Of all the challenging questions that digital health entrepreneurs seeking to improve patient engagement are expected to address, demonstrating return on investment is probably the toughest. First there’s the business of deciding on how to quantify the ROI of their products. Add to that is the job of navigating the gray area of the criteria for achieving ROI. But as Memotext Founder and President Amos Adler can attest, doing so successfully can open up a lot of opportunities across pharma, payers and health systems.
In an article earlier this year, Adler with Memotext cofounder Bill Simpson articulated some of that gray area. Is it qualitative and health outcome improvements that matter? How do you take something this multi-dimensional, quantify it in a metric and then somehow attribute fiscal value to that? Is it an objective improvement in medication adherence? For whom? The least adherent? The highest “value” patients?
The Toronto-based company has successfully developed programs not only for stakeholders in the pharmaceutical industry, but also for payers, health systems, pharmacies, and pharma benefit managers. At its core, Adler said the company has developed a suite of products geared to medication and care plan adherence, care coordination, treatment initiation and population health management.
Adler described Memotext’s approach in a phone interview. It has identified ways to incrementally improve poor medication adherence to moderate patient adherence. The Canadian company has also zeroed in on complex patients; not necessarily the largest patient population but some of the most costly.
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A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
If Memotext’s products lead to patients picking up their prescription from their pharmacy more frequently from three times per year to six times per year (as opposed to the ideal of 12 times a year) that helps pharmacies and pharma companies make more money. Its products can also help health plans and health systems reduce costs per patient per month, by reducing utilization of healthcare services by health plan members. That can amount to a ratio of 15: 1 — for every $1 spent on its digital health tools, clients can make or save an average of $15.
The reason why ROI can be so time-consuming to demonstrate, Adler said, is companies may need a year to set up a study, a year to carry it out and another 6 months to evaluate it. And yet, that poses its own set of problems because each pharma and healthcare organization has its own idea for what ROI is for their institution.
“Anytime you get into the longitudinal evaluation to get to ROI, it gets more and more murky,” Adler said. “One of the barriers to innovation is having no objective way to evaluate it and operationalize it… The secret to ROI in digital health is formalizing the criteria for quantifying and evaluating multiple outcomes categories.”
Co-commercialization is one approach that the company has adopted in the past 18 months. With Massachusetts General Hospital, it is working on an intervention for ADHD patients. At the Centre for Addiction and Mental Health, the largest facility of its kind in Canada, it developed a customized intervention for patients with schizophrenia. A collaboration with researchers from the University of British Columbia in Vancouver and provincial health authorities called Optimal Birth BC explore the effectiveness and scalability of a prenatal education program delivered by text messaging for pregnant women in rural British Columbia.
These kinds of partnerships involve figuring out how to co-create with a healthcare stakeholder a revenue model by solving a problem. But to work well, digital health companies need a long-term commitment from a stakeholder and vice versa.
The more successful examples healthcare entrepreneurs and stakeholders can benefit from, the more it will encourage other healthcare entrepreneurs to take a considered approach to identify and take on niche opportunities to improve patient engagement.
Photo: crazydiva, Getty Images
