DTx Part II: Building Evidence-Based Value Propositions for Digital Therapeutics

In DTx Part I: Identifying Optimal Payment Models for Digital Therapeutics we identified several potential payment models for monetizing the value of DTx. While establishing payment mechanisms is essential for capturing the value of DTx products, value assessment (i.e., creating a clear and differentiated value proposition) and value demonstration (i.e., creating effective evidence development and value communication strategies) are foundational, precursive steps.

Value Assessment

The value proposition of a DTx product should be tied to one or more of a clinical indication’s unmet needs. Because different stakeholders (e.g., regulatory bodies, providers, patients, etc.) view clinical indications through different lenses and may have varied perceived unmet needs, a comprehensive understanding of the overall patient journey and where the unmet needs fall within that journey is crucial. This can be achieved by engaging stakeholders throughout the product development process; involving stakeholders early on will also ensure the clinical relevance and utility of the DTx product. Moreover, the value provided by DTx can generally be categorized as generating clinical, economic, and/or patient experience impact. Subsequent to defining the value proposition, the desired target patient population should be defined based on considerations about their age range, geographic location, and insurance status, amongst other factors.

Value Demonstration

Once the value proposition of a DTx product has been established, DTx companies must set out to demonstrate it to stakeholders via compelling evidence development and value communication strategies. The two principal approaches that can be taken for developing a compelling DTx value story are — 1) the traditional therapeutic evidence approach and 2) an alternative evidence approach.

Traditional Evidence Types

“Traditional” evidence types are those that are tailored towards traditional therapeutics and that are commonly employed by pharmaceutical companies to demonstrate value. The Digital Therapeutics Alliance (DTA) states that in order to establish the safety and efficacy of DTx products, companies must:

• Complete “one or more clinical studies, including an adequately-powered randomized control trial (RCT) in the target patient population”,¹
• “Publish trial results inclusive of clinically-meaningful outcomes in peer-reviewed journals”,¹
• “Collect, analyze, and apply real world evidence and product performance data”¹

Robust studies demonstrating the safety and efficacy of DTx products should be considered table-stakes to all stakeholders.^2,3,4,5 However, cost-effectiveness and/or budget-impact studies can further differentiate DTx products from not only each other but also non-DTx products that may be considered standard of care.

Alternative Evidence Types

“Alternative” evidence types are those that can demonstrate the unique value of DTx products over traditional therapeutics (e.g., highlighting patients’ engagement and/or satisfaction levels in preventing, managing, or treating their condition). Additionally, patient stories, especially those containing direct quotes, could increasingly supplement traditional evidence types in conveying the value of DTx products to stakeholders. However, it is unclear how stakeholders evaluate and weigh patient stories relative to other evidence types with more measurable metrics. Stakeholders are encouraged to provide guidance surrounding how they would like to see patient stories, if at all, in their respective reviews of DTx products. As DTx companies continue to capture the patient voice and highlight the themes of patient empowerment and involvement in their therapeutic journeys, stakeholders will likely increasingly acknowledge the potential of these alternative evidence types for demonstrating the unique value of DTx over traditional therapeutics.¹

Evidence Standards

Evidence standards that were developed to assess the value for traditional therapeutics may not be the most effective pathway for assessing the full value of DTx products. Currently, there is little published guidance establishing evidence expectations for DTx products specifically and how they differ, if at all, from those of traditional therapeutics. However, we believe that guidance for DTx evidence development will become more formalized as the industry matures; there are already promising indicators that stakeholders are beginning to recognize the differentiated value of DTx over their traditional therapeutic counterparts and will likely divulge more detailed DTx-specific evidence expectations and guidance soon.^1,6,7,8  Some examples of these evidence standard development indicators include:

Key Takeaways

• DTx companies must assess and demonstrate value prior to identifying viable payment models for monetizing the value of their products
• Stakeholders expect to see demonstration of value via traditional evidence types (e.g., safety, efficacy, etc.); however, alternative evidence types (e.g., patient engagement, patient satisfaction, patient stories) should also be considered for demonstrating differentiated value from not only other DTx products but also from traditional therapeutics that may be considered standard of care
• Currently, there is little published guidance communicating evidence expectations for DTx products specifically and how they differ, if at all, from those of traditional therapeutics

Boston Healthcare has experience helping DTx companies develop robust value messaging and communication strategies. If you are interested in learning more about how we can help your business, please contact us.

[1] https://dtxalliance.org/wp-content/uploads/2018/09/DTA-Report_DTx-Industry-Foundations.pdf

[2] //https://www.amcp.org/sites/default/files/2019-03/AMCP-Format-V4.pdf

[3] https://www.accessdata.fda.gov/cdrh_docs/reviews/DEN160018.pdf

[4] https://pubmed.ncbi.nlm.nih.gov/18473689-welldoc-mobile-diabetes-management-randomized-controlled-trial-change-in-clinical-and-behavioral-outcomes-and-patient-and-physician-satisfaction/

[5] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3353040/

[6] https://www.fda.gov/medical-devices/digital-health/digital-health-software-precertification-pre-cert-program

[7] https://www.amcp.org/sites/default/files/2019-10/PF-SEPT2019_execsummary%20%28oct15%29.pdf

[8] https://www.express-scripts.com/corporate/articles/digital-health-formulary-announced