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Digital Health: Embrace The FDA

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With the emergence of digital health, the market has seen increased interest from non-traditional healthcare innovators, such as Silicon Valley, which bring with it a skeptical view of the FDA. This is not a conducive approach, and shows a misunderstanding of the FDA. Those that embrace the regulatory path will find a progressive agency, through which companies can differentiate their products.

The FDA Is An Adaptive And Progressive Institution
As digital health has emerged, the market has seen increased interest from non-traditional areas, such as Silicon Valley, but this has come with a sometimes skeptical view of existing regulatory structures. However, in our view, this demonstrates a fundamental misunderstanding of the FDA. We believe that instead of avoiding the FDA, digital health companies should embrace the agency. We believe there has never been a better time for digital health companies to go in front of the FDA, based on our conversations with the agency. This is underscored by the FDA Commissioner’s, Scott Gottlieb, announcement that a broad initiative focused on digital health devices will be released soon, which will include several pieces such as a “novel, post-market approach” on digital medical devices using real-world evidence collection, piloting use of third-party certification for low-risk digital health products, a more streamlined FDA review approach for higher risk digital technologies or services, and a paradigm shift in applying a “firm-based approach” rather than a “product-based approach.”

Regulatory Pathway Can Differentiate Innovators
In addition, we believe that digital health companies following the regulatory pathway will likely find it to be the preferred route. Although the process is more rigorous and sometimes rather lengthy, successfully gaining FDA approval can position a digital health company for success for several reasons including:

  • Crafting the pathway to approval, which can help in developing an economic moat
  • Creating barriers to entry, which helps distinguish itself from competition
  • Demonstrating a recognized level of safety and efficacy, which increases the potential ability to enter certain healthcare markets

Case Studies Portray The Impact Of Differing Levels Of Engagement
We present four case studies, including two biopharma products, a digital health product, and a diagnostics product. All showcase the FDA’s adaptability or consequences of not engaging with the agency. We believe these cases show that even non-traditional healthcare entities can find success in the healthcare market, as the FDA is receptive to an engaged sponsor. Digital health companies may not appreciate the FDA’s goal is not to block a product from the market, but provide an independent review. We believe companies that pursue the necessary steps with the FDA, rather viewing it as a hurdle toward profitability, benefit in the long term.

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