Neuronetics to Buy Magnetic Neurostim Firm Greenbrook TMS

Neuronetics and Greenbrook TMS began a definitive arrangement agreement, in which Neuronetics will acquire all outstanding Greenbrook shares in an all-stock transaction.
 
The transaction will create a vertically integrated firm that can provide access to TMS (transcranial magnetic stimulation) therapy with significant scale, the duo said.
 
Neuronetics’ NeuroStar is a non-drug, noninvasive treatment for depressive episodes. It’s also used to decrease anxiety symptoms for those who have comorbid symptoms. Neurostar is used to treat major depressive disorder (MDD) who couldn’t achieve satisfactory improvement from previous antidepressant medication treatment in the current episode.
 
It’s FDA cleared as an adjunct for adults with obsessive-compulsive disorder and for adolescent patients aged 15-21 with MDD.
 
Greenbrook is a provider of TMS and Spravato (esketamine nasal spray), FDA-cleared, non-invasive therapies to treat MDD and other mental health disorders. It operates through 130 company-operated treatment centers—118 following completion of the previously-disclosed settlement transaction.
 
“This transaction brings together two of the leaders in the mental health space in the U.S., which will allow us to provide access to innovative care to patients suffering from mental health conditions. Leveraging the significant scale and capabilities of the two businesses, we can drive increased awareness of NeuroStar, consistently deliver best practices, facilitate improved reimbursement on a regional and national level, and provide additional services and training opportunities to all of our customers which can improve their business operations,” said Keith Sullivan, president and CEO of Neuronetics. “Beyond the strategic benefits, we believe this acquisition will help create a more attractive financial profile for the combined company, including the increased scale and growth trajectory of our top line, the ability to realize material cost synergies, the acceleration of our path to profitability, and a bolstered balance sheet. In combination, we expect this transaction will create significant long-term value for shareholders.”
 
Neuronetics said the transaction will help to drive more awareness of NeuroStar, as well as better operationalize its best practices at Greenbrook sites. NeuroStar will also gain more brand recognition and expanded training opportunities.
 
In fiscal year 2023, the pro forma revenue of the combined company would have been about $145 million, doubling the scale of the standalone businesses. The combined company expects mid-teens year over year revenue growth in fiscal years 2025 and 2026.
 
Neuronetics’ executive management team will continue with the combined company, and the executive leadership team will be bolstered by key Greenbrook leadership team members, including Bill Leonard, Greenbrook’s current president and CEO, Peter Willett, Greenbrook’s current CFO, and Dr. Geoffrey Grammer, Greenbrook’s current chief medical officer.
 
The transaction is expected to close in Q4 2024.
 
“This transaction combines two organizations who share a common mission to better care for the growing number of patients who are suffering from mental health conditions, many of whom are poorly served by medication alone,” said Bill Leonard, president and CEO of Greenbrook. “By combining Neuronetics’ innovative NeuroStar platform as well as their education and training expertise, with Greenbrook’s well established practice operations and support capabilities, we believe the combined company can improve care at Greenbrook’s existing sites and, just as importantly, at any practice across the country that is looking to bring the benefits of NeuroStar to their patients.”