Digital Therapeutics at a Crossroads: Insights from the 2022 Future Healthcare 100 Summit

In recent years, the traditional healthcare industry has been undergoing comprehensive digital transformation. The informatization of medical processes, continuous health data recording via wearable devices, and the massive biological data generated by emerging technologies are serving as fuel for artificial intelligence. Through iterative algorithmic models, AI assists physicians in disease warning, diagnosis, treatment, monitoring, and long-term management, thereby expanding the scope of health management services from within medical institutions to the broader digital world. Against this backdrop, the concept of Digital Therapeutics (DTx) has emerged. By leveraging digital means, DTx converts existing medical principles, clinical guidelines, or standard treatment protocols into software-driven interventions, effectively improving patient adherence and accessibility in chronic disease management while breaking through the limitations of traditional pharmacological treatments.

Digital therapeutics have the potential to become a new milestone in the healthcare sector. The year 2021 was hailed as the “Year One” of digital therapeutics in China, while 2022 emerged as the “pivotal year,” marking a critical period for establishing deep roots, fostering upward growth, and enabling lateral expansion. On June 16, 2022, byOrganized by VCBeat and VB100, co-organized by Taozi Health and Yuanyi CapitalThe Digital Therapeutics Innovation Practice Forum was held online. VCBeat released its landmark “Global Report on Digital Therapeutics (2022),” a comprehensive nearly 100,000-word record of industry exploration. In collaboration with Weimai (Co-Chair of the DTA Asia-Pacific Policy Research Center), VCBeat also translated and released the Chinese version of the “DTX Value Assessment and Integration Guide.” The event featured insightful presentations from frontline entrepreneurs, clinical experts, and investors, providing valuable references for the industry’s development.

The following is a summary of the viewpoints presented by the forum speakers (arranged in order of presentation), with edits made to preserve the original meaning.

Jiang Tianjiao | Dean of VCBeat Research Institute

Digital therapeutics are software-driven, evidence-based intervention programs used to treat, manage, or prevent diseases.

The potential of digital therapeutics is currently immense. First, its core logic lies in providing patients with continuous, professional medical guidance during treatment and after discharge, thereby addressing subtle clinical needs that are difficult for physicians to fully attend to. This approach enhances patient adherence to treatment plans, reduces the long-term risk of major diseases, and ultimately achieves the goal of cost reduction and efficiency improvement. Second, successful case studies and supportive policies have further strengthened confidence in digital therapeutics across various sectors.

Mr. Jiang Tianjiao believes that the current challenge of obtaining regulatory approval for digital therapeutics is gradually being resolved. The greatest challenge remains the lack of hard metrics for the clinical efficacy of digital therapeutics, as the relevant foundational theoretical framework has yet to be established. To achieve commercialization in the future, digital therapeutics must focus on three clearer business logics: addressing clinical needs unmet by current pharmaceuticals and medical devices, replacing some currently expensive treatment methods, and providing continuous support to help patients reduce long-term costs associated with severe conditions.

Zhang Jing | CEO of Senmei Medical

Closed-source digital interventions refer to enterprises that fully control the entire process, including clinical insights and product translation, underlying principles and evidence-based validation, as well as promotion and commercialization. Possessing these capabilities signifies stronger product pipelines and greater potential for market operations.

When discussing the clinical efficacy of digital interventions, Mr. Zhang Jing pointed out that clinical evidence demonstrates significant improvements in relevant indicators for patients with chronic kidney disease (CKD) who receive structured management compared to those who do not. In this context, the integration of digital health technologies has enabled hospitals to scale up their patient management capacity and significantly enhance operational efficiency. Regarding patient acceptance of out-of-pocket digital health services, he shared collaborative data from Senmei Medical, Xinqiao Hospital, and West China Hospital, which indicated a considerable conversion rate among CKD patients adopting digital health solutions.

How Should Digital Health Software Be Configured to Help Patients Improve Treatment Outcomes?

Under the rigorous medical premise of ensuring interpretability and comprehensive objective quantification, Senmei Medical introduces enhanced gamification and incentive mechanisms to improve patient adherence. Targeting urinary sodium as a key indicator for relevant indications, it provides a stepwise intervention plan to reduce sodium intake, ultimately aiming to prevent or treat CKD and slow its progression in patients.

Li Jian | Chief Business Director, Healthcare and Life Sciences Industry, Amazon Web Services (AWS) Greater China

Current healthcare services remain predominantly hospital-centric, with low patient engagement and limited accessibility. This is particularly true for patients with chronic diseases, who require long-term, stable medical guidance and intervention. Digital health technologies are well-positioned to gradually shift the focus from hospital-based mid-to-late stage treatment toward early prevention and prognosis management, characterized by higher patient engagement and improved accessibility.

Therefore, Mr. Li Jian believes that digital therapeutics (DTx) address the primary pain points in chronic disease management and hold the potential to become a disruptive force in this field. He also shared the Amazon “Flywheel Theory” as it applies to DTx: the emergence of digital therapeutics enhances the utilization and integration of patient data, enabling better personalized treatment plans from which patients benefit. Meanwhile, the high-speed operation of this patient-centric DTx “flywheel” generates economies of scale, offering lower costs and greater accessibility to a broader patient population, which will further propel the robust growth of the digital therapeutics market.

The digital therapeutics industry’s demand for patient data storage, computing, and real-time intelligent analytics, coupled with its business nature that emphasizes iterative software development, makes digital therapeutics companies and cloud computing enterprises a natural “perfect match.” Cloud computing platforms can provide digital health companies with enhanced connectivity and innovation capabilities, enabling patients to truly benefit from convenient, secure, and high-quality digital healthcare services.

Chen Kaishen | Founder and CEO of Zhongxi Medical Technology

Relevant research data indicate that the five-year survival rate for cancer patients in China increased from 30.9% in 2010 to 40.5% in 2020. This figure is projected to continue rising, likely reaching 46.6% by the end of 2030. However, a significant gap remains when compared with corresponding data from the United States.

How can we further improve survival rates for cancer patients, and is it possible to manage cancer as a chronic disease? Chen Kaishen identifies three key entry points: first, upgrading diagnostic methods to enable early detection and screening; second, accelerating the research and development of innovative drugs to enhance therapeutic efficacy from a pharmacological perspective; and third, leveraging digital solutions to support more precise patient and disease management. After undergoing several waves of transformation, digital patient and disease management has now entered the stage of digital therapeutics, which integrates “intervention, automation, and robust clinical evidence.” Building on connectivity and empowered diagnosis and treatment, this approach focuses on maximizing patient benefits while more effectively addressing inadequacies in patient and disease management caused by factors such as uneven distribution of medical resources, thereby providing patients with long-term professional medical guidance in their daily lives.

Nowadays, the value of digital therapeutics (DTx) is becoming increasingly prominent, while simultaneously facing numerous challenges. As an evidence-based medical software, DTx must gain recognition not only from regulators and the clinical community but also from patients. From a regulatory and clinical perspective, DTx must have clearly defined mechanisms of action, efficacy evaluations, and safety assessments, supported by rigorous clinical studies and compliant data accumulation. From the patient’s perspective, DTx must deliver tangible clinical benefits to encourage greater voluntary participation.

Zhongxi has consistently upheld the values of “patient benefit-centricity, value-based healthcare orientation, and evidence-based medicine support.” Regarding future trends, Chen Kaishen envisions a tripartite integration of “clinical staging practices, molecular biology, and digital targets,” to truly deliver personalized, precision-tailored treatment plans that maximize patient benefits.

Hou Liping | President of Taiyuan Hou Liping Hospital of Traditional Chinese Medicine for Rheumatic and Bone Diseases

Rheumatic diseases are a group of chronic conditions characterized by extensive involvement, insidious and slow onset, and high disability rates.

Taiyuan Hou Liping Hospital of Traditional Chinese Medicine for Rheumatic and Bone Diseases leverages digital therapeutics combined with 35 years of clinical experience in TCM rheumatology to propose a “Healing Management” model aimed at ensuring long-term therapeutic outcomes for patients. This patient-centered model establishes a five-member multidisciplinary care team for each patient, comprising an attending physician, a physical therapist, a health educator, a rehabilitation specialist, and a medical assistant. By extending care beyond traditional clinical settings (such as outpatient visits and hospitalization), the model addresses patients’ needs to live, work, and study effectively while managing their condition. It implements proactive interventions across treatment, constitutional improvement, rehabilitation nursing, diet, and exercise, establishing a contractual approach to efficacy management based on mutual agreement between healthcare providers and patients.

Since 2018, eight clinical practice guidelines for common rheumatic diseases have been developed in accordance with national and industry standards. These practical standards integrate diagnosis, prevention, health education, rehabilitation, and treatment efficacy evaluation. To date, more than 8,000 patients with rheumatic diseases have been included in the therapeutic management model.

She believes that the primary focus for digital therapeutics in the field of Traditional Chinese Medicine (TCM) rheumatology should be on establishing standardization and digitization. This requires improving systems for efficacy evaluation, assisted diagnosis, rational drug use, and treatment course management, thereby facilitating seamless doctor-patient connectivity, enabling interoperability of diagnostic and treatment information, and ensuring long-term therapeutic efficacy.

Zhou Kaibo | CTO, Fudong Medical

For musculoskeletal injuries, the belief that “a hundred days of rest are needed for tendon and bone injuries” remains prevalent among most patients in China. However, from the perspective of orthopedic and sports medicine specialists, there is a growing consensus that rehabilitation is a critical component of the diagnostic and therapeutic process for patients following orthopedic surgery or suffering from sports-related injuries. Nevertheless, the overall level of musculoskeletal rehabilitation in China remains relatively low, with insufficient development of rehabilitation departments in general hospitals and specialized rehabilitation hospitals. Compared with developed countries, China has a significantly lower per capita number of rehabilitation physicians and therapists.

Leveraging a multitude of cutting-edge technologies, digital therapeutics are striving to address these pain points.

Mr. Zhou Kaibo shared Fudong Medical’s digital therapeutics solution for musculoskeletal rehabilitation—Yuexing™. To address numerous challenges in traditional musculoskeletal rehabilitation, such as geographical and temporal constraints, scarcity of rehabilitation resources, and the lack of data retention and tracking, Fudong Medical has developed an integrated solution comprising “wearable devices + App + SaaS + AI algorithms.” Regarding the Yuexing digital therapeutics platform, Mr. Zhou highlighted the application of smart sensors, focusing on their exploration in machine vision-based rehabilitation assessment and inertial navigation-enabled VR rehabilitation exercises.

In the field of musculoskeletal rehabilitation, Zhou Kaibo believes that the development of digital therapeutics requires greater application of intelligent, miniaturized, and unobtrusive sensors to capture more comprehensive, multidimensional patient data, thereby leveraging AI algorithms to provide more precise auxiliary assessments and rehabilitation plans for both patients and clinicians.

Yang Ruirong | Partner, Yuanyi Capital

From the perspective of healthcare industry development, the era of patient-centered care has arrived, and health challenges are becoming increasingly severe. In terms of traditional drug R&D, the cost of developing new drugs is rising while returns are diminishing. Against this backdrop, digital therapeutics, which have accelerated during the pandemic, are receiving growing attention from the healthcare sector.

In terms of capital investment, the total global financing for digital health companies exceeded $3.4 billion in 2021, which was 2.5 times the amount raised in 2020.

So, where is the future direction of digital therapeutics?

Yang Ruirong believes that the digital healthcare industry will see three major development trends in the future:

First is the integration of software and hardware, where the hardware component collects human health data, and the software then analyzes the customer's health status to provide appropriate diagnostic and treatment recommendations.

Second is the integration of online and offline services. Many chronic diseases require long-term treatment. To ensure continuous post-diagnosis therapeutic efficacy for patients without consuming additional medical resources, hospitals and enterprises are also deploying integrated online-offline models to manage patients’ ongoing treatment outcomes.

Third, it is value-driven. From an individual perspective, digital health management can reduce subsequent medication costs. Behind individual health lie national medical insurance and commercial insurance; improved population health not only enhances societal well-being but also reduces healthcare expenditures for insurers.

Chen Jingbo | Vice President, Dolphin Digital Healthcare Industrial Park

In 2020, Taozi Health actively responded to the national call for vigorous development of new infrastructure. Leveraging Chengdu’s advantages in medical talent, healthcare resources, business environment, and geographic location, it provided digital healthcare infrastructure support services for pharmaceutical and innovative medical enterprises. With strong support from the Chengdu Municipal Government and the Shuangliu District Government, Taozi Health established the Dolphin Digital Healthcare Industrial Park—an industrial cluster focused on internet-based and digital healthcare. To date, the park has attracted over one hundred leading healthcare companies across China, jointly fostering a premier hub for China’s digital healthcare industry.

Chen Jingbo pointed out that the healthcare industry is a sector characterized by heavy, intensive, and long-term operational demands. As a pioneer in the construction and operation of China’s digital healthcare industrial clusters, Taozi Health has both the responsibility and obligation to provide its partners with comprehensive, high-efficiency, and cost-effective solutions for internet healthcare infrastructure development, as well as uninterrupted, full-coverage operational support services. These services include talent recruitment, government-enterprise exchange forums, and regular self-inspections of medical practice standards, enabling tenant enterprises within the industrial park to focus wholeheartedly on business growth.

Mao Chaolan | Executive Director, Seagull Digital Medical Device Industrial Park

A review of domestic and international research reports and business information reveals that capital investment in digital health has intensified in recent years. In more specialized segments, digital therapeutics (DTx) represent the first shift of digital health toward serious medical care, prompting a race among companies both in China and abroad. According to a report shared by Mao Chaolan, the digital therapeutics market is projected to reach $32 billion by 2024, indicating substantial growth potential.

However, digital therapeutics in China are still in their infancy, with most companies currently engaged in product research and development. It remains unclear how Chinese digital therapeutics enterprises can accelerate their growth and what strategies they should adopt. For the direct regulatory authorities in most provinces, digital health is also a new challenge, raising questions about how to balance regulation with development, as well as openness with breakthroughs.

Mao Chaolan noted that, a decade later, State Council Document No. 2 has once again turned its focus to Guizhou. The significant release of the “Opinions of the State Council on Supporting Guizhou in Forging New Paths in the Large-Scale Development of the Western Region in the New Era” has drawn renewed attention to the province, including from Taozi Health. Taozi has closely observed the strong momentum of Guizhou’s digital economy-themed industries and recognizes substantial room for growth in medical innovation within the province’s digital economy sector. The successful operational experience of the Haitun Digital Medical Industrial Park has enabled Taozi Health to develop a comprehensive and systematic set of standards for industrial services. Consequently, the company is confident in its ability to coordinate and empower industrial resources in Guizhou, Guiyang, and surrounding areas, thereby truly establishing a new landmark for the digital medical device industry.

On May 12, 2022, driven by the strong support of leaders at all levels in Guizhou Province, the Seagull Digital Medical Device Industrial Park was established in Baiyun District, known as the “Dual-Heart” zone of Guizhou, with a firm commitment to setting an industry benchmark. It is hoped that, with the support of the Seagull Digital Medical Device Industrial Park, China’s leading digital health solutions will go global and tell the Chinese story.

As digital therapeutics (DTx) gain momentum across various countries worldwide, what can China’s DTx sector learn from international pioneers? What challenges do DTx companies face when aiming to serve patients globally? At the Digital Therapeutics Forum of the 6th Future Healthcare 100 Conference in 2022, Megan Code, Founder of the Digital Therapeutics Alliance (DTA) and current DTA Chief Policy Officer; Bai Yan, Director of Strategic Investment at Weimai and Co-Chair of the DTA Asia Research Center; and Chen Peng, Senior Researcher at VCBeat Eggshell Research Institute and Senior Editor at VCBeat, participated in a panel discussion to address these questions.

Ms. Megan Coder stated that during the global development of digital therapeutics, it was found that different healthcare systems have entirely distinct requirements for medical data and clinical outcomes related to digital health. Consequently, varying regulatory demands across regions prevent digital therapeutic companies from offering their services to patients in different markets. However, it is encouraging to note that conducting a sufficient number of clinical trials at an adequate level of quality has become an industry consensus.

Mr. Bai Yan pointed out that, thanks to the rapid development of China’s internet industry, digital therapeutics technologies are more readily accepted by hospitals, physicians, and patients alike in China. Through Weimai’s communications with various hospitals, it has been observed that physicians are highly interested in such products and strive to educate patients on how using these solutions can lead to better improvement in their medical conditions.

Mr. Chen Peng stated that VCBeat has been focusing on the field of digital therapeutics since 2016, collaborating with the industry to bring together stakeholders through the establishment of associations, jointly exploring the development of digital therapeutics in China. Particularly after the Top 100 Conference in 2021, more and more people began to pay attention to digital therapeutics, and many startups also received investment.

Since its explosive growth in 2021, digital therapeutics (DTx) has gradually moved from the margins to the mainstream. With continuous influx of capital, related technologies have also been developing rapidly. At the Digital Therapeutics Forum during the 6th Future Healthcare Top 100 Conference in 2022, Yuanfeng Bi, Co-founder and COO of VCBeat; Wenrong Xia, Innovation Director of Sanofi’s Digital Department; Hao Wu, CEO of Taozi Health; Li Wang, Founding Partner of Heda Capital; and Jingye Zhang, CEO of Senmei Medical, participated in a roundtable discussion titled “How Digital Therapeutics Can Effectively Integrate the Healthcare Chain and Deeply Empower Upstream and Downstream Industries,” sharing their insights on the DTx industry.

Xia Wenrong, Innovation Director of Sanofi’s Digital Division, stated that the field of digital therapeutics can indeed deliver significant value to patients. First, existing data indicate that digital therapeutics can effectively support patients and enhance the precision of physicians’ diagnostic and treatment plans. Second, collaboration between digital therapeutics and internet hospitals can foster the development of multidisciplinary care. For instance, in the treatment of certain dermatological conditions, patients may also experience mental health issues; digital therapeutics can facilitate coordination among a broader range of specialists to optimize treatment regimens.

Mr. Wu Hao, CEO of Taozi Health, believes that digital therapeutics can collaborate with primary care hospitals to enhance their treatment capabilities by leveraging digital therapeutic functions across the pre-diagnosis, intra-diagnosis, and post-diagnosis stages, as well as in the formulation of treatment plans. Furthermore, the development of digital health requires a comprehensive supporting ecosystem and policy framework; not all market participants possess these conditions. It is advisable to leave specialized tasks to specialized professionals. Companies in the digital therapeutics sector should seek partnerships with firms that offer greater expertise beyond technology.

Wang Li, Founding Partner of Heda Capital, stated in a discussion on digital health investments that the digital therapeutics industry is still in its developmental stage. Currently, most capital remains in the phase of initial engagement and observation, with relatively few actual investment cases; decisions must be made based on the specifics of each project. However, Heda Capital will place greater emphasis on teams with specialized operational capabilities, while also focusing on forging strong alliances among its portfolio medical teams to foster collaboration.

Mr. Zhang Jing, CEO of Senmei Medical, shared his insights, emphasizing that having clear clinical evidence and enabling patients to use the product independently at home are key features of digital therapeutics. The pipeline developed by Senmei, including sodium control and PEW intervention, fully aligns with these characteristics. The entire process is objectively quantified and meets the interpretability requirements of medical principles. To support this, Senmei Medical has developed two types of test strips. In such detailed areas, the team must possess strong learning capabilities and dual insights into both clinical practice and patient needs, integrating disciplines such as IT, medicine, and engineering.