Over the past month, our HealthXL community members discussed new distribution channels for DTx, seeking capital for DTx products and digital health pharma partnerships, among other topics. We’ve put together a snapshot of five expert insights from these meetings.
#1 On alternative distribution channels for DTx: The activation and engagement of patients with DTx is challenging, therefore pharmacies and telehealth platforms could serve as an adoption ‘booster’ to increase product recommendations, as well as product compliance and long-term engagement. Pharmacies could be a great avenue for over the counter (OTC) DTx solutions where there is no prescription required, particularly with drugs that have a companion DTx. However, a pharmacist needs to have the willingness to engage with the therapy, which is challenging at the moment due to the lack of incentives. On the other hand, telehealth platforms seem like a natural fit for DTx solutions as a distribution channel. However, with both of these alternative distribution models the suitability of each depends on the use case - the type of DTx, the country's policy around the role of pharmacies, and how the telehealth platform will be deployed.
#2 On obtaining capital for DTx: Investors need to see clear evidence generation and regulatory strategies. It is important to show that there is a scientific base and market need for the product, but even though showing the data is key, being confident about it is essential. Different types of investors will have different approaches and want to see different things. Companies should therefore adapt their pitch to each investor in order to show them evidence and (likely) commercial outcomes they expect to see.
#3 On generating impactful evidence for DTx: DTx companies should identify the clinical endpoints that will support their commercial model at the beginning. In order to achieve that, it is key to understand what the value is for the different stakeholders/buyers they want to target. For example, if payers are important for the company’s commercial model, they will need to generate evidence that shows the economic value in the relevant patient population. DTx companies can learn from Pharma and MedTech when it comes to economic modeling and early validation of the product potential. It’s important to start using health economics modeling early on, validate the assumptions about the product with medical affairs, and validate the market access and pricing assumptions. This way the digital health company will better align their commercial strategy with their clinical operations efforts from the get go.
#4 On seeking partnerships with pharma: Developing a bidirectional relationship with the pharma partner is key to ensure the digital health company also benefits from the collaboration. Digital Health companies need to be careful to avoid becoming an agency/vendor vs. a DTx company, as the line is very thin when working with pharma. To establish a true partnership, both parties need to be clear on what they want to achieve in the short and long term; sometimes partnerships fail because there was no alignment on the long-term goals, but rather, just a focus on short/mid-term achievements. Digital health companies should make sure to find a long-term partner with a shared long-term vision.
#5 On building a relationship with the FDA: DTx companies should try and have open conversations with the FDA early on. In these conversations, DTx companies should define the purpose of their product and be very specific. For example, if the DTx company has chosen a clinical endpoint that has not previously been validated, they need to provide a justification on why that endpoint is relevant and provide sufficient information to make sure the FDA agrees that these endpoints are appropriate for the clinical study of the product. It may be the case that the FDA doesn't agree with the primary endpoints selected by the company to show the product’s safety and effectiveness. In that case, the best option is to communicate directly with the FDA to understand their thought process and what they are looking for, as it may be possible that they accept the secondary endpoints instead. Therefore, having open conversations and building a relationship with the FDA can be very beneficial in the development of the product.
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