Fenwick’s healthtech practice co-lead Michael T. Esquivel posed some questions to healthcare regulatory partner Jennifer Yoo about how the regulatory landscape for digital health is changing. Read Jennifer’s views and insights below.
Q: Tell us about your practice and your areas of focus with clients.
A: Generally speaking, I advise and counsel healthcare companies in transactional and regulatory matters. This includes working closely with digital health and other healthcare companies, including companies at the early stages of development, on a wide range of healthcare regulatory matters and compliance.
I joined Fenwick earlier this year and have met with an incredibly innovative array of companies in the digital health space. I’ve been conversing with our clients regarding regulatory compliance as they develop their product and service offerings and focus on their target audiences and revenue model. It’s never too early for healthcare companies to start thinking about compliance, and it will pay off down the road.
Q: How do you think digital health has influenced the healthcare industry?
A: Digital health technology is increasing access to healthcare more broadly. Until recently, access to digital health options has only been available to people with the resources. However, the massive and sudden widescale need for telehealth and digital health in response to the COVID-19 pandemic—along with the federal government’s involvement and innovations in digital health—means more widespread growth and access to digital health, bringing equitable care to more people.
The pandemic identified a need for more easily accessible healthcare options, which digital health provides. It’s not only the private sector that is responding to this need, but there is also considerable federal and state government interest in bringing digital health to the masses.
Q: What trends have you observed around digital health regulations?
A: Many digital health companies I’ve spoken with initially want to sell directly to consumers or providers, then realize that real revenue streams come through payer arrangement pathways, which inevitably require increased regulatory oversight and compliance in order to secure these contracts. Digital health companies starting out don’t necessarily want to invite greater regulatory oversight, but it’s often required when a healthcare company proceeds along the traditional reimbursement route.
I always recommend companies think about regulatory compliance sooner than later, regardless of their initial revenue model. They should chart a path early on and know what programs they want to pursue so they don’t lose momentum down the road when they are playing catch up with applicable regulations. Compliance may be an expense, but noncompliance is a much greater expense in healthcare.
Q: What regulatory challenges are digital health companies facing currently?
A: With more government focus on digital health, antitrust concerns are a growing issue. The Federal Trade Commission have said they are watching movements in healthcare M&A—both in horizontal and vertical integrations. I am fortunate enough to work with a highly skilled team of antitrust advisors where we can advise our clients as a cohesive team.
In addition, there are growing privacy concerns, in particular in a post-Dobbs landscape when it comes to women’s and reproductive health. Our privacy and cybersecurity team helps companies navigate novel privacy and security challenges created by our clients’ game-changing technologies in an evolving global regulatory landscape.
Q: What consumer concerns are most prevalent in digital health?
A: Privacy issues are one of the biggest consumer concerns. Consumers are more aware of privacy issues than ever before and companies face huge reputational risks by breaching customer trust. There is a lot of work cut out for innovators, founders and digital health companies to step up and advocate for the protection of their users’ privacy. This is especially true in a post-Dobbs world where people, particularly women and others who may be seeking abortion and/or reproductive care, are afraid that their personal heath data is not secure and might even be used against them.
HIPAA is actually pretty narrow in how and when it applies and consumers are already savvier in the few months since Dobbs about how their private health information is governed. In many ways we have to wait and see in terms of pending legislation and the results of the upcoming midterm elections to determine when might be the right time for private companies to step up and directly address these concerns for their consumers.
Q: How has the recent Dobbs decision impacted your practice?
A: Digital health is always exciting and ever changing but Dobbs and the overturning of Roe v. Wade was a game changer. Women’s health—both in a business and legal perspective—has seen an uptick in investment. Now, there is more awareness of femtech and other companies putting women’s health at the forefront of digital health.
People are becoming more aware and having more discourse and conversation about the implications of these legal decisions. Last month, I moderated a Rock Health panel on digital health post Dobbs during which lots of important issues around women’s health were discussed.
I didn’t do a lot of work on women’s health and reproductive care before, but I’m excited about where the healthcare is headed. It’s wrong to think of women’s health as niche. Women’s health is healthcare for half the country’s population. I have two daughters so there is even more reason for me to be personally involved in fighting for women’s healthcare through my practice as well as in my pro bono work.
It is such an inspiring time—to see a lot of people getting galvanized, stepping up and creating innovations in health care that have not typically been in the forefront.
Q: What will you be looking forward to as digital health continues to grow?
A: With the pandemic catalyzing the explosion of telehealth and digital health, I am excited to see activity growing within the digital health space. The real revenue growth is going to be in entering into payer arrangements and federal healthcare programs, all of whom are invested in expanding digital health, and I’m excited to be there alongside companies as they grow.
At Fenwick, I’ve met clients who are touching what is new, innovative and disruptive in healthcare, including entrepreneurs who may not have initially imagined they would be players in digital health. I’m working with people whose personal fire was ignited after Dobbs and are now actively involved in women’s health. That type of passion and desire to make healthcare more broadly and equitably accessible is what keeps me optimistic for the future.
I anticipated I would work with a lot of cool companies at Fenwick, but I didn’t anticipate giving the advice I do now, post-Dobbs. I’ve had the opportunity to talk about current issues in healthcare and engage in ways I have not been able to before, alongside people who are just as eager to engage in this work with me.
Jennifer can be reached at jyoo@fenwick.com, and Michael at mesquivel@fenwick.com.