Some Straight Talk on Digital Therapeutics (DTx) in Health Care

“Digital therapeutics (DTx) deliver medical interventions directly to patients using evidence-based, clinically evaluated software to treat, manage, and prevent a broad spectrum of diseases and disorders.”

The Digital Therapeutics Alliance
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A novel trend coming out of the fast-growing mobile health market, digital therapeutics are software products used to treat medical conditions. These products are designed to enable patients to take greater control over their care, similar to consumer wellness apps but with one key difference: Digital therapeutics focus on delivering clinical outcomes.

Particularly important in the definition above is that digital therapeutics are evidence-based, clinically evaluated software. However, while digital therapeutics are software-based, they are subject to the same regulatory oversight that traditional medicines undergo. This ensures that the product is safe to use, effective as well as has a clinical impact. They can also be prescribed independently or in concert with other medications or treatments to optimize patient outcomes.


First, some basic information on digital therapeutics – DTx products represent a new category of evidenced-based therapeutic technologies that support clinicians in delivering high-quality patient care. They address a range of disease states and provide a wide variety of software-based interventions. As defined by The Digital Therapeutics Alliance, DTx products are used independently or in concert with other medical therapies to:

  • Directly impact disease state measures and clinical outcomes
  • Expand access to safe, confidential, and effective medical treatments
  • Provide therapies for previously un- or undertreated conditions
  • Extend clinicians’ ability to care for patients
  • Maximize patient engagement
  • Close gaps in care
  • Lower overall healthcare costs

Digital therapeutics are not at a conceptual stage but are well within the production and delivery stages. DTx targeting chronic medical and mental conditions have been developed over the past 15 to 20 years. The Digital Therapeutics Alliance even has a product library of DTx. This list can be essential as it helps differentiate DTx that physicians can prescribe from unregulated apps that overpopulate online app stores. The organization says that all products claiming to be digital therapeutic must adhere to these foundational principles:

Image Credit: The Digital Therapeutics Alliance

Where are we today? – Extracting some examples from the product library referenced above gives us a sense of some diseases that can benefit from digital therapeutics.

One such product is Insula, a prescription-only software that assists type 2 diabetics in managing their condition. It recommends patients’ personalized insulin doses as well as acts as a coach in managing their diabetes. A randomized trial conducted in France showed that a precursor to the software helped improve glucose control compared with standard care.

Another example is Kaiku Health. The app supports cancer patients by allowing them to report potential symptoms that they might encounter; subsequently, it shares self-care instructions with them. Through Kaiku Health, patients can also message their care team. Studies have shown that such forms of digital monitoring lead to good patient adherence and satisfaction, as well as save time by reducing in-person visits or even phone consultations.


What are some of the challenges in implementing digital therapeutics?Reimbursement and oversight are two significant areas of concern in health care systems, yet the regulatory landscape surrounding DTx is still in flux. The first question that must be answered is who is responsible for regulating DTx. The second is the relation of DTx to machine learning and whether changes in software or updated machine learning algorithms would require reapproval or new approvals. The Total Product Lifecycle approach currently under consideration by the FDA could address some of these concerns.

System-level challenges of DTx also include cybersecurity. DTx interfaces with, and is reliant on, multiple nonmedical entities, including internet, phone, and cloud storage service providers. There are no global answers to these issues, but patients and clinicians alike will be reluctant to transmit sensitive health data over unsecured channels. Moreover, reimbursement for DTx is moving slowly. Some private insurers pay for DTx as prescribed, but nationwide reimbursement codes remain uncommon.

A yet unexplored problem is adherence to DTx use once prescribed; as large-scale implementation becomes a reality, this issue will need to be appropriately addressed. “App burnout,” a phenomenon referring to the short-term use of apps, may be relevant to DTx as the prescribed length of time (i.e., weeks, months, years) increases.


My take on the future of digital therapeutics – Digital therapeutics are not just a fad. They have the potential to address unmet patient needs that traditional treatments and therapies have been unable to meet. The ability of companies that leverage digital therapeutics to address these gaps, in combination with the much faster product development timelines, could give them a significant advantage over traditional life sciences companies.

“Digital therapeutics are poised to shift medicine’s emphasis from physically dosed treatment regimens to end-to-end disease management based on behavioral change.”

The Digital Therapeutics Alliance

The potential of digital therapeutics has players across multiple industries weighing their options. Technology giants are interested in developing and acquiring digital therapeutics to enter and change the health care landscape. Payers are exploring whether digital therapeutics can deliver better quality of life and outcomes while maintaining or reducing the overall cost of care in specific disease areas while independently analyzing how patient data, which could be collected through such products, can be leveraged to inform coverage. Start-ups are coming up with innovative digital therapeutic ideas to attract investors.

Thus far, the main DTx developments have been delivering already proven treatments via electronic/software means. However, the future of DTx will likely include higher-order constructs and products that address comorbid disorders.

Leveraging DTx to improve mental and physical health is likely to be the biggest, paradigm-shifting change that medicine has known since the invention of antibiotics. However, how to apply these tools remains an area that needs operationalization. DTx is at the nexus of digital innovation and scalability/wide-scale use of digital interventions, with more investment and exciting developments on the horizon.

The Digital Health Formulary: An Idea Whose Time Has Come

“We’re looking to scale our digital therapeutic strategy to align with our clinical strategies. The goal here is proper, appropriate utilization.”

Jeff Johnson, Vice President of Innovation and Clinical Health, Banner Health
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As providers become more comfortable with prescribing connected health services, healthcare organizations are creating their own formularies and giving their doctors a menu of preferred mHealth apps, devices, and solutions. Formularies aren’t new concepts but have been slow to take root because of the crowded and uncertain nature of the mHealth marketplace – often referred to as the “Wild Wild West.” With hundreds of thousands of apps and other products available, it isn’t easy to pick and choose which ones work best (or at all). And healthcare providers don’t have the time or the inclination to do the sorting.

“The next era of healthcare will be defined by digital care that empowers patients while delivering both clinical and financial outcomes.”

Wei-Li Shao, Chief Clinical Officer, Omada Health

As mentioned earlier, in a rapidly evolving market, it is difficult, if not impossible, for health care administrators to keep track of all the digital health apps, devices, and programs available. As of this writing, the estimate is that there are at least 300,000 mobile health apps, and the actual number could be far greater. It’s far more manageable to say, ‘Here are 15, 20, or 30 digital health apps that can simplify contracting, streamline pricing and ease administrative workflow.’ It can give a greater sense of predictability in what insurers and employers can offer members or employees. Hence, the creation of digital health formularies.

Image Credit: IQVIA Institute

Who’s creating digital health formularies today?In my post on Monday, I outlined some examples of organizations that have created digital health formularies like CVS, Express Scripts, and Ochsner Health. In the last several years, we’ve seen several health systems and other organizations move to create their own digital health formularies. I like to segment the space as follows:

Pharmacies and PBMs – I’ve already mentioned CVS and Express Scripts in my earlier post this week. Express Scripts formulary comprises 15 clinically validated digital health programs addressing diabetes, prediabetes, hypertension, asthma, COPD, depression, anxiety, and insomnia. These services, designated as either a preferred or alternative option, come from Livongo, Omada Health, LifeScan (powered by Welldoc), Propeller Health, Learn to Live, and SilverCloud Health.

“We did very little advertising [among our employees] for Livongo when it was launched. Just by offering it through CVS, we immediately got about 25 percent of our eligible population to sign up.”

Noora Garnett, Director of Benefits, Hubbell Inc.

Health Systems – As providers become more comfortable with prescribing connected health services, healthcare organizations are creating their own formularies and giving their doctors a menu of preferred mHealth apps, devices, and solutions. Formularies aren’t new concepts but have been slow to take root because of the crowded and uncertain nature of the mHealth marketplace. Here’s a partial listing of health systems that have developed their own digital health formularies:

  • Ochsner Health – As highlighted in my post earlier this week, Ochsner has been at the forefront of creating a digital health infrastructure.
  • Banner Health – The Phoenix-based, 30-hospital health system is looking to create the infrastructure for a hybrid healthcare strategy that includes a robust remote patient monitoring platform. Working on a platform developed by Xealth, the health system has created a governance strategy that will curate selected digital health products for its providers. The platform will also facilitate RPM programs, particularly as Banner Health looks to push care management into the home for selected populations, such as patients discharged from the hospital after surgery or those with chronic conditions. The more opportunities to connect with patients, the more chances to boost care and affect outcomes.
  • Froedtert & Medical College of Wisconsin Health System – Froedtert has extended the concept of a prescription formulary into the digital health space. One digital health tool it has experience with involves diabetes care. They also have deployed GetWell Loop, a digital care management software that automates patient engagement follow-up care. It is used for different episodes of care, such as joint replacement surgery.
  • Kaiser Permanente – In 2018, Kaiser Permanente began providing patients access to apps by simply signing in to their kp.org account. The organization also trained clinicians on the use of the apps, workflow, documentation, and evidence-based best practices. Following the rapid expansion of the app referral effort earlier this year, clinicians referred 44,000 mental health care patients to the digital tools. More recent data shows app referrals have increased to 115,000, and the number continues to grow.
  • Providence St. Joseph Health – Xealth spun out of Providence St. Joseph Health (PSJH) in 2017. Xealth is a digital health prescribing platform that enables clinicians to easily integrate, prescribe and monitor digital health tools for patients from their EHR workflows. These can include patient education, online third-party apps and programs, device monitoring, and non-clinical services such as rideshares, food delivery and e-commerce product recommendations. Using the Xealth platform, care teams and physicians can monitor patient engagement and analyze the effects of more engaged patients.
  • Mount Sinai Health – The Rx.Health Platform was born out of Mount Sinai Health in New York to address the fragmentation in digital health. The platform supports curation, prescription, monitoring, and improvement of outcomes with over 250 automated care pathways for a variety of service lines from GI to cardiology to oncology.

Commercial payers – Cigna, UnitedHealthcare, Anthem, and Aetna, all have some kind of digital health formulary, most frequently covering behavioral and mental health, diabetes care, cardiovascular care, and other areas. Payers are constantly updating their services segments to include digital health formularies. For example, Evernorth, Cigna Corporation’s health services segment, created their Digital Health Formulary in 2019, which features solutions evaluated and measured by physicians, pharmacists, and health research scientists for clinical effectiveness. User-experience experts also evaluate the solutions to assess usability, scalability, and interoperability.

Independent organizationsORCHA (Organisation for the Review of Care and Health Applications) is an independent organization based in the UK, evaluating and distributing digital health tools by uniting digital health standards and regulations. It provides an unbiased review of various health and care apps. Each app is evaluated against 300+ review measures while assessing clinical assurance, data privacy, and usability & accessibility. (You can watch a short video on how ORCHA’s review engine works here.) ORCHA aims to transform digital health around the world by catering to a) governments and health bodies to deliver national accreditation programs, b) healthcare organizations to safely adopt and embed quality assured health apps, c) healthcare professionals to identify the most effective apps for their patients, d) developers to help them stay abreast of the changing standards and regulations in the digital health space, and e) education by providing digital health activation strategy for public health and local authorities. ORCHA’s services aren’t free, but it includes multiple plans and packages to cater to the needs of its target audience — from government bodies to app library members.


What’s necessary for seeing broader adoption of digital health tools? – The missing element is a coherent regulatory framework to ensure that apps and other digital tools are accurate, useable, and protect patient privacy. The rising use of digital health products over the last few years has led to a patchwork of laws and regulations that have serious weaknesses. The FDA regulates some of these products as medical devices, but most apps meant to be used only for monitoring and recording symptoms — not treating disease — are not regulated. Many other applications are considered low-risk by the FDA and therefore are subject to enforcement discretion, meaning the FDA effectively chooses not to enforce its authority on these devices. As described earlier, this may put users at risk.

Another problem is that the iterative nature of digital health apps does not lend itself to existing regulatory paradigms. Medical knowledge and advice can change rapidly, as we have seen during the Covid-19 pandemic, and applications require frequent updates. But the FDA regulates and approves devices as final products. While it widely permits — and sometimes requires — post-market studies, it does not readily provide for the frequent post-approval updates and modifications needed for software, artificial intelligence algorithms, and clinical recommendations. In addition, some aspects of critical concern to digital health app users, like privacy and usability, are outside the scope of formal FDA review and may not be considered by other agencies or companies in the development or review of these applications.


What’s next for digital formularies in health care? – As evidence grows for digital health tools, the critical barrier historically — reimbursement — is overcome with the recognition that the app, service, or tool can bring value to an episode of care, a bundled payment, an outcome, or a capitated plan member. Business models are emerging to support the adoption of apps. These business models include direct-to-consumer, a medical benefit with “device-like” reimbursement, a pharmacy benefit that deploys “drug-like” reimbursement, and value-based contracting where the app might be paid for on a per member per month basis. Reimbursement is a final frontier. These investments will yield maximum returns across the health/care ecosystem if the data they generate is combined with other data about patients receiving care at home. A key part of the innovation and proof-points must be based on interoperability of the data generated by the digital health tool under consideration and the value it adds to the overall care, treatment, coaching, behavior change, and personalized diagnostics for that patient.