Issue 132
Welcome back to E&O Fridays, a paying subscribers-only weekly newsletter focused on the world of digital pharma products and FDA-regulated digital health.
E&O Fridays.
Happy New Year! (Wow, this section and today’s top story got a bit long so I’m going to hold off on clinical trial updates until next week.) Here’s what’s happening in the world of FDA-regulated and pharma-focused digital health:
- Up until this issue, I’ve only noticed one price change in Germany’s list of reimbursed prescription digital therapeutics (Issue 123 back in October 2021), which was a DTx for tinnitus going from €116.97 to €203.97. However, the second renegotiation of a DiGa has resulted in a marked decrease in reimbursement. Insomnia DTx Somnio’s price is now €223 — down from €464 during its first year. Visit E&O’s DiGa tracker for more.
- One other DiGa update: Germany listed HiDoc’s DTx Cara Care for irritable bowel syndrome the day after Christmas. The 12-week program is focused on nutrition (low FODMAP diet) and psychotherapy (cognitive behavioral therapy and intestinal-directed hypnotherapy). Currently reimbursed at €718.20, which makes it one of the priciest in the formulary.
- Ancient history: In December 2020 Natural Cycles asked CMS to create a new HCPCS Level II billing code for its (then) newly cleared contraception software. NC argued: “The Patient Protection and Affordable Care Act (‘ACA’) mandates that private health plans require coverage for all FDA-approved methods of contraception… It also requires this coverage to be provided with no patient out-of-pocket costs. …Natural Cycles is first-in-class, having been granted the De Novo classification, none of the existing HCPCS codes apply, which is why Natural Cycles is requesting a new code. In order to enable insurance plans to cover Natural Cycles at no cost for the patient, Natural Cycles requires a new HCPCS code for a stand-alone software application for contraception.” CMS responded by asking how private insurers were processing and covering this non-prescription product. Meanwhile, private insurers were asking for a billing code. Classic billing code chicken-egg issue. Perhaps needless to say, but more than a year later: There is still no code for this.
- The UK’s NICE has recommended AliveCor’s KardiaMobile NICE “as an option for detecting atrial fibrillation (AF) for people with suspected paroxysmal AF, who present with symptoms such as palpitations and are referred for ambulatory ECG monitoring by a clinician.” The NHS in England and Wales are legally obligated to adopt NICE’s recommendations so this is a big deal for increased adoption of AliveCor’s devices across the pond. NICE’s cost-benefit analysis showed: “…that KardiaMobile is cost-saving compared with Holter monitor by an average of £13.22 per patient over 2 years in people presenting with symptoms such as palpitations.” (That’s about $18.) NICE had published medtech innovation briefings that have been generally favorable about AliveCor’s devices dating back to 2015. Those are informational in nature and intended to help regional clinical directors to figure out which medical technologies to put into practice. This is the first time NICE has issued an official recommendation for AliveCor’s devices though.
- The FDA granted Breakthrough Device Designation for Blue Note Therapeutics’ prescription digital therapeutic BNT200, which is designed to “treat anxiety and depressive symptoms in adults with acute myeloid leukemia (AML) who are hospitalized for a regimen of high-intensity induction chemotherapy.” This is Blue Note’s second BDD — it secured its first in June 2020 for its flagship prescription digital therapeutic, BNT001, which treats symptoms of anxiety and depression in adults with cancer.
- Another breakthrough: FDA also granted Breakthrough Device Designation to a sensor-equipped digital pen designed to diagnose neuromotor impairments earlier: “The NeuroMotor Pen, with built-in highly accurate sensor technologies, combined with its analytical software, processes minute limb and hand motion parameters to quantify fine motor skills, represented by ‘motion features’.”
- Becton Dickinson’s acquisition of Scanwell Health four days before Christmas caught my eye. Scanwell’s app analyzes the results from a COVID test that BD makes. The system with the app only managed to get an FDA OK at the end of October. My somewhat educated guess is that BD sold between $3 million and $4 million worth of these app-enabled tests during the last two months of 2021. So maybe that’s $24 million in revenue from a product that Scanwell helped to app-ify (partial attribution) in 2022? More if BD’s share of the COVID testing market increases this year. Considering that and BD’s ambitions to use Scanwell’s SaMD platform for other at-home tests, what would you say is the ballpark acquisition price for Scanwell? (BD says the transaction was immaterial so we may never get an official dollar amount even though BD is a public company.)
- At the CES event in Las Vegas this week, Abbott unveiled a new suped-up continuous glucose monitor, called Lingo, that also monitors ketones and lactate. The company also expects it will be able to track alcohol levels before long. The name “Lingo” refers to the wearable’s ability to “speak your body’s unique language.” (One branding Zoom meeting too many if you ask me.)
- FDA cleared a new, stopwatch-shaped, Bluetooth-enabled glucose meter from Ascencia Diabetes named Contour next GEN.
- The FDA also managed to post up a number of guidance documents since the last E&O Fridays. You’ve likely already dug into the one of particular interest to this audience, a draft guidance called “Digital Health Technologies for Remote Data Acquisition in Clinical Investigations.”
- The other relevant FDA draft guidance was focused on the agency’s transition plan for medical devices issued emergency use authorizations during the pandemic. I’ll dig into this one more below since so many prescription digital therapeutics focused on psychiatric disorders soft-launched during the pandemic.
- The AMA published its taxonomy for artificial intelligence (AI) used in medical services and procedures, which E&O first highlighted in August 2021 (Issue 113). “This taxonomy provides guidance for classifying various artificial intelligence (AI) applications (eg, expert systems, machine learning, algorithm-based services) for medical services and procedures into one of these three categories: assistive, augmentative, and autonomous.” This will likely shape how CMS thinks about AI too. Worth getting your head around it here.
- One more thing… The White House Office of Science and Technology Policy is asking for input on “how digital health technologies are used, or could be used in the future, to transform community health, individual wellness, and health equity.”
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FDA’s plan for transitioning psychiatric digital health out of its pandemic enforcement discretion
Back in April 2020 (Issue 048) I dug into the FDA’s pandemic-era, enforcement discretion guidance document for digital health devices focused on psychiatric disorders. If you’re not familiar with this guidance, it’s what allowed so many digital health companies to launch digital therapeutics during the COVID era without first securing the FDA clearances they would typically need to get to market. Here’s a quick recap from my write up in April 2020:
“During the pandemic, the FDA is allowing digital therapeutics that treat psychiatric disorders and would normally require a 510(k) clearance or other market authorization to go to market without a clearance at this time. The agency specifically mentions computerized behavioral therapy programs, which are prescription-only, but says the guidance applies to digital therapeutics that use other interventions as well as to digital therapeutics that are not prescription-only.
The agency names eight medical conditions: Obsessive-Compulsive Disorder Generalized Anxiety Disorder Insomnia Disorder Major Depressive Disorder Substance Use Disorder Post-traumatic Stress Disorder Autism Spectrum Disorder Attention Deficit Hyperactivity Disorder But the FDA also notes that this list is not exhaustive and that the guidance applies to conditions ‘like’ these. So, might this apply to schizophrenia, too? Maybe.
One reader pointed out that the guidance probably does not apply to DTx offerings that are targeting a combination of conditions. The FDA made clear, however, this guidance is only for offerings that are adjuncts and not standalone therapeutics. That means, for the most part, that a physician needs to be in the loop to some extent.”
(For more background, re-read that issue here, which includes some initial thoughts from some of the companies that would go on to launch digital therapeutics under this policy, like Big Health, Pear, and Akili.)
The most interesting part of that old article was the discussion on how long the pandemic might be but also how long of a grace period the FDA would put in place after the pandemic.
Here’s what I wrote back then:
“The one area where there seems to be disagreement about this guidance document is how long it is likely to be in effect. One reader pointed out that emergency authorizations put in place during H1N1 lasted for about 14 months. Some cautioned that this enforcement discretion may only last a few months or six months, while others expected there to be a grace period that might last as long as two years after the pandemic is considered officially over.
“Jason Brooke, a longtime FDA attorney who focuses on medical devices and digital health, expects such a grace period — if there is one — to be shorter:”
“I could see a short grace-period, but two years seems unrealistic. In my conversations with the FDA about other product types that have received enforcement discretion during the pandemic, it was clear that the policy would only be in effect until the emergency declaration was lifted. At that point, the normal rules apply (e.g., premarket notification, registering & listing, etc). I would not hang my hat on the presumption of such a long grace period, especially when we’re talking about devices involved with serious conditions.”
As the new draft guidance published by the FDA at the end of 2021 makes clear, the grace period is likely to be a 180-day, three-phase transition. So, about six months time. By the end of that period, the agency will expect device manufacturers to have secured market authorization or pull their therapies from the market. FDA expects the 180-day clock to start on the day that HHS officially declares the public health emergency (PHE) over.
This guidance document is a draft, of course, and so far only one digital health company has weighed in on it via the official commenting process: Pear Therapeutics. Pear commended the agency for its enforcement discretion but also drew a sharp line between its already FDA-cleared therapies and the ones on the market thanks to the EUA:
“As FDA finalizes its Enforcement Discretion Transition Plan Draft Guidance, it is vital that FDA reinstate the special controls that were set forth in 21 C.F.R. § 882.5801 as swiftly as possible in order to ensure that all computerized behavioral therapy devices for psychiatric disorders are appropriately tested and validated to meet FDA’s safety and effectiveness standards. The Digital Therapeutics Enforcement Policy made greater access to cognitive behavioral therapy possible during an extraordinary period, but the flexibilities implemented during the PHE period should not remain in place once the PHE ends. Products, of which there are many, that have not been adequately tested or that do not comply with general and special controls could pose a public health risk.”
Pear’s key argument, however, is that the FDA shouldn’t give companies 180 days to transition — they should only get 90 days:
“A transition period of 180 days after the implementation date seems longer than necessary for manufacturers of many of the devices in the affected product categories to finish developing their marketing submissions. Manufacturers that have been working to comply with FDA’s general and special controls since the date the Digital Therapeutics Enforcement Policy was issued (April 2020) should not require an additional 180 days. Further, given that some manufacturers are not even complying with the more limited requirements set forth in the enforcement policy, the risk to public health is increased the longer these products remain under enforcement discretion. Therefore, Pear recommends that FDA implement a shorter 90-day transition period for computerized behavioral therapy devices for psychiatric disorders and other similarly situated products when it finalizes the Enforcement Discretion Transition Plan Draft Guidance to allow these products to come into compliance with FDA regulations or withdraw from the market once the PHE ends.”
Here’s my list of companies and digital health devices that came to market thanks to this enforcement discretion policy. Not all of these were full commercial launches:
- Akili Interactive Lab soft-launched Endeavor but then managed to secure full market authorization for EndeavorRx from the FDA less than two months later (Issue 057)
- Pear Therapeutics soft-launched its schizophrenia prescription digital therapeutic Pear-004 in May 2020 (Issue 050)
- Big Health added a claim to its website that read “Our digital therapeutics are safe and effective non-drug alternatives for mental health.*” and the asterisk further explains that because of the FDA enforcement discretion policy above, for adults “diagnosed with Insomnia Disorder or Generalized Anxiety Disorder by a medical provider, Sleepio and Daylight can be made available as an adjunct to their usual medical care for Insomnia Disorder or Generalized Anxiety Disorder, respectively.”
- In June 2020 Quit Genius announced that it was expanding beyond its tobacco cessation program. Thanks to the FDA enforcement policy the company said it would “now offer integrated support for alcohol and opioid addictions to help support patients during the pandemic and beyond.”
- In July 2020, thanks to the FDA enforcement policy, Orexo announced an accelerated timetable for two of its long-planned prescription digital therapeutics, which it developed with GAIA: vorvida and deprexis.
- In February 2021, Blue Note Therapeutics very quietly set up a patient-facing brand site for its flagship prescription digital therapeutic, attune. “Attune is available to patients today, but only by prescription from your doctor. Due to COVID-19, the FDA recognizes that cancer patients are struggling now more than ever. Their recent guidance enables the immediate release of attune, while it is also being studied in clinical trials.” It also likely launched a similar site for another pre-FDA prescription digital therapeutic for people with cancer called cerena around the same time, but I only noticed it in June 2021. Cerena is a “digital therapeutic program to aid the physical health of people with cancer.” The program’s modules appear to focus on bone health, kidney health, food poisoning, sun exposure, and more.
- In July 2021 Happify Health sort of soft-launched its prescription digital therapeutic, Ensemble, prior to getting FDA clearance too. Ensemble is a prescription-only digital therapeutic for people with generalized anxiety disorder (GAD) or major depressive disorder (MDD). Happify launched a clinical trial with a design that would have been trickier to pull off without the enforcement discretion policy.
- In October 2021 Limbix soft-launched its SparkRx prescription digital therapeutic pre-FDA clearance thanks to the policy too: “SparkRx is rooted in cognitive behavioral therapy, a therapeutic modality proven to assist with the symptoms of depression and other mental health disorders. SparkRx is an adjunct treatment for teens and young adults aged 13-22 who are experiencing symptoms of depression… SparkRx is accessible via a health care provider and available at no cost to patients for a limited time.”
Who am I missing? And which of these do you think will successfully stay in the market after the clock starts and the 180 day period ends? Or do you think the FDA will take Pear’s suggestion and cap it at 90 days?
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