Scooby Doo found an animated ice man in 1970. Non-animated people found a real ice man in 1991. 5300 years ago, Ötzi was balding, had bad teeth, stomach issues, and his knees were degenerating. The dude could have been me. He was wearing skins, had a well-crafted axe, some grains, and a pouch of medicines. Birch fungus for inflammation. Bracken fern for tapeworm. Sixty two tattoos suggested he used acupuncture. Medicines are old.
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Medicines evolve. Hippocrates knew willow bark treated fever, pain, and inflammation. He just didn’t have a marketing budget. It took until 1897 for Bayer to turn salicylic acid into acetylsalicylic acid to make it more tolerable. They called it Aspirin. Yes, mom, I know your dad used cloves for toothaches.
Treatments get better. They cost money to research, produce, and distribute. They get pricy. Or pricier.
From 2008 to 2021 the price of new-to-market drugs grew at 20% per year. That statement needs an some oomph. In 2008, the average price of a new drug was $2,115. In 2021, the average price was $180,000. Now, there are some reasons for this. Like many new drugs focus on small patient populations. So, costs have to be spread over a small base.
In 2015, the first peer-reviewed paper mentioned digital therapeutics. The idea is simple. If pressure, bark, fungus, needles, and chemistry could cure what ails ya, certainly you could get some comfort from the Internet. If watching Facebook can give moderators PTSD... If our phones make us dopamine addicts…Then certainly, digital drugs can work.
You can buy all sorts of remedies you see on TV. Those potions and elixirs haven’t been vetted by the FDA and aren’t backed by peer-reviewed science. But, they exist. People buy them. And, people believe they work. Digital remedies have been in the App Store just about as long as there’s been an App Store. They’re not vetted either. The FDA stepped in to sanction software as medical device (SaMD).
Pear Therapeutics is one of the best known digital therapy companies.
“At Pear, we set out to transform healthcare through the use of prescription digital therapeutics (PTDs), a new class of clinically validated, software-based therapeutics that we pioneered to improve patients’ outcomes across many therapeutic areas, alone and in combination with pharmaceuticals.”
Pear, “Makes apps that make you feel better.”
When Pear backed into a public company in June 2021, the FDA had approved three products: reSET®, reSET-O® and Somryst®. They help people with substance abuse disorders and who suffer from chronic insomnia.
They don’t just say they help people. The FDA says they are clinical proven to help people. Which is more than the makers of prostate pills flogged by former baseball player smacking golf balls can say.
PTD are just like other therapies. You go to the doc. Say, “Hey, I can’t sleep.” The doctor prescribes Somryst. You go to the App Store plonk down 900 bucks for a nine week course. In 2022, doctors wrote 45,000 prescriptions for Pear products. Only about half were filled. Pear only collected money from 41%.
Remember when I said Pear backed into being a public company? There was already a public company called Thimble Point. It had $400M in cash. Its business was finding a company who needed $400M. It found Pear.
Approved products ready to go, flush with cash, selling software with infinite margins, what could be more perfect? Pear was bankrupt in less than year. From a $1.6B valuation to selling scrap IP to $6M.
To me, this is SaaS media. With $400M, you could have given away or deeply discounted those first users. If it worked for them, the recurring revenue would have been impressive. I have no idea why they didn’t do that.
To people who know digital health, the real issue was that Pear did get the FDA to approved that their therapies worked. But there’s worked and worked. Just because a clinical study found evidence of a behavioral change doesn’t mean it changed enough behavior for patients to care.
This situation was tailor made to work. That it didn’t is setting other PTDs back. Last month, Eddie Martucci, Ph.D. stepped down as CEO of Akili. They’re going to sell apps instead of prescription digital therapies.
Seems like it’s back to fungus, cloves, or willow bark. Things that work and are free. If he were alive when he thawed, we could have asked Ötzi.