Miao Health Files IPO Prospectus: Innovating Chronic Disease Management Through Digital Therapeutics to Rebalance Doctor-Patient Supply and Demand

How Can Digitalization Help Patients with Chronic Diseases Better Manage Their Health in the Post-Pandemic Era?

According to a report released by IQVIA, there are currently over 350,000 digital health apps serving consumers worldwide. The COVID-19 pandemic has compelled patients and physicians to adapt to online health platforms more rapidly than ever before. Consequently, telemedicine apps and health-related apps have garnered increasing attention, with download volumes far exceeding pre-pandemic levels.

Meanwhile, the concept of Digital Therapeutics (DTx) has also been propelled into the spotlight, becoming a hot topic in the broader health industry. As part of proactive health intervention technologies and the digital health ecosystem, DTx provides digital service tools for patients, healthcare providers, and medical institutions, enabling the prevention, management, or treatment of certain diseases. Examples include software for diabetes prevention, apps for hypertension management, and games for treating mental disorders. These innovations have reshaped the supply-and-demand dynamics between doctors and patients, improving accessibility and adherence.

Although the term “digital therapeutics” sounds somewhat futuristic, the concept has already become a reality. Currently, 90% of digital therapeutics on the market are concentrated in four major areas: mental health, chronic diseases, oncology, and rehabilitation. During the healthcare sector’s digital transformation, some innovative companies began exploring early on how to combine technology with evidence-based medicine to revolutionize personalized patient care and health management. They did not deliberately adopt the label of “digital therapeutics”; only when the concept gained widespread recognition did they realize that this had been their focus all along.

As the first Chinese enterprise certified as a member by the Digital Therapeutics Alliance (DTA), Miao Health has been quietly dedicated to the field of digital health. Leveraging its years of expertise in digital health management, the company has built a digital platform for lifestyle intervention in chronic diseases and developed active health intervention digital therapeutics based on this platform. It provides patients with multidimensional lifestyle interventions grounded in evidence-based medicine, offering services that include disease prevention, treatment, and health management.

Miao Health’s digital therapeutics are designed for patients with diabetes, hypertension, and medical obesity, aiming to improve their health outcomes. Meanwhile, as its suite of digital products for chronic disease management gradually matures and enters the market, the company has identified reliable payers for its services.

The latest statistical data show that the prevalence of diabetes among adults in China has reached 12.8%, with 120 million people diagnosed with diabetes and an additional 400 million individuals in the prediabetic stage. It is estimated that China’s annual health expenditure related to diabetes amounts to approximately USD 109 billion. Diabetes has become a major public health issue posing a serious threat to the health of the Chinese population.

After years of practice, Miao Health has pioneered a digital management pathway for diabetes to help patients achieve “proactive health management.” In fact, type 2 diabetes is treatable, reversible, and can allow for medication discontinuation. This digital therapy will empower standardized management of diabetes reversal, and can be combined with medications and other therapies, shifting the focus from “disease-centered treatment” to establishing lifelong health management services.

Cutting-edge international research has demonstrated that blood glucose levels can be maintained within the normal range through lifestyle interventions—such as dietary modifications, physical activity, sleep optimization, and stress management—without the need for injections or medication. Among patients with newly diagnosed diabetes, those who lose more than 10 kilograms can maintain normal blood glucose levels without medication or injections in 60% of cases; for those who lose more than 15 kilograms, this rate increases to 80%.

Miao Health’s approach involves controlling the incidence of complications by providing proactive management services. Patients utilize an app, mini-program, and dedicated customer service for follow-up care to meticulously record daily metric monitoring and adherence to medical advice. By integrating lifestyle data to standardize users’ daily behaviors for blood glucose control, timely intervention and medical assistance are provided when issues arise, thereby reducing the incidence of complications.

The results indicate that lifestyle interventions can significantly reduce the subsequent incidence of retinopathy, cardiovascular and cerebrovascular diseases, and all-cause mortality among participants. Compared with the control group, the intervention group showed a significant reduction in the cumulative incidence of diabetes and all-cause mortality. Medication is no longer the sole benchmark or intervention for disease management; a large number of patients can reduce their medication usage through scientific and effective health promotion.

This is made possible by Miao Health’s Miao+ IoT Health Big Data Platform, which enables continuous, multi-dimensional tracking of health management data for users; its H-Health Risk Stratification Management Platform, which stratifies and analyzes user health risks and quantifies health status using an “H-value”; and its M-AI Health Intervention Platform, which automatically generates personalized health management plans.

Combining precision nutrition, scientific exercise, blood glucose monitoring, psychological counseling, and pharmacological intervention can help restore and improve pancreatic islet function, concurrently repair liver function, increase muscle mass, address the root causes to stabilize blood glucose levels, and achieve diabetes remission. By integrating medications or medical devices with clear evidence-based clinical guidelines, such digital diabetes management can deliver tangible value to patients.

From a trend perspective, digital therapeutics focused on chronic disease management are generally able to identify payment possibilities across various dimensions, particularly for products with a large patient base, such as those in the field of diabetes management. Although digital therapeutics cannot completely replace medications, they can provide better care for patients, help them connect with high-quality services including medical care, pharmaceuticals, and insurance, and leverage technology to better serve users and create value.

Given China’s national context, there are four potential payers for digital therapeutics (DTx) in the field of chronic disease management: out-of-pocket payments by individuals, pharmaceutical companies, basic medical insurance, and commercial health insurance. Out-of-pocket payments are likely to focus on rigid-demand areas, particularly mental health disorders, while basic medical insurance, as a payer, struggles to support the rapid scaling of DTx. Therefore, pharmaceutical companies and commercial health insurers are more optimistic about serving as payers for DTx, having already shown interest in internet healthcare.

Drawing on years of experience serving the insurance industry, Miao Health is striving to integrate digital therapeutics with the payment mechanisms of commercial insurance. This effort is driven by two key factors: first, the significant cost-effectiveness advantages of incorporating commercial health insurance into chronic disease management; and second, while digital therapeutics ensure effective and efficient services for patients with chronic conditions, their long-term efficacy validation generates valuable data that can be used to develop referenceable economic models, thereby helping insurers control costs.

Therefore, Miao Health has helped insurance companies build a digital middle platform for “insurance + health management,” providing one-stop SaaS solutions that offer digital upgrade tools to agents, insurers, users, and service support parties, thereby transforming the operational model of health insurance. By embedding digital therapeutics into health insurance products, it enhances coverage for non-standard individuals with chronic diseases and enables insurers to pay for digital therapeutic services.

Taking “Blood Sugar Guardian” as an example, this is China’s first managed-care health insurance product for diabetes, jointly developed by MiaoBao, the insurtech platform under Miao Health, and Asia Pacific Property & Casualty Insurance Company. It aims to reduce the incidence of complications and prolong the disease course through daily management of diabetic patients. The key innovation of “Blood Sugar Guardian” lies in breaking through the underwriting restrictions of traditional insurance, significantly expanding the pool of eligible individuals with diabetes. It imposes no limits on blood glucose levels, allowing all diabetic patients under the age of 70 who have not experienced complications to enroll. Similarly, health insurance products such as “Blood Pressure Guardian” also extend coverage to individuals with hypertension.

In fact, digital therapeutics are bridging the significant gap caused by historical and current imbalances in healthcare resources, creating a vast blue ocean for the entire industry, including R&D and manufacturing, distribution, and payers. Looking ahead, technological advancements and evolving policy landscapes are expected to spur a surge in digital health interventions targeting a broader range of health conditions. These interventions will deliver high-quality, clinically validated treatments at an unprecedented scale, seamlessly integrating insurance products, health management services, and pharmaceutical care. Such patient-centered digital therapeutics, which incorporate full-lifecycle management and demonstrate genuine clinical efficacy, will create multi-stakeholder value propositions with diverse payment models, ultimately driving positive and sustainable growth across the industry.