Digital Therapeutics Trailblazer Pear Files For Bankruptcy, CEO Resigns

Digital therapeutics trailblazer Pear Therapeutics (NASDAQ: PEAR) filed for bankruptcy on Friday.

The Boston-based company said that it will continue to operate on a scaled down model while it looks to execute an expedited sale.

In the meantime, the company’s CEO and founder, Dr. Corey McCann, announced that he will be stepping down.


Pear Therapeutics made history when its substance use disorder treatment reSET landed the first FDA clearance for a digital therapeutic in 2017. It has since received FDA clearance for its prescription opioid treatment reSET-O.

“The Pear team has accomplished a lot together in bringing the first Prescription Digital Therapeutics (PDTs) to market,” McCann said in a Linkedin post. “We’ve shown that clinicians will readily prescribe PDTs. We’ve shown that patients will engage with the products. We’ve shown that our products can improve clinical outcomes. We’ve shown that our products can save [payers] money. Most importantly, we’ve shown that our products can truly help patients and their clinicians.”

This news comes less than a month after Pear announced it was withholding its Q4 earnings and looking for “strategic alternatives” to maximize shareholder value. These alternatives included the potential for an acquisition, sale, merger, divestiture of assets and licensing.


Pear went public through a $1.6 billion SPAC merger in 2021. But the digital therapeutic provider has struggled on the public markets. When the company first went public, the stock was trading at roughly $10 per share. The company’s stock is now trading for about $0.22 per share.

While Pear made headway with several state Medicaid organizations, McCann cited payers’ lack of coverage as one of the headwinds for the company.

“[Payers] have the ability to deny payment for therapies that are clinically necessary, effective, and cost-saving,” McCann said. “In addition, market conditions over the last two years have challenged many growth-stage companies, including us.”

Although this might be the end of the road for Pear, over the last year the digital therapeutics industry, with Pear as one of the key leaders, made significant strides forward in creating a reimbursement pathway.

Pear inked deals with Massachusetts’ state Medicaid program, to cover reSET and reSET-O. It also had a value-based agreement with Oklahoma Medicaid.

New reimbursement codes have also paved the way for easier payer and provider adoption. In 2021, the Centers for Medicare & Medicaid Services (CMS) added a new Level II Healthcare Common Procedure Coding System (HCPCS) code for “Prescription digital behavioral therapy, FDA cleared, per course of treatment,” which made it easier for commercial and Medicaid payers to cover digital therapeutics.

Additionally, Highmark Health became the first commercial payer to cover digital therapeutics.

Pear isn’t the only digital therapeutics company facing challenges on the public market.

Earlier this year, Boston-based prescription digital therapeutics company Akili Inc. (Nasdaq: AKLI) announced it was laying off 30% of its staff in a cost-cutting play to extend its cash runway. Akili went public in August of 2022.

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