Even after COVID 19, outpatient restrictions have made it increasingly challenging for patients to receive traditional face-to-face care. This has accelerated the demand for, and adoption of, digital therapeutics (DTx). Hence, US and EU regulators have started exploring appropriate DTx reimbursement models to facilitate their use.
Europe is leading the way in DTx reimbursement models; the US is lagging
Given that DTx is fairly novel, many countries have not yet implemented specific DTx reimbursement models, including the US. Therefore, US legislators are now pushing for DTx reimbursement laws to be passed.
In contrast, Europe has been the trailblazer in DTx reimbursement. In 2019, Germany introduced a DTx-specific pricing and reimbursement (P&R) framework for digital health applications (DiGA), with 35 solutions evaluated to date. Other European countries have started to adopt similar reimbursement regimes, with France, Italy, and Spain expected to follow suit.
The UK has no specific DTx reimbursement pathway, but local NHS organizations can approve solutions for coverage under public insurance. For example, in May 2022, Sleepio was approved by the UK’s NICE as the first-line treatment for insomnia.
Is DiGA the optimal model to replicate?
There are three key identifiable issues with DiGA relating to market entry and uncertainty.
Firstly, time. The German Federal Institute of Drugs and Medical Devices (BfArM) takes up to 3 months to examine applications; if successful, the solution can be permanently listed on the DiGA registry. However, the lack of scientific evidence may subject the solution to be provisionally listed and given a 12-month market trial. This hampers the pace of launching the solution publicly, which can be crucial in the fast-moving and innovative DTx space.
Secondly, providers with provisionally approved solutions face the uncertainty of their products being removed from the DiGA registry. Such removal will undoubtedly dissuade physicians from prescribing preliminarily listed solutions. For example, M-sense’s “M-sense Migraine” app was removed from the DiGA registry in April 2022 and health insurers currently do not plan to make the app eligible for reimbursement again. As a result, M-sense has to cover the prescription costs to provide continuous treatment to patients.
Lastly, the uncertainty around the feasibility of generating real-world evidence (RWE) for future listings. DiGA is introducing a way for providers to apply for provisional listing with RWE to suggest a benefit. If approved, these providers have to demonstrate a benefit to patient outcomes within the first year or the solution will be delisted. However, this “value-based” process has yet to be used in practice due to the perceived risks of regulatory uncertainties – all 35 DiGA-approved solutions as of July 2022 were approved based on evidence from traditional randomized controlled trials (RCTs).
Where to from here?
DiGA is the most mature model for DTx reimbursement, but more time is required to assess its efficacy, practicability, and sustainability. It will be interesting to see if other European countries replicate DiGA’s approval process or implement a hybrid process involving one-off or ongoing collection of RWE alongside traditional data from RCTs. A hybrid model could be less risky for providers and see increased confidence to seek approval on the basis of RWE.