DIGITAL THERAPEUTICS MARKET ANALYSIS

The global digital therapeutics market was valued at US$ 5.48 Bn in 2022 and is forecast to reach a value of US$ 24.34 Bn by 2030 at a CAGR of 20.5% between 2023 and 2030. The global digital therapeutics market is experiencing strong growth due to the increasing burden of chronic diseases and outbreak of COVID-19 (pandemic). Moreover, growing adoption of patient-centric healthcare applications and increasing adoption of digital healthcare solutions and technologies is expected to boost growth of the market. However, factors such as challenges involved with digital therapeutics and concerns about patient data privacy are expected to hamper the market growth.

Global Digital Therapeutics Market: Regional Insights

Based on geography, the global digital therapeutics market is segmented into North America, Latin America, Europe, Asia Pacific, Middle East, and Africa.

Among regions, North America is expected to gain highest share in the market during the forecast period owing to the rise in incidence of chronic diseases, increasing adoption of digital healthcare, and outbreak of COVID-19 (pandemic) in the region. For instance, research has shown that digital therapeutics solutions for the disease management can drive better outcomes for people living with chronic diseases. According to the U.S. Centers for Disease Control & Prevention (CDC), chronic diseases, such as cardiovascular diseases, cancer, and diabetes, are the leading causes of death and disability in the United States.

Europe and Asia Pacific are also expected to witness significant growth in the digital therapeutics market due to the increasing prevalence of chronic diseases, rise in adoption of digital healthcare, increasing penetration of Internet and smartphone, and outbreak of COVID-19 (pandemic) in these regions. For instance, several European countries, such as France and Belgium, are in a process of evaluating the use/regulation of digital therapeutics, with Germany spearheading these advances, as it has created a pathway, called DiGA, for doctors to prescribe digital therapeutics to publicly-insured patients and receive reimbursement in the same way as a traditional treatment.

Figure 1. Global Digital Therapeutics Market Share (%), by Region, 2023

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Global Digital Therapeutics Market Drivers:

Rise in burden of chronic diseases to propel market growth

One of the key factors expected to augment the growth of the digital therapeutics market over the forecast period is the growing burden of chronic diseases worldwide. For instance, chronic diseases are highly prevalent and are expected to increase substantially in the coming years. According to the World Health Organization (WHO), noncommunicable diseases (NCDs) kill 41 million people each year, equivalent to 74% of all deaths worldwide. Research has shown that digital therapeutics solutions for the disease management can drive better outcomes for individuals living with chronic diseases. This in turn is driving the growth of the market.

The outbreak of COVID-19 to drive market growth

Another factor which is driving the growth of the global digital therapeutics market is the outbreak of COVID-19 (pandemic). For instance, as a result of the pandemic, the adoption of digital health is higher than ever before, making it an ideal time for implementing novel and convenient digital care options. In April 2020, the Food and Drug Administration FDA) issued guidelines to increase the availability of digital medical devices or digital therapeutics solutions for mental health and to reduce the burden on healthcare facilities and the risk of exposure to the virus. Such initiatives by the governments are expected to augment the market growth.

Global Digital Therapeutics Market Opportunities:

Growing adoption of patient-centric healthcare applications is expected to offer significant growth opportunities for players operating in the global digital therapeutics market. For instance, in May 2022, MyHealthcare launched a patient-centric digital health platform in collaboration with Sakra World Hospital to deliver 360-degree patient care outcomes. A new platform will empower people to manage their healthcare needs such as booking doctor appointments, preventive health check-ups, book diagnostics tests, manage family health, view e-prescriptions, view test results and other reports, and request for pathology tests or delivery of medicines at home.

Increasing adoption of digital healthcare solutions and technologies is expected to offer significant growth opportunities for players in the global digital therapeutics market. Digital health solutions or technologies present an opportunity for better, safer, and efficient healthcare delivery systems. In March 2021, Encora Therapeutics, a clinical-stage medical device developer, received the U.S. Food and Drug Administration’s (FDA’s) Breakthrough Device Designation for its patent-pending tremor reduction wearable. The device stimulates the wrist with vibrations. It is indicated to aid in the transient relief of hand tremors in adult essential tremor or Parkinson's patients.

Global Digital Therapeutics Market Trends:

Government initiatives to digitalize healthcare is a recent trend

Digital transformation in the healthcare industry means digitizing processes and products to deliver better healthcare services with better customer experience. The digital revolution in the healthcare across the globe is progressing rapidly, driven by the federal government regulation, technological advancement, and financial incentives. Several governments worldwide have also invested billions to modernize and digitize healthcare infrastructure. This trend is expected to continue during the forecast period, driving the growth of the market.

Rise in adoption of mHealth (Mobile Health) is another trend

mHealth (Mobile Health) is the use of mobile and wireless technologies to support the achievement of health objectives. The most common application of mobile health is the use of mobile devices to educate consumers about preventive healthcare services. Furthermore, mHealth is also used for disease surveillance, outbreak tracking, treatment support, and chronic disease management. Thus, with the rise in disease burden, the use/adoption of mHealth is also increasing rapidly. This trend is expected to continue over the forecast period, driving the market growth.

Global Digital Therapeutics Market Restraints:

Lack of awareness about DTx to hamper market growth

One of the key factors expected to hamper growth of the global digital therapeutics market is the lack of awareness about digital therapeutics (DTx). Awareness of the benefits and opportunities of digital therapeutics solutions among patients and healthcare professionals and its acceptance are crucial elements for growth of the market. In most regions, healthcare professionals and patients are not aware of digital therapeutics solutions and technologies used to treat chronic illness. Thus, there is a need to improve the awareness related to digital therapeutic solutions as it can reduce the overall healthcare cost, benefiting low-income countries and their people.

Growing concerns about data privacy to hinder market growth

Another factor which is hampering growth of the global digital therapeutics market is the growing concerns about patient data privacy. Security and privacy risks are one of the major challenges for the market as the nature of data, and is vulnerable to cybersecurity attacks and data theft. Digital therapeutics solutions or technologies are also vulnerable to third-party interference, signal errors, and transmission outages. This may result in the loss of critical patient data, the alteration of critical clinical information, and interrupted communication, among others. This in turn is also expected to hamper the growth of the digital therapeutics market.

Figure 2. Global Digital Therapeutics Market Share (%), by Application, 2023

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Global Digital Therapeutics Market Segmentation:

The global digital therapeutics market report is segmented into Application, Product Type, Sales Channel, and Region.

Based on Application, the market is segmented into Diabetes, Obesity, Cardiovascular Disease (CVD), Central Nervous System (CNS) Disease, Respiratory Disease, Smoking Cessation, Gastrointestinal Disorder (GID), and Others. Out of which, Cardiovascular Disease (CVD) Segment is expected to dominate the digital therapeutics market over the forecast period and this is attributed to the prevalence of cardiovascular diseases (CVDs).

Respiratory Disease Segment is also expected to witness significant growth in the near future and this is owing to the outbreak of COVID-19 (global pandemic).

Based on Product Type, the market is segmented into Software and Device. Of which, Software Segment is expected to dominate the market over the forecast period and this is attributed to the increasing adoption of digital healthcare solutions and technologies.

Device Segment is also expected to witness significant growth in the near future and this is owing to rise in use of digital health therapeutic devices worldwide.

Based on Sales Channel, the market is segmented into Business-to-Business (B2B) (Employer, Healthcare Provider, and Others) and Business-to-Consumer (B2C) (Patient and Caregiver). Out of which, Business-to-Business (B2B) Segment is expected to dominate the market over the forecast period and this is attributed to the increasing healthcare digitalization and/or government initiatives to digitalize healthcare industry.

Business-to-Consumer (B2C) Segment is also expected to witness significant growth in the near future and this is owing to growing adoption of patient-centric healthcare applications.

Global Digital Therapeutics Market: Key Developments

In July 2022, AmerisourceBergen planned to launch digital therapeutic (DTx) platform to facilitate access to innovative products. The platform enables doctors to easily access and order prescription and non-prescription DTx through their e-prescribing workflow and monitor patient fulfilment.

In February 2022, DynamiCare Health Inc. announced that the U.S. Food and Drug Administration (FDA) has granted Breakthrough Device Designation for the DCH-001, a prescription-only digital therapeutic intended to treat tobacco use disorder complicating pregnancy and childbirth.

In January 2021, Epillo planned to launch its pilot project- Blockchain based Digital Therapeutic Devices (DTx) in a strategic partnership with Hydrus7 Labs, a USA based blockchain Technology Company to aggressively expand its innovation portfolio as well as broaden and accelerate product development in Europe and United States.

In June 2020, MedRhythms announced that it has received Breakthrough Device designation from the U.S. Food and Drug Administration (FDA) for its patented digital therapeutic to treat chronic stroke walking deficits.

Global Digital Therapeutics Market: Key Companies Insights

The global digital therapeutics market is highly competitive. This is attributed to the rise in burden of chronic disease and the outbreak of COVID-19, as a result, players in the market are focusing on launching novel products in the market.

Some of the key players in the global digital therapeutics market are Happify, Inc., 2Morrow, Inc., Akili Interactive Labs, Inc., Click Therapeutics, Inc., and Fitbit, Inc. (Twine Health, Inc.).

*Definition: Digital Therapeutics (DTx) are evidence-based therapeutic interventions driven by software to prevent, manage, or treat a medical disorder or disease. DTx are a part of digital health that deliver therapeutic interventions directly to patients via evidence-based, clinically-evaluated software for disease management.