Issue 162

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.

Here are a few bullets on what’s going on in FDA-regulated and pharma-focused digital health:

• Great read: In Health Affairs, Memora Health co-founder Nisarg Patel wrote another worthwhile recap of market activities for prescription digital therapeutics — this time focused on moves related to billing and reimbursement. For longtime E&O readers, it works as a great summary document covering much of what I’ve reported in real-time over the past year. Here’s an excerpt: “One challenge with retaining a universal Level II code encompassing multiple digital therapeutics products is the implications for a future Medicare physician fee schedule for this code. In the absence of cost data, CMS may examine commercial contracts for PDT products as a comparison for establishing an initial fee amount. However, given how broad the indication basket is for ‘prescription digital behavioral therapy’ as a billing code—theoretically covering everything from opioid use disorder to schizophrenia, and arguably also encompassing lifestyle modifications for conditions such as Type II diabetes and congestive heart failure—it’s unclear whether PDTs encompassing varying indications and levels of sophistication should be priced identically.”
• Pear Therapeutics released its Q2 results this week. The big news is that the company has revised its 2022 revenue guidance down from $22 million, which it had set as a target prior to its SPAC, to a range of $14 million to $16 million. To hit those numbers, Pear is focused on 20 percent quarter-over-quarter growth it said. It posted $3.3 million in revenue in Q2. Pear also made the decision not to set any guidance for 2023 revenue yet. Pear re-emphasized that its current strategy is to continue to land deals with state Medicaid programs. It says it currently has ongoing discussions with more than 30 states. The company also said much of its revenue currently comes from state Medicaid programs bulk buying prescriptions to reSET-O. *One other update I noticed buried in Pear’s SEC filing was an update on its deal with SoftBank to develop a digital therapeutic for the Japanese market focused on the treatment of sleep/wake disorders for the Japanese market. “Total anticipated revenue from this agreement is between [$600,000] and [$750,000] and the Company anticipates fulfilling its performance obligations by the end of 2022.” Pear has already netted $254,000 in revenue from its SoftBank collab as of the end of June.
• One more from Pear: “SelectHealth, a Utah-based not-for-profit health plan and wholly owned subsidiary of Intermountain Healthcare, announced today that reSET-O, the only FDA- authorized [prescription digital therapeutic] to treat opioid use disorder (OUD), has been added as a covered benefit for SelectHealth’s members. SelectHealth serves more than one million members across Utah, Idaho, and Nevada.” More
• Last week in Issue 161, I mentioned Resmed’s acquisition of Mementor, the developer of a prescription digital therapeutic for insomnia called Somnio that is permanently listed in Germany’s DiGA formulary of reimbursed apps. I wondered if this deal might see Somnio scaling to markets outside of Germany, but speculated based on the press release that Resmed wasn’t thinking that way yet. Well, in its quarterly call with investors this week, Resmed said it was eyeing a Europe-wide launch for Somnio and other markets Resmed already operates in globally, but it gave no timeline for such a rollout.
• One more thing… The Access to Prescription Digital Therapeutics bill, which would establish a new Medicare benefit category for PDTs, gained three new co-sponsors this week: Rep. Terri Sewell (D-AL), Rep. Ann Kuster (D-NH), and Rep. Robert Wittman (R-VA). That brings the House version of the bill up to 13 co-sponsors, while the Senate bill just has two senators backing it so far.

Did a friend forward this to you? You, too, can win friends and influence people via newsletter forwards by clicking right here. Become the newsletter-forwarder we both know you were meant to be. Act fast! This offer won’t last forever (I am not immortal).

Orexo’s deal with the VA for deprexis prices the prescription digital therapeutic at $149.75 per Rx

Starting on July 15, 2022, the US Department of Veterans Affairs began to reimburse for a prescription digital therapeutic named deprexis, developed by GAIA and licensed for commercialization in the US by Swedish pharmaceutical company Orexo. Orexo didn’t include any pricing info in its press release announcing the deal with the VA, but I dug some up, so read on for those details.

The VA has agreed to pay $149.75 for each 12-week deprexis program prescribed to individuals diagnosed with mid-to-severe major depression disorder (MDD). The agreement runs through mid-2027.

Meanwhile, the German version of deprexis, which is marketed under the same brand but directly by its developer GAIA, is priced at about $215 for 90 days:

“There is a one-off license fee of €210 per license (incl. 19% VAT). The license allows the use of deprexis for a minimum prescription period of 90 days.”

(When you factor in the VAT, it’s more or less the same price point, right?)

The only other prescription digital therapeutic company with an agreement like this one with the VA is Pear Therapeutics.

As E&O reported back in June 2021 (Issue 107), all three of Pear’s PDTs are available and reimbursed via the VA. When I first reported on the VA-Pear agreement, the pricing for reSET and reSET-O were both $1,623.17 for a (90-day reSET program and 84-day reSET-O program) prescription.

Now the VA’s database shows a price increase for both the reSET and reSET-O programs to $1,753.02 while the price for Somryst has remained the same at $877.39.

Clinical trial updates from Novartis-Propeller, Twill (Happify), Pear Therapeutics, and Woebot

This is a recurring feature of E&O Fridays that digs into new digital health-related clinical trials as well as updates to others E&O mentioned in previous issues.

Done recruiting: Novartis-Propeller asthma study in Germany

Novartis finished up recruiting for its Propeller Health-powered asthma medication adherence study after recruiting 425 participants — fewer than the anticipated 1,000 participants it originally listed as a target. More on the study:

Pushed back: Twill sets its Ensemble study finish date back one year

We’ll see if this ends up taking another year, but Twill (the company formerly known as Happify) just posted an update to its study on its Ensemble prescription digital therapeutic, which treats both generalized anxiety disorder (GAD) and major depressive disorder (MDD), that shows it is anticipating an April 2024 final completion date now instead of April 2023. More:

Pushed back: Pear’s study on a tweaked version of reSET-O set to finish up in December 2022 now instead of August

Small update on this study from Pear that is testing a new version of reSET-O: It is set to finish up at the end of the year instead of this month. More:

Now recruiting: Woebot’s study on digital therapeutic for adolescents with depression  More:

Links to E&O’s reports, databases, newsletters

The Exits & Outcomes site is designed to make it easy to find long-form research reports, databases, and past newsletter editions. Click below for dedicated pages for each of those categories:

• Read through the long-form E&O research reports here.
• Search and sort the E&O databases here.
• Skim more than 200 past issues of E&O newsletters here.