Pear Therapeutics, maker of prescription digital therapeutics, announced today that it’s filed for Chapter 11 bankruptcy and it’s seeking a sale of its business or assets.
The company will continue its scaled-down operations during Chapter 11 as it seeks a sale, and Pear will use its available cash to fund its operations and costs post-petition.
The Boston-based company’s CEO Corey McCann referenced the filing on LinkedIn, stating, “Today is a difficult day for Pear Therapeutics. We announced that Pear voluntarily filed for Chapter 11 and will seek to sell assets through a sales process. We also announced a reduction in force, including me. This is certainly not the outcome I envisioned when I founded Pear in 2013.”
McCann thanked the departing Pear employees and highlighted their accomplishment in bringing some of the first prescription digital therapeutics to market. He noted market conditions caused the company and other growth-stage businesses to face challenges over the last two years.
“Here’s to the future of digital medicine that we’ve worked so hard to create,” McCann said.
THE LARGER TREND
Last month, Pear announced it was exploring “strategic alternatives,” including a possible company sale, merger or acquisition. It hired a financial advisor to look into actions that could “maximize shareholder value,” including a potential sale, M&A, divestiture of assets, licensing or other strategic transactions.
Without a transaction, Pear said the company would need to reorganize, liquidate or pursue other types of restructuring. In a filing with the Securities and Exchange Commission, Pear withdrew its revenue and operating guidance for fiscal 2022 and 2023. It did not hold a fourth quarter and full-year earnings call.
The publicly-traded company wasn’t immune to the many layoffs seen throughout the digital health sector. In November, Pear said it would cut its workforce by about 59 employees, or around 22% of the company. In July, it let go of approximately 25 employees, making up about 9% of its workforce.
Still, last year the company established numerous partnerships to expand access to its reSET and reSET-O offerings aimed at treating substance use and opioid use disorder, including collaborating with the Wisconsin Department of Health Services, Spero Health, and the California Department of Healthcare Services. The company also announced plans to offer its prescription digital therapeutics via telehealth providers.
Darren Mann, Kathryn Kuttler and Dr. Peter Haug will offer more detail during the HIMSS23 session “Improved Patient Care Enabled by Real-Time Interoperable Clinical Decision Support.” It is schedule for Thursday, April 20 at 4 p.m. – 5 p.m. CT at the South Building, Level 1, room S105 C.