Digital therapeutics will soar in the next five years

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New research, Digital Therapeutics & Wellness: Disruption, Innovation Opportunities & Forecasts 2018-2023, found that growth will be fuelled by self-insuring businesses in the US wanting to save on costs, as well as interest from healthcare providers and insurers.

Savings

Compared to medical bills for chronic conditions, digital therapeutics subscriptions, costing a few hundred dollars per person per year, offer large savings on drug costs and their inherent potential complications. Juniper anticipates revenue from self-insured employer-paid digital therapeutics will exceed $5.2bn in 2023.

The study by Juniper Research found significant opportunities for businesses that manage healthcare systems and integration, as well as for health insurers. Insurers could also potentially offer digital therapeutics for some conditions without reference to drug companies. Annual spend from insurers is expected to reach $6.3bn by 2023. However, this is dependent on being able to integrate digital therapeutics into existing healthcare workflows.

Opportunity and threat

Investment by drug companies in this area has been limited so far. Juniper considers digital therapeutics to be both an opportunity and threat for pharmaceutical companies, as it could offer new business for them, but also erode their revenues through insurers developing or acquiring their own treatment platforms.

“Our research shows that the average time from development to commercialisation for a digital therapeutic is three to four years. This gives drug companies and insurers an opportunity to bring chronic condition treatment to market in a fraction of the time and cost of drug development," says research author, James Moar.