Catalysing the future of health
Digital therapeutics are a novel category of medical interventions that have the potential to disrupt the future of healthcare models
What are digital therapeutics?
Digital therapeutics (DTx) are software-based products for the prevention, management and treatment of health conditions. They are defined by the Digital Therapeutic Alliance as evidence-based therapeutic interventions that are driven by high-quality software programs to prevent, manage or treat a medical disorder or disease. Digital therapeutics are a subcategory of digital medicine products, which in turn are a subset of digital health. A feature of DTx is that they require both clinical evidence and evidence from real-world outcomes. As such, they need to be reviewed and approved by regulatory bodies for claims of safety, risk and efficacy.
Strategic choices for life sciences companies
Life sciences companies have a unique opportunity to invest in digital therapeutics before other non-traditional players.
Will life sciences companies see DTx as an opportunity or a threat?
Traditional life science companies may see digital therapeutics either as a potential threat to their business model or as an opportunity to innovate. On the one hand, digital therapeutics could compete with existing pharmacological treatments for market share. On the other hand, a digital therapeutic offering could play the role of differentiator, as an attractive value proposition for those pharmaceutical companies that have historically been interested in ’beyond the pill’ value delivery.
Traditional pharma and medtech companies have a first-mover advantage to capitalise on the opportunity presented by digital therapeutics, before players in other industries, like technology giants, take over. Benefits for life sciences companies from becoming active in the development of novel digital therapeutics are:
- Improvement in patient health outcomes
- Augmentation of the value of companion drugs/medical devices
- Extension of the drug/medical device life cycle
- Access to real-time clinical information and real-world data
- Personalisation of treatment
- Extension of the therapeutic offering
- Market entry into new therapeutic areas
- Potential for innovation in the product pipeline
- Possibility to explore digitisation of commercial model including field sales force
Strategic choices to take
Life sciences companies have a unique opportunity to structure their strategic approach to enter or consolidate their position in the digital therapeutics space. There are some fundamental questions that biopharma and medtech companies will need to answer. We have formulated these questions around a strategic choice cascade framework.
Strategic choice cascade framework for digital therapeutics
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Our latest report looks at the current state of R&D returns for 15 leading biopharma companies, the impact of the pandemic on R&D pipelines during 2021 and how this has expedited the adoption of digital solutions and impacted the IRR.