Issue 194
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Pear assets sold to Click, Welt, Nox, and mystery buyer for a little more than $6 million
The news you know: Pear’s bankruptcy court asset auction took place yesterday. Today a filing from the bankruptcy court revealed the four companies that bought Pear’s assets, and they include one mysterious buyer named Harvest Bio LLC. Next week the judge presiding over the case needs to decide if the purchase agreements will go through, so these aren’t done deals just yet.
Question: Who is behind Harvest Bio LLC? The Delaware company was formed a little over a week ago apparently to participate in this bankruptcy auction.
Wild guess: Is someone from the old Pear team trying to resurrect the company? The most dramatic turn of events that I can imagine is that Pear’s former CEO and founder Corey McCann bought back Pear’s core assets via Harvest Bio LLC. What are the chances that’s what just happened?
Onto the details of the auction. Who paid how much for what (plus which companies are the backup bidders for some of the assets…
Winning bid: Click Therapeutics placed the winning bid for the patents related to the Pear Platform. Click is set to pay $70,000 in cash for these patents.
Winning bid: Mystery bidder Harvest Bio LLC is set to pay a total of $2.03 million in cash for the lion’s share of Pear’s assets. Those include:
- $50,000 in cash for the Invention Science Fund licenses and patents
- $50,000 in cash for Pear’s assets focused on a major depressive disorder intervention,
- $50,000 in cash for its assets focused on schizophrenia (Pear-004), multiple sclerosis and depression (Pear-006), and other pipeline assets
- $50,000 in cash for the corporate trademarks
- $180,000 for its distribution technology PearConnect
- $1.65 million in cash for the reSET and reSET-O assets
Winning bid: Perhaps surprisingly, the assets that fetched the most money at auction were Pear’s Somryst assets. Nox Health Group bid $3.9 million in cash for them.
Winning bid: Finally, WELT Corp. is set to pay $50,000 in cash for Pear’s migraine intervention assets (Pear-014).
Back-up bid: Click Therapeutics is set to acquire the assets for PearConnect for $170,000 in cash if the bid from Harvest Bio LLC falls through for some reason. (I thought it was odd that Click would want the patents for the tech but not the tech itself. What can Harvest Bio do with the assets if Click owns the patents? Odd situation.)
Back-up bid: Similar to the above but in reverse. Harvest Bio LLC is the backup bid for the patents related to Pear’s Platform. Harvest Bio bid $60,000 in cash and will get the patents if Click’s bid falls through for some reason.
Back-up bid: WELT Corp. is the backup buyer of the Somryst assets for a purchase price of $3.2 million cash and the reSET and reSET-O assets for $1.55 million in cash.
Back-up bid: XR Health didn’t end up with any winning bids but it is a back-up bidder for the schizophrenia, MS/depression assets, and the remaining group of “other pipeline assets” for $60,000 in cash. Well, certainly an interesting turn of events. Curious if these bids all hold up next week. In the meantime, let me know if you figure out who set up Harvest Bio LLC.
Swing Therapeutics gets De Novo clearance for Stanza, a PDT for fibromyalgia, but is commercializing via a virtual clinic model for now
De Novo: Earlier this month the FDA granted Swing Therapeutics a De Novo clearance for Stanza, Swing’s prescription digital therapeutic for fibromyalgia.
Already launched via FDA enforcement policy: Despite only just securing the official FDA market authorization, Swing made Stanza available about six months ago with a limited indication focused on the psychiatric components of fibromyalgia. The company was offering its digital therapeutic under the FDA’s enforcement policy for psychiatric-related digital health devices during the COVID public health emergency. Now that Stanza is FDA-cleared, Swing can market it using a much broader indication for use that covers a range of fibromyalgia symptoms beyond behavioral health.
Commercializing via a virtual clinic: Swing Therapeutics’ CEO Mike Rosenbluth told me that the company is currently commercializing Stanza via the company’s fibromyalgia-focused virtual clinic, named Swing Care. Swing Care is set up using the typical MSO-Friendly PC model that most virtual clinics use today. Rosenbluth said that for now Swing Care only operates in Texas. It has already contracted with BCBS of Texas and also accepts Medicare Part B. Swing is actively working to gain coverage for its provider services from other major Texas payors.
Texas-only for now: While Swing is based in the San Francisco area, Rosenbluth said it launched in Texas first for a number of reasons. Texas has a large population, but it also has fewer patients in closed managed care networks (like Kaiser). Setting up its physicians group in Texas also enables it to move to other states that allow Texas-based clinics to operate across state lines. Stanza is only available through Swing Care currently, but Swing is working with a few other provider groups to make the prescription digital therapeutic available to their patients too. Once those are set up, the company plans to move Swing Care into other states and expand via the clinic model.
TN and SC next? Rosenbluth wouldn’t share which states Swing is eyeing next but it does have business entities established in states like Tennessee and South Carolina. So, those may be next.
Then maybe pursue broader payer coverage: Once Swing Care is operating in multiple states, Rosenbluth and his team plan to explore how they might offer broader access to the prescription digital therapeutic. He told me that Swing has learned by watching the first generation of prescription digital therapeutics companies that changing physician behavior is a challenge and that payors are generally not willing to pay for PDTs via pharmacy or medical benefits yet — at least not in the next six months.
Similar to but different from Oui/Vita: In a past issue of E&O, I wrote about Oui Therapeutics’ spin-out Vita Health. The Swing Therapeutics-Swing Care strategy is similar but with one key distinction. Whereas Oui and Vita are two separate companies with their own unique set of investors, the fate of Swing Therapeutics and its virtual clinic are much more intertwined. I’ll be tracking Swing’s progress closely.
Woebot Health pauses plans for postpartum depression prescription digital therapeutic
Woebot Health told me this week that it has decided to suspend its prescription digital therapeutic initiatives for now and focus on other go-to-markets. I asked Woebot about two clinical trials that the company terminated in recent weeks. Woebot and its partner Iqvia made the decision to suspend their randomized controlled trial for Woebot’s prescription digital therapeutic for postpartum depression. The company described the trial like so:
“This randomized, double-blind, controlled trial evaluates the efficacy and safety of 8 weeks of treatment of two digital therapeutics in a population of women with mild to moderate postpartum depression. …Eligible participants will be randomized to one of the two groups and will receive instructions on downloading and using the smartphone application to which they were randomized. Participants will use the app as instructed and will attend telehealth visits to complete assessments for the primary and safety endpoints at Weeks 4 and 8 (EOT).”
The other study was a newer one that also focused on the digital therapeutic for postpartum depression:
“This study is a 6-month follow-up study to WB001-001 conducted to assess and evaluate the durability of the effect of {WB001+TAU} beyond the 8-week treatment period.”
Woebot Health’s CEO Michael Evers told me via email:
“Since our start in 2017, Woebot Health has focused on both the behavioral health and the prescription digital therapeutics (PDT) markets. Today we’re seeing the need for behavioral health solutions accelerating while the PDT space is taking longer to mature. We’re therefore pausing our pivotal trial in postpartum depression (WB001, and its associated follow-up study) to focus resources where we can make the most immediate impact. We expect the PDT space to continue to evolve and see PDTs playing a critical role in the future of mental health. In the meantime, we will continue to drive evidence and compliance in our behavioral health solutions and stay connected to the FDA as it evolves the regulatory framework for PDTs.”
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