The digital health field continues to boom as SoftBank-backed startup hits unicorn status in SPAC reverse merger
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At the intersection of medicine and cutting-edge technology, the broad field of digital health has seen booming valuations in recent months with some big-name investors jumping in. Now, a company working on software-based therapeutics has leaped to unicorn status and will take its show on the road to Nasdaq.
Pear Therapeutics, a startup developing prescription digital therapeutics, will go public as part of a reverse merger with a tech-focused SPAC dubbed Thimble Point Acquisition Corp. that will value the company at $1.6 billion, the partners said Tuesday.
As part of the pact, Thimble Point will invest a total of $400 million, with $276 million coming from the SPAC’s trust account and the rest in PIPE funding. The deal is expected to close in the second half of the year, and the newco plans to trade under the ticker $PEAR.
Pear currently sports three FDA-approved PDTs, as they call them, which are standalone or complementary software products that the biotech hopes to extend into a range of therapeutic areas. The most recent product approved was Somryst, a treatment for chronic insomnia that earned the FDA’s nod in March 2020.
In December, Pear closed an $80 million Series D led by Japan’s SoftBank Vision Fund 2. That round was expanded to $100 million as an additional investor jumped on board in March.
On top of chronic insomnia, a market Pear estimates could hold around 30 million US patients, the company’s two other products target opioid addiction, another field that could include as many as 20 million patients, it said. On top of investing more funds into commercialization plans, Pear will look to build its pipeline, which includes 14 investigational products, the company said in a statement.
“Thimble Point sought to collaborate with a high-growth, tech-enabled company with the potential to disrupt large and established industries,” the SPAC’s CEO, Elon Boms, said in a statement. “We chose to invest in Pear because we believe it has the opportunity to become the primary commercial platform through which patients and prescribers access PDTs. Our growth capital comes at an inflection point for Pear, as the team works towards expected near-term value creation milestones.”
Thimble Point went public back in February with a $240 million IPO and the goal “to focus on high-growth software and technology-enabled companies that are disrupting large and established industries and markets,” the blank-check company said in its prospectus. The team behind Thimble Point starts with Boms, the managing director at the Pritzker Vlock Family Office and co-founder and chairman of LaunchCapital.
Pear comes with the Novartis brand name at its back after signing a deal with the Swiss drugmaker in March 2018 to work on the schizophrenia and multiple sclerosis front. Novartis generics subsidiary Sandoz also joined up to help launch opioid PDT reSET in late 2018 but backed out after rejigging its portfolio after the departure of CEO Richard Francis.
Pear is part of a wave of digital health platforms that have earned massive valuations in recent months. Just last month, decentralized clinical trial player Science 37 went public as part of its own SPAC reverse merger, earning a valuation at a little more than $1 billion.
Meanwhile, genetics testing company 23andMe went public back in February as part of a reverse merger with a SPAC from billionaire Richard Branson. That deal valued the company at a whopping $3.5 billion.