Assessing the market access landscape for Prescription Digital Therapeutics - a long way to go

The global Covid-19 pandemic highlighted the need for and application of digital health innovations, including digital therapeutics. One type of digital therapeutic is Prescription Digital Therapeutic (PDT). PDTs are evidence-based software designed to treat a medical disease or disorder which requires a prescription from a qualified health professional (QHP).

PDTs are relatively new to the market – awareness, acceptance, and adoption are on a slow rise. The first PDT to be approved by the FDA came in 2017, with Pear Therapeutic’s novel product reSET indicated for patients with substance abuse. Since that first approval in 2017, there have been an estimated ~35-40 products approved for marketization by the FDA, though the FDA still lacks a clearly stated definition for Prescription Digital Therapeutics.

Many public and commercial payers are skeptical about the value and efficacy of these products. According to a survey conducted by Pear Therapeutics, in Oct 2021, the adoption rate is only at 40 percent among the minority of payers who have familiarity with PDTs. Discussions are underway on whether PDTs should be reimbursed, and under which type of benefit (pharmacy or medical benefit). Very little has been done in terms of standardized procedures to get them reimbursed, e.g., reimbursement codes and amounts. Manufacturers of PDTs have their work cut out to launch and then make sure these products are appropriately reimbursed by payers and adopted by healthcare providers and patients.

We analyzed the PDTs currently on the market and in development, current reimbursement metrics and processes, current CMS policy proposals, and what the immediate future holds from an access and adoption perspective. To achieve this, we conducted secondary desktop research using publicly available information, company websites, governmental and advocacy groups, and payers within the digital therapeutics space. We also looked at information pertaining to stakeholder opinions- of where they believe the industry is currently, thoughts around current and future development of PDTs, and to define current legislation and practices surrounding PDTs based on the latest available evidence.

Our research revealed that there is a lot left to be desired.

• Currently, PDTs are not reimbursed by CMS due to a non-existing benefit category. This has stalled adoption throughout the industry, as most commercial payers do not reimburse PDTs- even if they have a digital formulary- and Medicaid defers to specific, state-by-state benefit programs.
• There is language limiting to when/if healthcare providers may be reimbursed for their involvement when interacting with and prescribing PDTs. There is a proposal - Access to Prescription Digital Therapeutics Act of 2022 (S. 3791/H.R 7051) – that will establish a CMS benefit category for PDTs and broaden the language surrounding provider reimbursement.
• AMCP and CMS have voiced their support and urge for PDT-related legislation. This legislation may help to alleviate current coverage/reimbursement hurdles and limitations, so that we can focus on getting PDTs to those who need them the most.

A standardized methodology, that appeases manufacturers, patients, providers, and payers, needs to be developed to ensure PDT manufacturers continue to develop innovative pipelines of products that take advantage of their unique digital components. While the Access to Prescription Digital Therapeutics Act of 2022 (S. 3791/H.R 7051) has the potential to provide an initial framework for reimbursement for currently available PDTs, continued patient access to these products will most likely require PDTs to negotiate in value or outcomes-based agreements in the foreseeable future. These agreements will allow PDT manufacturers to take advantage of their cloud-based nature, which will allow for efficient real-world evidence collection to further prove their efficacy and economic impact, with the goal to achieve favorable reimbursement and coverage decisions for their current/future products.

Reach out to us to access an in-depth report of the analysis.

References:

1. Most Payers Are Unfamiliar with Prescription Digital Therapeutics
   https://healthpayerintelligence.com/news/most-payers-are-unfamiliar-with-prescription-digital-therapeutics
2. COVID-19 Accelerated Use of Digital Therapeutics, but Coverage Issues and Regulatory Questions Could Slow Their Momentum
   https://morningconsult.com/2021/06/15/digital-therapeutics-use-coverage-polling/
3. Pear Therapeutics Announces Publication of Real-World Data Showing High Rates of Engagement, Retention and Abstinence with reSET®
   https://www.businesswire.com/news/home/20221024005254/en/Pear-Therapeutics-Announces-Publication-of-Real-World-Data-Showing-High-Rates-of-Engagement-Retention-and-Abstinence-with-reSET%C2%AE

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