Key legal aspects of implementing digital therapeutics (DTx) in Netherlands

Digital Therapeutics (DTx) are on the rise in the Dutch healthcare system. The first health apps have found their way to by prescribed by doctors and be reimbursed from healthcare insurers. However, the legal landscape for DTx in the Netherlands is still fairly uncharted. Specific regulation or guidelines are still lacking, so assessment of DTx has to fall back on the general framework.  

The expected higher demand for care in the Netherlands due to an ageing population, a relatively small active workforce, an increase in the number of people with a chronic illness and a tendency among patients to ask for more (personal) care form the motive behind the current interest in telemedicine and telecare, including DTx. 

The main legal aspect to consider in terms of market placement of DTx is whether the DTx qualifies as a medical device, or as just a software product. If it is considered a medical device, it needs to comply with the EU Medical Devices Regulation (EU) 2017/745 ("MDR”). The relatively new MDR includes a wider scope which makes that software products, like DTx products, are more likely to fall within the qualification of a medical device. 

Software will qualify as a medical device in accordance with article 2 of the MDR, if the intended purpose relates to one of the following:  

• diagnosis, prevention, monitoring, treatment or alleviation of disease,  
• diagnosis, monitoring, treatment, alleviation or compensation of injuries or handicaps, 
• investigation, replacement or modification of the anatomy or of a physiological process, control of conception. 

Software qualifies as a medical device if it is intended by the manufacturer to be used alone or in combination for humans for one or more specific medical purposes as mentioned above. Whether or not software fits this description, depends on the specific kind of software, the functioning and its purpose. The manufacturer determines the exact purpose of a product, which is of influence for the qualification of the DTx product. The Medical Device Coordination Group (MDCG) created a guidance document with guidelines to determine whether a product is a medical device or not.  

The Netherlands has not (yet) developed any guidelines in this respect. Parties in the Netherlands are dependent on the European guidelines for the explanation and qualification the legal obligations under the MDR.  

Apart from the qualification of the product as a medical device, often companies active in this space also wish to offer services or service components, such as coaching or elements of telemedicine. The Dutch legal framework allows for such a setup. Providing of services in combination with DTx could possibly be regarded as providing healthcare in the Netherlands, which will come with additional legal requirements and obligations.  

It should be determined on a case by case bases whether the service, or the activities, can be qualified as healthcare as meant under Dutch law. The decisive criterion in this respect is whether the service can be qualified as individual healthcare: care that relates directly to a person and aims to promote or monitor that person's health, including examining and counselling, as well as practicing medicine. General, non-personalized advise on a general webpage will not qualify as providing healthcare.  

If the app switches from being only a medical device to providing healthcare, the exploiter (the exploiter being the party offering the app to the user) of the DTx might become a healthcare provider. Healthcare providers can be both a natural person or a legal entity. Healthcare providers must comply with certain legal obligations. A healthcare provider will have to register with the Dutch Ministry of Health as a care provider and will also be included in the National Register of Care Providers (LRZa). In case the healthcare activities are recognized as healthcare under the Healthcare Insurance Act, some additional obligations will apply: the healthcare provider will have to apply for an "admission-license" and certain requirements regarding the management structure and/or supervision, financial- and corporate management accountability are applicable.  

Above all, a healthcare provider should provide "good care". Among other things, this means that the healthcare provider must act in accordance with the professional responsibility arising from the professional standards and quality standards. This professional responsibility stays with the exploiter of the DTx, even if it engages third parties that provide care on behalf of the DTx-exploiter to users of the program.  

A medical treatment agreement will arise (by operation of law) between the exploiter of the DTx and the users of the DTx. Based on the medical treatment agreement, the DTx exploiter is obliged to meet the requirements of good care, to keep and maintain a patient file, to observe secrecy with regard to the patient(information), to provide information to the patient and request consent with respect to the treatment.  

If Software processes personal data of the users/patients, it must comply with the applicable data protection regulations, in particular with the EU General Data Protection Regulation (“GDPR”). The GDPR only applies to the processing of data of individuals (regardless of citizenship) residing in the European Union (art. 3 GDPR). If they use the app outside of their jurisdiction, the GDPR will still apply if the provider is a company established in the EU.  

When processing personal data, the principles contained in art. 5 GDPR, such as the lawfulness and purpose limitation of data processing, data minimization, and the integrity and confidentiality of processing, must be taken into account. Personal data concerning health is considered to be a special category of personal data (Art. 9 GDPR). As a result, in addition to the generally required legal basis for the processing of personal data (Art. 6 GDPR), an exception to the general prohibition concerning the processing of special categories of personal data is required. Exceptions to the prohibition of the processing of data concerning health are provided by art. 30 of the Dutch GDPR Implementation Act (Uitvoeringswet Algemene vervordening gegevensbescherming, "UAVG"). Specifically, art. 30 (3) sub a states that the processing of personal data concerning health is allowed when carried out by healthcare providers, institutions or facilities relating to health or social services, in so far as the processing is necessary for the proper treatment or care of the data subject or for the management of the institution or professional practice concerned. 

If data is stored on the device or if data is collected from the users' device and if this is not strictly necessary for providing the service, users must generally provide additional consent1 according to the EU “e-Privacy Directive” (Art. 5 (3) of Directive 2002/58/EU). The e-Privacy Directive, which was implemented in Dutch law in the Dutch Telecommunications Act (Telecommunicatiewet), does not concern only cookies, but any scenario where the provider stores data on or collects data from a device. 

Assuming that the DTx will qualify as a medical device, the key legal requirements will follow from the MDR.  

The general rules on advertisement or promotion can be found in the Dutch Civil Code (DCC). The articles 6:194-196 DCC contain the rules about comparing and misleading advertising. In summary, the rules prohibit unfair, unclear and misleading advertisement, and provides rules for comparing advertisement.  

In case the DTx also qualifies as a medical device, the stipulations of article 7 MDR on advertising also apply. The Netherlands has incorporated these obligations in the Wet medische hulpmiddelen ("Wmh", Medical Device Act) and the Code of Conduct Medical Devices ("Gmh", Code of Conduct Medical Devices), the self-regulatory industry code for the medical device industry. The Gmh holds additional requirements with respect to, among other things, advertisement and promotion of medical devices. Advertisement may not be misleading and has to be accurate, true and verifiable. The advertising should not damage the reputation of the industry and the statements made have to be supported by suitable evidence. These criteria have to be considered for advertisement and promotion to both consumers and professionals.  

According to the Wmh, it is forbidden to prospect, offer or award cash or monetary-valued services or goods to a healthcare professional or organization that is involved in the application of a medical device, with the apparent aim of promoting the sale of a medical device ("prohibited inducement"). The Wmh includes four exceptions to this basic principle, including the use of discounts and bonuses in relation to the sale of medical devices. The Gmh, contains more detailed criteria for arrangements to be met in order to qualify as an allowed exception to prohibited inducement. 

However, the above prohibition of inducement does not mean that normal commercial transactions are not allowed. In fact, in addition to buying a medical device, it can also be loaned, rented or leased under certain conditions. In that case, other type of financial arrangements will have to be made. The Code Committee had stated in a recent advice that article 6 Gmh aims to maintain and promote normal trade between suppliers of medical devices and users of these products. That is why parties have the freedom to determine how to design a commercial transaction legally and which financial agreements they agree on. 

Given the importance of transparency described in article 6 of the Gmh, the Code Committee assumes that – if agreements are made about the use of medical devices on the basis of a title other than transfer of ownership – a commercial transaction as discussed here is always based on a written agreement. The written agreement shall at least contain the following information: 

• The legal title on which the medical device is made available to the HCP/HCO; 

• The conditions under which the medical device is made available; 
• The periodic compensation the HCP/HCO owes to the supplier (if any); 
• The period the medical device will be made available to the HCP/HCO;  
• The conditions on how to return the medical device after the agreed term (or not); 
• Any additional costs associated with the loan, lease or trial placement.  

Article 6 of the Gmh sets no requirements or restrictions on the amount of bonuses and discounts and does not preclude the granting of bonuses or discounts that are of such nature that a device is delivered below cost, or that a discount of 100% is offered, so that the device is in fact delivered free of charge. So loan, rent and lease are all possible options in this respect.

In the Netherlands, there are numerous ways to distribute the DTx to both healthcare professionals and to patients. There is no specific regulation with respect to the distribution of DTx, or medical devices in general. However, Dutch health insurers do have influence – based on reimbursement – on how some medical devices can be distributed. 

In the Netherlands, manufacturers of medical devices and/or healthcare providers are allowed to partner or collaborate with commercial companies. Please note the rules on forbitten inducement in this respect, but apart from the restrictions as set in the Wmh and the Gmh, there is no objection to commercial collaboration.  

The Dutch Autoriteit Consument en Markt (ACM) monitors collaborations within the Dutch healthcare sector. Collaborations are also allowed from a competition-law perspective, as long as the collaboration does not unnecessarily restrict competition and if it is not harmful for patients or insured persons. For example, the ACM monitors whether collaborating parties do not have a market share that is too large and could possibly obstruct competition, and whether the collaboration does not exceed what is necessary to achieve a certain goal.  

In the Netherlands, for a long time the only option was for consumers to pay out-of-pocket for DTx products, because there were no guidelines for health insurers to reimburse these types of programs as "healthcare" under the basic insurance policy. As DTx evolves, the market for these products is growing and the healthcare system is evolving as well. Health insurers companies can, under certain conditions, reimburse patients for DTx products if they fall within the medical device-category and comply with the applicable requirements. Because this market is still evolving and is difficult to assess for every product, consumers still regularly pay for DTx products by themselves.  

Since the Covid-19 pandemic, employers in the Netherlands have regularly started to offer DTx products to their employees within company health programs. Especially when employees were forced to work from home during lockdowns, companies offered products like mental health applications to help their employees. However, healthcare through employers is less common and used in the Netherlands than it is in other countries, like the US. 

There are no specific restrictions in the Netherlands for offering and selling DTx products as normal, commercial products. This could include for example direct sales to consumers or companies, but also sale of the DTx product through a third party. The seller would in principle be free to set a commercially chosen price for the DTx product.

It is still unclear how DTx will be reimbursed in the Netherlands, it could either be reimbursed as part of a "normal" treatment, or it could qualify and be reimbursed as a medical device (or medical aid) under the Dutch Healthcare insurance act. 

In late 2021, Amsterdam hospital OLVG and health insurer Zilveren Kruis received permission from the Dutch Healthcare Authority to consider and reimburse apps for cardiology care as regular care. And recently, health insurer VGZ and Maastricht UMC+ made agreements on reimbursement for remote measurement and analysis of cardiac arrhythmias. This makes the use of an app a regular part of the care and the treatment. 

The Health Insurance Act (Zvw) describes which medical devices are eligible for reimbursement from the basic health insurance package. It is primarily up to the health insurer to assess whether a (new) device qualifies for reimbursement from the basic health insurance package. This is also called whether a device 'falls under the function-based entitlement'. It is also up to the health insurer to assess whether a (new) device meets the statutory criterion 'the state of science and practice'. In other words, whether the device is proven effective. 

Also, the Dutch government subsidizes the healthcare sector in certain fields, like innovation. Some examples are the 'promising care grant', the 'program IMDI' and the 'E-Health-grant'. Especially the E-Health grant could be something DTx could qualify for. 

In 2021, the Dutch healthcare authority NZa expended the funding of digital care. This was an important decision to enable reimbursement of digital care provided by a GP or medical specialist. In first instance, this was meant for reimbursing a digital consult for example. However, since then, the NZa has encouraged the use of digital care in practice in a more general sense.