Digital therapeutics: at an inflection point

Digital therapeutics have the potential to transform care delivery, but the industry is facing some significant challenges. Big Health’s CEO shares his thoughts on recent marketplace developments and building a winning formula for DTx.

Q1: Digital therapeutics (DTx) is still an emerging healthcare category. How does Big Health define DTx?  

A:  As pioneers in this area of healthcare, we’ve played a significant role in the development of the space, yet I still often speak with people who don’t fully understand what a digital therapeutic is. Think of DTx as a clinical treatment that is delivered digitally and typically automated and personalized so that patients can access care anytime, anywhere. Second, digital therapeutics are deeply evidence-based. They’re developed in alignment with the leading forms of care — such as cognitive behavioral therapy (CBT). They are then studied in a large-scale research environment, just as a new drug would be, to prove their effectiveness and safety as a treatment. Lastly, they are typically covered as a healthcare benefit, regulated, and reimbursed just as you would a drug or other medical claim. In these instances, they are often recommended to a patient by a healthcare practitioner with no or little out-of-pocket cost to the patient.

Q2:  DTx seems to be at an inflection point, with setbacks being reported by notable players in the industry. What’s your view of the current state of DTx, and how do these factors impact Big Health’s plans going forward?  

A: As a category, DTx is growing rapidly and becoming an important part of the overall health care delivery system. According to Global Market Insights, the global digital therapeutics market is projected to grow at a 31.5% CAGR from 2023 to 2032, with an estimated total market value of $104B USD in 2032. However, some companies have struggled in their efforts to scale quickly and secure further financial support to fund growth. It’s becoming increasingly clear that regulatory as company strategy — i.e., “get FDA cleared and then coverage, physician prescribing, and patient adoption will follow” — is not quite right for DTx. To me, there are three key takeaways from recent events:

1) Clearance does not automatically unlock coverage — Companies must rigorously engage with coverage bodies around specific conditions like insomnia and anxiety where current medical practice does not follow the guideline-recommended approach, and medication overprescription is a significant concern. And companies need to build real health economic evidence showing the value of treating with DTx to drive broader coverage more quickly.

2) Focus on broad adoption — Companies must continue to explore models of direct patient access, as well as clinician referral, including psychologists, therapists, and other non-script-writing providers who are front-line mental health care workers. DTx should increasingly become first-line care for many of these conditions, given its efficacy and pristine safety profile. For example, in Scotland, the National Health Service has concluded that Sleepio should be first-line care for insomnia, and that it should be directly accessible by patients in addition to being referred by providers. And here in the US, during the Public Health Emergency, FDA enacted an enforcement discretion policy that permitted patients to directly access digital therapeutics for mental health if FDA’s rigorous guidelines were followed to ensure patient safety and product quality. This policy allowed patients in our covered populations to directly access Sleepio for insomnia and Daylight for anxiety. So, there is a precedent for some flexible distribution models that benefit patients.

3) Prioritize clinical quality & evidence generation

There have been some recent examples in the press where DTx companies have struggled to gain commercial adoption despite some modicum of seemingly adequate evidence. In reality, there is a very different bar for clinical effectiveness and scientific rigor that we apply at Big Health. We’ve established the largest body of clinical evidence in the industry with 14 randomized controlled trials, 80+ publications, and positive NICE guidance — the first DTx to achieve this standard. While it’s certainly important to establish a commercially viable business, commitment to clinical outcomes and evidence that backs them up must always come first.

Q3: How has Big Health been able to scale faster and more efficiently than others in the DTx space?

A: While DTx itself is inherently scalable because it is software-based, Big Health is further differentiated based on the robust clinical evidence behind our products and our path to market. For example, the FDA’s enforcement discretion policy allowed us to accelerate real-world deployment of DTx in a regulatory-compliant manner to treat and help more than 150,000 patients during COVID.¹ In turn, that added positive, real-world outcomes to our volume of clinical evidence. And the combination of clinical and real-world evidence led to increased coverage receptivity from the types of organizations that are core to our business model, including large prescription benefits management providers with over 150M covered lives, as well as leading employers such as News Corp, The Hartford, Boston Medical Center, and BNY Mellon, among many others.

Now, within each of these relationships, we are able to go beyond patient outcomes to fully demonstrate the actual cost-benefit economics of our products, while also enabling us to iterate and innovate based on a continuous feedback loop. Conservatively, we are able to demonstrate a 4:1 ROI on direct health care costs, which has been validated by leading health economics experts from Johns Hopkins.² So, our scaling strategy is well-connected and working.

Q4: What do you see as the future for the DTx space to generate more adoption?

A: Building awareness of the products and their effectiveness is absolutely essential to growth in the category. As I mentioned, we have an enormous volume of research on the clinical outcomes of our products. Additionally, while those of us who work in the space daily are familiar with DTx, it’s still a foreign concept for many people, patients, providers, and public health administrators. For DTx to continue its upward trend to success, the concept needs to be brought into the mainstream. People need to understand that a digital therapeutic can safely, effectively, and conveniently treat their condition. As a clinically based category, we must be mindful of the need to assertively differentiate ourselves from digital wellness products, taking a page out of pharma’s book to ensure digital therapeutics are understood as real, powerful treatment options. We need to break through legacy systems and SOPs to get DTx into the clinical workflow and enable providers to easily select these treatment options and bill for them. These need to become a commonplace practice of medicine in provider’s offices across the globe. By partnering with national PBMs that cover more than 150 million lives, Big Health has been able to expand access to this critical care on a large scale. But we can’t stop there; we need to add DTx treatments to every formulary, regardless of the type of population, through Medicaid, Medicare, and all commercial formats.

Q5: With all this in mind, what’s your outlook for Big Health in 2023?

A: Our business is strong and on a good trajectory because our existing base of customers value covering our products for their members and new coverage populations are coming online. Our second product to market, Daylight, is gaining strong traction and more treatments are on the way.  We’re working to significantly increase our coverage across employers, health plans, PBM partners, and government coverage entities. Our products will be available on a fully reimbursed basis to significantly more patients by year-end.

And, importantly, we are also getting increasingly better at placing our products in front of the right patients. As a team, we’re highly motivated to bring scalability and increased equity to mental health care to help society address this growing challenge while moving beyond drugs as the predominant form of care. And thanks to the efforts of our team and the trust of our many partners and patients, we have already put up a Big Health record quarter of patients treated and revenue in Q1 and further expect 2023 to be our biggest revenue growth year yet.

Lastly, while there are many necessary milestones that we’re determined to meet as a business, let’s remember that everything we do at Big Health is about advancing patient care. Recent research that we conducted with respected industry experts at Milliman showed that patients with insomnia and anxiety are predominately treated with medication alone, despite the guidelines indicating CBT should be the first line. We must do better, and we can genuinely impact millions of lives by continuing to innovate. Patients deserve non-drug, evidence-based treatments in mental health. That’s at the core of what drives our team and me every day.

About Arun Gupta:

Arun Gupta is the Chief Executive Officer and Executive Chairman of Big Health, the leading provider of clinical-grade, non-drug treatments for the most common mental health conditions. Big Health’s two products – Sleepio for insomnia and Daylight for generalized anxiety disorder – are proven in over 80 peer-reviewed papers to deliver clinical outcomes without serious side effects.^3,4 Previously, Arun founded Quartet Health, a technology and clinical services company scaling effective mental health access in partnership with insurers and health systems. He led Quartet through a significant scale-up serving as CEO for Quartet’s first five years and then as Executive Chairman of the Board. Earlier, Arun built and scaled several industry-defining companies as a General Partner at Accretive. The firm’s launches created over $5B of equity value, including several IPOs with successes like Accolade, R1, Fandango, and others. Arun earned a Master’s Degree from the Harvard Kennedy School, where he was a Reynolds Fellow for Social Entrepreneurship and graduated with honors from Duke University.

Sleepio and Daylight are available as an adjunct to usual medical care for insomnia disorder or generalized anxiety disorder, respectively, for adults ages 18 and older, without FDA review under their COVID-19 policy.

For media inquiries, please contact press@bighealth.com.

1. Internal Data. (2023).
2. Internal Data. (2023).
3. Espie et al. (2012). Sleep
4. Carl et al. (2020). Depression and anxiety