Health tech Spacs drift downwards

2021 has seen a startling rise in the number of deals between special-purpose acquisition companies and medical technology, digital health and diagnostics groups seeking a fast and easy way to go public. A flurry of these deals in February was followed this week by Somalogic reversing into CM Life Sciences II in a transaction worth $651m, including a $375m Pipe investment. Somalogic specialises in protein analysis, and plays in three industries: clinical diagnostics, with its SomaSignal assays for cardiovascular disease, diabetes and cancer; aiding drug development; and basic research. Its revenues in 2020 were just $55m, but the Spac deal will bring Somalogic’s pro forma enterprise value to $1.2bn. News of the deal pushed CM’s share price up 10%, but this is an outlier among the class of 2021 – most have seen their valuation fall since announcing deals. Indeed the shine is perhaps coming off Spacs, at least in the health tech space. VG Acquisition Corp, the blank-cheque company backed by Virgin, has lost nearly a quarter of its value since announcing its intent to buy 23andMe – a fall rendered all the steeper by the fact that its value had soared 31% on the day of the announcement

Health tech Spac deals in Q1 2021
Target Spac (main backer)  Focus Deal announced Share price since announcement
Somalogic  CM Life Sciences II (Casdin Capital and Corvex Management) Proteomics Mar 29 10%
Humacyte Alpha Healthcare Acquisition Corp (AHAC Sponsor) Bioengineered vascular grafts Feb 17 4%
Owlet Baby Care Sandbridge Acquisition Corp (Sandbridge Capital and Pimco) Digital health  Feb 16 (6%)
Sharecare Falcon Capital Acquisition Corp (Falcon Equity Investors) Telehealth Feb 12 (15%)
Sema4 CM Life Sciences (Casdin Capital and Corvex Management) Genomics Feb 10 (4%)
Nautilus Biotechnology Arya Sciences Acquisition Corp III (Perceptive Advisors) Proteomics Feb 8 23%
23andMe VG Acquisition Corp (Virgin Group) Genetic testing Feb 4 (24%)
Talkspace Hudson Executive Investment Corp (Hudson Executive Capital) Telehealth Jan 13 (14%)
Source: company announcements. 

Share This Article