The era of the digital pill is upon us.

Regulators at the U.S. Food and Drug Administration just green-lighted a tiny, swallowable sensor called Abilify MyCite that tracks when the patient takes their meds. The tablet is specifically targeted to people with mental health conditions like schizophrenia and bipolar disorder, and is the first of its kind to get approved.

Digital pills, which typically include a sensor about the size of a grain of sand, can travel safely through the body and communicate with some kind of external device, like an app or a wearable patch.

They aim to solve a big and expensive problem: Patients not taking their meds on time, or at all. That costs taxpayers somewhere in the realm of $100 billion and $289 billion a year in the U.S. alone.

When patients don’t get their scripts filled or finish a dose, their symptoms get worse and they often end up in the hospital. The hope for this new category of tech is to provide health providers with a GPS tracking system of sorts for the human body. By tracking a patient’s compliance to their regimen, rather than relying on what they self-report, they can nudge them if needed.

Another big picture goal for digital pills is to better tailor or personalize medications for patients.

Clinical trials aren’t known for their diversity, which has resulted in medications being prescribed in a one-size-fits-all manner. One outcome is that women will often end up taking larger doses than required, as a medication has been tested out on a larger male.

A third hope is that a digital pill, when analyzed alongside other vital signs, can provide some insight into how a patient is responding to their meds in real-time, and allow physicians to adjust their dose as needed.

Digital pills are designed to augment traditionally therapies. But some in the medical community believe that tech can someday replace pills altogether — a category sometimes referred to as “digital therapeutics.”

Digital therapeutics goes beyond sensor-laden pills to include other digital elements, like coaching via a mobile app to help a patient achieve a better health outcome.

As an example, one company in the space, Propeller Health, has a program for people with chronic respiratory disease that includes a mobile app and a rescue inhaler packed with sensors. The idea behind is that Propeller can track which patients aren’t taking their controller meds frequently enough, and alert them to that fact. The company also looks at external triggers, such as weather events and air quality.

These technologies tend to have a clear business model, if they can prove that they work. Propeller’s solution is compelling for pharmacy benefits managers, insurers and pharmaceutical companies, which are all looking for ways to make medications more effective and prevent costly health outcomes like a trip to the emergency room.

But a more ambitious set of start-ups see a future where a digital regimen could replace a pill entirely.

The idea is that a virtual coach, in combination with other services, could help a patient change their behavior to become more healthy or less anxious. And in these cases, they wouldn’t require a pill at all. One example of that is Big Health, which has an app that is designed to treat insomnia by training users to change their habits around bedtime. Or Virta Health, which helps people with type 2 diabetes get off their meds through a combination of exercise and nutrition.

As venture capitalist Vijay Pande recently put it, “it’s going to seem backwards and even barbaric that our solution to everything was just giving out pills.”