Digital health is gaining steam as biotech and pharma companies engage with IT innovators to develop this new category of healthcare solutions and tools. In the process, some previously unlikely companies are teaming up, pairing their unique skills to develop better solutions to serious challenges than either could alone.
“Life sciences companies are particularly good at recognizing what they don’t know,” acknowledges Asher Rubin, global head, life sciences and healthcare industry group for Hogan Lovells. Therefore, partnering with IT experts makes more sense than trying to develop the expertise in-house.
Partnering with IT, however, is very different than partnering with a pharmaceutical or biotech company. These companies tend to have consumer sensibilities. They’ve built their businesses around delivering functionality in entertaining, easy-to-use applications and form factors.
Because of that, “there’s a perspective difference. When Apple or Google, for instance, makes a phone, the marketplace decides which is best. Meanwhile, it makes a better version. While pharma wants the best product to prevail, it has a greater focus on patent protection and exclusivity,” Rubin says.
Appreciating that difference in perspective really requires partners to understand the rationale behind the open source concept in the technology world and exclusivity in the pharmaceutical environment. In pharma, drugs maintain maximum value throughout the life of their patents. Then, when those patents expire, generic companies become competitors.
Technology has a different business model. That industry thrives by developing a continuous influx of new products. A mobile phone introduced today based on a 20-year-old patent would be irrelevant. (If you don’t remember, 1997 phones were only phones, but they finally came in multiple colors…on the keypad.)
Pharma and IT companies also have different expectations in terms of speed of product development and what constitutes a finished product. “The time it takes to launch a healthcare product is something digital companies must adjust to,” Rubin says.
Reimbursement is another difference. Orders occur on a different time frame, and third parties—not healthcare consumers—are still deciding how to pay for digital health solutions.
Additionally, digital health companies must ensure they understand the regulatory environment. “Initially, 23andMe didn’t realize it had a regulated product,” he recalls. “Companies are getting better at recognizing when their products are regulated, and the FDA’s precertification program is speeding products to market.” That program prequalifies technology companies that have a culture of quality and organizational excellence, in a process that resembles the FDA’s treatment of lab-developed tests or establishment reports for manufacturers. “The program aims to get digital technology to the market in a way that makes more sense.”
Digi solutions boost effectiveness
While IT and life sciences partners are adjusting to those differences, pharma is learning how digital applications can improve the effectiveness of their products. For example, the recent approval of the first digital pill (Abilify MyCite, by Otsuka and Proteus Digital Health) lets physicians track compliance and patient activity levels. “The next level of digital pill may monitor the level of drug still circulating in the body and let patients know when they need to take another,” Rubin predicts. Consequently, dosages can become more accurate, particularly as patients come in different sizes.
Pear Therapeutics is another example. It has the first FDA-approved stand-alone digital medicine for substance abuse, which combines its outpatient digital solution with face-to-face therapy. “Statistics indicate its product is 25 percent effective at 12 weeks in reducing opioid dependence. Face-to-face therapy alone is only 7 percent effective,” he says.
IT and pharma become equal partners
In the digital partnerships that are emerging, the partners are working together as equals. “We’re seeing more partnerships in the true sense of the word, because each party brings something unique. In that regard,” Rubin says, “the structure more closely resembles a joint venture than a customary collaboration.”
That equality is driven by a few key elements: economics, expertise, and shared risk. “The parties realize they each can develop a better product and earn more money by working together than either can alone,” he says. Both parties also bring deep subject-matter expertise and mature infrastructures, and neither is willing to relinquish its rights in what eventually may become a highly lucrative industry. Naturally, pharma is eager to share the risks, particularly while distribution methods and reimbursement strategies are being sorted.
Pioneering digital health
Hogan Lovells started its deep dive into digital health about five years ago when its pharmaceutical and technology clients began asking questions about each other. Recognizing the beginning of a trend, “we set up a digital health working group that explored the requirements in this space around partnering and collaborations,” Rubin recalls.
One of its early projects involved crafting an exclusive agreement that enabled Regeneron to analyze Geisinger Health’s biospecimen to link patient phenotype and genotype for use in drug development. “There were health privacy concerns as well as data security and patient consent issues that had to be addressed,” Rubin recalls. Today, Hogan Lovells has a global digital health team of more than 40 lawyers from various practice groups and regions to help identify those issues as well as the regulatory pathways for digital health solutions.
Digital health is a young and dynamic field. As digital health evolves, many new players are likely to emerge, and new partnerships will form. Join Asher Rubin and industry panelists as they discuss these new partnerships and their implications for life science companies Monday afternoon, January 8, at the Digital Medicine & Medtech Showcase panel "Strange bedfellows: The new partnerships driving next gen digital medicine."