Medtech Insight is honoring May and June awareness months for mental health, Alzheimer’s and brain health by speaking with industry leaders about rising innovations to address neurological diseases and mental health, the regulatory and investment climate, reimbursement, and more.
Vijay Ravindran wants to get his product to market the “right way.”
Ravindran is the founder and CEO of Floreo, the developer of a virtual reality platform that teaches social and behavioral skills to autistic individuals. He told Medtech Insight that the company chose to pursue US Food and Drug Administration approval for the digital therapeutic (DTx) – and a Breakthrough Device designation – to be responsible with its investors.
“When we started Floreo, we didn't start … with a clear sense of exactly how we would commercialize,” Ravindran said. “I wasn't necessarily thinking about the FDA at all, or even that Floreo was a digital therapeutic, I was thinking of it probably more as an educational tool that could be wielded by parents.”
Learners, as they’re called by Floreo, use a virtual reality headset to work through lessons that teach various skills such as eye contact, conversations and social cues.
An example of a lesson from Floreo practicing greetings: “the Learner will independently recognize and respond to a variety of social greetings, using both verbal responses and nonverbal cues, across 6 opportunities.” Floreo
Ravindran found the product gaining traction with therapists and health care providers, which suggested Floreo might fit the definition of a medical device. He also recognized that without reimbursement, there was “limited ability to adopt new technology that increased costs for the provider.”
He noted, “What led us down the regulatory path was really working backwards from reimbursement [that was] needed by health care providers and the ecosystem."
The company first began talking to FDA through its Q-submission program, which allows companies to request early feedback before a premarket submission. (Also see "Q-Sub Guidance Needs Clarity On Informal Meetings And Timelines, Say Commenters" - Medtech Insight, 29 May, 2024.)
Since there has not been an approved medical device to treat autism (not including its diagnosis), dialogue with the FDA about what a clinical trial would look like was invaluable, Ravindran said. They ran smaller studies before applying for and receiving Breakthrough Device status, which validated “that our approach [made] sense to the FDA,” he explained.
“We applied for breakthrough device designation mainly because we knew it would be an asset to have that badge that our study from last year was done appropriately,” the CEO said.
Floreo's next target was the FDA's Total Product Lifecycle Advisory Program (TAP) Pilot. To be eligible for enrollment, a device must have received a breakthrough designation but should not have started its pivotal trial. Ravindran acknowledged that this can be a very narrow window in the development process, but for Floreo the opportunity came at the perfect time.
TAP is intended to test the “feasibility and benefits” of early interactions with the FDA. The pilot was launched in January 2023, and as of 30 April there were 45 devices enrolled in the program. (Also see "‘Banner Year’ For FDA’s Device Center Includes Record Number Of Novel Authorizations" - Medtech Insight, 18 January, 2024.)
“TAP seemed to open up a unique opportunity to further tune our pivotal trial with an eye towards payers, and that was definitely in line with our interest and what we wanted to accomplish,” Ravindran said. “We were willing to take a delay of several months to participate in the program and get that feedback.”
Again, Ravindran believed it was the most responsible pathway for Floreo and its investors.
A pivotal trial can consume a large amount of investor capital, especially for an early-stage company, so Floreo chose to break it into smaller stages to receive feedback assuring them they were on the right track, rather than steaming ahead without those checks.
“A lot of companies have gone straight to a pivotal trial without even doing a pre-submission in some cases … and so that seemed irresponsible with investor capital, especially in 2023 and 2024,” he said.
How To Get Paid
Many payors and investors are “skittish” about the emerging DTx space. Following a tried-and-true commercialization route through the FDA is one way that Floreo is legitimizing itself as a medical product.
In 2022, Floreo introduced a new Current Procedural Terminology (CPT) III Code to the American Medical Association as an add-on to the speech, behavioral and occupational therapy codes commonly used for children with autism.
The CPT III Code 0770T allowed providers to create billing scenarios to make use of the Floreo system in their practice, Ravindran said. But that was just one step of many.
Floreo aims to graduate the CPT III code to a permanent CPT I code, which applies to common medical procedures and services. Without that conversion or a five-year renewal, the code Floreo achieved, which took effect on 1 January 2023, will expire in 2028.
While waiting for reimbursement from private and public payors, Floreo has partnered with schools and health systems to license the program to neurodivergent children. (Also see "Industry Finds Innovative Revenue Streams For Digital Therapeutics" - Medtech Insight, 14 June, 2024.)
School districts can get the product “into action” more quickly than providers sometimes, Ravindran said during the Digital Therapeutics Alliance’s Annual Summit on 6 June. Students without an official autism diagnosis can – and are – benefiting from Floreo as well, the company says.
It can be an issue getting the required VR headset into users' hands; costs range from $3,500 for Apple’s Vision Pro to a simple $20 set-up of goggles and a phone or tablet. Floreo is available on three platforms: the Meta Quest VR headset, the PICO VR headsets and on iPhones with plastic goggle set-up. The program also requires use of a companion app on an iPhone or iPad.
Customers can lease hardware from Floreo, including iPhones and iPads through Floreo’s partnership with Apple Education.
“Once a provider wants to use something … it's really about how much can you bring down the friction [for them],” Ravindran said. “You have to make it really easy for them.”
Health care providers are the best advocates to convince payors to cover products, the CEO noted. “We believe that ultimately Floreo is successful if the health care providers in the autism therapy space are successful using Floreo,” he said.
