Quick Q&A: On pharma investments in digital health

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April 11, 2019

PwC Health Research Institute (HRI): 

What types of investments are pharmaceutical companies making in digital health?

Tim Pantello, PwC Managing Director:

What has really happened over the last year is almost every pharmaceutical company is involved in digital health. Some have a foot or half their leg in, and some have just a toe in. But almost every company that we talk to is involved.

Typically their involvement in digital health is taking one of three forms. The first is doing in-house development and building their own capabilities and platforms to deploy across multiple products in a therapeutic area or across a number of conditions that fall under a large therapeutic area. Second, you have other companies that are co-developing with startups in Silicon Valley who are developing behavioral software leveraging behavioral science to impact outcomes. The third area you are seeing is pure investing in other companies, such as a pharmaceutical company purchasing a stake in a software developer.

Almost everyone is starting to become involved in digital health now, and the point I would make is that this investment and involvement is not going away.

For example, the FDA is trying to make it easier for digital health products to come to market, and we are starting to see a pathway for pharmaceutical companies to design apps and services without having to do a separate 510(k) filing, especially for an app that is supporting medication adherence to a prescribed regimen or helping to improve patient experience. One of the things we are saying to our clients is every new chemical entity that comes to market should come with some connectivity to it in some form or fashion.

One of the hardest things to do in our business is to try to influence consumer behavior, which is what many pharmaceutical companies are trying to do. They have to do more than just provide new chemical entities—they have to fit that drug product into the lives of patients and into the care delivery ecosystem. That’s not easy to do.

HRI:

When you look at what the FDA is doing in digital health, what regulatory changes do you think will have the biggest impact on the pharmaceutical sector?

Tim Pantello:

I think two will have the most immediate effect on life sciences companies: The FDA’s change to multifunction devices that makes it easier to have the lesser functions of a device treated differently than the prescription functions, and the FDA’s move to treat companion applications as promotional labeling. Both changes will allow companies to move faster to bring digital health products to market than would have been possible historically.

By decoupling digital health products from the old regulatory framework that will allow life sciences companies to work in more of a software company mindset instead of pure hardware company mindset.

Almost everyone is starting to become involved in digital health now, and the point I would make is that this investment and involvement is not going away.

For more on this topic, read the HRI Report, Acceleration by regulation: Pharma stands to benefit from the FDA’s digital health approach.

For more of HRI’s insights and content, visit our Regulatory Center and report library

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Tim Pantello

Tim Pantello

PLS Lead, PwC US

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