When ConcertAI secured one of 2022’s most eye-catching digital health investment deals in early March, there was a glimpse of the potential in an area that has proved a slow burn for digital health - oncology. 

The company, which uses data to speed up clinical research into different types of cancer and to match patients with clinical trials and medications, hit a valuation of $1.9 billion in five years following the $150 million Series C investment from Sixth Street.

ConcertAI isn't alone. Newly minted unicorn Transcarent has just launched a solution to manage outcomes and costs for patients diagnosed with common cancers. Transcarent is the latest company from Glen Tullman and the team at 7Wire.

It isn't just later stage deals where investors are seeing opportunity. New York-based cancer care coordination and experience startup Jasper Health raised $25 million in Series A funding led by General Catalyst while TrialJectory, which matches cancer patients to clinical trials, also recently announced it had raised $20 million in Series A funding led by Insight Partners. 

In December, Freenome raised $290 million from Roche to advance its cancer early detection platform. “We appreciate the shared belief our investors  have in what is possible when it comes to fighting cancer,” Mike Nolan, chief executive officer of Freenome, said in an announcement. 

What is possible when it comes to fighting cancer is becoming a key question within digital health. 

Risk vs. reward 

The investment case for digital health and oncology is straightforward - apply digital innovation to the leading cause of death worldwide and reap the rewards.

As the burden of cancer is rising globally, the cost of therapies is increasing to become unaffordable to many, an issue especially prevalent in the USA and out-of-pocket markets.

The opportunity may be straightforward, but solutions are not. 

A complex disease with even more complex treatments - from molecular-targeted therapies, immuno-oncology, to precision radiation - cancer also presents issues around side effects from medication, comorbidities, and manifestations of the disease itself. 

Put simply, cancer adds complexity. For instance, while some oncology therapies are moving towards oral formulations that can be taken at home, which presents a clear opportunity for patient monitoring, there are limitations to what digital health can do compared to regular blood pressure monitoring at home.  

Thus, understanding the complexity of cancer and finding the most appropriate spaces for digital health to support in a meaningful, commercially viable way is tricky. 

Despite the challenges, innovators are finding gaps. Within our advisory team, we have seen evidence of digital innovation having an impact both along the patient journey and the pharma value chain. 

Along the patient journey, this has tended towards solutions such as imaging analytics, digital pathology, and radiology for easier and more accurate diagnosis and staging of cancer.  

Clinical decision support systems (CDSS) are also being developed for the most accurate treatment identification and prescription, alongside electronic patient-reported outcome (ePRO) and remote patient monitoring. These can have a real impact on adverse events and toxicity management predictions and supporting care team intervention. 

Within oncology, there is also a major opportunity to increase communication and education between patients, providers, and their communities, particularly around issues such as fatigue,  nutrition management, treatment toxicities, etc.

For the pharma value chain, research has been a fruitful area for innovation, particularly in machine learning for the development of novel therapies based on real-world evidence of what is currently working on which patient populations. 

We are also seeing improved evidence from clinical trials based on patient-reported outcome (PRO) endpoints alongside improving market access, and commercial opportunities, by using digital technology to provide more personalized and effective therapy, education of patients and caregivers, and monitoring of quality of life (QoL).

Finding the right dance partner 

While there are direct-to-consumer opportunities within oncology, most companies have taken an approach that requires finding the right partner to get to market. 

At a recent HealthXL meeting, we polled attendees about where digital health solutions are proving the most popular - 36.4% pointed to patient support programs, 27.3% saw potential in DTx as companion apps. 

That tallies with what we see in the market, where the most active area is partnerships involving companies offering electronic PRO solutions for patients with cancer.

A good example of this is Voluntis, the French digital therapeutic company that was recently bought by drug delivery specialist AptarGroup. 

When announcing the deal, Eric Elliott, chairman of Voluntis, pointed toward “synergy in the ability to accelerate offerings to the digital health marketplace”.

Voluntis has partnered with three of the top ten pharma companies to develop customized patient monitoring solutions for oncology, both in broad cancer solutions and more specifically in breast and ovarian cancer. 

Among the most popular areas for partnership is decision support, which has garnered interest from large pharmaceutical companies. Syapse announced in January that it is continuing a strategic collaboration with Pfizer which is focused on breast cancer. 

“Real-world evidence is a critical element to better understanding the treatment journeys of people living with cancer – allowing us to make smarter decisions, appropriately accelerate medicine development and personalized care, and helping ensure that patients receive the right medicines at the right time,” Andy Schmeltz, the global president and general manager of Pfizer Oncology, said when announcing the extension of the partnership. 

Treatment monitoring has also provided a strong area for collaboration, such as in 2020 when Kaiku Health agreed to co-develop novel digital patient monitoring and management modules in oncology, in a feasibility program conducted together with Roche. 

Anecdotally, the main driver for pharma companies to combine digital therapeutics (DTx) with oncology treatments could be brand differentiation. These projects are often managed on a country level, which means many partnerships are short-term - an issue for companies that are looking to scale. Within HealthXL meetings, changing that mindset within pharma to move beyond one-off investments has been cited as a key challenge.  

For pharma, there is also an opportunity with reimbursement payers. HealthXL research found that oncology is among the conditions most commonly reimbursed via telehealth, with four out of six payers in the US covering oncology telehealth consultations.  

Getting to scale

One of the key questions in oncology is where to focus. Is the more fruitful path a solution that can support regardless of therapy or specific diseases, or focus on strategic opportunities to complement existing diagnostic approaches and treatments for breast or prostate cancer? For instance, our advisory team has noted that oncology companion apps tend to be cancer agnostic.

Every form of cancer has a specific patient path, with gaps existing in all of them. The trick is finding the right gap. 

A key consideration for any scaling company is getting a grip on the addressable market size. Should a digital health provider try to solve a problem for a rare disease with a small patient population, but at a potentially large cost, or should it focus on a broad solution or more prevalent disease? 

Despite the prevalence of cancer, the relatively small oncology patient population overall, combined with a wide diversity of disease and treatment types, results in high levels of customization for small numbers of users or individual drugs. Coupled with distinct geographic differences in treatment paradigms, this has sometimes resulted in a perceived lack of scalability.

Perhaps unsurprisingly, lung, breast, and ovarian cancer have emerged as key areas for the application of digital health, which is likely a result of the strength of the corresponding drug pipeline. 

The chicken or the egg 

When it comes to adoption, digital tech in oncology can suffer from something of a chicken and egg issue. 

As has been pointed out in HealthXL meetings, while pharma organizations may have the network and experience to enhance their portfolio with digital products, it can be hard for them to sell internally. Value can sometimes be seen as intangible - particularly in therapeutic approaches to quality of life or comorbidities. 

Then, there is the not insignificant matter of getting clinicians on board. Among a poll of members at one of our digital health meetings earlier this year, we asked; what are the main challenges in the adoption of digital health products in oncology? At 32%, integration into Electronic Health Record (EHR) and Care Team workflows was the main issue, with care team awareness and education at 24%. 

Building trust is an issue. For instance, in cancer screening, we have seen some hesitancy in some oncology disease areas to offer a tool designed for use without clinical supervision or consultation.

Within our community, we have seen a variety of opinions on how receptive the healthcare provider ecosystem is to new digital tools, with evidence and anecdotes suggesting a lack of awareness of digital tools or demand for innovation. 

For instance, while there is potential for long-term monitoring to improve overall survival by preventing complications, improving the preparation for chemo sessions, and early relapse detection, it is not a case of just taking a solution out of the box. 

Detecting complications and relapses earlier with remote patient monitoring programs means more alerts, which could add to clinician fatigue. Successful companies need to build something that clinicians and hospitals are keen to use, including easing implementation and onboarding. The interoperability of data is another major concern. 

A worthy challenge 

Cancer care will always involve complex diagnostics and collective decision-making. Digital health companies need to not only deal with stakeholders such as patients and clinicians but also with formal and informal caregivers, payers, and health systems. 

Thus, oncology is a complex equation to solve for digital health companies. 

The potential opportunity, however, is unparalleled. As money flows into unicorns such as ConcertAI and Transcarent, digital health in oncology seems to be slowly coming of age.