Digital Therapeutics Market Analysis North America,Europe,Asia,Rest of World (ROW) - US,Canada,UK,Germany,China - Size and Forecast 2023-2027

Digital Therapeutics Market Forecast 2023-2027

The Digital Therapeutics Market size is forecast to increase by USD 10.62 billion, at a CAGR of 25.59% between 2022 and 2027. The market growth is primarily being propelled by several factors. These include the rising occurrence of chronic diseases, technological advancements in digital therapeutics, and the widespread use of smartphones and connected devices. However, challenges such as high development and regulatory costs, as well as limited reimbursement and insurance coverage, could potentially impede the market's progress. Nevertheless, there are positive trends that are expected to contribute significantly to the market's exponential growth. These include the increasing adoption of personalized and adaptive interventions, as well as the integration of artificial intelligence and machine learning into digital therapeutics.

What will be the Size of the Digital Therapeutics Market During the Forecast Period?

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Market Dynamics and Customer Landscape

 

The Digital Therapeutics (DTx) Market is witnessing a surge driven by a paradigm shift towards preventative healthcare and the management of preventable chronic diseases. Despite reluctance among patients, there's an increasing adoption of mHealth applications and smart health-tracking technologies, bolstered by rising smartphone penetration and digital literacy. Clinical validation and integration into healthcare infrastructure underscore the importance of digital health technology. Venture capital investment and initiatives by organizations like the GSM Association further propel the market. With a focus on patient-centric care and patient retention, the market addresses chronic conditions like obesity and cardiovascular disorders, paving the way for integrated healthcare systems and software-based medical devices (SaMD). Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Key Driver

The increasing prevalence of chronic diseases is a key driver of the market. With the rising incidence of chronic illnesses globally, there is a growing need for affordable and efficient treatment alternatives. Chronic diseases, including cardiovascular conditions, diabetes, and mental health issues, are major contributors to global mortality and morbidity, as highlighted by the World Health Organization. In response to this challenge, these therapeutics offer a promising approach to enhance patient outcomes and reduce healthcare costs. These digital treatments deliver evidence-based interventions through mobile applications, wearables, and other technologies, empowering patients to better manage their chronic diseases and achieve improved health outcomes.

As the prevalence of chronic diseases continues to rise, the demand for such therapeutics is also expected to grow. Consequently, the market is poised for significant expansion during the forecast period, driven by the increasing need for effective solutions to manage chronic conditions.

Key Trends

The market is experiencing significant growth due to the increasing adoption of personalized and adaptive interventions. These solutions utilize data analytics, artificial intelligence, and machine learning to deliver customized treatment programs that cater to individual patient needs, interests, and lifestyles.

For instance, companies like Happify Health and Pear Therapeutics offer personalized mental health interventions for patients with substance use disorders using cognitive-behavioral therapy and mindfulness techniques. Such tailored interventions provide patients with more effective and engaging treatment options, leading to improved health outcomes. As the demand for personalized solutions rises, the market is expected to continue its upward trajectory during the forecast period.

Major Challenge

High development and regulatory costs are one of the key challenges hindering market growth. The major costs associated with product development and regulatory compliance are some of the main challenges the global market for these solutions must overcome. A sizable initial expenditure is needed for research and development, clinical trials, and regulatory filings to establish digital medicine.

Additionally, getting regulatory approval from organizations like the FDA can be an expensive and time-consuming process. Smaller businesses may be particularly burdened by these expenses, which inhibits market innovation and competitiveness. As a result, businesses could find it unfavorable to become profitable and obtain financing. Access to cutting-edge remedies is hampered by the high development costs involved with digital pharmaceuticals, which act as a significant barrier to the entry of new players. Hence, regulatory costs and high development are challenges that can hinder the growth of the market in focus during the forecast period.

Market Customer Landscape

The market report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.

Global Market Customer Landscape

Who are the Major Market Players?

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Akili interactive: The company offers digital therapeutics that deliver specific sensory stimuli and simultaneous motor challenges designed to target neural systems involved in attentional control.

The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including

• Alphabet Inc.
• Better Therapeutics Inc.
• BigHealth 
• Brain+ ApS
• Canary Health
• Click Therapeutics Inc
• Digital Therapeutics Alliance Inc. 
• GAIA AG
• Jogo Health Inc.
• Limbix Health Inc.
• Medtronic Plc
• Noom Inc.
• Omada Health Inc. 
• Pear Therapeutics Inc.
• ResMed Inc.
• Teladoc Health Inc.
• WellDoc Inc.
• DarioHealth Corp.

Qualitative and quantitative market research and growth analysis of companies have been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. In the market growth analysis, data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.

Market Segmentation

 

The Digital Therapeutics (DTx) Market is at the forefront of healthcare innovation, targeting chronic conditions like CNS disease, CVDs, and psychiatric disorders. Despite initial reluctance among patients, the market is fueled by increasing patient demand and adoption of mHealth applications. Digital health technology plays a pivotal role, supported by clinical validation and integration into healthcare infrastructure. Employers and payers are recognizing the value of DTx in reducing healthcare costs and improving outcomes for patients with chronic diseases like diabetes and obesity. With rising penetration of smartphones and internet, the market continues to attract venture capital investment and regulatory support, as seen with initiatives like the Software Pre-Cert Pilot Program by the FDA. Collaborative efforts between patients, providers, and organizations like the GSM Association are driving the development of integrated healthcare systems, paving the way for patient-centric care and improved management of chronic conditions.

By Product

The market share growth by the software segment will be significant during the forecast period. The global market is experiencing significant growth for software as a product. Software products are becoming dominant in providing efficient and individualized healthcare interventions as a result of the increasing usage of these solutions.

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The software segment was valued at USD 1.55 billion in 2017 and continued to grow until 2021. Numerous variety of software products, such as mobile applications, web-based platforms, and virtual coaching tools, are available in the market in focus. To enhance the overall user experience, providers are concentrating on creating intuitive user interfaces, sophisticated analytics tools, and interoperability features. Software products are an important aspect of the emerging field of digital therapeutics due to partnerships and collaborations between healthcare organizations and software developers that improve innovation and broaden market reach. Hence, owing to the rising demand for this software, the market in focus is expected to witness significant growth during the forecast period.

Which are the Key Regions for the Market?

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North America is estimated to contribute 44% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. In 2022, the North American market witnessed significant growth. Government initiatives in the region have been essential in enhancing the integration into healthcare delivery systems. Healthcare professionals and patients now have more confidence, which has encouraged the adoption of digital therapeutics. The market in North America is anticipated to continue growing during the forecast period due to the rising importance of the demand for affordable treatment solutions and patient-centered care. Digital therapeutic solutions have been aggressively developed and promoted by manufacturers in North America. To give efficient interventions, they have been utilizing cutting-edge technology like AI, machine learning (ML), and data analytics.

Market Analyst Overview

The market is witnessing rapid growth globally, driven by advancements in digital health technology and its integration into healthcare systems. Both developed and developing economies are embracing smart health tracking and patient-centric care, fostering the adoption. Integrated healthcare systems leverage mobile services, with a significant portion of the global population owning smartphones. This widespread penetration supports the growth of mHealth applications, emphasizing regulatory flexibility.

 

The market is undergoing a transformative phase, driven by the urgent need to address chronic conditions like CNS disease and cancer. Despite challenges such as reluctance among patients and varying technology literacy levels, the market is bolstered by clinical validation and integration into healthcare infrastructure. As healthcare costs escalate due to preventable chronic diseases, there's a growing focus on preventative healthcare and leveraging electronic health records to facilitate patient retention. Increasing phone penetration and internet penetration offer opportunities for wider adoption, attracting venture capital investment and fostering behavioral change towards better health outcomes.

Digital health products address various health conditions, including cardiovascular disorders, chronic kidney disease, chronic lung disease, Alzheimer's, obesity, smoking cessation, and central nervous system (CNS) diseases. Regulatory initiatives, such as the FDA's Digital Health Innovation Action Plan, contribute to standardization and the development of software-based medical devices (SaMD). With a focus on personalized healthcare, the market is poised for continued expansion, offering innovative solutions to improve patient outcomes and address diverse health challenges.

Segment Overview

The market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest market trends and analysis and growth opportunities from 2017 to 2027. 

• Product Outlook
  • Software
  • Devices

• End-user Outlook 
  • Business-to-consumer (B2C)
  • Business-to-business (B2B)

• Region Outlook 
  • North America
    • The U.S.
    • Canada
  • Europe
    • The U.K.
    • Germany
    • France
    • Rest of Europe
  • Asia
    • China
    • India
  • ROW
    • Australia
    • Saudi Arabia
    • Brazil

Market Scope
Report Coverage	Details
Page number	144
Base year	2022
Historic period	2017-2021
Forecast period	2023-2027
Growth momentum & CAGR	Accelerate at a CAGR of 25.59%
Market growth 2023-2027	USD 10.62 billion
Market structure	Fragmented
YoY growth 2022-2023(%)	23.68
Regional analysis	North America, Europe, Asia, and the Rest of the World (ROW)
Performing market contribution	North America at 44%
Key countries	US, Canada, UK, Germany, and China
Competitive landscape	Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks
Key companies profiled	2Morrow Inc, Akili Inc., Alphabet Inc., Better Therapeutics Inc., BigHealth , Brain+ ApS, Canary Health, Click Therapeutics Inc, Digital Therapeutics Alliance Inc. , GAIA AG, Jogo Health Inc., Limbix Health Inc., Medtronic Plc, Noom Inc., Omada Health Inc. , Pear Therapeutics Inc., ResMed Inc., Teladoc Health Inc., WellDoc Inc., and DarioHealth Corp.
Market dynamics	Parent market analysis, Market forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period
Customization purview	If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized.

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What are the Key Data Covered in this Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the growth of the market between 2023 and 2027
• Precise market forecast of the market  size and its contribution to the market in focus on the parent market
• Accurate predictions about upcoming market growth and trends and changes in consumer behavior
• Growth of the market industry across North America, Europe, Asia, and the Rest of the World (ROW)
• Thorough market growth and forecasting analysis of the market’s competitive landscape and detailed information about vendors
• Comprehensive market analysis and report of factors that will challenge the growth of market vendors

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