[Good Brain 2023] DTx Accelerates Entry into Institutional Market... "Leading Global Market with Technological Gap"

Panel Discussion on Policy Directions for Popularizing Digital Healthcare
Under the Theme

This year marks a foundation for the domestic digital healthcare industry to take a step forward. Following the approval of Korea's first and second digital therapeutics (DTx) devices by the Ministry of Food and Drug Safety in February and April respectively, recent plans for health insurance coverage of DTx have laid the groundwork for innovative medical technologies to enter the market. Although the pace has been slower compared to major advanced countries like the U.S. and Europe, Korea, as an IT powerhouse, is expected to lead the market in the digital healthcare sector.

On the 20th, at the Westin Chosun Hotel in Jung-gu, Seoul, panelists are discussing "Strengthening the Foundation of Digital Healthcare" at the 'Good Brain 2023 Conference.' From left to right: Kim Jae-jin, President of the Korean Society of Digital Therapeutics; Kang Sung-ji, CEO of Welt; Bin Jun-gil, CEO of Neurofit; Lim Chan-ho, CBO of Imocog; and Jung Young-ae, Director of the Reimbursement Listing Office at the Health Insurance Review and Assessment Service. Photo by Kim Hyun-min kimhyun81@

On the afternoon of the 20th, at the Westin Chosun Hotel in Jung-gu, Seoul, the 'Good Brain 2023 Conference' hosted by Asia Economy held a panel discussion on the theme of 'Policy Directions for the Popularization of Digital Healthcare.' The discussion included CEOs involved in domestic DTx research and commercialization, as well as regulatory authorities, to discuss the future direction of Korea's DTx. The session was moderated by Kim Jae-jin, President of the Korean Society of Digital Therapeutics (Professor of Psychiatry at Gangnam Severance Hospital), with panelists including Kang Sung-ji, CEO of Welt; Lim Chan-ho, Chief Business Officer (CBO) of Imocog; Bin Jun-gil, CEO of Neurofit; and Jung Young-ae, Director of the Health Insurance Review and Assessment Service's Reimbursement Registration Office.

Q. Last month, the Health Insurance Review and Assessment Service gave the industry the option to choose between 90% selective reimbursement and non-reimbursement for DTx prescriptions.

▲Jung Young-ae, Director=Entering reimbursement means that DTx has entered the institutional framework as a medical service. However, to prove efficacy and effectiveness, DTx will be provisionally listed under health insurance for up to three years, after which reimbursement status and pricing will be decided upon formal listing. Although Korea's approval of DTx came later than in major advanced countries like the U.S. and Europe, the progress is considered fast. Since it is difficult to apply the existing insurance reimbursement system directly to innovative medical technologies, two options?reimbursement and non-reimbursement?are provided to allow strategic market entry.

Q. Which do digital healthcare companies prefer more: reimbursed or non-reimbursed prescriptions?

▲Kang Sung-ji, CEO=Aimmedi's 'Soms'?the first domestic DTx?declared non-reimbursement, but our DTx 'Welt-I' has not yet made a choice. Both treat insomnia with similar mechanisms. If there is a large price difference between the two products, there may be a misconception that the cheaper product is less effective.

Although guidelines for health insurance listing of DTx have been issued, the industry is carefully deciding on strategic market entry. If reimbursement applies to DTx prescriptions, patient preference may increase, but due to the low-fee structure of the health insurance system, medical professionals may be less active in using them. Conversely, with non-reimbursed prescriptions, medical institutions can set higher prices compared to reimbursement, so medical institutions are expected to prefer this option.

On the 20th, at the Westin Chosun Hotel in Jung-gu, Seoul, panelists are discussing the topic of 'Strengthening the Foundation of Digital Healthcare' at the 'Good Brain 2023 Conference.' Kang Sung-ji, CEO of Welt, is speaking. Photo by Hyunmin Kim kimhyun81@

Q. The speed of DTx development in Korea is slower than overseas. Can Korea quickly become a powerhouse?

▲Kang Sung-ji=To be competitive in the global DTx market, Korea must push forward with speed rather than scale. The Korean DTx market accounts for a very small portion of the global market. Speed means a time gap. Korea's early internet adoption is an example. Internet penetration was faster than other countries, which led to the birth of various internet-based businesses. Domestic DTx development has already begun, and I believe the time gap can create a technological gap.

▲Professor Kim Jae-jin=Considering why Korea became a digital powerhouse, it is because the public desired digital technology and its actual usage increased, which led to the development of related technologies. If public usage of DTx increases alongside company development, it can advance together.

Q. Older adults often find digital technology challenging. Will they be able to fully utilize the complex functions of DTx?

▲Lim Chan-ho, CBO=We discarded all early versions developed during the process. They were apps operated via touchscreen, but older adults found touch operation difficult. Our developed product, Cogte, uses a voice-based interface that operates solely through conversation without touch. We have completed testing with 250 patients domestically and also tested with patients with mild cognitive impairment (MCI) in Germany.

Q. While new drug development is in full swing worldwide, what role can DTx play?

▲Lim Chan-ho=Ultimately, DTx is unlikely to replace existing drugs. Taking dementia as an example, DTx aims to delay or improve the disease. Since expensive dementia drugs are also being developed, I believe we need to proceed in an 'end-to-end' manner together.

▲Jung Young-ae=With rising medical expenditures, there is sufficient public demand and expectation for DTx. However, the medical community's top concern is the lack of clinical evidence on treatment effectiveness, so the government and HIRA must scrutinize this carefully. Also, since DTx is a treatment that shows effects based on patients actively using it alone, it must be a product that doctors can trust and prescribe. Patient information security issues related to digital device use must also be resolved.

At the 'Good Brain 2023 Conference' held on the 20th at the Westin Chosun Hotel in Jung-gu, Seoul, panelists are discussing the topic of 'Strengthening the Foundation of Digital Healthcare.' From the left, Jaejin Kim, President of the Korean Society of Digital Therapeutics; Sungji Kang, CEO of Welt; Jungil Bin, CEO of Neurofit; Chanho Lim, CBO of Imocog; and Youngae Jung, Director of the Reimbursement Registration Office at the Health Insurance Review and Assessment Service. Photo by Hyunmin Kim kimhyun81@