Digital therapeutics: a growing market
The year is 2008 and Apple have just added a new category to their AppStore: “Medical”. Within months, some of the first healthcare apps are becoming available to download, including Epocrates®, a platform for healthcare professionals to connect with their patients remotely, and Johnson & Johnson’s OneTouch®, which allows diabetes patients to check their blood sugar via a Bluetooth-enabled glucose monitor.1
A little over ten years later, and digital health is a multi-billion industry with over 350,000 health, fitness, and medical apps available (as of 2020).2 The fact is, digital therapeutics, including healthcare apps, are no longer an ‘outsider’, or a new phenomenon, but an established part of modern-day medicine. In markets with universal healthcare coverage, this raises the question: “who should pay?”.
In the UK, a mix of funding models currently exists, including patient out-of-pocket payments, and local and national funding. In this article we will explore who is picking up the bill for digital therapeutics used within the National Health Service (NHS), and whether this is expected to change as the use of these technologies continues to grow.
There are several funding models in the UK
The private market
There is a sizable private market for digital therapeutics, particularly healthcare apps, in the UK, and there are certainly benefits to a private launch for the manufacturer. Private launches can be quicker without the need for pricing or procurement discussions, and manufacturers do not need to meet the Digital Health Technology Assessment Criteria if they are not seeking NHS England endorsement.3
As these will not be delivered via prescription, manufacturers can market apps directly to patients,4 but uptake may still be low without physician recommendations. Further to this, as patients are the payer in this case, willingness-to-pay can also be a significant barrier. For manufacturers looking for a deeper reach into the UK therapeutic landscape, a different approach might be sought.
Local and regional reimbursement
NHS funding and recommendation can ensure digital therapeutics become part of standard clinical practice in the UK, in a way which could be less possible for those on the private market. However, geographical variation is common, as funding, and funding decisions, are still mostly made at a local or regional level by local commissioning bodies (formerly Clinical Commissioning Groups (CCGs), now Integrated Care Systems (ICS)).5
Local funding can be a barrier to consistent and uniform availability, and adoption, of digital therapeutics. Even with the introduction of the ICS, which consolidated 135 CCGs into 42 ICS,5 patient access to certain technologies is somewhat a postcode lottery. Not only can this be burdensome to manufacturers – costing resource, time, and money (in the form of incentivising discounts) to get their products to patients – this can lead to inequality in patient care.
Centralised funding for these technologies remains rare. There are national funding models in place for ‘Med Tech’, but up until recently this has focused solely on traditional medical devices. One example is the Innovation and Technology Funding Payment (ITP), a programme that provided national reimbursement, with a single national price, for certain devices. No digital therapeutics were considered, although the partnering Evidence Generation Fund (EGF) supported apps targeted towards crisis mental health assessments.6
The ITP ran until 31st March 2021, after which the Med Tech Funding Mandate (MTFM) was introduced. The 2021/2022 Mandate only supported specific devices previously funded by the ITP, but from April 2022 new technologies can be considered, potentially including apps and other digital therapeutics. To be included, technologies need NICE support, to be cost saving over three years, and to have a budget impact that does not exceed £20 million in any of the first three years.7
NICE support for Med Tech can be given through Med Tech briefings and guidance. While this does not guarantee MTFM funding, there are still benefits to the manufacturer. NICE support demonstrates to local payers (e.g., ICS or hospital decision makers) that the technology has met the rigorous clinical and health economic evidence thresholds expected by the institute.8 In May 2022, SleepioTM – an app for the treatment of insomnia – made headlines as the first digital therapeutic to receive NICE guidance; up until then only medical devices had been evaluated by NICE.9
We anticipate changes to the funding landscape in the future
The management of digital therapeutics is already evolving in the UK, with major changes currently being implemented at the regulatory level10 (check out our insider insights post on the topic). In the coming few years, we also expect to see changes in regard to market access.
One way we expect to see the landscape evolve is in addressing patient inequality in access to digital therapeutics, reducing inequality being a long-term goal of the NHS. Indeed, the NHS Long Term Plan calls out the NHS Diabetes Prevention Plan, a locally funded programme incorporating digital health apps, as a source of inequality to be addressed. The plan announced extra funding to roll out the scheme nationally, ensuring country-wide access to the apps.11 Thus, we expect to see a move to a more centralised funding model in the future, to ensure digital therapeutics are made available to all relevant patients.
With a potential expansion of national funding for digital therapeutics in the future, and following the recommendation of SleepioTM, we expect to see more frequent NICE guidance on their use. Although there is currently no guidance for other digital therapeutics in development,12 there are now moves within NICE to address the ‘explosion’ of digital health. A new Early Value Assessment has been announced, with the aim to offer rapid assessments of the clinical effectiveness and value for money of new digital therapeutics. A pilot scheme began in June, assessing two apps that target depression and anxiety in children, with the results expected in October.13
Digital therapeutics is a rapidly growing and evolving market; with apps and other digital tech becoming part of the way we approach patient care in today’s healthcare world. In order to ensure equitable patient access to these new treatments, we expect to see a push in coming years for a more centralised funding model in the UK. Central to this, could be NICE’s new Early Value Assessments, so those of us looking for a clearer view of the future of digital therapeutics in the UK are eagerly awaiting October for the outcome of the pilot.
In the meantime, if you would like to hear how we can support your digital therapeutic launch in the UK, do not hesitate to get in touch.
- Timeline: The iPhone as medical tool. https://www.mobihealthnews.com/2580/timeline-the-iphone-as-medical-tool Accessed 13th July 2022.
- Digital Health Trends 2021: Innovation, Evidence, Regulation, and Adoption. Published online, 2021. Available at https://www.iqvia.com/-/media/iqvia/pdfs/institute-reports/digital-health-trends-2021/iqvia-institute-digital-health-trends-2021.pdf Accessed 13th July 2022.
- Public Health England. Guidance: Criteria for health app assessment. Published online, 2017. Available at https://www.gov.uk/government/publications/health-app-assessment-criteria/criteria-for-health-app-assessment Accessed 13th July 2022.
- Code of Practice for the Pharmaceutical Industry 2021. Published online, 2021. Available at https://www.abpi.org.uk/publications/code-of-practice-for-the-pharmaceutical-industry-2021/ Accessed 13th July 2022.
- Integrated care in your area. https://www.england.nhs.uk/integratedcare/integrated-care-in-your-area/ Accessed 13th July 2022
- Boehringer Ingelheim. An Innovator’s Guide to the NHS: Navigating the barriers to digital health. Published online, 2020. Available at https://www.boehringer-ingelheim.co.uk/sites/gb/files/documents/innovators_guide.pdf Accessed 13th July 2022.
- NHS England Announce New Funding Mechanism for Innovative MedTech. https://deviceaccess.iges.com/news-and-events/medtech-funding-mandate-guidelines/ Accessed 13th July 2022.
- What is NICE Recommendation and Why is it Useful? https://deviceaccess.iges.com/news-and-events/nice-medtech-recommendation-benefits/ Accessed 13th July 2022.
- Sleepio to treat insomnia and insomnia symptoms. https://www.nice.org.uk/guidance/mtg70 Accessed 13th July 2022.
- Guidance: Regulating medical devices in the UK. https://www.gov.uk/guidance/regulating-medical-devices-in-the-uk Accessed 13th July 2022.
- The NHS Long Term Plan. Published online, 2019. Available at https://www.longtermplan.nhs.uk/wp-content/uploads/2019/08/nhs-long-term-plan-version-1.2.pdf Accessed 13th July 2022.
- Guidance, NICE advice and quality standards: in development. https://www.nice.org.uk/guidance/indevelopment?ngt=Medical%20technologies%20guidance Accessed 13th July 2022.
- NICE’s Early Value Assessment for Medtech: panning for nuggets of innovation gold. https://www.nice.org.uk/news/blog/nice-s-early-value-assessment-for-medtech-panning-for-nuggets-of-innovation-gold Accessed 13th July 2022.