Digital Therapeutics Market Size, Share & COVID-19 Impact Analysis, By Type (Devices and Software & Services), By Application (Prevention and Treatment), By Sales Channel (B2B and B2C), and Regional Forecast, 2023-2030

The digital therapeutics market size was USD 5.53 billion in 2022 and is projected to grow from USD 6.77 billion in 2023 to USD 28.66 billion by 2030, exhibiting a CAGR of 22.9%. North America Dominated the Market due to Large Population Suffering from Chronic Illnesses.

Digital therapeutics (DTx) includes the software and devices that digitally maintain evidence-based therapeutic interventions for the prevention and management of diseases. The software and devices aid in the treatment of various disorders related to mental health, diabetes, respiratory diseases, and cardiovascular diseases. The increased demand for these products is also due to the increasing prevalence of chronic diseases such as diabetes, mental illness, cancer, and heart failure (HF), worldwide. Hence, the adoption of therapeutics for managing and treating various chronic illnesses is increasing among patients.

• As per an article published by the American Cancer Society, Inc. in 2021, an estimated 1.9 million new cancer cases will be diagnosed and will cause 608,570 cancer deaths in the United States.

Additionally, the increased demand for these products amongst the pharmaceutical industries and physicians is also anticipated to drive market growth. The increased focus on research and development activities among market players to develop novel and advanced therapeutics for treating various diseases is expected to spur the growth of these products. For instance, in 2020, Akili, Inc. received clearance from the U.S. FDA for Interactive’s video game treatment EndeavorRx for children with attention deficit/hyperactivity disorder (ADHD).

COVID-19  IMPACT:

COVID-19 Positively Impacted the Market Due to Increased Adoption of Digital Therapeutics

The COVID-19 impact on the global digital therapeutics market growth will be positive during the forecast period. Due to the outbreak of the COVID-19 pandemic and lockdown restrictions, the demand for efficient diagnosis and treatment at home significantly increased over the world. Moreover, the initiatives undertaken by major key players in the market to manage patients during the COVID-19 pandemic played a major role in the increased adoption of these products.

• For instance, in April 2020, Fitbit Health Solutions announced a collaboration with The Scripps Research Institute and Stanford Medicine to study the role of wearables in the detection, tracking, and management of COVID-19 infection in patients.

Henceforth, the major players in the market witnessed increased revenues generated from the software and devices owing to the high demand and shifting adoption towards online treatment rather than visiting clinics and pharmacies during the COVID-19 pandemic.

• For instance, according to a publication by MobiHealthNews in May 2021, 41.0% of start-ups in digital health companies noticed significantly higher revenue than expected during COVID-19, and 29.0% of companies generated slightly higher revenue than expected.

A surge in the high demand for treatment at home for various chronic diseases during the pandemic has created an opportunity for market players to introduce novel and advanced software and devices in the market, thereby boosting the steady market growth during the forecast period of 2023-2030.

LATEST TRENDS

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Technological Advancements in These Products to Augment the Market Growth

Technological advancements in digital software and devices are helping healthcare professionals to record and monitor clinical data regularly and provide better treatment to their patients. The high-performance capabilities of these products are a great aid to the healthcare industry.

Digital therapeutics assists in providing specialized medications, lifestyle and nutrition management, tracking day-to-day activities, and treating physical, mental and behavioral health conditions. Novel and technologically advanced therapeutics provides data-based insights to its customer, limits human error, increases customer satisfaction, and provides a high-quality user experience, leading to an increased demand for such therapeutics in the market.

The increasing focus of major key players on developing such technologically advanced software with easy access for physicians and patients is expected to propel the market during the forecast period.

• In July 2022, AmerisourceBergen Corporation announced to launch DTx Connect, a fully integrated ordering, dispensing and fulfillment platform that aims to facilitate patient access to physician-ordered therapeutics and diagnostics. The platform integrates with electronic medical records (EMR), giving physicians easy access to prescription and non-prescription therapeutics.

Also, the rising partnerships and collaborations amongst the market players and research organizations to develop innovative and more effective products for chronic conditions are expected to propel the digital therapeutics market during the forecast period.

DRIVING FACTORS

Rising Prevalence of Chronic Diseases to Drive the Demand for Digital Therapeutics

The usage of therapeutics software and devices is driven due to the increased demand for the management and treatment of chronic diseases worldwide. Adding to this, the growing prevalence of all types of chronic conditions, such as type 1 diabetes & type 2 diabetes, cancers, Alzheimer’s diseases, mental disorders, obesity, and gastrointestinal disorders especially in emerging countries, is expected to propel the demand for this software during the forecast period.

• For instance, according to the 2022 report estimates published by the International Diabetes Federation (IDF) Diabetes Atlas, 62.0% of all new Type 1 Diabetes cases in 2022 were in people aged 20 years or older.


• Furthermore, according to the 2021 report estimates published by the World Obesity  Federation in India, the prevalence of obesity in adults aged 15-49 years is 23.4%. Such an increase in the prevalence of chronic diseases in adults is expected to drive the demand for these products in the coming years.

The growing initiatives undertaken by various healthcare agencies and market players, such as the creation of awareness regarding the prevention and treatment of chronic diseases, have increased the demand for this software. Moreover, an increase in the number of physicians in developed and emerging countries referring their patients to use these products for chronic conditions are some other major factors expected to augment the demand in the market.

Increasing Usage of Smartphones for Digital Therapeutics to Drive the Market

With growing digitalization, healthcare has witnessed several changes over the last few years. The emergence of smart medical devices and a cloud-based data platform combined with smartphones enables better treatment and health monitoring. This has resulted in the increased focus of market players and other organizations to develop and launch innovative technologies with inbuilt applications for treating many chronic diseases with the help of these products.

With the rising focus of major industry players on approvals from regulatory bodies, launches of new digital therapeutics mobile applications in the market are likely to accelerate the market growth in the forecast period.

• For instance, in 2021, Mahana Therapeutics, Inc. received the U.S. FDA 510(K) marketing clearance for its Mahana Parallel Digital Cognitive Behavioral Therapy (CBT) mobile application, it is as substantially equivalent to a marketed predicate device for Irritable Bowel Syndrome (IBS)

Such major developments in this market have led to effective chronic disease management among patients and the increasing demand for such applications. This is expected to boost market growth in the forecast period.

The increased usage of smartphones coupled with the introduction of mobile applications for the treatment of chronic diseases is expected to spur the global digital therapeutics market forecast.

RESTRAINING FACTORS

Limitations Associated with the Digital Therapeutics to Limit its Adoption

This market represents an emerging field of software and device-driven based products intended to prevent, manage or treat medical conditions. However, increasing issues related to cybersecurity are a major concern limiting the adoption of therapeutics. Patients are concerned about the risks and vulnerabilities in protecting their medical data. Certain risks and cyberattacks are responsible for the restrained adoption of these products in the forecast period.

• According to Appdome Inc., in September 2022, the risk of cyberattacks on digital therapeutics apps increased as compared to previous years. The cyberattacks are due to the increased availability of more users and the rise in patient health information.


• Furthermore, malware programs can easily invade Android or IOS phones, hampering patient data. It can be used to illegally release sensitive and personal data or gain backdoor system access.

Such high risks of cyber security breaches associated with the patient’s personal health information have been restricting the global adoption of these products by the patient population. Furthermore, limitations associated with therapeutic products, such as the generation of false and over-predictive results and mismanagement of the patient’s health, are expected to limit the market growth during the forecast period.

SEGMENTATION

By Type Analysis

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Rising Usage of Health Monitoring Apps to Surge Growth of the Software and Services Segment during 2023-2030

Based on type, the market is segmented into devices and, software & services.

Software and services accounted for the highest market share in 2022 due to the increased adoption of software. The software offers patients convenient usability, easy access, and personal medications. The rising focus of market players on the development of software for patients suffering from chronic conditions such as cardiovascular diseases, diabetes, and mental health would contribute to the segment’s growth.

• For instance, in June 2022, Pfizer Inc. and Sidekick Health teamed up to launch a new digital therapeutics solution for patients suffering from atopic dermatitis (AD). The new platform is designed to manage treatment adherence amongst patients with AD.

The devices segment also registers a significant global digital therapeutics market share. Various advantages associated with devices include real-time diagnosis and personalized treatments which are easily accessible to consumers. Furthermore, robust research on advanced devices for the treatment of chronic diseases is anticipated to fuel segmental growth during the forecast period.

By Application Analysis

Treatment Segment to Account as the Dominant Segment in 2021 Owing to Strong Usage of These Products for This Application

In terms of application, the market is segmented into prevention and treatment.

The prevention segment is further sub-segmented into pre-diabetes, obesity, and others. The treatment segment is further sub-segmented into diabetes, respiratory care, mental health, cardiovascular, and others. The prevention segment registered a significant CAGR in the forecast period. Increasing modern lifestyle-related conditions such as smoking cessation, obesity, prediabetes, and various other chronic conditions are expected to boost the demand for these devices during the forecast period.

• For instance, the World Obesity Atlas 2022, published by the World Obesity Federation, estimated that one billion people globally, including 1 in 5 women and 1 in 7 men, will be living with obesity by 2030. Such an increasing prevalence of obesity is expected to boost the demand for preventive software, thereby increasing segmental growth.

The treatment segment registered the highest share in the market. The growing prevalence of people suffering from cardiovascular diseases, diabetes, and poor mental health conditions is boosting the demand for this application area.  Furthermore, major key players are focusing on the formation of strategic collaborations with other organizations to introduce medication adherence software, leading to the high adoption of these products in the forecast period.

By Sales Channel Analysis

Rising Inclinations Among Pharmaceutical Companies to adopt Digital Therapeutics Driving B2B Segment

In terms of sales channels, the market is segmented into B2B and B2C.

The B2B segment is expected to hold the highest share of the market during the forecast period. The B2B (Business to Business) segment consists of the payer, provider, employer, and pharmaceutical companies. The market share is dominated by key market players and pharmaceutical companies owing to the increasing number of mergers and collaborations amongst them for new product launches. Furthermore, the increasing focus of companies in providing the product to their employees, is expanding the customer base, thereby propelling segmental growth.

• For instance, in February 2023, JOLLY GOOD Inc. and TEIJIN LIMITED announced a partnership to develop virtual reality solutions in this market for major depressive disorders.


• For instance, in April 2021, Voluntis and Eisai Co., Ltd. collaborated to design and develop innovative therapeutics to support patients' ongoing treatment of cancer.

The B2C (Business to Customer) segment is expected to show a significant rise in CAGR during the forecast period owing to growing awareness about the benefits and ease of use of these products amongst patients and caregivers.

REGIONAL INSIGHTS

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The digital therapeutics market size in North America stood at USD 2.64 billion in 2022. The dominance of this regional market is attributable to the growing number of cases of patients suffering from chronic diseases and mental health disorders, such as substance use disorders

• In November 2021, according to a report published by the U.S. Centers for Disease Control and Prevention (CDC), an estimated 100,306 people died of drug overdoses in the U.S. during the 12 months ending in April 2021, and an increase of 28.5% deaths from the 78,056 deaths during the same period from the year 2020.

Moreover, an increasing number of collaborations and agreements amongst the key players to focus on the research and development of these products is expected to increase the introduction of these devices in the region.

Europe held the second-largest share in the market and is expected to grow at a significant CAGR owing to the country's increased healthcare expenditure per person. Furthermore, the rising focus on partnerships and regional expansion amongst the key market players coupled with new product launches is expected to spur market growth in the forecast period.

The Asia Pacific market exhibited the highest compound annual growth rate owing to the increased adoption of technologically advanced products and favorable government policies. The high adoption of economically available internet and mobile is expected to boost the adoption of these products, thereby propelling the market growth in the region.

The rest of the world accounted for a significant share of the market owing to the increased awareness about these products and recent developments in the healthcare sector of the region. Moreover, the ongoing studies related to these products and awareness programs initiated by governmental organizations have led to an increase in the adoption of these products, fueling the market growth in the region.

KEY INDUSTRY PLAYERS

Pear Therapeutics, Inc with Strong Portfolio of Mental Health Solutions is Expected to Emerge as a Prominent Player in 2022

This is a partially fragmented market comprising several players in digital therapeutics with a diverse range of products, including mobile software and devices. Industry leader Pear Therapeutics, Inc, holds a dominant position with a strong portfolio of software. The increasing sales of reSET & reSET-O in the U.S. are contributing to its strong market share. Also, the rising R&D expenditure of the company for the development of these products is another factor contributing to the higher market share of the company.

Other market players, such as AppliedVR, Inc., Welldoc, Inc., CureApp, Inc., and Brain+ A/S are focusing on the execution of innovative strategies such as mergers and acquisitions, market penetration, partnerships, and distribution agreements to increase their revenue in the market. For instance, in 2021, AppliedVR, Inc. received the U.S. FDA clearance through the De Novo pathway for RelieVRx, to provide adjunctive pain-relief treatment based on cognitive behavioral therapy skills for patients with a diagnosis of chronic low back pain.

LIST OF KEY COMPANIES PROFILED:

• Omada Health Inc. (U.S.)


• Welldoc, Inc. (U.S.)


• Fitbit Health Solutions (U.S.)


• CANARY HEALTH (U.S.)


• JOGOHEALTH (U.S.)


• GAIA AG (Germany)


• CureApp, Inc. (Japan)


• Propeller Health (U.S.)


• Brain+ A/S (Denmark)


• Pear Therapeutics, Inc. (U.S.)

KEY INDUSTRY DEVELOPMENTS

• January 2023 – Lupin, a wholly-owned subsidiary of Lupin Limited, announced the launch of its therapeutics solution, LYFE. LYFE is India’s only evidence-based holistic heart care programme that significantly reduces the risk of a heart attack and improves vitals and quality of life for cardiac patients.


• October 2022 – Fitbit Health Solutions introduced a partnership with Pretaa that seeks to improve outcomes for Americans and their families affected by substance abuse by introducing health and activity data in Pretaa’s substance abuse recovery app.


• August 2022 – Akili Inc., the maker of a video game-like digital therapeutic for children with ADHD, announced the merger with a special-purpose acquisition company Social Capital Suvretta Holdings Corp.


• July 2022 - AmerisourceBergen Corporation announced to launch DTx Connect, a fully integrated ordering, dispensing, and fulfillment platform that aims to facilitate patient access to physician-ordered digital therapeutics and diagnostics. The platform integrates with electronic medical records (EMR), enabling physicians to have easy access to prescription and non-prescription software.


• June 2022 – The Spokane Regional Health District (SRHD) introduced a new app from the Washington State Department called 2Morrow Health. The app helps to create a plan to stop vaping or smoking, offering ways to manage smoking cravings and track the progress in order to help the patients quit smoking.


• March 2022 – Curebase Inc. and Blue Note Therapeutics collaborated on the home-based clinical trial of prescription digital therapeutics to help people suffering from cancer with their mental health and improve outcomes.


• October 2020 – Sidekick Health joined forces with Pfizer Inc. for the launch of an integrated DTx solution for Atopic Dermatitis (AD).

REPORT COVERAGE

An Infographic Representation of Digital Therapeutics Market

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The digital therapeutics market report covers a detailed analysis and overview. It focuses on key aspects such as competitive landscape, type, application, sales channel, and region. Besides this, it offers insights into the market drivers, market trends, market dynamics, COVID-19 impact on the market, and other key insights. In addition to the factors mentioned above, the report encompasses regulatory and reimbursement scenario and pipeline analysis that have contributed to the growth of the market over recent years.

Report Scope & Segmentation