In many ways, the healthcare sector is still wrestling with how best to regulate and reimburse digital health technologies (DHTs) – which include artificial intelligence, cloud-based services and digital devices – and as a result uptake of these technologies has been slow with patients and payers alike, despite clear interest in their utility.
Most existing value assessment methodologies are designed for pharmaceutical products and are not well-suited to DHTs. Compounding this problem is the fact that the healthcare sector is often glacial in its pace of change, while digital innovations are evolving rapidly every year. Nevertheless, with many DHTs showing great promise in helping patients and creating value for payers, a more pragmatic approach to reimbursement is needed soon.
Progress is being made in several markets, and Dr Lorenzo D’Angelo, principal in CRA’s Life Sciences Practice, notes that COVID-19 could act as a catalyst for national and local reimbursement systems to start tackling this issue.
But uncertainty remains over optimal trial designs for gathering evidence, the kinds of value payers actually want to see, and the reimbursement and coverage options available. The FDA, for example, has gone back and forth on whether to keep a truncated digital health pathway implemented during COVID-19 in place after the pandemic.
In a recent report, ‘Challenges and solutions to bringing digital health technologies to market’, analysts from CRA take a look at the major access and regulatory barriers facing companies attempting to launch DHTs, and ask how the industry can overcome these challenges and work with payers to make access pathways easier to navigate.
The authors note that there is a “long way to go” to achieve this – but there is a strong public health need for standardisation to encourage the development and appropriate utilisation of digital health innovations.
And within this environment, the pharma and digital health industries have an opportunity to show leadership in helping reimbursement for DHTs find its footing.
“The situation varies greatly on a country to country basis,” says D’Angelo, who was one of the report’s authors.
Across Europe there is a mix of nationally- and regionally-funded programmes, with different payers having different guidelines for DHT adoption.
“While most countries are moving towards standard value assessment frameworks, in some countries it is evolving more quickly than others,” D’Angelo adds.
The analysis contrasts Germany’s efforts with the UK’s as an example.
Germany’s Digital Healthcare Act, approved in December 2019, allows doctors to prescribe health apps to patients and mandates that all insured persons have equal and self-determined access to the advantages offered by digitalisation.
Doctors are obliged to connect to the centralised system, and the new law introduced financial penalties for those not connected by 1 March 2020.
Germany also implemented a structured HTA process for apps. After the evidence package is reviewed, and if comparative trials are available, the apps are included in a public list. Conditional reimbursement is available for apps where trials still need to be developed. The assessment forms the basis of price negotiation, which occurs within a year.
In the UK, meanwhile, funding sources are not unified under a national effort. For example, NHS England’s Innovation and Technology Tariff (ITT) and the Innovation and Technology Payment (ITP) are available at the national level, while clinical commissioning funding exists at the regional level.
NICE Medtech Innovation Briefings do include the DHT’s role in the treatment pathway as well as a review of published evidence and the likely associated cost. The aim of these national briefings is to ease local decision-making by providing a factual overview – but they ultimately do not make recommendations.
D’Angelo adds that the UK’s approach is still falling under existing pathways for medical devices, which is the case in many countries at the moment.
“The problem is, these pathways are usually more applicable to traditional medical devices where software is either a side aspect or is not present at all, whereas many DHTs today are fully software-based,” he says.
Moreover, these pathways are often actually designed to reimburse a procedure rather than a specific device.
“The way that DHTs are often prescribed, however – especially in the case of apps – is that they are used directly by the patients themselves. It’s actually closer to a pharmaceutical than to a traditional medical device.
“What would be helpful in countries like the UK is having a pathway that is more specific for digital healthcare, so that it’s more transparent and easier to use for manufacturers.”
D’Angelo adds that DHT manufacturers have a role to play in working with policymakers to raise awareness that these specific pathways are required.
“They need to be made aware of this gap, as well as the pressures from both the increasing acceptance of digital in other industries and the changes from COVID-19. Thankfully, I think this is a process that is already happening.”
CRA’s report says that HTAs expecting results from multiple randomised clinical trials (RCTs) to be available at the time of launch for DHTs only creates hurdles. Often much of the data for these products is collected post-launch as real-world evidence.
On top of that, there is a lack of standardised and dedicated value assessment methods for DHTs. The analysis notes that there is currently “little consensus” on what defines value in digital innovations, with a lack of clarity on evidence requirements.
Part of the issue is the huge variety within the DHT space – some provide indirect value to the patient, e.g. through reminding them to take their medication, while others focus on direct treatment such as cognitive behavioural therapy, and some are designed more to provide value to a healthcare system itself – for example, by collecting more precise information on drug response.
Nevertheless, improved patient outcomes and potential cost savings for healthcare systems will always be key for payers, and the analysis recommends that manufacturers try to define and demonstrate both indication-specific value and implications for healthcare systems in order to increase the likelihood of reimbursement.
D’Angelo says that to drive a consensus on the value of DHTs in specific indications, and identify how this value can be measured, companies need to be engaging with influential stakeholders.
“You need to be able to understand from their perspective what value looks like – what they’re interested in and how they think it is most likely to get reimbursed. At the same time, you can discuss what pathways exist and what opportunities there are to get a strong revenue stream from that technology.”
He says that in addition to payers, these stakeholders could include consumers and opinion leaders in the indications being addressed, as well as patient advocacy groups and physicians.
“Patients can advocate the technology, either in discussions with physicians or in discussions with payers. It’s also important to get their feedback on how the product functions, and what it needs to be providing in order for patients to find it useful.
“Meanwhile, speaking to physicians and carers can help you understand what value that specific technology could bring in routine use, and what endpoints and trial designs could demonstrate that.”
He adds: “Depending on the technology, I’d also want to reach out to partners in the sector to see if they could be interested in using the technology for their own purposes. You might not even need a payer to reimburse it if you can open a revenue stream with a pharma company, for example.
“Technologies that can monitor data in conjunction with a drug can be enormously valuable to pharma by helping to extend the life cycle of a product. They might be willing to pay for the application even if they allow patients to use it for free.”
Until then, the authors suggest that companies explore and prioritise the multiple decentralised reimbursement routes currently available, as well as seeking partnering opportunities at an early stage of development to help create and test products.
“Companies should keep a close eye on the latest developments in DHT reimbursement,” says D’Angelo. “Things are developing quickly in terms of new pathways and tenders, and knowing what different regions are offering can help in both planning for reimbursement and for designing trials and pilots.”
Lorenzo D’Angelo is a principal in the Life Sciences Practice of CRA based in Munich. Dr D’Angelo is an experienced consultant helping global pharmaceutical and medical device companies with their commercial strategies.
George Underwood is the editor for pharmaphorum’s Deep Dive digital magazine. He has been reporting on the pharma industry for seven years and has worked at a number of leading publications in the UK.