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As featured on BusinessMirror:  Digital Therapeutics in Pharma

With digital therapeutics set to become a US $18 billion global opportunity by 2027, it’s time for the pharmaceutical industry to make the most of its potential.

Digital Therapeutics (DTx) are software-based interventions with proven clinical benefits that aim to prevent, manage, or treat medical conditions, often using tools like mobile apps and sensors to drive behavioral changes in patients.1 This innovative field within digital health has seen rapid progress over the years, offering customized health services to improve patients' quality of life and clinical outcomes.

Fueled by the latest innovations in medical apps, wearables, tech platforms, data gathering, and artificial intelligence-led real-time analytics, DTx are rapidly changing how pharma companies and health care providers deliver and personalize healthcare and fill in essential gaps.

DTx are creating huge opportunities for the industry to cover blind spots and under-serviced areas within the patient journey and realize new revenue streams. A true win-win scenario for patients and ongoing business success. Establishing a solid digital foundation today is imperative for the long-term viability of pharmaceutical players in the future.

However, while consumer-centric digital health is an important topic for most pharma players, the DTx landscape is far from pharma's core business and the challenges of getting everything up and running are many and shouldn't be underestimated.

In a country where healthcare accessibility remains a concern like the Philippines, the integration of DTx could lead to improved patient outcomes, increased patient adherence and reduced burden on healthcare infrastructure.

With the potential to address gaps in patient care and revolutionize the patient journey, digital therapeutics could help bridge the existing healthcare disparities in our country. The Philippines, characterized by its diverse geography and population distribution, stands to benefit immensely from digital interventions that could extend healthcare access to underserved areas.

Michael Arcatomy Guarin
Head of Deal Advisory and Healthcare Sector Head
KPMG in the Philippines

As the Philippines continues its journey towards achieving universal healthcare coverage and improved patient outcomes, embracing digital therapeutics holds immense promise. The Philippines' unique healthcare landscape presents both challenges and opportunities for the integration of DTx. By aligning with global best practices and tailoring strategies to the local context, Philippine pharmaceutical companies (PharmaCos) can play a pivotal role in advancing healthcare through digital innovation.

The challenges in setting up the DTx portfolio

Creating a strong and successful DTx portfolio that enhances or complements Pharmacos' current drug or solution portfolio means tackling a range of internal and external challenges. Many of which require a fundamental rethink of how the organization runs, its tech stack, and its culture. Becoming more agile and change-ready is vital when it comes to developing digital solutions.

What then must be looked at? We categorize company internal challenges into six areas:

  • A lack of vision and ambition, especially regarding financial expectations and how to best realize business opportunities, and how to clearly define actionable and measurable goals.
  • The decision on the market region, size and segmentation needs to be well thought through (e.g., a not-too-restrictive market or indication selection).
  • The DTx not being compatible with the overall portfolio, thus synergies cannot be raised.
  • People and capabilities are not set up to develop, test and market DTx.
  • IT and innovation processes are not optimized, which makes it difficult to quickly change and rapidly get products to market under high cyber security and privacy standards.
  • An underestimation of the huge transformation and change requirement. This challenge sits at the heart of all points mentioned above.

Six steps to a transformed business

Integrating new technologies and encouraging a fundamental culture shift is essential if you want to create innovative solutions, optimize processes and provide greater value to your patients. Let's look at the key aspects and success factors for a successful transformation.

Vision and ambition

Now is the time to set and communicate your vision and goals for your DTx portfolio in alignment with your overall transformation strategy and business plan. Ask relevant questions up front: What do we want to achieve - for the business and our patients? If applicable, who are our main investors, what is their point of view, and what do they expect in return? What is their investment appetite and what are the relevant key performance indicators (KPls) for them? Relevant metrics can include market share, market growth, patient prescription numbers, but also patient adherence to DTx. Global VC funding in digital therapeutics has increased 4-fold from 2017 to 2022, displaying the fastest-growing segment in healthtech. But, especially in the initial time after launch, patient prescription numbers can be a tough challenge since DTx in most countries is still a young topic.


Carefully consider your key markets, competitors and the regulations and reimbursement schemes that are specific to each region. To date, most DTx have gained market access through the US Food and Drug Administration (FDA). CE-marked DTx products in Europe have been primarily launched in Germany and Belgium11. But thinking big can also mean going global and extending your reach vertically.

Also, with payer reimbursement pathways varying greatly, and at differing maturities in different regions, it's a good idea to incorporate a range of payment models into your decision-making.


Start with what you know. Focus on your area(s) of core expertise, closely matching your drug or solution portfolio.

People and capabilities

Arguably the most important element for your DTx transformation is people. The right team is a vital driving force for your mission. Do you have the capabilities to plan, develop, ensure regulatory approval, provide high cyber security standards and successfully launch the DTx? Are the right functions in place to support patients and HCPs - both from a medical and technical perspective? A successful DTx portfolio requires a range of different capabilities, and often new skills. Hiring, and ensuring the seamless integration of, medical-trained health tech enthusiasts, mobile app developers, UX/UI designers - just to name a few - is costly, time-consuming, and resource-intensive.

To quickly close existing gaps, upskilling your existing employees, using agencies, and/or building tech-savvy partnerships should be considered. Where necessary, rethink your organizational structure. What has traditionally worked could likely get in the way of a more agile, streamlined, and digital business. Carefully choose the right operating model for your DTx. Do you want to run your DTx business as a separate business or fully integrate it into existing structures? Consider what to run in-house and who could be relevant(start-up) cooperation partners.

IT innovation, IT security and data privacy

When discussing IT, it's important to create and maintain an environment that encourages innovation and emphasizes a digital-first mindset. On the technical side, ensure your platform and hardware, including complementary digital technologies are robust, reliable, and flexible enough to quickly change with your business needs, market, and government expectations.

To ensure the security and privacy of all data, you must incorporate security and privacy considerations from the outset and conduct regular audits of your data systems and third-party vendors. This proactive approach will help prevent data leakage, loss or unauthorized manipulation.


With all the above-mentioned, we hypothesize that a crucial factor for successfully establishing comprehensive and successful DTx portfolios is to recognize and appreciate the magnitude of the transformation involved. Updating business models, investing in new tech, security, and digital capabilities, getting the right people, and challenging the status quo are essential.

How KPMG can help

If you're not sure where to start or need assistance along the way, we can help. With our global network of specialists in digital transformation, including many with extensive expertise in strategy and tech enablement across the pharmaceutical and life sciences industry, KPMG can help ensure your DTx vision becomes a reality.

The excerpt was taken from the KPMG Thought Leadership publication: https://hub.kpmg.de/digital-therapeutics-in-pharma

© 2023 R.G. Manabat & Co., a Philippine partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

For more information, you may reach out to KPMG in the Philippines Head of Deal Advisory and Healthcare Sector Head Michael Arcatomy Guarin through ph-kpmgmla@kpmg.com, social media or visit www.home.kpmg/ph.

This article is for general information purposes only and should not be considered as professional advice to a specific issue or entity. The views and opinions expressed herein are those of the author and do not necessarily represent KPMG International or KPMG in the Philippines.