Healthcare Innovation Team Lead Núria Vàzquez Salat explores how pharmaceutical companies are approaching digital transformation and why understanding end-user emotions is essential for meaningful adoption.
Reason cannot defeat emotion, an emotion can only be displaced or overcome by a stronger emotion.
– Baruch Spinoza
The global digital health market is expanding rapidly, and this growth is expected to accelerate with the promises of artificial intelligence (AI). In 2023, the European digital health market was valued at USD 66.2 billion, with a projected compound annual growth rate (CAGR) of 22.3% from 2024 to 2030. Historically rooted in MedTech, digital solutions are increasingly being adopted across the broader healthcare landscape.
With this rapid expansion, it is only natural to ask whether the pharmaceutical industry—the biggest industry player in the health sector— will embrace digital transformation or whether newcomers may challenge its privileged market position. To explore this more, I travelled to Madrid with my colleague David Chadima to attend the annual Digital Health Conference 2025, a key gathering for pharma and MedTech players working in digital health.
Pharma’s digital momentum
Although traditionally a risk-averse industry, the conference highlighted how pharmaceutical companies are actively experimenting with digital and AI solutions across the value chain. Some interesting initiatives that were discussed aim to:
- Reduce operational costs, such as optimising clinical trial management.
- Enhance strategic capabilities, for example, using AI to build HEOR scenarios.
- Add value to existing products via the digital companion, which helps them extend their IP protection or outcompete similar alternatives.
Indeed, digital companions – apps and portals designed to support treatment adherence and patient engagement – are seen as a growing area of investment. The main takeaway from the conference was that while still early days, pharma is clearly recognising the potential of digital solutions to complement traditional therapies.
Barriers on the ground
Despite this enthusiasm and possibilities, the healthcare sector is particularly well-known for being difficult to adopt new solutions. There are some structural barriers that even established players cannot easily overcome, like the complexities of accessing patient data and the fragmentation that accompanies it, closely followed by the broken clinical workflows that make it difficult to implement digital solutions. Added to these sector-specific barriers are challenges linked to the technology itself, including the need to supervise generative AI algorithms and manage cybersecurity breaches. Finally, as with all disruptive technologies, effective change management becomes essential, both within healthcare systems and internally across the relevant pharmaceutical departments, to ensure new ways of working can take hold.
Unfortunately, one frequently overlooked challenge is end-user acceptance. While patients are the typical users, some digital tools—such as AI diagnostics—target healthcare professionals (HCPs). During the conference, both pharmaceutical and MedTech players seemed to assume that adoption barriers would fade as digital natives age into the system. However, holding to this assumption might cost them dearly as the healthcare sector’s complexity makes this assumption risky and slow to realise.
Europe’s imperfect healthcare market
Europe’s universal healthcare systems create what economists call an “imperfect market”, where the user and the payer are not the same. In most markets, like online shopping, you are both the buyer and the end user, shaping demand through your preferences and willingness to pay. Healthcare works differently: the end user is the patient (or the HCP), but the payer is the government.
Because treatments directly affect health outcomes, patients naturally value them highly. Yet they normally have little influence over access, since governments decide which treatments are funded and how regional or national health budgets are distributed. This dynamic shapes the behaviour of pharmaceutical companies, which focus primarily on payer expectations (i.e. their client) via compliance with regulatory and reimbursement procedures.
The same pattern applies to the digital health sector. It falls to governments to determine which digital solutions offer value to their citizens. Some member states, such as Germany, France and Belgium, have already established reimbursement pathways for digital solutions. Germany’s DiGA framework, the first of its kind in Europe, is often cited as a reference point. However, DiGA records show that only 68 apps were approved for reimbursement in 2024 across Germany.
This unexpectedly low number suggests a disconnect: despite industry presenting evidence of the added value of digital solutions, insurers remain unconvinced. If the data is there, what else is holding adoption back?
Between reason and emotion, there is only one winner
Even though payers hold decision-making power in the health sector, end users ultimately determine adoption. Pharmaceutical companies know this from experience: prescription adherence is tracked by public authorities, and when patients do not take a treatment over time, reimbursement rates fall. DiGA records reflect a similar pattern for digital solutions, following a two-stage process. Once approved, manufacturers set the first-year price insurers pay, but afterwards, the price is negotiated. Manufacturers’ average list price is €585, while insurers reduce it to €226 after negotiations — a significant 62% drop. Digital solutions, it seems, have not been able to escape a well-known industry headache.
Nothing illustrates the risk of assuming end-user acceptance better than the fact that only 3% of the 35,000 Apps on the market are still used after 30 days. This applies not only to health Apps but to all Apps, including those aimed at digital natives. Contrary to what the pharmaceutical and MedTech sectors often assume, adoption is unlikely to increase simply because digital natives age or because citizens receive more education on its benefits.
This is largely due to the important role that emotions play in healthcare. If clinicians distrust an AI diagnostic tool, no amount of data will convince them otherwise. Similarly, patients and their carers, especially when facing life-threatening conditions, experience heightened emotions. More evidence might convince governments, but for end users to adopt digital tools, manufacturers must address emotions such as distrust, fear and overwhelm.
In short, for digital solutions to succeed in healthcare, industry must incorporate cultural change into its adoption strategies. The evidence-driven personality traits common among pharmaceutical employees do not match the motivations of healthcare professionals, who tend to be highly empathic and value human interaction. Indeed, no study has shown a correlation between age and HCPs’ acceptance of digital solutions.
Most importantly, HCPs understand the importance of holding a patient’s hand in their hours of need. No digital solution can replicate human warmth. Only when industry manages the emotional response of end users to their solutions will digital health reach its promised share of the market.
Work with us to drive better healthcare
In the Healthcare Innovation team, we believe that healthcare systems are among society’s most valuable assets, and we work to secure their sustainability for future generations. We do so by focusing on three main workstreams:
Tackling bottlenecks: Recognising the limitations of current frameworks, we bring stakeholders together to accelerate the adoption of innovative treatments and technologies, ensuring equitable access to quality care.
Facilitating the adoption of innovative solutions: Leveraging our sector’s expertise and extensive networks, we offer strategic insights into healthcare markets, competing technologies, and emerging trends.
Empowering patients & citizens: Through our experience in Patient and Public Involvement (PPI) and healthcare innovation, we empower patients and citizens to actively participate in the management of their health.
Want to collaborate or learn more? Get in touch.
