Pear Therapeutics made headlines in 2017 as the first company to have a prescription digital therapeutic (PDT) cleared by the U.S. Food and Drug Administration for treatment of disease. Despite a promising start, on April 7, the company announced it had filed for Chapter 11 bankruptcy and was laying off 170 employees including its CEO and was planning to sell its assets. But with numerous PDTs in the pipeline and pending legislation to get the therapies covered by Medicare, it’s still a hot area for health care journalists to follow.
PDTs are therapeutic interventions prescribed by a health care providers that use software, mobile apps, websites or other technologies to replace or complement existing treatment of a disease or condition. They are evidence-based therapies with proven clinical efficacies and are approved by regulatory authorities for the management or treatment of specific medical conditions. I wrote a blog post for AHCJ last November suggesting several story angles on PDTs.
Pear’s products include reSET, a PDT used in conjunction with standard outpatient treatment for substance use disorder related to stimulants, cannabis, cocaine and alcohol. ReSET provides cognitive behavioral therapy for adult patients through a mobile device, and information for providers such as patient use of the tool, lessons completed and patient-reported cravings. A companion product, reSET-O (FDA approved in 2018), was designed for those being treated for opioid use disorder.
The company also received FDA approval in 2020 for Somryst, a PDT for chronic insomnia, and had 14 additional products in development for alcohol use disorder, schizophrenia, posttraumatic stress disorder, acute and chronic pain, migraine, multiple sclerosis and other conditions. Together, the products were covered by 15 Blue Cross/Blue Shield insurance plans and multiple state Medicaid plans, Modern Healthcare reported.
Still, the company struggled financially, earning just under $13 million in revenue in 2022 while suffering losses of around $123 million, the Modern Healthcare story said. A LinkedIn post from the former CEO attributed the failures to payer denials to cover the therapies and market conditions. The company underwent two rounds of layoffs last year. A filing with the Securities and Exchange Commission stated the company would maintain a transition team of about 15 employees to continue operations, according to an article in Mobihealth News.
Lessons for industry
Neither Pear nor Mindstrong — a company that had smartphone applications to monitor mental health but ceased operations in March — was able to invest the money required to carry out necessary scientific research to back up such technologies, according to an opinion piece published in STAT by John Torous, M.D., director of the digital psychiatry division at Beth Israel Deaconess Medical Center and an assistant professor of psychiatry at Harvard Medical School. (Torous was a panelist at AHCJ’s 2021 Summit on Mental Health, speaking on the promise and limitations of telehealth, apps and mental health tech.)
It’s a common problem in the industry, he noted, but it doesn’t mean that PDTs and digital mental health have no future. “These failures tell us that patients, clinicians and payers want digital tools that are effective in real-world settings. That means promising pilot studies…must be followed by high-quality studies. It is time to think about a new generation of evidence and new studies to build the type of real-world data we need to ensure products offered are both safe and truly effective,” he wrote. Just like other types of clinical research, studies must be “run in real-world clinical settings, involve diverse patients and [be able to] be replicated by outside teams.”
Changing physician behavior, driving patient adherence and unlocking payer coverage for PDTs “remain slow and arduous undertakings” but Pear’s demise doesn’t spell doom for the field as a whole, wrote Mike Radocchia, a digital health strategy consultant and executive advisor, in an April 12 LinkedIn article. Pear did have some unrealistic expectations and poor cash management, he wrote, but should be thanked for the “trailblazer tax” they paid by securing the first FDA clearance for a PDT, building awareness of PDTs among key stakeholders such as payers, and clearing trails others can follow in gaining insurer coverage for their products from Medicaid programs.
Resources for journalists
PDTs are still a growing industry worth keeping an eye out for story coverage. More than 35 PDTs have been approved by the FDA in the past five years, and some 137 products are in the pipeline, according to a presentation I saw at the Academy of Managed Care Pharmacy’s annual meeting in March. Of those, 37% are in psychiatry, 31% are in neurology and others are in areas as varied as gastroenterology, psychiatry, endocrinology, women’s health and more.
The Access to Prescription Digital Therapeutics Act of 2023 (S. 723/H.R. 1458) is a bipartisan bill that would expand coverage of PDTs, add PDTs to the list of services and products eligible for coverage under Medicare and Medicaid, and direct the Centers for Medicare and Medicaid Services (CMS) to establish payment methods and product codes for billing. It was reintroduced in March (after being introduced the previous year) by U.S. Sens. Shelley Moore Capito (R-W.Va.) and Jeanne Shaheen (D-N.H.) and U.S. Reps. David McKinley (R-W.Va.) and Mike Thompson (D-Calif.).
Journalists can review the types of PDTs approved by querying the De Novo and Premarket Notifications (510(k)s) databases on the FDA website and search using the product codes PWE, QMY and QMZ. General internet searches for “FDA approval” and “digital therapeutic” will also pull some information.
Reporters also can investigate the pipeline of new products. Some information can be found through general internet searches for “digital therapeutic” and “FDA” or by looking at the websites of companies that already have had other products approved such as Akili Interactive.
Experts for PDT stories