Digital Therapeutics Global Market Opportunities and Strategies to 2032

This report describes and explains the digital therapeutics market and covers 2017-2022, termed the historic period, and 2022-2027, 2032F termed the forecast period. The report evaluates the market across each region and for the major economies within each region.

The global digital therapeutics market reached a value of nearly $5.56 billion in 2022, having grown exponentially at a compound annual growth rate (CAGR) of 38.0% since 2017. The market is expected to grow from $5.56 billion in 2022 to $21.66 billion in 2027 at a rate of 31.2%. The market is then expected to grow exponentially at a CAGR of 24.6% from 2027 and reach $65.08 billion in 2032.

Growth in the historic period resulted from the emerging markets growth, growing adoption of digital transformation in healthcare sector, rising government initiatives in healthcare and growing number of internet users. Factors that negatively affected growth in the historic period was regulatory and reimbursement challenges.

Going forward, rising chronic diseases, increased healthcare expenditure and rising penetration of smartphones and tablets will drive the growth. Factor that could hinder the growth of the digital therapeutics market in the future include data privacy concerns.

The digital therapeutics market is segmented by product into software and devices. The software market was the largest segment of the digital therapeutics market segmented by product, accounting for 84.6% or $4.70 billion of the total in 2022. Going forward, the software segment is expected to be the fastest growing segment in the digital therapeutics market segmented by product, at a CAGR of 31.9% during 2022-2027.

The digital therapeutics market is segmented by sales channel into business-to-business (B2B) and business-to-consumers (B2C). The business-to-business (B2B) market was the largest segment of the digital therapeutics market segmented by sales channel, accounting for 69.7% or $3.87 billion of the total in 2022. Going forward, the business-to-consumers (B2C) segment is expected to be the fastest growing segment in the digital therapeutics market segmented by sales channel, at a CAGR of 34.4% during 2022-2027.

The digital therapeutics market is segmented by application into preventive applications and treatment or care-related applications. The treatment or care-related applications market was the largest segment of the digital therapeutics market segmented by application, accounting for 61.9% or $3.44 billion of the total in 2022. Going forward, the preventive applications segment is expected to be the fastest growing segment in the digital therapeutics market segmented by application, at a CAGR of 32.4% during 2022-2027.

North America was the largest region in the digital therapeutics market, accounting for 47.6% or $2.64 billion of the total in 2022. It was followed by Western Europe, Asia Pacific and then the other regions. Going forward, the fastest-growing regions in the digital therapeutics market will be North America and Western Europe where growth will be at CAGRs of 33.3% and 31.4% respectively. These will be followed by Asia Pacific and South America where the markets are expected to grow at CAGRs of 29.2% and 27.9% respectively.

The global digital therapeutics market is fairly concentrated, with a few large players operating in the market. The top ten competitors in the market made up to 34.94% of the total market in 2022. The market concentration can be attributed to the presence of large number of players in different geographies. Prominent players are acquiring the products and entering into partnerships with the other companies to consolidate their market positions across the globe, while others are distributing products. Teladoc Health Inc. was the largest competitor with a 19.47% share of the market, followed by Noom with 4.21%, Fitbit Health Solutions with 3.63%, Omada Health Inc. with 2.05%, Biofourmis with 1.64%, Propeller Health with 1.27%, Happify Health with 0.76%, Virta Health with 0.71%, Canary Health with 0.63% and WellDoc Inc. with 0.58%.

The top opportunities in the digital therapeutics market segmented by product will arise in the software segment, which will gain $14.11 billion of global annual sales by 2027. The top opportunities in the digital therapeutics market segmented by sales channel will arise in the business-to-business (B2B) segment, which will gain $10.40 billion of global annual sales by 2027. The top opportunities in the digital therapeutics market segmented by application will arise in the treatment or care-related applications segment, which will gain $9.58 billion of global annual sales by 2027. The digital therapeutics market size will gain the most in the USA at $5.78 billion.

Market-trend-based strategies for the digital therapeutics market include introduction of artificial intelligence (AI) in digital therapeutics, launch of new digital therapeutics platforms, development of software for accelerating clinical trials for digital therapeutics and strategic partnership and collaborations among market players.

Player-adopted strategies in the digital therapeutics market include expanding capabilities through strategic partnerships.

To take advantage of the opportunities, the analyst recommends the digital therapeutics companies to focus on introduction of artificial intelligence (AI) in digital therapeutics, focus on launch of new digital therapeutics platforms, focus on development of software for accelerating clinical trials for digital therapeutics, expand in emerging markets, continue to focus on developed markets, focus on strategic partnerships and collaborations, provide competitively priced offerings, participate in trade shows and events, continue to use B2B promotions, use direct-to-consumer (DTC) advertising and focus on fast-growing applications.