What are digital therapeutics?
According to the Digital Therapeutics Alliance, digital therapeutics “deliver evidence-based therapeutic interventions to patients that are driven by high quality software programs to prevent, manage, or treat a medical disorder or disease. They are used independently or in concert with medications, devices, or other therapies to optimize patient care and health outcomes.”
Currently, more than 300,000 health applications are available in the market, though there is no official screening process required for these applications before launch. Although most of these tools are accessible to all people, applications requiring a physician prescription are expected to grow in the future. There have been talks of establishing accountability for these products to improve their validation as well.
Express Scripts’ digital formulary creates a path for prescription apps to enter the market
Express Scripts had unveiled the release of a stand-alone digital health formulary, which intends to help guide payers to ensure safety, efficacy, and usability of digital health technology tools. The formulary, which would include both technology- and software-enabled applications, will be curated by physicians, pharmacists, and other experts. These applications will be evaluated on clinical outcomes, therapeutic value, usability, security, privacy, and cost effectiveness. The digital formulary will help payers make informed decisions on which digital health tools to provide to members.
Being introduced in 2020, The ESI digital health formulary resembles a regular drug formulary in the sense that solutions are placed on preferred and alternative tiers. The PBM has released the first COHORT to include 15 digital health programs in the formulary. First to be included in the formulary are solutions from Livongo, Omada, LifeScan, Propeller Health and Learn to Live and SilverCloud Health. These companies provide digital health solutions through mobile or app-based solutions and digital Cognitive Behavioral therapies for prevention and management of diabetes, hypertension, chronic respiratory conditions and certain mental health conditions.
Categorized based on indications, the formulary prefers Livongo Health across diabetes and hypertension. Livongo Health offers personalized coaching to patients in real-time through its digital platform. Omada Health’s digital solutions have the alternative tier status to Livongo. Express Scripts expects the digital formulary to create a route for next-generation prescription-only digital health tools seeking to enter the market. However, due to the breadth of the services being offered, Express Scripts could face challenges in appropriately categorizing these applications.
The future of coverage for digital therapeutics
Challenges for Express Scripts in creating a DT formulary include:
- Choosing trusted digital health partners from a plethora of contenders with little evidence of clinical effectiveness
- With expected double-digit growth in the global digital health market, payers will have to invest time and money in a methodology that can screen these applications for efficacy
Advantages for Express Scripts include:
- Tech savvy consumers are plentiful and are developing an appetite for digital offerings
- Patients could be incentivized to use solutions from the formulary
- Value-based models could be used to prefer certain applications and tie reimbursement to outcomes
- Guidance on the value and usability of applications to ease the decision-making process for consumers
- Encourages patients to take greater control of their care
- Lays the groundwork to create and manage new tools
ESI has taken the first step toward formalizing a list of applications that help payers navigate the murky waters of a fast-growing mobile health market. CVS Caremark has also supported digital health products through a new vendor benefit management program that focuses on management of third-party health products, including digital therapeutics. Going forward, other PBMs could follow ESI’s lead as payers see the benefits in reimbursement and patient data collection through digital therapeutics. ESI’s movement has also created market access opportunities for tech companies looking to enter the healthcare industry. Pharma could also collaborate with technology companies to improve product life cycles and advertise drugs on a new medium. However, the collaboration between Sandoz and Pear Therapeutics to launch their prescription app ended in October 2019. Therefore, involvement beyond smaller collaborations by pharma may not materialize in the near future.