Issue 186
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E&O Fridays.
Here are three quick things happening in prescription digital therapeutics this past week…
- Maryland’s state legislature is considering a bill that instructs the state’s Medicaid program to cover prescription digital therapeutics for program recipients who have been diagnosed with substance use disorder or depression. The addition of depression suggests that Otsuka is lobbying the state on behalf of its future digital therapeutic focused on depression from its partnership with Click. Usually, these bills are just the work of Pear’s lobbyists, which is why they are often tailor-made for Pear’s reSET-O and are sometimes written in a way to exclude other interventions. One brief on the bill circulating amongst the legislatures notes that: “Digital prescription therapeutics supplement rather than supplant existing treatments and services. Thus, while they may improve patient outcomes, the Maryland Department of Health (MDH) advises that they are not anticipated to reduce costs or substitute for other services.”
- Utah’s state legislature has moved to fund a pilot of Pear Therapeutics’ reSET-O for Medicaid recipients with opioid use disorder. “This Appropriation would fund a pilot program for the use of FDA-authorized prescription digital therapeutics in the treatment of behavioral health conditions in the Medicaid population. Prescription digital therapeutics are being implemented across the country in an effort to enhance treatment engagement and outcomes without drawing from an already depleted clinical/medical workforce.” The $300,000 appropriation is significantly less than the nearly $770,000 that the pilot’s sponsor requested, but money is coming out of the state’s Opioid Litigation Settlement Restricted Account.
- OK, one more… Akili changed up its marketing on its homepage for EndeavorRx. Currently, the company’s website no longer advertises the cash pay price as $99. It now instructs interested parents to contact Phil Pharmacy for pricing.
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Pear Therapeutics is seeking a buyer and won’t host a Q4/FY22 investor call.
Pear Therapeutics announced this morning that it would not host an earnings call with investors to discuss its fourth quarter and fiscal 2022 year-end results. Instead it has hired MTS Health Partners to explore a sale of the company — along with other options to “maximize shareholder value.” You may remember MTS Health Partners from its advisory services around funding, mergers and acquisitions to such companies as MedRhythms (funding round), BehaVR (when it merged with OxfordVR), and Otsuka (when it inked its last $80 million partnership with Proteus Digital Health pre-bankruptcy proceedings).
As I noted back in issue 184 of this newsletter, Pear’s stock dipped below $1 a share for the first time three weeks ago, which suggested the company could go this route soon. Around the same time, Pear’s Chief Commercial Officer Julia Strandberg resigned (she has since landed at Philips Connected Care business). It seems like Pear is likely to be very quiet between now and whenever it figures out its next move:
“Pear is exploring the potential for an acquisition, company sale, merger, divestiture of assets, licensing, or other strategic transactions and/or seeking additional financing. There is no set timetable for this process and there can be no assurance that this process will result in the Company pursuing a transaction or that any transaction, if pursued, will be completed on attractive terms. If the Company is unable to complete a transaction, it may be required to seek a reorganization, liquidation or other restructuring. The Company does not expect to disclose or provide an update concerning developments related to this process unless or until the Company’s Board of Directors has approved a definitive course of action or otherwise determines that other disclosure is necessary or appropriate.”
Understandably, the fate of Pear is important to other prescription digital therapeutics companies. I’m curious about what you think. Here’s a quick two-question survey on this situation. All responses are anonymous.
The bill is back. Who lobbied Congress for a Medicare benefit category for prescription digital therapeutics last year?
A group of Congress members reintroduced the 2023 version of the Access to Prescription Digital Therapeutics bill this past week. Apart from updating the relevant dates, the bill’s text is identical to prior versions. As efforts to win new co-sponsors for the bill begin again, I figured it was worth reviewing which industry associations, patient groups, pharmaceutical companies, digital health companies, and provider groups disclosed lobbyist activity around the House and Senate versions of the bill. I knew about a few of these but found a few surprises too. And, I included a dollar amount for how much each of these groups paid federal lobbyists in 2022.
To be clear, this is total lobbyist dollars spent last year — not dollars spent on lobbying about this one issue, which isn’t something disclosure laws require companies to break out.
OK, read on for a list of group who lobbied Congress on the Access to Prescription Digital Therapeutics Act of 2022:
Industry Associations and Patient Groups
Digital Therapeutics Alliance: The DTA is widely known to be the main force behind these bills and its sizeable membership list is worth checking out for a sense of the players who are backing these lobby efforts via the DTA. Total lobbyist dollars spent in 2022: $300,000.
American Medical Association: Yes, one of DC’s heavyweight associations backed the PDT bill last year. While it was just one of many (hundreds?) of bills that the AMA informed lawmakers it was backing, it’s a big part of the coalition here. Total lobbyist dollars spent in 2022: $21 million
Academy of Managed Care Pharmacy: AMCP was another known backer of the bill so no surprise here. Its total lobbying dollars spent in 2022 amounted to $390,000.
National Alliance on Mental Illness: NAMI’s total lobbyist dollars in 2022 amounted to $30,000.
The Michael J Fox Foundation for Parkinson’s Research: OK, doc, this is heavy. This one did surprise me a bit. I know the foundation is sponsoring a number of digital health-powered clinical trials but it’s news to me that it has an interest in prescription digital therapeutic coverage policies. Its total lobbyist spend last year was $170,000.
Pharmaceutical companies
Otsuka Pharmaceutical: Otsuka’s interest in the future of prescription digital therapeutics reimbursement stems from its partnership with Click Therapeutics. The company also acquired the assets of Proteus Digital Health to continue to power its Abilify MyCite brand. Total lobbyist dollars spent last year: $1.5 million
Grunenthal Group: OK, this is another surprise. Grunenthal Group describes itself as a company focused on pain management. I wasn’t aware of any particular digital therapeutic assets that this German pharmaceutical company was working on. Are you? Total 2022 lobbyist dollars spent: $320,000
Digital Health Companies
Pear Therapeutics: I think the only thing surprising here is that some individual digital health companies conducting their own lobbyist efforts outside of the DTA and other orgs. Total spent in 2022: $270,000
Big Health: This is surprising, of course, because Big Health doesn’t currently have any prescription digital therapeutics. It appears to be intent on sending at least one PDT to the FDA soon, however. Total lobbyist dollars spent in 2022: $130,000
Venture Capital Firms
Social Capital: This appears to be the only investor in prescription digital therapeutics companies that stepped up to lobby for Medicare reimbursement. Remember: It was a Social Capital-affiliated SPAC that took Akili public. Total 2022 lobbyist spend: $200,000
Healthcare Providers
Wisconsin’s Children’s Hospital & Health System: Here’s another headscratcher. Any idea why this healthcare group is interested in reimbursement for prescription digital therapeutics? Total 2022 lobbyist dollars spent: $450,000.
Trials from Samsung-MGH, Mahana Therapeutics, and Akili
This is a recurring feature of E&O Fridays that digs into new digital health-related clinical trials as well as updates to others mentioned in previous issues. Just a handful of studies this week…
Now recruiting: Samsung and MGH want to validate a smartphone-powered algorithm that detects signs of depression and anxiety
This is an interesting new study sponsored by MGH that seeks clinical validation of the algorithm:
“Wearable technology holds promising potential for mental health monitoring and detection. Samsung has developed an algorithm that they believe can detect signs of depression and anxiety in smartwatch users. They have used this algorithm to create a ‘Mindfulness Index,’ which is an easily understood visual index of mental health. The primary aim of the study is to evaluate the performance of Samsung’s Mindfulness Index in identifying those who have received a diagnosis of Major Depressive Disorder (MDD) from a clinician-administered semi-structured diagnostic interview.”
Done recruiting: Akili’s COVID-19 brain fog study
Akili recruited 110 participants of the 125 it had originally anticipated for this study:
“The primary objective of this study is to investigate the efficacy of AKL-T01, a remotely-delivered digital cognitive intervention, relative to a waitlist control in improving cognitive functioning in COVID-19 survivors.”
Complete: Mahana IBS study that would widen indication from 22+ to those aged 18+
Assuming it went well, Mahana appears poised to submit its latest study results to the FDA to broaden its indication to include people aged 18-21. Its original indication was for those with IBS aged 22 and up:
“The main objective of this prospective, open-label, non-significant risk study is to assess the efficacy and safety of Mahana IBS together with care as usual in approximately 100 young adults with Irritable Bowel Syndrome.”
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