Jonathan Machado

14 October 2020

5 min read

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Why we invested in Big Health

By Jonathan Machado

4 min read

In the wake of a global pandemic that has already derailed social and economic stability, some medical experts have warned policymakers to brace for an increase in mental health disorders.

While there is no cure-all for anxiety and insomnia, technology is increasingly on the frontlines when it comes to treating the underlying causes that keep many people awake at night.

Big Health, a digital therapeutics company that creates automated and customized solutions for mental health, is proving that mobile apps can be used as a credible alternative approach to traditional drug therapy. When Samsung NEXT invested in the company earlier this year, we noted that a significant number of people are dealing with sleep disorders and other mental health disorders.

A B2B2C customer acquisition strategy

Big Health’s mission is to help users back to good mental health, and it's been making good on that mission since the start of the COVID-19 outbreak, thanks to a go-to-market strategy that relies on getting large enterprises to offer the apps as a healthcare benefit for their employees.

As the result of a Community Access Initiative developed in response to the pandemic, 6.5 million new users now have access to its Sleepio and Daylight apps. The program gave employers – and their employees – free access to the Big Health apps. Among the participants in the program were Samsung Research and the National Health Service, the publicly funded healthcare system in the United Kingdom.

The altruistic gesture was motivated by Big Health’s mission, but also was a brilliant way for the company to bring new prospects into its marketing funnel. In fact, Big Health’s apps are increasingly being offered as member benefits by large multinational employers that self-insure, as well as by major health plans. Other early adopters include AmeriGas, Boston Medical, Comcast, and The Hartford.

“What we're doing is taking evidence-based, non-drug approaches and fully automating them — so there are no coaches or psychologists, just pure software,” says Peter Hames, the company’s founder and CEO. “As a result, we can deliver those solutions with the same scalability and consistency as drugs. Essentially we're substituting the molecule with an algorithm.”

Looking ahead, machine learning has the potential to transform digital therapeutics due to its ability to automate the analysis of large data sets in order to provide relevant feedback to users in real-time.

“With machine learning, we will be able to continually optimize the effectiveness of any solution,” says Peter. “Our clinical data shows we're already achieving a really compelling level of clinical effectiveness in helping people with generalized anxiety disorder. By applying technologies, such as machine learning, we will be able to go beyond that — and continue to push that 70 percent remission rate higher and higher, across an increasingly wide variety of people.”

“With machine learning, we will be able to continually optimize the effectiveness of any solution" - Peter Hames, Big Health founder and CEO
Solutions backed by empirical evidence

Selling to companies that amplify its user base isn’t the only innovative aspect of Big Health’s approach. The company has partnered with leading medical research facilities to conduct randomized clinical trials that provide empirical data regarding the effectiveness of the evidence-based cognitive and behavioral techniques used in its apps. To date, the company’s apps have been studied in 13 randomized controlled trials, and 53 papers have been published in peer review journals.

Sleepio, Big Health’s digital sleep improvement program, has been scientifically proven to help users overcome poor sleep and, as a result, improve mental health. It features cognitive and behavioral techniques.

Meanwhile, Daylight is a fully automated digital solution for addressing worry and anxiety. It was designed in partnership with mental health experts and has the ability to learn about each user’s unique challenges and respond to how someone is feeling in the moment.

Big Health’s ability to provide personalized treatments at scale is indicative of how digital approaches can be used to understand and act on data, while delivering automated self-help solutions.

Personalization is based on questionnaires designed to collect information and help assess an individual’s condition. Each individual’s answers yield a unique data set that Big Health’s automated system uses to create personalized intervention strategies, and is delivered in the form of animated video snippets.

“Big Health’s commitment to clinical evaluation and research aligns with our focus on helping our clients include clinically effective digital point solutions as part of their benefits packages.” - Sree Chaguturu, M.D., chief medical officer at CVS Caremark
Providing measurable economic benefits

Ultimately, Big Health’s apps are providing an impressive ROI for enterprise customers. Companies are willing to make the investment because the benefits include lower healthcare costs and better employee productivity. According to Big Health, a person with insomnia costs, on average, about $7,000 more in total healthcare expenditures than employees who are good sleepers.

Using an app is an economical alternative to drug treatment. In a recently released study, Big Health demonstrated 28 percent lower total annualized healthcare costs for Sleepio users compared to a control group in a Fortune 500 employee population. Sleepio users also had $1,677 lower per-employee total annualized healthcare costs. Moreover, because the apps are a proven alternative to drug therapy, they can increasingly be billed through a company’s pharmacy benefits manager.

In July, Big Health announced that its Daylight digital therapeutic solution for anxiety would be available to employers and other plan sponsors through CVS Caremark’s Point Solutions Management program. "Employers and other plan sponsors are increasingly looking for innovative tools to help people manage worry and anxiety, especially in light of the COVID-19 pandemic,” says Sree Chaguturu, M.D., chief medical officer at CVS Caremark, the pharmacy benefit management business of CVS Health. “Big Health’s commitment to clinical evaluation and research aligns with our focus on helping our clients include clinically effective digital point solutions as part of their benefits packages.”

Big Health’s partnership with CVS underscores the effectiveness and inherent value proposition of its apps. Big Health has managed to position itself in the market with software as medicine, because its solutions are an effective alternative to drugs. What’s more, its therapeutics are built in a way that can scale, which means the company can rapidly create new healthcare products with their technology.

The type of digital technology being developed by Big Health could ultimately transform hardware, such as the Samsung watch. The Holy Grail from Samsung’s perspective would be to give payers an incentive not just to pay for the app, but to pay for the watch as a therapeutic device.

For now, Big Heath is clearly focused on growth, and partnerships are a key part of its strategy. But Peter emphasizes that the company’s North Star is helping millions of people with their mental health. “If we optimize for maximum value, maximum impact,” he says, “good things will happen for everybody.”