advises Aaron Nelson, general partner at dRX Capital. “Learn to take advantage of that.”
The products most likely to succeed are those that scientifically demonstrate real value. While consumer markets could be bent to the will of consumers—the taxi industry’s grudging acceptance of Uber is one example—healthcare has too much at stake to embrace risky approaches.
Catherine Wood, founder and CEO, ARK Investment Management, LLC, challenges that notion. “We’re wasting more than half of our healthcare dollars today, so where’s the risk?!” She sees great opportunities to bring efficiencies to the overall healthcare system, from drug developer to patient and payer.
Nelson cites Science 37 as one example of an efficiency-boosting technology. This startup is decentralizing clinical trials by replacing dozens or hundreds of trial sites with one metasite, essentially bringing trials to patients’ homes. This approach claims to streamline recruitment, reduce recruitment costs and increase patient retention. “Clinical trials management is a USD 40 billion industry. Science 37 threatens it,” he says. That sort of disruption is rare, but possible in the healthcare ecosystem.
In contrast, PureTech favors digital solutions that integrate with mainstream medicine. For example, “Akili is developing software to improve cognition for ADHD and as a screening or biomarker product that would be prescribed by doctors,” Elenko says. “That will be a true digital therapeutic.”
Digital health is transitioning
Digital health companies are transitioning from what Nelson calls Digital Health 1.0 to Digital Health 2.0. The difference is that version 1.0 is agog with the potential, and version 2.0 is moving it forward. “We’re excited about the more intimate marriage of those who understand healthcare markets and those who understand technology,” Nelson says. That combination will result in more sophisticated business models as well as better products. Traditionally, he says, technology designed by healthcare providers—like electronic health records— has a cumbersome user interface when compared to consumer apps.
“In the public markets,” Wood says, “the search is on to find the next Google, to take the guesswork out of healthcare.” Those investors are looking internationally. As regulations thwart technology leaders, those innovators are going offshore. “The UK, particularly after Brexit, wants to dominate innovation in financial and health services.”
Validation: Nice, but not necessary
Succeeding in the digital health market doesn’t require product validation, but it does require good science. “You can have scientifically sound, thoughtfully developed programs that are not regulated as long as they provide real value to stakeholders,” Nelson says.
Regulatory approval may serve as a gate, however, to help prescribers cut through the noise to choose solutions that offer a clear, evidence-based value proposition. To put the problem in perspective, Elenko says there are more than 150,000 health apps already available. “Most are unused.”
Whether pharma will boldly embrace the plethora of emerging digital tools is debatable. Nonetheless, Nelson predicts, “Ultimately, pharma will happily consume digital health as a set of tools to help it do what is does best—to demonstrate the value of a drug.” That assumes, of course, that it has visionaries to lead the charge.