Pear sets out its stall for potential sale

Friday’s announcement that Pear Therapeutics was effectively putting itself up for sale is the latest hammer blow to the digital health sector, which has recently seen numerous rounds of job cuts and company failures. Pear had been a poster child for digital therapeutics through its 2021 $1.6bn float via a merger with a special purpose acquisition company, as well as its three FDA-approved products. But enthusiasm for digital health, which reached fever pitch during the pandemic, has cooled significantly. Tougher economic conditions and tightening capital markets have dented sentiment for tech-focused companies and seen Spac valuations tumble. Pear, which posted a $30.7m third-quarter net loss, has been in distress since last year, when it trimmed its workforce by 30%, and last month announced the departure of its chief commercial officer. Pear’s products have experienced the same problem as other digital therapeutics of limited cover from health insurance companies, despite the group’s success in securing interest from commercial insurers. Shares in the company are now trading 97% below their list price, and with little appetite for risk in the market it is hard to see who will come to Pear’s rescue.