Samsung Electronics and AimMed have embarked on an attempt to load a digital therapeutic device (DTx) for insomnia on the wearable device Galaxy Watch.

At a workshop organized by the Korean Society of Pharmaceutical Science and Technology last Friday, Jung Kyung-ho, a director at AimMed, said the company signed a memorandum of understanding with Samsung Electronics to develop Somzz exclusively for Galaxy Watch.

According to Jung, the MOU calls for developing digital healthcare services based on wearable devices and cooperating in related business.

Somzz is the first DTx in Korea developed by AimMed. In February, it won approval from the Ministry of Food and Drug Safety as a software medical device that materialized behavioral therapy for insomnia as a mobile application (app).

In a presentation titled "Medical Technology Innovation of Korea's No. 1 Digital Therapeutic Device, Somzz," Director Jung also revealed the overall direction of AimMed's business.

"After thinking about how to graft digital therapeutic devices to the market, we decided to diversify our business model in prevention, diagnosis, treatment, and aftercare rather than simply increasing our pipeline of digital therapeutic devices," Jung said.

AimMed is registering Somzz with application stores, including the App Store and Google Play. The process is expected to take about a month. However, it will take a little longer for patients to be able to prescribe Somzz at the point of care.

Through the Innovative Medical Technology Implementation Track, AimMed will supply Somzz to medical fields for three years to prepare to evaluate new medical technologies. AimMed has secured six medical institutions to conduct the research -- Seoul National University Hospital, Korea University Anam Hospital, Samsung Medical Center, Severance Hospital, Yongin Severance Hospital, and Wonju Yonsei Hospital.

"The implementation of innovative medical technology is divided into two phases, and only tertiary medical institutions with their IRBs (institutional review boards) can participate in the research phase. First of all, the approval for implementing innovative medical technology is expected to be made around Oct. 20, and prescriptions will be available from November,” Jung said. "We plan to expand to the clinical care phase in the first quarter of next year when primary medical institutions can participate."

After the implementation period, the new medical technology must be re-evaluated with the obtained real-world data (RWD). According to Jung, the company aims to finalize the implementation of the innovative medical technology as soon as possible and formally put it on the reimbursement list.

"You may think that the development period for digital therapeutic devices is shorter than that of new drugs, but it takes seven years -- three years to receive approval and four years to be officially listed for reimbursement. It also requires 1 billion won ($770,000) to 1.5 billion won a year to license and maintain a digital therapeutic device, and the cost could rise to 2 billion won," he said.

The costly process is one of the reasons why AimMed is willing to license digital therapeutic device technology from other companies to help them commercialize it. Jung also emphasized the importance of building an ecosystem surrounding digital therapeutic devices.

"There are only 40 to 50 licensed digital therapeutic devices worldwide, except for Europe, which is not a licensing system. This ecosystem had not existed in Korea until then," Jung said. "However, if we fail, the second and third digital therapeutic devices will also face a difficult situation. It is difficult for a company to create an ecosystem alone, and our priority is to create an ecosystem with as many medical institutions and professionals as possible."

He said, "We have experience licensing digital therapeutic devices, so we want to work on creating a pipeline with companies that haven't yet commercialized. In the gaming industry, Nexon is primarily publishing games and distributing merchandise developed by other companies, while NC Soft develops its games, AimMed aims to be the Nexon of DTx."

Jung also disclosed AimMed’s goal to go unreimbursed when listing its fee. This is because although there is no difference in the company's revenue, whether it chooses reimbursement or non-reimbursement, the company believes that the benefits to medical professionals and institutions will not be significant if it chooses reimbursement.

AimMed also seeks partners in sales and marketing to Korean and international hospitals.

"It is difficult to conduct sales and marketing activities directly, and we are considering licensing out to domestic pharmaceutical companies," Jung said. "We also plan to expand overseas, but we are not planning to do business directly in the foreign markets. We plan to select companies that can get local licenses and productize and provide resources."

AimMed also plans to offer Somzz as an over-the-counter (OTC) product that does not require a doctor's prescription through pharmacies.

"In our follow-up study, we found that the prognosis tends to deteriorate two months after using Somzz for six to nine weeks," Jung said. “ Therefore, we are considering distributing Somzz to pharmacies for follow-up care. We're considering having pharmacies give the activation key like a Google gift card."