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Chief Scientist

In response to the COVID-19 pandemic, our team will be interviewing experts from across the ecosystem to bring the HLTH community timely facts and updates. About Acacia Parks: As Chief Scientist at Happify Health, Acacia’s research focuses on digital methods for managing and treating depression and anxiety, as well as chronic health conditions. Her passion lies at the intersection of research and regulatory strategy for digital therapeutics. She received her B.A. in Psychology from Reed College, and her Ph.D. in Psychology from the University of Pennsylvania, where her graduate research helped build the foundation for research on bringing mental health interventions to the general public. Prior to joining Happify Health, Acacia was an Associate Professor of Psychology at Hiram College.

COVID-19 Discussion with Acacia Parks

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Co-founder & CEO

In response to the COVID-19 pandemic, our team will be interviewing experts from across the ecosystem to bring the HLTH community timely facts and updates. About Sean Duffy: Sean is certain that behavioral medicine is at an incredible tipping point of innovation, thanks to technology and design. He holds a BS in Neuroscience from Columbia University, was an MD/MBA candidate at Harvard, and formerly worked for Google and IDEO.

COVID-19 Discussion with Omada Health

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Lead Analyst, Healthcare

The development of GLP-1 agonist drugs to treat diabetes and, increasingly, support weight loss represents one of the most significant trends shaping the healthcare industry today. Given the prevalence of obesity in the US and worldwide and the documented link between obesity and other conditions—including <a href="https://pitchbook.com/news/reports/2023-cardiovascular-disease-heart-health-vc-market-snapshot" target="_blank">cardiovascular disease</a>, the leading cause of death globally, and chronic kidney disease—we believe the effects of this new drug class will extend far beyond the drugmakers themselves.  In a recent <a href="https://pitchbook.com/news/reports/q3-2023-healthcare-future-report-weight-loss-drugs" target="_blank">report</a>, PitchBook’s healthcare analyst team outlined predictions for how widespread adoption of weight loss drugs could reshape healthcare, from biopharma and digital health to healthcare services, medtech, and healthcare IT. We also detailed the outlook for payer coverage of weight loss as well as the emerging weight loss drug pipeline, which includes modalities offering efficacy and patient convenience improvements over currently approved GLP-1s.  Payer coverageWe believe employee pressure will force employers to cover weight loss drugs within the next 2-3 years – initially at great cost. We also believe Congress will eventually pass legislation allowing Medicare to cover weight loss medications, which will require CMS to make adjustments to the Medicare Advantage risk adjustment calculations (which consider obesity rates) to avoid undesirable knock-on effects. Medicaid coverage will be initially constrained by fixed state budgets regardless of clinical efficacy, but will expand as drug prices fall. ACA exchange plans will likely lag in coverage, absent regulatory mandates. Payers will employ prior authorization requirements to concentrate utilization among patients with a higher BMI or weight-related comorbidities. Employer approaches and care navigationWhile Medicare and to a lesser extent Medicaid would realize significant total-cost-of-care savings from a reduction in obesity rates, employers will see less of these savings. The one-two-punch of weight loss drugs and high-cost specialty medications will drive employers to become more active payers via network management, care navigation, and creative benefits design. Employers will also seek out digital health providers that offer integrated lifestyle-based and pharmaceutical treatment for obesity. The employer fertility market provides an interesting parallel: Providers like Carrot tout their ability to significantly reduce IVF utilization by steering employees to less invasive (and less expensive) fertility treatments. Biotech funding and M&amp;AVC dollars are already pouring into late-stage startups with promising weight loss drug candidates, and we also expect to see further IPO and M&amp;A activity as big pharma incumbents look to challenge Eli Lilly and Novo Nordisk’s dominance. (Pfizer, Amgen, and Boehringer Ingelheim also appear well positioned.) Carmot Therapeutics, which has two weight loss candidates in phase 2, recently achieved unicorn status following a $150.0 million Series E. Structure Therapeutics recently completed an upsized offering, raising $185.3 million in February 2023, fueled by its own phase 2 GLP-1 small molecule drug, GSBR-1290. There is also activity at the early stage: Novo Nordisk acquired early stage obesity drug developer Embark Biotech for $16.4 million. We are also watching key players in Southeast Asia, including China’s GMAX Biopharm, Sciwind Biosciences, and Jiangsu Hansoh, along with South Korea’s D&amp;D Pharmatech. AstraZeneca recently acquired Chinese biotech Eccogene’s oral dose GLP-1 for $185 million. For established international entities, strategic partnerships play a pivotal role in reinforcing market presence, facilitated by significant capital investment and localized regulatory advantages. For example, China’s Innovent Biologics is collaborating with Eli Lilly for its phase 3 obesity drug, mazdutide.  Emerging modalitiesOnce payer coverage is widespread, the weight loss drug market will quickly saturate. Consequently, investors should focus on startups introducing new IP, especially emerging modalities or new biological insights that offer additional benefits. On the one hand, triple GIP/GLP-1/glucagon receptor agonists – the technology found in Eli Lilly’s Retatrutide – offer superior clinical validation. On the other hand, ease of use matters – especially if patients must remain on the drug for life. Oral therapeutics currently being developed by Eli Lilly, Novo Nordisk, Structure Therapeutics, Viking Therapeutics, and Pfizer have advantages in lower costs and ease of use despite weaker clinical results and daily dosing. They also win on room temperature stability and scalable manufacturing. Another oral administration candidate, Amgen’s AMG-133, must only be taken monthly, but its antibody composition comes with manufacturing and distribution downsides. Far-sighted investors may seek to place bets on cell and gene therapy, which could shift the treatment paradigm toward single-dose cures. Clinical trialsAs the patient pool contracts due to increased adoption of existing treatments, future clinical trials may face challenges in recruitment. Emerging startups, especially those late to the market, may face slower clinical trial enrollments if existing treatments prove sufficiently effective. In the last few years, private equity firms have become increasingly active consolidators of clinical trials sites, and sites with expertise in cardiovascular and metabolic conditions – until recently a tiny sliver of the biopharmaceutical market – will become prize assets commanding high valuations.  Telemedicine and retail pharmacyThere is a significant <a href="https://pitchbook.com/news/reports/q1-2023-digital-health-report" target="_blank">opportunity</a> for telehealth companies to focus on weight loss as a primary business model or add weight loss telehealth to existing platforms. Examples include WeightWatchers’ acquisition of VC-backed startup Sequence and new weight loss telehealth programs from digital health unicorns Ro and Noom. B2B telehealth provider SteadyMD is quickly scaling up similar programs for retail weight loss providers to spin up similar programs. <a href="https://pitchbook.com/news/reports/q3-2023-pitchbook-analyst-note-walmart-and-walgreens-place-new-value-based-care-bets" target="_blank">Retail pharmacies </a>that have made significant primary care bets, including CVS, Walgreens, and Walmart, should reap rewards because they will be able to provide patients with easy access to both prescribers (primary care) and scripts fulfillment. Costco has also jumped into the fray by partnering with Sesame to offer $29 virtual visits. Although the announcement did not mention weight loss, the cross-selling benefits with Costco’s pharmacy offering are unambiguous. We expect fierce competition among both startups and retailers on both telehealth visit economics and ease of access. Procedural volumes and cardiovascular careAccording to PitchBook <a href="https://pitchbook.com/news/reports/2023-cardiovascular-disease-heart-health-vc-market-snapshot" target="_blank">research</a>, investors have poured more than $10 billion into cardiovascular digital health and medtech startups since 2020. Over the same time period, private equity firms have begun aggressively buying up independent cardiovascular practices. Health systems also rely on cardiovascular surgeries as a key revenue generator. Given <a href="https://www.nejm.org/doi/full/10.1056/NEJMoa2307563" target="_blank">evidence</a> that Novo Nordisk’s Wegovy reduces stroke and heart attack rates by 20% in cardiovascular patients with obesity and overweight – and the promise of even better clinical efficacy in the pipeline – the business model of cardiovascular care will change dramatically, with many providers taking a revenue hit due to decreased procedural volumes.  ConclusionPitchBook analysts will be carefully tracking the transformative effects of this new drug class on care delivery, outcomes, and economics as they unfold. For additional insights – ranging from the demand for injectable packaging and sleep apnea machines to patient engagement strategies – download the full report here.

How Weight Loss Drugs Will Reshape Healthcare

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Senior Principal, MercerWELL

Partner, Clinical Innovation Leader

Associate, Medical Consultant

The concept of “Food as Medicine” is simple: Food aids individuals by supporting health. It doesn’t replace medicine, but it has the potential to enhance it.  Does Food as Medicine have a role in employer health programs? Before we answer that question, let’s take a step back. It’s clear that there’s a dietary problem in the US. Only <a href="https://www.cdc.gov/nccdphp/dnpao/division-information/media-tools/adults-fruits-vegetables.html" target="_blank">1 in 10 people</a> in this country consume the recommended amounts of fruits and vegetables. Lower-income households <a href="https://www.ers.usda.gov/amber-waves/2008/november/can-low-income-americans-afford-a-healthy-diet/#:~:text=Low%2Dincome%20households%20tend%20to,nutritious%20foods%20than%20other%20households" target="_blank">consume less produce</a> and are at a higher risk for <a href="https://www.ers.usda.gov/webdocs/publications/99282/err-275.pdf?v=1931.5" target="_blank">food insecurity </a>and <a href="https://www.healthaffairs.org/doi/10.1377/hlthaff.2015.0645" target="_blank">diet-related diseases</a>. Healthy eating habits can be hard to adopt or maintain for those living in food deserts or who have difficulty covering the higher costs of fresh, health-conscious foods.This is where the Food as Medicine movement comes in. Employers can potentially address food insecurity and nutrition insecurity by considering a benefit to deliver and/or subsidize healthy food.  Employers can also assist employees who are newly diagnosed with a medical condition, such as diabetes, not only by offering and/or discounting healthy food but also by providing access to a dietitian to provide culinary education and medical nutrition therapy. Specific nutrients in foods can play a pivotal role in preventing and even managing a number of health conditions. For example, the consumption of whole grains and vegetables has been associated with stopping hypertension and, similarly, eating a diet high in fresh fruits, vegetables, extra virgin olive oil, legumes, and fish has been tied to the prevention of chronic diseases. Employers can further support employees who are experiencing complex health issues by offering delivery of medically tailored meals (MTMs) once the patient returns home from the hospital. MTMs are fully prepared home-delivered meals designed by a registered dietitian to address specific medical needs. A recent study published in <a href="https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2797397" target="_blank">JAMA</a> found that national implementation of MTMs for high-risk individuals could produce a net cost savings of $13.6 billion annually ($2,500 per patient year). While MTMs are not widely covered by public or private health insurance plans, pilot programs have shown significant decrease in hospitalizations and overall improvement in chronic disease management and some plans are taking steps in that direction. <a href="https://www.highmarkhealth.org/hmk/newsroom/pr/2022/2022-12-05-Medically-Tailored-Meals.shtml" target="_blank">Highmark Health</a> recently launched such a pilot for members with qualifying chronic health conditions who are at high-risk for food insecurity.  Produce prescriptions offer another more flexible Food as Medicine option that can be added to an organization’s wellness program or as part of a medical benefit for employees. For example, health plan <a href="https://www.hioscar.com/diabetes" target="_blank">Oscar</a> offers $100 per year for healthy groceries for members with type 1 or type 2 diabetes who have an annual physical or wellness visit. Generally, these “prescriptions” come in the form of a voucher for fresh fruits and vegetables. Many employers offer free wellness apps such as <a href="https://www.weightwatchers.com/us/" target="_blank">WeightWatchers</a> and <a href="https://www.noom.com/" target="_blank">Noom</a> that focus on nutrition; however, if an employee can’t afford fresh produce (over canned or processed foods) or if they live in an area where fresh produce isn’t readily available, they are less likely to see the full benefit of a wellness program.  Food as Medicine as part of the organization’s weight management strategyMany employers have programs in place to address obesity, which is associated with a number of chronic conditions and higher medical costs. The rapid increase in utilization of GLP-1 medications has raised questions about whether and how to cover these costly drugs. Food as Medicine can play a part in a comprehensive strategy to support weight management. In addition to the initiatives discussed above, employers can make it easier for employees to stick to a healthier diet with:  <ul><li>Healthy cafeteria and snack options</li><li>Onsite cooking classes and lunch and learns, offering chef-inspired and dietitian-approved recipes that are easy to recreate at home</li><li>Nutrition education sessions with registered dietitian nutritionists </li><li>Flexible work hours to support healthy lifestyle activities including time for mindful eating</li><li>Integrating nutrition support programs into existing EAP programs</li></ul> What does the future of this movement look like? As programs offered by early adopters become more mainstream, they will bring together food, healthcare and technology to support employees’ overall health and wellbeing in a more holistic, people-centric, and more effective, way. For example, if the algorithm or coach identifies financial barriers for the employee, then having the system tie in SNAP benefits information and SNAP-eligible foods into meal plans, recipes, meal delivery would be helpful.  For employers just getting started, think about which area to address first. For example, if diabetes is an issue for your population, you might choose to begin with specialized Food as Medicine support for members with this condition. You’ll also need to think about how to integrate Food as Medicine within your benefits ecosystem, what support you’ll need to administer it, and how you will define success. There are many ways to bring the Food as Medicine movement into your program. It won’t be hard to find one that is scalable for your population and helps to advance your program’s health and well-being objectives in a practical, visible, and meaningful way. This article first appeared on <a href="https://www.mercer.com/en-us/insights/us-health-news/" target="_blank">Mercer’s US Health News Blog</a>.

It’s Time to Bring “Food as Medicine” into Your Health Program

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