Boston-based Akili Interactive Labs, maker of video game-like treatments for children with ADHD and autism spectrum disorder, has found a partner to help promote its digital therapeutic products in eastern Asia.
Thanks to a new strategic partnership announced this morning, Osaka, Japan-based pharmaceutical company Shionogi will take over the commercialization, marketing, clinical development and regulatory filings for Akili’s two lead products, AKL-T01 and AKL-T02, in Japan and Taiwan. However, Akili is still retaining control of distribution, data collection and storage, R&D and technical support responsibilities for the therapeutics, which Akili is planning to handle through an in-development platform designed specifically for digital therapeutics teased earlier this year at CES 2019.
“[Shionogi has] the deep expertise in the Japanese-specific regulatory, marketing and sales mechanics. We’re obviously happy with them leading those functions, but with a lot of input because obviously this is a new type of product that they haven’t sold before,” Eddie Martucci, CEO and cofounder of Akili, told Babyforyou.net.ua.
“And it’s not that Shionogi or anyone else doesn’t care about [distribution] and doesn’t have logistics here. We just think that the logistics that you will need in the future … are going to be important to maximize digital therapeutics for patients and respond really deeply and adaptively and reflexively to patients’ needs. We want to be at the front lines and kind of owning that flexibility and adaptability. And I think in this partnership with Shionogi, they’re really excited to look to us to own that piece.”
The terms of the deal include an upfront payment of $20 million from Shionogi to Akili, with the latter also eligible to receive up to $105 million in additional payments tied to development and commercial milestone. The digital therapeutics company will also be receiving financial support for its ongoing product development, as well as “substantial royalties” on sales of the products within Japan and Taiwan. Outside of these territories, Akili will continue to hold all commercialization and development rights for its products.
Why it matters
In addition to these terms, this morning’s partnership announcement also included a note that Shionogi has committed to future equity investment in Akili’s business. For Martucci, it suggests a growing interest in digital therapeutics and cognitive health within a health market that has so far taken a different approach.
“We’re really excited to see Shionogi desire and ask to have that type of commitment available,” he said. “Akili believes cognition is one of the biggest unmet needs in the next generation of medicine, and I think what you’re seeing here is a company that has [historically] focused more on traditional symptoms of these neurological disorders taking a first big step and a commitment to how a digital treatment might be able to tap into cognition, even if that story is not fully baked yet. We’re really pleased to see that kind of commitment.”
What’s more, partnerships between digital health companies often see the technology taking a complementary, or even backseat, role to more standard drug treatments, Martucci noted. As such, he said Akili sees its new partnership as unique from many prior digital therapeutic deals because AKL-T01 and AKL-T02 will be standing on their own as independent therapeutic products.
“We do view this as a fundamentally different type of partnership in digital therapeutics where you’re seeing recognition of this digital treatment as an actual asset,” Martucci said. “I think this deal, whether it’s implied or whether it’s not, is [noteworthy because] our partnership with Shionobi is treating that as an independent pillar, which may combine those drugs in the future but is an asset in itself that can help patients.”
Topping it all off is the deal’s distinction between commercialization and digital distribution. Akili still isn’t quite ready to provide a breakdown of what exactly its “Global Access Platform” will comprise, but the terms of the partnership and Martucci’s comments reaffirm Akili’s interest in building and controlling what it sees as a vital component of its future business.
“There’s a little bit of a psychological assumption that the pharmaceutical industry must partner and deliver this for it to be a legitimate medicine,” Martucci said on the topic back in January. “I disagree vehemently. We may partner with pharmaceuticals or medical device manufacturers, but we are building today the end-to-end [prescription and procurement] process, the entire backend for digital medicine that doesn’t exist today — the sales force, the medical affairs, the insurance processing — that will enable a platform for scalable digital medicine.
What’s the trend
Akili’s strategy is a fork in the road for digital therapeutics’ relationship with pharma, which so far has relied on more traditional partnerships. Pear Therapeutics and Novartis, for instance, have been very vocal about their development and distribution partnerships, which recently culminated in a hybrid digital distribution model for the launch of reSET. Meanwhile, Otsuka Pharmaceutical lent its support and expertise to the regulatory efforts of Proteus Digital Health, and recently provided the digital pill maker $88 million as Abilify MyCite sees a gradual rollout across healthcare system pilots.
As for Akili, the company has been actively pursuing FDA clearance of AKL-T01, its pediatric ADHD therapy, for roughly a year now, and has a fair body of clinical evidence backing its case. Last year saw the the company raise $68 million in its latest round of funding, while a recent pilot study conducted by the Children’s Hospital of Philadelphia found evidence that the video game therapeutic was feasible and well adhered to by young patients.
On the record
“ADHD and autism have a significant impact on children and their families in Japan and Taiwan, yet there remains a significant gap in treatment options and access to today’s medicines,” Dr. Isao Teshirogi, president and CEO of Shionogi, said in a statement. “Akili is a clear leader in digital medicine, and their digital treatment systems represent game-changing solutions to treating these disorders and we look forward to working with them to lead the development of the first digital medicine in Japan and Asia while bringing new hope to children affected by cognitive dysfunction.”