Welldoc – Anand Iyer, Chief Strategy Officer

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Digital therapeutics hold the potential for a new class of drugs with software as the therapeutic agent. In this episode of TD Cowen’s FutureHealth Podcast Series, Charles Rhyee, Cowen’s Health Care Technology Analyst, speaks with Anand Iyer, Chief Strategy Officer of Welldoc. Mr. Ieyer played a key role in the development of Welldoc’s BlueStar, the first FDA-cleared mobile prescription therapy for adults with type 2 diabetes. They discuss the adoption of digital therapeutics, challenges to achieving a successful commercial model, and COVID-19’s impact on consumer and physician readiness to adopt telehealth and digital care.

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Transcript

Speaker 1:                       Welcome to Cowen Insights, a space that brings leading thinkers together to share insights and ideas shaping the world around us. Join us as we converse with the top minds who are influencing our global sectors.

Charles Rhyee:                Welcome to the Cowen FutureHealth Podcast, [00:00:30] a part of Cowen’s 5th Annual FutureHealth Conference held virtually this year on June 24th and 25th 2020. Over the past five years, the Cowen FutureHealth Conference brought together thought leaders, innovators and investors to discuss how the convergence of healthcare, technology and consumerism, is changing the way we look at health, healthcare and the healthcare system.

                                         My name is Charles Rhyee and I’m Cowen’s healthcare services analyst and one of my areas of focus over the past several years, has been in digital therapeutics, which will have the potential of a new class of drugs and software as the therapeutic agent. And in this episode of [00:01:00] the podcast here to discuss the topic, I’m pleased to have joined me Anand Lyer, Chief Strategy Officer of Welldoc and someone who played a key role in the development of BlueStar, the first FDA cleared mobile prescription therapy for adults with type 2 diabetes. Welcome Anand.

Anand Lyer:                     Good morning, Charles.

Charles Rhyee:                So Anand, why don’t we start with what is Welldoc and what does the company do?

Anand Lyer:                     So Welldoc, we’re a digital health and digital therapeutics company that uses automated AI driven digital software, [00:01:30] to help support both the patient and the provider in the management of their chronic condition. Whilst we started our journey in type 2 diabetes, we’ve expanded to include other forms of diabetes type 1 and soon to be gestational, along with the comorbid conditions of diabetes, namely hypertension, weight management, and heart failure.

                                         And the reason for being for our product, is to A, provide real time coaching for a patient [00:02:00] at the point of care. So that when they enter any parameter, could be a glucose parameter, could be a medication parameter, could be a social determinants of health parameter, what they ate, how they exercised, to provide them real time coaching and feedback at that point of their care, but to secondly provide them with the longitudinal insights, to not just tell them how they did say at the end of the day, end of the week, end of the month, but rather to tell them the correlative insights on how [00:02:30] they did. “Hey, your glucose was high here and here because of this violating meal, or because of the skip medication.” So you have the ability to teach them over time.

                                         We also support what we call clinical decision support for the healthcare provider. And that is, how do you take all the data for a patient and run it through evidence-based algorithms and software and provide to their doctor, their nurse, their certified diabetes educator, a view of A, where they were, say three months ago, [00:03:00] where they are today, what’s changed and what evidence suggests they should do.

                                         And when you provide those two pieces to support the patient and to support the provider, we’ve seen a tremendous shift in hemoglobin A1cs, we’ve seen a tremendous shift in costs that the patient incurs through the healthcare system, and we’ve seen a tremendous engagement on the part of both the provider and the patient. So you’re kind of knocking off that quadruple aim set of objectives. That’s what we do at Welldoc.

Charles Rhyee:                That’s great. [00:03:30] And maybe talk a little bit more about BlueStar in particular, can you talk about the results and outcomes that you’re actually seeing in your patients?

Anand Lyer:                     Yeah, one of the things we decided earlier on was that, did we want to be an app for an app sake or did we actually want to be a something of more clinical value. And in the early days, we worked with University of Maryland in the Department of Epidemiology, Dr. Charlene Quinn, who helped run randomized control studies. These were first in the industry, [00:04:00] nobody had ever done a randomized control study on an app, they typically do RCTs on medical devices and drugs. And we had shown in this randomized control study, on average 2.A1c reduction for patients who used our product.

                                         We’ve replicated that in a third randomized control study that we did in the Province of Ontario, and with over 45 peer reviewed journals and posters, and real world studies. So on average, we see that [00:04:30] hemoglobin A1c shift by two points. What we have also noted Charles is that, the shift is also pronounced in slightly higher when they start with a higher A1c, so there’s a disproportional effect of BlueStar for patients who start with higher A1cs.

                                         We’ve seen for example on average, 60% of our patients who start with an A1c above nine have dropped center an excess of three points just which is very significant. And just compare that to what the FDA requires for a new [00:05:00] drug, a new drug to be cleared by the FDA requires A1c to be dropped in a clinical trial by 0.5. So you’re talking about four to six to 7X what the FDA requires declare a new drug, and so that’s very important.

                                         And lastly, I’ll say that we were very fortunate to work with IBM Watson Health, formerly Truven Analytics, on understanding the economic impacts associated with those types of A1c shifts. And on average, on average, when a patient shifts their A1c by their [00:05:30] two points, it’s about a $3,100 per patient, per year total cost savings for the employer or for the health insurer to support that patient.

                                         And so we’re seeing a large part of those through reductions in acute utilization, emergency room, hospital admission, doctor’s office visits, but also in the supplies and meds that they consume. And of course, the comorbid complications that they have. So you actually see tremendous health outcomes in the numerator and cost outcomes in the denominator.

Charles Rhyee:                [00:06:00] And by that you mean less medication utilization?

Anand Lyer:                     For many patients, yes. And for many patients, you may actually get them to a higher correct dose of their meds. But in doing so, you may have knocked out one or two unnecessary hospitalizations, which is clearly a larger cost than the addition of say, an additional dose of a medication.

Charles Rhyee:                It seems though, I mean three and a half point decrease coming down from nine, [00:06:30] isn’t it right to see that if you drop below, was it five and a half or so, you’re not really considered diabetic? I mean, is it possible to put somebody through to almost provision for reversal?

Anand Lyer:                     So it’s a great question. It’s a great question. No, just the genetics of diabetes, nobody’s figured out that cure just yet. And so the key word here is average. So if a patient who starts on average with an A1c above nine, which can be nine, 10, 11, 12 as high as 18 or 20, [00:07:00] has drops in excess of three points, we typically see in the bell curve, there’s a huge band of patients whose A1cs are between nine and 10 and a half and 11, if you would, and that’s really the band you want to go after, where you’re bringing those people down to goal.

                                         And of course, we’ve seen very significant drops for people whose A1cs are 14, 15, we’ve seen six, seven point drops. And the idea here is that, seven is the goal as [00:07:30] established by the American Diabetes Association. If you have an A1c between six and seven, you’re considered diabetic, but extremely well controlled. Of course if you have an A1c less than six, typically five and a half to six is that pre-diabetic range, and typically less than five and a half means you don’t have diabetes. So I think the net effect is to try to bring these people down to that goal of seven or less than seven and keep them there overtime.

Charles Rhyee:                Touching on that then, how do you guys see this working better [00:08:00] than the status quo? So maybe, it would be helpful to compare what BlueStar does and what Welldoc is doing to, what is the current standard of care though?

Anand Lyer:                     So if I, I’ll personalize it Charles. As many of the folks in the industry know, I’m a type 2 diabetes patient myself, so let’s just use me as the example. I have to manage my glucose, I have a blood glucose meter, I have several of them, one in my car, one at home, one in my bag, et cetera. [00:08:30] And I have to monitor my glucose levels at various times throughout the day, because there’s a different meaning of what it means to wake up, say, with a low blood glucose value versus have a high blood glucose value after a meal, that tells you something about the number of carbohydrates perhaps, that you ate at that meal.

                                         So I have to manage my blood glucose, but at the same time, I have to manage my food intake, I have to manage my exercise, I have to manage my sleep, all of the vectors if you would, that support [00:09:00] diabetes patients overall wellness. And there’s this little thing called life that tends to get in the way every now and then, right? There is no blame. People try to do what they do, but they have the reality of the things that they need to do and they can’t just live their life around their disease. It’s quite the opposite, they almost want to put the disease in the background.

                                         At the same time, I am encouraged to see my doctor four times a year predominantly to measure my A1c, my hemoglobin A1c and it’s measured, the standard of care says, [00:09:30] measure it every three months. And so I diligently try to write down everything in the current standard of care model and take it into my doctor, but what’s the doctor going to do in a five minute office visit? And it’s actually funny Charles, when I go to my doctor’s office here in Maryland, I see other diabetes patients furiously writing down on a napkin in their glucose results from the last three weeks or what they ate, and I don’t remember what happened yesterday, let alone three weeks ago.

                                         And so it’s a little bit of garbage [00:10:00] in and garbage out. And so the standard of care today, whilst the rules we think about it Charles, diabetes is probably one of the best codified diseases, right? There is a rule and a guideline for almost everything. A, American Diabetes Association, the American Association of Diabetes Educators. I mean, it is a well understood, well quantified and well documented disease. And yet, we’re stuck in this current paradigm where people aren’t doing the things that they should and there’s [00:10:30] no way to translate, if you would the data, should they gather it to information, knowledge, action, and therefore outcomes.

                                         So that’s the snapshot of how it’s working today. It’s a little bit of haphazard, and you almost want to turn that equation upside down and say, is there a way technology can actually support both the patient and the provider? So can they stand on technology shoulders and reach higher and can technology help first, [00:11:00] auto sense and grab this data? So you start to think about connected devices, connected blood glucose meters, connected blood pressure, cuffs, weight skills, things like that.

                                         Can we take information from the patient’s existing treatment pathway like their medication regimen from their pharmacy or their lab values from their EHR? Can we bring these in and can we use these values along with their daily inputs, to judiciously provide them coaching that’s scientifically driven, cleared [00:11:30] by the Food and Drug Administration, the FDA. So these are clinically validated feedback that are coming to these patients telling them what to do at that point in time. And then can we provide and use AI driven software to just isolate the things that the provider needs to talk to the patient about?

                                         So rather than me going to my doctor, and he looks at me and says, “Okay, tell me how the last three months has gone?” “I don’t know.” If he sees a high glucose value, he says, “Did you eat too much?” “I [00:12:00] don’t remember.” “Did you skip your med?” “It could have been.” Instead of that kind of wasted time in that scarce five minute visits that I have with my doctor, can you actually look at this report and say, “Hmm, it looks like there’s three things we need to focus on. So by the way, great job here, here, and here, but let’s focus on these items.”

                                         And so you’re actually using data to illuminate the pathway forward to optimize the treatment pathways. And so it’s a stark difference Charles, between the desired vision and certainly what we’re doing at Welldoc, and what status [00:12:30] quo is sitting, if that makes sense.

Charles Rhyee:                As we think more broadly about digital therapeutics themselves, so you were one of the first to get approval. Maybe help our listeners here understand a bit more than, how you’re defining digital therapeutics and let’s compare that because you just made the comparison to the digital health or to just a health app that I might have on my iPhone or a Galaxy phone.

Anand Lyer:                     So if you were to think of the universe of apps and if you were to think [00:13:00] of a Venn diagram is probably the best way to describe this, you have apps, the largest circle. Within apps, you have a subset of those apps called digital health apps. So those that focus on health. They could be tracking your weight, they could be tracking the number of steps that you take. It could be recording symptoms, things like that. And then you have a subset of the digital health circle, which is digital therapeutics.

                                         So what defines that innermost circle? A couple of things, and these things for the interested folks who want to go and check up on it, [00:13:30] Welldoc, along with four other digital therapeutics companies, co-founded what’s known as the Digital Therapeutics Alliance, the DTs Alliance.org is the website. And we did that because we wanted to help the industry understand what rigor is required, around the development and delivery and support and maintenance of this class of product, these digital therapeutics products, that are required.

                                         And [00:14:00] so one requirement we’ve discussed, multiple randomized control studies that actually demonstrate in peer reviewed published journals, that you have an outcome. Second is, clearance by the regulatory authorities as a suitable class of medical device. And again, it’s the judgment of a third party, a non-biased party that says “Yes, your product is safe to use. It doesn’t induce any risk or you’ve sufficiently managed risk in your product. [00:14:30] And we have audited your process to build the product and we’ve established that there’s GMP or good manufacturing processes associated with that.”

                                         Third, it does meet all the cyber security requirements. And you think about cyber here, things like SOC 2 and HITRUST certification and Privacy HIPAA. You think about privacy in a stronger sense in the EU for example, with GDPR, it has to meet these requirements. Fourth, it actually [00:15:00] has to connect back into the clinical workflow and care team. And what’s really distinguishing a digital therapeutic from any digital health or even telehealth Charles? A digital therapeutic solution will connect the patient back to their own health care provider, and that’s important, because there’s a trust factor associated with the patient and the provider.

                                         When you contrast that with telehealth, I could be connected to a telehealth doctor. And when you look at what’s happening with COVID-19 and the fact that [00:15:30] state laws have been relaxed where doctors in Oregon can see a patient in Maryland, I don’t know who this doctor is, they don’t know what my fears, beliefs, struggles are and yet, they’re the ones who I’ve been connected to. So it has to connect with the patient’s own, if you would.

                                         And like that, there’s several criteria that have actually been listed out by the DTx Alliance. Again, the website is DTx Alliance.org. But [00:16:00] really to summarize these, is there’s a higher level of rigor associated with the development, with the testing, with putting it through randomized control studies to show that it actually works, to getting it cleared, and then to supporting it and maintaining it with the proper SLAs and things like that in place, really, that differentiate a digital therapeutic from a digital health or another health app solution.

Charles Rhyee:                So Anand, obviously all that makes sense. And if we think about the [00:16:30] adoption of digital therapeutics then with your product on the market, Pear Therapeutics with their FDA approved solution for substance abuse treatment, the uptake has probably not been as large as I think some people had initially expected and which suggests that there’s a bit of a learning curve here. Can you speak to sort of the challenges and hurdles in commercializing a digital therapeutic. Where are some of the big roadblocks [00:17:00] in getting people to understand sort of what digital therapeutics can really offer?

Anand Lyer:                     So you brought up a couple of great examples Charles. Pear Therapeutics, in fact just yesterday or the day before yesterday, we got the announcement from the FDA that Akili, one of the co-founding members of the Digital Therapeutics Alliance, received their first FDA clearance and congratulations to the entire Akili team for that accomplishment. What we’re learning and what we’ve learned [00:17:30] is that, there is an adoption curve.

                                         And what we’ve learned is that the analogy perhaps Charles is, how do you open a door that has say three keys that have to be simultaneously turned and so what are the keys to success here literally? One is, you have to have a mechanism for payment, and those mechanisms can be many. In one pathway, you can have a mechanism that’s [00:18:00] tied to a prescription, right? So you can think of the dispensation of a digital therapeutic along the lines of an RX. And that’s for example, the pathway that Pear Therapeutics has chosen.

                                         It’s one of the early pathways that we had as well. And since then we’ve broadened to include others, which I’ll talk about in a second. And in that pathway, you have to then ensure that you’re listed on, say a database, that you’re on [00:18:30] someone’s formulary, and that somebody is covering you as a benefit. And just think about the complexity of what’s involved, that means you have to more than likely have an agreement with the PBM, you more than likely have to have the PBM market this to their payers in a favorable position on their formulary, and you then have to have pull through to ensure that not only is it on the shelf, but people are actually buying it off the shelf, so to speak.

                                         So it’s a fairly complex model that is going to [00:19:00] take time because at its core, it requires a doctor today to actually know about the fact that “Hey, I can actually prescribe something that’s not a pill or an injectable, or a topical ointment that the patient can use to help manage their condition. So there’s a great deal of awareness and industry adoption at the grassroots level. That’ll take time to manifest if you would.

                                         At the same time, there are other payment [00:19:30] mechanisms where you can go directly to an enterprise if you have the regulatory clearance as we do, as we both have the RX and OTC clearances for our BlueStar product, that says can you go directly to an enterprise which could be a payer, a self-insured employer, say a large clinic, IDN and things like that, and have a software licensing model, whether it’s a per user, whether it’s a per site, whether it’s a PMPM. There’s so many different models that exist.

                                         And so I think the first thing for commercial success, is you have [00:20:00] to have a business model, that has to be well understood. And once you have the business model, you then have to execute what is known or what we call the digital therapeutics engagement chain, which is, how do you actually target the right patients? And once you’ve targeted them, how do you outreach to them? Do you outreach in person?

                                         So is it in a clinic for example, the doctor says, “Hey, Charles, I think this can help you walk across the hall and my nurse is going to [00:20:30] get you started.” Is it done through an email? Is it done through an SMS campaign, other social media campaign, a letter, posters, things like that? So how do you outreach, and then how do you activate? Is the activation assisted with a human? Is the activation self?

                                         You start to think about some of the things we’re doing with deep link technology where a single link that sent to the patient’s text, message inbox. When they click on that single link, it actually performs multiple functions, not the least of which is [00:21:00] downloading the app, but then pulling all the relevant information and their current labs, first name, last name, et cetera, from the EMR and pre-populating their profile in the digital therapeutics such that you’ve taken friction out of that activity.

                                         So now it’s frictionless activation. And then once you’ve activated, how do you get them to engage? And that’s the billion dollar question that everybody’s asking, right? How do you actually get them to engage and engagement in and of itself, has to be [00:21:30] taken into consideration with the outcomes that are achieved, I’ll tell you why. The last thing a payer would want, is to continue to pay for years for a product that doesn’t improve somebody’s health. But that’s the worst of both worlds. A, they’re paying and B, people aren’t getting healthier.

                                         So what you actually want, is you want engagement in the context of outcomes. And so I think the summary response is, there has to be a business model in place, but then there has to be this value chain, is what we call the engagement [00:22:00] chain, that identifies the right target, that figures out the right mechanism or mechanisms for outreach, for activation, for engagement. And then of course on the back end of that, you have the typical support and report functions.

                                         It’s that collection of things that needs to happen in order to have a successful commercial model. The lessons learned for us and certainly for others in the industry is that, you can’t bet [00:22:30] on just one, you have to have multiple pathways that’ll create success. And I recall a recent panel that I was on with Chris Hogue, who is with Propeller, another one of the co-founding members of the Digital Therapeutics Alliance.

                                         And there was a very interesting comment that Chris made, which is, “We’re on the fourth iteration of our first business model.” And this was right around the time when they were acquired [00:23:00] by ResMed. And just think of what he just said, right? “We’re on the fourth iteration of our first business model,” which means there’s a learning and there’s an adaptive nature of this. It’s almost like you’re doing it in sprints if I were to use the software development analogy.

                                         And so I think it’s important for people to realize that there may not just be one pathway for success, there could be multiple pathways for success that may differ as you sell to different customer [00:23:30] types, as you sell in different geographies, et cetera.

Charles Rhyee:                No, that makes a lot of sense, and I think that example you talked about, the fourth iteration of the first business model, it speaks to having to adapt to all the other parties involved, right? You talked earlier in the RS model, that you have to engage with potentially payers, PBMs, physicians. How much of this do you think then is [00:24:00] an education process particularly, let’s say providers, and I use that because when you think about a lot of the digital therapeutic companies that are coming, let’s talk about Akili for example as well and Pear.

                                         A lot of you are walking down a path, you’d look into, in some ways mimic the traditional drug that is prescribed by a provider. And in this case though, pharma companies have obviously big market machines and [00:24:30] traditional means of marketing drugs to physicians, obviously used to be in person, maybe more detailing now. What is the challenge then for a new class of therapeutics that physicians just aren’t familiar with. What’s that going to look like and how do you overcome that?

Anand Lyer:                     So if the provider is a part of your go to market model, which in digital therapeutics, the likelihood of that is fairly high, there’s many answers to that. [00:25:00] So one is, do you directly reach out to the providers, i.e, to a certain effect, you become a pharma like company, where you have a direct salesforce that’s calling on and detailing if that’s the right word, physicians, right? Instead of putting samples of drugs on their shelf, you’re putting sample codes of digital therapeutic solutions.

                                         So the analogy is actually quite powerful and it’s literally the same as you become a Merck or a Pfizer or a GSK. [00:25:30] And that’s a very, very resource capital intensive process, as you can imagine, but one that actually goes straight to the grassroots. At the same time, can you partner with a pharmaceutical company that may actually then leverage a part of its sales distribution force to actually do that for you.

                                         So you start to look at the likes of some of the digital therapeutics partnerships in the industry, along the lines of click and sign a fee, or what formerly was [00:26:00] Sandoz and Pear with the intent of, if you would leverage that field force to actually get. So the digital therapeutics companies has a multiplier effect, because they’re using somebody else’s resources to get if you would, to those individuals.

                                         And then you have of course, professional organizations that you can work with. The American Medical Association, the American Association of Clinical Endocrinologists, in our case for diabetes, et cetera. [00:26:30] So there are pathways where you can go through a middleman if you would, you can go through a third party that then brings if you would scale, just really what we’re after here is, how do you actually drive scalability?

                                         And so you’re leveraging a third party’s presence to reach out in a cost effective, scalable way, each of these providers, either that’s kind of one answer. There’s another answer that says, over time, [00:27:00] we’re just going to see inevitability of a physician’s ability to either know that the digital therapeutic solution exists in a certain disease domain, and that there’s a certain familiarity and trust associated with the use of a digital therapeutic.

                                         So I’ll be a little general here, Charles. But when you think about it, we’re now in 2020. The iPhone was first introduced in 2007 if memory serves me correct, [00:27:30] and your first generation of iPhone kids, are going to be going to college in the next five years. And arguably, within the next five to eight years, you’re going to see the first generation of medical school entrance, who are iPhone generation users. And do you think that they’re not going to expect that there’s a digital solution component to the delivery of healthcare in the science of medicine? Of course, they will, because digital has pervaded every [00:28:00] other aspects of their life, why not medicine?

                                         And so when you step back at it and look at it that way, I use the word inevitability because I do believe, we’re not going to call it digital health or digital therapeutics five years from now, we’re just going to call it health and therapeutics, and the digital will have to be an implicit and inherent component of it.

                                         And if not, you won’t be a player, which is why you see whether it’s a payer, whether it’s a pharmaceutical company, whether it’s an IDN, [00:28:30] whether it’s a self-insured employer, everybody wants to pilot and try and learn, how do we incorporate a digital aspect of our care solutions? How do we incorporate digital into that fundamental fabric of delivering care? That’s something that they’re all interested in.

                                         I think, going forward, we won’t use this, it’s the same way nobody calls it e-banking anymore, right? They just call it banking, they’ve dropped the prefix. I think we’ll see the same effect. And so I think there’s different ways to get to the provider direct, [00:29:00] and then there’s the second pathway that says it’s just going to happen, and it’ll happen organically in the next five to eight years.

Charles Rhyee:                That’s great. I want to ask you, COVID 19 obviously, is impacting us all right now and the environment is very fluid in some ways. But one of the outcomes of all of this has been really not only quick reaction lesson from the regulators, but a really quick reaction for the market [00:29:30] to sort of embrace virtual care, particularly, let’s say telehealth is the big example. We’ve seen huge upsurge in the use of telehealth. Two questions really, how to interpret the surgeon utilization. And in particular, what does that say about consumer and/or provider readiness to embrace digital? And then the second question is, what do you think that this means for the progress of digital therapeutics itself?

Anand Lyer:                     So COVID-19, has actually uncovered [00:30:00] so many structural flaws in our healthcare system. And in fact, in our societal system at large Charles. I live here in Maryland, and I have a 10th grader. And when kids were sent home from school, we were thinking great, open up a couple of Zoom windows, and get teachers to jump on and lecture in real time and call it a day. [00:30:30] And very quickly, you learn of the socio economic disparities within even well to do counties, where not every child has access to either high speed internet access, or an appropriate laptop that allows them to conduct a WebEx Zoom like encounter.

                                         And you’re like, “Huh, I didn’t expect that. Okay, well, we better get laptops to every child, and we better ensure that everybody has high speed internet access, because [00:31:00] otherwise it’s not going to work.” So now, all of a sudden, doctor’s offices are empty, because those primary care doctors who may not have been deemed essential emergency if you would, think about a doctor’s office in COVID-19, where they’re not providing emergency services and they’ve told their patients not to come or they’ve been instructed to tell their patients not to come unless it’s an emergency.

                                         So by and large, you have empty doctors offices. And overnight, [00:31:30] they too in a fee-for-service model, need to see patients, that’s the only way they’re going to make money. And so they embrace immediately the Zoom like platforms, and they pay specific attention to some of these emergent telemedicine codes. And overnight, what we’ve seen, is that there’s just a huge influx of telemedicine calls.

                                         My wife’s a dermatologist, [00:32:00] and literally within a week, she had shifted almost her entire practice over to telemedicine calls. And when you think about that effect, even post COVID-19, after COVID-19, the decay curve has gone away and hopefully it’ll go away soon, the convenience associated with a tele visit, the inherent interruption [00:32:30] factor if you would to a family, who has to take their child for a follow up visit, that interruption factor is so much less.

                                         It’s so much easier to just do it over a tele consult, and I think there’s going to be a large part of telemedicine that just persists beyond this first tale of COVID-19. Now, interstage left into this discussion, chronic diseases and digital therapeutics. So was it just day before yesterday, perhaps that the CDC issued a new report [00:33:00] that said of the COVID-19 patients tested in the US, 30% of them had diabetes. 30% Charles, that’s two and a half times the incidence of diabetes in the United States.

                                         So there’s a disproportional effect of COVID-19 on those with diabetes, and it’s well known. The news covers this every day that you’re at more risk, you’re more vulnerable if you have an underlying condition like congestive [00:33:30] heart failure, diabetes, asthma, et cetera. And in the case of COVID-19, where you can’t see your doctor, you can’t interact with your doctor, the ability to have a digital therapeutic solution that actually allows you to have that continuity of care with your health care provider, not just any healthcare provider, is critical.

                                         And so I think the silver lining, if that’s the right way to say it of COVID-19 as it relates to digital therapeutics, is not only did it create [00:34:00] an uptick and surge in the number of telehealth consults and tele visits and telehealth in general, it’ll also create an uptick in demand for digital therapeutic solutions, because these solutions will be logical extensions of healthcare providers treatment pathway for a patient, in a manner that’s trusted, safe, secure, proven, all the things that we spoke of earlier on.

Charles Rhyee:                Yeah, that’s really interesting. And your thoughts here, [00:34:30] are you seeing that maybe then in demand for the BlueStar platform as the discussions with potential enterprise clients? Has this event changed the way their conversations have shifted with you?

Anand Lyer:                     We are Charles. We’re seeing an uptick in not just users, so enterprise customers and users, but we’re also seeing an uptick in usage. So just as an interesting tidbit, [00:35:00] I asked some of our data team, “Can you show me anything different in the months of March and April 2020?” The peak COVID time when the shutdown was occurring and people were quarantining at home. “Can you show me any difference in pattern of engagement?” And what we saw was about a 22% uptick in engagement, compared with engagement from say, the same people during the course of the six months prior.

                                         So there was a [00:35:30] market, 22% increase in engagement, and we dug underneath the covers to see what that uptick was, and primarily a couple of functions. One was, how they manage their activity and their glucose. One was certainly their food management, which is a huge one, and one was the measurement of glucose itself. And so what we saw that people were actually going to the app more, because it was a trusted source for them to actually help make smart food choices, ensure [00:36:00] that they’re exercising in a while they were quarantining at home. And so I think we did see that effect, and I think we’ll continue to see that effect, even post COVID-19 when the curve has decayed.

Charles Rhyee:                That’s interesting. And when you look at that cohort of patients, even as let’s say, states have opened up, are you able to maybe track some of those members? If they’re in a state that has opened up, let’s say, around Memorial Day, three weeks ago. Do you find that those numbers are still engaged or is that your expectation, [00:36:30] at least?

Anand Lyer:                     It’s our expectation, Charles, and I think that’s going to be part of what our journey is in the coming weeks and months is how do we actually look on a week by week basis and try to effect and correlate if you would, whether it’s with zip codes and counties, whether it’s correlating to people on different medication regimens, so more complex insulin regimens versus say more oral, simple, Metformin, Januvia like regimens, whether it’s a correlation between age groups, whether it’s a correlation [00:37:00] to, whether these people are heavy engagors in food management or activity management or sleep management.

                                         I think the correlative insights we’ll gain in the coming months, will teach us a lot about going back to that digital therapeutics engagement chain, how to target the right person with the right messaging at the right instance, and we’ll learn so much. It becomes in a way, a data driven strategy.

                                         You’ll actually use the data that you have, [00:37:30] to actually articulate and sharpen pencils on where to target patients, how to target and onboard patients, what features to promote to them, because you’ll have data that actually suggests that in a statistically significant way. And so I think the next several months for all of the digital therapeutics, companies are going to be critical to start to understand some of those data patterns.

Charles Rhyee:                So now then, maybe one last big picture question for you here then, [00:38:00] as you think about the opportunities that are before not only just Welldoc and Digital Therapeutics, but overall, as we see increasingly a greater shift to use digital tools. And obviously, COVID has opened I think the eyes of many people on the potential here, what do you think the biggest opportunities to improve healthcare are? The sort of big age and how important do you think the digital will be as a part of that?

Anand Lyer:                     [00:38:30] So I think digital will be a part of it to the earlier comment, we won’t call it digital therapeutics or digital health, we’ll just call it health. And inherently there’ll be some component of it, which is delivered over a digital medium. I think the future trend is going to be one that is going to be very data driven. So we will use data, even from say the first 30 or 60 days of patient engagement, to actually hone in [00:39:00] on an exact therapeutic pathway that makes sense at the unequals one level.

                                         So we’ll use, say data initially at a population level that will gather to then understand trends, patterns as it relates to the population, but we’ll zero in on cohorts and individuals to understand the patterns that are right for patient A versus patient B. And so I think what we’ll see, is not only a further embracing [00:39:30] of digital therapeutics and digital health going forward, but we’ll see the role of data, shine even more in its ability to actually hone in and provide the best therapeutic pathway for a physician and patient pair to help optimize their condition, bend their outcomes, curves and vendor clusters.

                                         So I think the role of data, will improve and it’ll improve almost quadratically, why? We’re collecting data at an amazing [00:40:00] rate. We’ll just think about how I’m collecting glucose data and activity data and medication data and sleep data, food data, et cetera. And to be able to harness the value. We speak of those, you’ve heard it before Charles, the 5 V’s of data. So just think about the variety of data we’re capturing. Think about the velocity by which it’s coming in, very high. Think about the variety of data that we’re capturing, thinking about the veracity. [00:40:30] These things are coming directly from sensors and whatnot, the trust is high. And then lastly, the value.

                                         So I think in many ways, these 5 V’s, paint an amazing picture of potential of what digital therapeutics will do that are data driven, illuminated by data insights if you would. I think that’s going to be a really important thing to watch out for going forward for all domains of disease for all classes of digital therapeutics, the data will help illuminate some of the most [00:41:00] interesting pathways forward for the adoption of these things in society.

Charles Rhyee:                Well, that’s I think all the time we have, and really, thank you Anand for joining us today. That was a really moving discussion and it was really exciting to see a lot of what’s coming down in the future and we look forward to hopefully speak with you again on the topic, as we see the world progresses as well as we see how the industry progresses.

Anand Lyer:                     Thanks, Charles and thanks Cowen for the participation and look forward to doing this again in the future.

Charles Rhyee:                Great, thank you.

Speaker 1:                       Thanks for joining us. Stay [00:41:30] tuned for the next episode of Cowen Insights.


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