Payer Reimbursement and Prescription Digital Therapeutics: Understanding FDA Regulations

Anthony Watson, former vice president of Regulatory and Quality at Pear Therapeutics, discusses his recent perspective article explaining FDA regulations as they relate to prescription digital therapeutics (PDTs) and highlights why he believes payers will begin to better understand the importance of reimbursement for PDTs.

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Welcome back to PopHealth Perspectives, a conversation with the Population Health Learning Network where we combine expert commentary and exclusive insight into key issues in population health management and more. 

Today we are joined by Anthony Watson, former vice president of Regulatory and Quality at Pear Therapeutics. Mr Watson discusses his recent perspective article explaining FDA regulations as they relate to prescription digital therapeutics (PDTs) and highlights why he believes payers will begin to better understand the importance of reimbursement for PDTs. 

I'm Anthony Watson. I hold a number of roles, but my background is that I spent 20 years at FDA, all of it in CDRH, the Center for Devices and Radiological Health. There I held a number of different positions, but what's most important for the article is that about the past 10 years while I was at FDA I focused on digital health and the regulation of digital health products. I was very early in the process of digital health regulation and was involved with a number of people at the FDA who were involved in creating that regulation. Since then, I've gone on to a number of different positions in the industry, all of which involved medical devices, regulation of medical devices, as well as combination products. But also in each of those roles, I was also involved in digital health and getting digital health products approved for the different companies I've worked for. Right now I work for a combination product company in Watertown, but my position at the time of the article was the Vice President of Regulatory and Quality at Pear Therapeutics.

So the article was really to help people understand, particularly targeted towards the clinical community as well as perhaps payers who may be also reading the article to help them understand the way FDA regulates medical devices and particularly digital health. In the article, we talk about a little bit of the history of FDA regulation of medical devices. There's a very common misconception that the 510(k) process is somehow not focused on safety. It's often referred to as a me-too process where very little actual science or safety and effectiveness evaluation occurs, but the reality is that process was actually based on a foundation of safety. And without going into depth about what the article says, it describes why that is true. And if you can understand the basis for why the 510(k) process, or the substantial equivalence process, is based on safety, then one can understand why the process is the way it is.

And it's been around for now going on almost 50 years. And really there is no evidence, no significant evidence that there is any real problem with that process. So all of that is to say the way these medical devices are reviewed should be respected for the purposes of understanding that these digital health products that are put on the market by FDA are in fact safe and effective and that although additional data can be generated, the fact that they were put on the market and evaluated by FDA should be sufficient to understand that they are safe and effective.

So that was the very basis of the article. There was a lot more information to support that position and the idea was hopefully people who are reading it will have more faith in the fact that when FDA clears or approves the product, it is in fact safe and effective. And maybe payers will begin to accept that information or at least understand the basis for evaluating it, evaluating those products, not treating them like drugs, which is an entirely different process. And the science behind why those products have to go through that type of process is very different than those that a device would have to go through. That was the article in a nutshell.

We're hoping that if one were to read the article, first of all, they become a little more comfortable with the standard process by which FDA approves or clears, that's the term used for substantial equivalents, approves or clears the products that are put on the market. And therefore, physicians will be more accepting of these types of technologies, as well as the fact that payers will also see the value in these products and not treat them as if they needed significant amounts of randomized, controlled clinical trials because the basis of these products is different.

So the clinical implications are hopefully doctors who are using this technology will be able to adopt that technology a little quicker and understand the basis for which those products are approved. And payers will also begin to accept that information and understand that FDA approval, although maybe not sufficient for reimbursement, is a good, solid foundation for reimbursement. And that these small digital health companies should not have to start all over again with brand new data to support reimbursement, which is a massive problem for bringing these technologies fully to market.

Thanks for tuning in to another episode of PopHealth Perspectives. For similar content or to join our mailing list, visit populationhealthnet.com.

This transcript has been edited for clarity.