Issue 044.
Get E&O weekly. | Subscribe
Digital health research from Brian Dolan.
Welcome to E&O.
Last week’s newsletter had a 59 percent open rate. Here’s what’s happening this week:
- A pandemic. My plan is to cover coronavirus-related developments only if they impact the future of digital health interventions in some meaningful way. So, this week’s edition of E&O will include a few. For example, the crisis has triggered some important regulatory rollbacks that will likely lead to long-term changes — much more on that after the jump.
- One quick follow-up to my Sanofi-Verily-Onduo-Dexcom writeup from last week. Verily paid Sanofi $122 million worth of Dexcom stock as a dividend following the restructuring of Onduo, which saw Sanofi’s share reduced from 50 percent to 19.9 percent. This is oversimplifying it, but, in effect, Verily paid Sanofi $122 million for 30.1 percent of Onduo. Remember, when they set-up Onduo initially, Sanofi and Verily put in $250 million each (cash, IP, sweat) for a total of $500 million. So, 30.1 percent of Onduo on Day 1 was worth $150.5 million. Likely, there was much more to how these numbers came to be, but, just based on those numbers, the difference in valuation for that stake is a mere ($27.5 million). I’ll probably have more on the transaction next week.
- The Academy of Managed Care Pharmacy (AMCP) has published a worthwhile overview of the current issues facing digital therapeutics. No new insights, but it captures much of the consensus thinking: “Participants generally favored inclusion of DTx within the existing pharmacy benefit because of the ability to apply managed care tools, such as formularies and prior authorizations. This allows use of already-established processes whereby a health care organization identifies drug products and therapies that are the most medically appropriate and cost-effective to best serve the health interests of a given patient population.”
- Specialty pharmacy and patient services company Eversana, which currently has deals in place with Noom and Cognoa, has named Ed Cox as its new EVP of strategic alliances and global head of its new digital medicine practice area. Cox was formerly CEO and founder of Dthera, a pioneering digital therapeutics company focused on Alzheimer’s, that started up in 2012.
- Finally, rumors of a new fitness offering from Apple have emerged ahead of the company’s annual iOS reboot in the fall. The offering, code-named Seymour, will consist of workout videos that guide and track Apple Watch wearers through the motions. Based on these initial reports, Seymour doesn’t sound as sophisticated as the many MSK digital therapeutics offerings on the market, but it sure looks like Apple could be headed in that direction soon.
Did this get forwarded to you? You can sign up as a paying subscriber and get full access to E&O by clicking here.
The Feds rolled back telehealth regs: Medicare reimbursement, HIPAA and anti-kickback waivers, interstate licensing.
Because of the coronavirus pandemic, this week the US federal government made it easier for patients to get access to their physicians and other caregivers remotely — either via phone calls or video visits.
Considering that surveys have shown something on the order of just 10 percent of people in the US have ever used remote visit software to see a healthcare provider, these changes and the likely large number of people who end up experiencing telehealth for the first time will probably lead to a longterm shift in consumer behavior. Even if many of these regulations return to their pre-virus status in the coming months, they will have made it possible for more people to experience telehealth. (More on commercial payers’ moves in the next story below.)
Here’s a quick rundown of the regulations that the Feds rolled back this week to make it easier for people to receive remote care from providers:
- Medicare covers “e-visits” for all now: CMS announced that any Medicare patients can now use telehealth, virtual check-ins, or e-visits regardless of whether they live in a rural area. The different flavors of visits and their respective billing codes are outlined in the image above from CMS.
- HIPAA: Thanks to a “HIPAA waiver”, HHS said providers could use almost any kind of video conferencing software to talk to patients if they use telehealth in “good faith”. Specifically, HHS named Facetime and Skype as viable options right now.
- Anti-anti-kickback: HHS Office of Inspector General (OIG) relaxed anti-kickback regs to let providers reduce or waive beneficiary cost-sharing (co-pays) for telehealth visits paid by federal healthcare programs.
- Interstate medical licensing for telehealth: HHS also announced licensure waivers that allow physicians working in federally-paid “health care programs to receive payment for telemedicine services in states where they do not hold a license during the coronavirus (COVID-19) emergency.”
- DEA has relaxed some restrictions around using telemedicine to prescribe controlled substances too. More here.
Meanwhile, most commercial payers expand access to telehealth or waive co-pays, too
I spent a fair amount of time this week tracking the various telehealth-related announcements from private health plans across the US. Then, late yesterday, the Blue Cross Blue Shield Association announced that all 36 of its licensees would waive co-pays for telehealth visits between patients and providers:
“All 36 independently-operated BCBS companies and the Blue Cross and Blue Shield Federal Employee Program (FEP) are expanding coverage for telehealth services for the next 90 days. The expanded coverage includes waiving cost-sharing for telehealth services for fully-insured members and applies to in-network telehealth providers who are providing appropriate medical services.”
- UnitedHealth announced that its members could access their existing telehealth benefits for free. It also announced that all members (whose in-network providers are willing and able) can conduct remote, synchronous visits with no cost-sharing.
- Cigna said it would waive cost-sharing for telehealth visits related to the coronavirus, but it would also waive them for members at a higher-risk for coronavirus who prefer to use telehealth instead of traveling for an in-person visit.
- Humana provided a bit more nuance in their announcement, so I’ll quote the relevant graf here:
“To help reduce the risk of infection and spread of disease, Humana is encouraging members to use telemedicine (e.g., video chat) as a first line of defense for all urgent care needs. The company will waive costs for telemedicine visits for urgent care needs for the next 90 days. This will apply to Humana’s Medicare Advantage, Medicaid and commercial employer-sponsored plans and is limited to in-network providers delivering synchronous virtual care (live video-conferencing). Self-insured plan sponsors will be able to opt-out of the program at their discretion. Humana is working closely with federal agencies to understand the impacts of both telemedicine and the coronavirus test on High Deductible Health Plans and Health Savings Accounts.”
- Aetna, a CVS company, made its announcement a bit earlier than most on March 6th:
“For the next 90 days, Aetna will offer zero co-pay telemedicine visits for any reason. Aetna members should use telemedicine as their first line of defense in order to limit potential exposure in physician offices. Cost sharing will be waived for all virtual visits through Aetna-covered Teladoc offerings and in-network providers delivering synchronous virtual care (live video-conferencing) for all Commercial plan designs. Self-insured plan sponsors will be able to opt-out of this program at their discretion.”
- Centene has announced plans to expand “access to certain telehealth services” because of COVID–19, but hasn’t mentioned waiving co-pays.
- Molina has expanded access to virtual visits for all of its members and covered lives, including Medicare and Medicaid members, via its partner Teladoc. No mention of waiving co-pays, however.
Most of the companies mentioned here note that these changes are in effect for 90 days or until the coronavirus emergency is considered over, but these temporary measures will likely change the consumer experience of healthcare.
One obvious problem right now: demand for these synchronous, remote visits are leading to hours-long wait times. Dr. Jay Parkinson, founder of Sherpaa (acquired by Crossover Health), has long-argued for asynchronous, remote care as a better alternative. This post of his from 2018 is perhaps more relevant today than it has ever been.
FDA: Not going to object to modifications to remote monitoring devices’ indications if they help with COVID–19
Last night the FDA announced that it would allow medical device companies to tweak their claims if their remote monitoring technologies could help with the coronavirus pandemic while not creating “undue risk”:
“For the duration of the public health emergency, FDA does not intend to object to modifications to the FDA-cleared indications, claims, or functionality of the subject devices without prior submission of a premarket notification where the modification does not create an undue risk in light of the public health emergency. FDA currently believes a modification does not create such undue risk in the following scenario:
1. The device is intended for the purpose of displaying, printing or analyzing the physiological parameter(s) measured by the device; and
2. The device is intended for the purpose of supporting or providing adjunctive recommendations to the health care professional or patient about prevention, diagnosis or treatment of COVID-19 or co-existing conditions; and
3. The health care provider and/or patient can independently review the basis for any diagnostic or treatment recommendations.”
Earlier in the week, the agency relaxed regulations related to virtual clinical trials. You probably already read about those changes, but they are also in this same guidance document — read the full details here.
Roche-Genentech’s in-house digital therapeutic for autism spectrum disorder may use virtual reality
Back in October, E&O mentioned Roche-Genentech’s plans to build its first digital therapeutic in-house after spotting a reference to it in a job posting. Well, a new job posting adds a new detail about the project: virtual reality. Two days ago, Genentech’s San Francisco office posted the job ad for a position called: “Principal/Sr. Principal Platform Product Manager – Neurology/VR, Digital Health Technologies.”
Here’s what it said: “We’re looking for experienced, customer-focused product managers who want to have an impact by helping us build, clinically validate and deliver to patients a digital therapeutic to treat Autism.”
In addition to listing “VR” in the job ad’s heading, under the “desired qualifications” subheader, the posting stated: “Experience with developing Virtual Reality hardware/software solutions.”
Janssen Biotech, Vivante partner to discover predictive digital biomarkers for GI disorders
J&J company Janssen Biotech has partnered up with Vivante Health, the digital medicine company founded by Dr. Kimon Angelides, who also founded the original diabetes startup that eventually rebranded as Livongo. Janssen and Vivante’s partnership will focus on discovering predictive digital biomarkers for chronic diseases. Here’s how Vivante describes itself:
“Since 2015, the Vivante team has been developing a comprehensive digital health platform for inflammatory conditions, with a primary focus on digestive health and disease. Vivante Health’s user-centric, data-rich platform captures real-time information and includes biometric testing, as well as microbiome analyses, to capture a holistic profile of individuals and match them with psychosocial, nutritional, and medication interventions to fill gaps in care and alter disease progression.”
The companies will initially focus on digital biomarkers for inflammatory bowel disease, with an eye on future applications for Crohn’s disease and ulcerative colitis.
Quick links to E&O research reports
The links below aim to make it easier for paying subscribers to find the long-form research reports on the E&O site:
The Digital Health Enrollment Report (Subscribers-only Link)
The Omada Health Report (Subscribers-only Link)
The Google Health Report (Subscribers-only Link)
The Pear Therapeutics Report (Subscribers-only Link)
The AliveCor Report (Subscribers-only Link)
Apple’s Healthcare Work Experience (Subscribers-only Link)
Approximating Livongo’s S-1 (Subscribers-only Link)
That’s a wrap on Issue 044. More next week.
