Pear Therapeutics06.23.21
Pear Therapeutics Inc., the leader in developing and commercializing prescription digital therapeutics (PDTs) to treat serious disease, and Thimble Point Acquisition Corp., a special purpose acquisition company (SPAC) whose management team is associated with the Pritzker Vlock Family Office, today announced they have entered into a definitive business combination agreement.
Pursuant to the Business Combination Agreement, upon closing of the Business Combination, the combined company will be named Pear Holdings Corp. and will be led by Pear’s current management team. The Combined Company’s common stock is expected to be listed on Nasdaq under the new ticker symbol “PEAR.”
“At Pear, we set out to transform healthcare through the use of PDTs, a new class of clinically validated, software-based therapeutics that we pioneered to improve patients’ outcomes across many therapeutic areas, alone and in combination with pharmaceuticals. With our end-to-end PDT platform, we are executing on our vision to redefine how patients, clinicians and payors can better navigate and benefit from a healthcare system so in need of disruption,” said Corey McCann, M.D., Ph.D., President and Chief Executive Officer. “In our view Pear is at a commercial inflection point, with the potential for rapid expansion. We believe this transaction will allow us to drive widespread usage of PDTs to treat major medical conditions and overcome significant barriers to patient care.”
“As the category creator and leader in PDTs, Pear is at the forefront of revolutionizing healthcare. Pear’s impressive team of healthcare and technology leaders have built development, regulatory and commercial roadmaps for this new sector and have gained early market traction, creating a pathway to rapid scalability,” said Elon Boms, Chief Executive Officer and Chairman of Thimble Point Acquisition Corp. and Managing Director of PVFO. “Thimble Point sought to collaborate with a high-growth, tech-enabled company with the potential to disrupt large and established industries. We chose to invest in Pear because we believe it has the opportunity to become the primary commercial platform through which patients and prescribers access PDTs. Our growth capital comes at an inflection point for Pear, as the team works towards expected near-term value creation milestones.”
“We believe prescription digital therapeutics are creating a new category of medicine with applications worldwide,” said Kirthiga Reddy, Partner at SoftBank Investment Advisers. “As the lead investor of Pear’s last private financing round, we are pleased to support the company’s mission and their journey to becoming a publicly traded company.”
Pear, founded in 2013, is led by a management team that intends to leverage its biopharmaceutical, medtech, and technology expertise to create transformational products for patients and scale the delivery of them to global markets. Pear’s PDT engine enables the discovery, development and commercialization of PDTs at scale. Pear is one of nine companies invited to participate in the U.S. Food and Drug Administration’s (FDA) Precertification Pilot Program. Pear has developed and commercialized the first three FDA-authorized PDTs, has 14 product candidates, and is scaling its platform for third-party product distribution opportunities. The Company’s three FDA-authorized products, reSET, reSET-O and Somryst, address large market opportunities with more than 20 million patients suffering from substance and opioid use disorders and more than 30 million from chronic insomnia, in the U.S. alone, respectively.
Like traditional medicines, PDTs are developed in a GMP-compliant environment, tested in randomized controlled trials demonstrating safety and efficacy, evaluated and authorized by regulators like the FDA, and used under the supervision of a prescribing clinician. Unlike traditional medicines, PDTs are software applications and are designed to collect real world data for use by prescribing clinicians and by payors and health systems for population health management.
Summary of Business Combination
The Business Combination values the Combined Company at a pro forma equity value of approximately $1.6 billion. Pursuant to the Business Combination, the Combined Company is expected to have approximately $450 million of net cash on its balance sheet upon the closing of the transaction. This includes approximately $400 million in gross proceeds from a combination of approximately $276 million in cash held in Thimble Point’s trust account, assuming no Thimble Point shareholders exercise their redemption rights at closing, and approximately $125 million, at $10.00 per share, from a fully committed PIPE with participation from leading healthcare and technology investors, including 5AM Ventures, Arboretum Ventures, Blue Water Science Advisors, LLC, dRx Capital (Novartis Pharma AG), The Eleven Fund, FORTH Management, Health Innovation Capital (HIC), JAZZ Venture Partners, a leading integrated delivery network, Neuberger Berman funds, Palantir, Pilot House, Pritzker Vlock Family Office, QUAD Investment Management, Sarissa Capital, Shanda Group, SoftBank Vision Fund 2, Temasek, and Trustbridge Partners.
As a result of this broad support, the PIPE offering was oversubscribed, and it was upsized from $100 million to $125 million. All existing Pear equity holders will roll the entirety of their equity holdings into the Combined Company and are expected to hold approximately 72% of the issued and outstanding equity of the Combined Company immediately following the closing.
Net proceeds from the Business Combination will be used to further capitalize Pear’s category-leading position by investing in commercialization of Pear’s three FDA-authorized products, advancing Pear’s pipeline, and scaling its end-to-end platform.
The Combined Company’s board of directors will be initially comprised of seven directors, including four of Pear’s current directors plus one director designated by Thimble Point Acquisition Corp. Thimble Point’s designee is Jorge Gomez, the current CFO at Dentsply Sirona, the world’s largest manufacturer of professional dental products and technologies, and former CFO at Cardinal Health, one of the largest distributors of pharmaceuticals, a global manufacturer and distributor of medical and laboratory products, and a provider of performance and data solutions for healthcare facilities.
The Business Combination was unanimously approved by each of Thimble Point’s Board of Directors and Pear’s Board of Directors, and is expected to be completed in the second half of 2021. The Business Combination will be subject to approval by Thimble Point’s shareholders and satisfaction or the waiver of the closing conditions identified in the Business Combination Agreement.
Advisors
BofA Securities and Citi are acting as financial advisors to Pear and placement agents on the PIPE Transaction. BTIG and Chardan are serving as co-advisors. Citi and Cowen are serving as a capital markets advisors to Pear. Goodwin Procter LLP and Foley Hoag LLP are acting as legal advisors to Pear. Shearman & Sterling LLP is acting as legal advisor to the placement agents.
Credit Suisse is acting as financial advisor to Thimble Point. Sullivan & Cromwell LLP is acting as legal advisor to Thimble Point.
Pursuant to the Business Combination Agreement, upon closing of the Business Combination, the combined company will be named Pear Holdings Corp. and will be led by Pear’s current management team. The Combined Company’s common stock is expected to be listed on Nasdaq under the new ticker symbol “PEAR.”
“At Pear, we set out to transform healthcare through the use of PDTs, a new class of clinically validated, software-based therapeutics that we pioneered to improve patients’ outcomes across many therapeutic areas, alone and in combination with pharmaceuticals. With our end-to-end PDT platform, we are executing on our vision to redefine how patients, clinicians and payors can better navigate and benefit from a healthcare system so in need of disruption,” said Corey McCann, M.D., Ph.D., President and Chief Executive Officer. “In our view Pear is at a commercial inflection point, with the potential for rapid expansion. We believe this transaction will allow us to drive widespread usage of PDTs to treat major medical conditions and overcome significant barriers to patient care.”
“As the category creator and leader in PDTs, Pear is at the forefront of revolutionizing healthcare. Pear’s impressive team of healthcare and technology leaders have built development, regulatory and commercial roadmaps for this new sector and have gained early market traction, creating a pathway to rapid scalability,” said Elon Boms, Chief Executive Officer and Chairman of Thimble Point Acquisition Corp. and Managing Director of PVFO. “Thimble Point sought to collaborate with a high-growth, tech-enabled company with the potential to disrupt large and established industries. We chose to invest in Pear because we believe it has the opportunity to become the primary commercial platform through which patients and prescribers access PDTs. Our growth capital comes at an inflection point for Pear, as the team works towards expected near-term value creation milestones.”
“We believe prescription digital therapeutics are creating a new category of medicine with applications worldwide,” said Kirthiga Reddy, Partner at SoftBank Investment Advisers. “As the lead investor of Pear’s last private financing round, we are pleased to support the company’s mission and their journey to becoming a publicly traded company.”
Pear, founded in 2013, is led by a management team that intends to leverage its biopharmaceutical, medtech, and technology expertise to create transformational products for patients and scale the delivery of them to global markets. Pear’s PDT engine enables the discovery, development and commercialization of PDTs at scale. Pear is one of nine companies invited to participate in the U.S. Food and Drug Administration’s (FDA) Precertification Pilot Program. Pear has developed and commercialized the first three FDA-authorized PDTs, has 14 product candidates, and is scaling its platform for third-party product distribution opportunities. The Company’s three FDA-authorized products, reSET, reSET-O and Somryst, address large market opportunities with more than 20 million patients suffering from substance and opioid use disorders and more than 30 million from chronic insomnia, in the U.S. alone, respectively.
Like traditional medicines, PDTs are developed in a GMP-compliant environment, tested in randomized controlled trials demonstrating safety and efficacy, evaluated and authorized by regulators like the FDA, and used under the supervision of a prescribing clinician. Unlike traditional medicines, PDTs are software applications and are designed to collect real world data for use by prescribing clinicians and by payors and health systems for population health management.
Summary of Business Combination
The Business Combination values the Combined Company at a pro forma equity value of approximately $1.6 billion. Pursuant to the Business Combination, the Combined Company is expected to have approximately $450 million of net cash on its balance sheet upon the closing of the transaction. This includes approximately $400 million in gross proceeds from a combination of approximately $276 million in cash held in Thimble Point’s trust account, assuming no Thimble Point shareholders exercise their redemption rights at closing, and approximately $125 million, at $10.00 per share, from a fully committed PIPE with participation from leading healthcare and technology investors, including 5AM Ventures, Arboretum Ventures, Blue Water Science Advisors, LLC, dRx Capital (Novartis Pharma AG), The Eleven Fund, FORTH Management, Health Innovation Capital (HIC), JAZZ Venture Partners, a leading integrated delivery network, Neuberger Berman funds, Palantir, Pilot House, Pritzker Vlock Family Office, QUAD Investment Management, Sarissa Capital, Shanda Group, SoftBank Vision Fund 2, Temasek, and Trustbridge Partners.
As a result of this broad support, the PIPE offering was oversubscribed, and it was upsized from $100 million to $125 million. All existing Pear equity holders will roll the entirety of their equity holdings into the Combined Company and are expected to hold approximately 72% of the issued and outstanding equity of the Combined Company immediately following the closing.
Net proceeds from the Business Combination will be used to further capitalize Pear’s category-leading position by investing in commercialization of Pear’s three FDA-authorized products, advancing Pear’s pipeline, and scaling its end-to-end platform.
The Combined Company’s board of directors will be initially comprised of seven directors, including four of Pear’s current directors plus one director designated by Thimble Point Acquisition Corp. Thimble Point’s designee is Jorge Gomez, the current CFO at Dentsply Sirona, the world’s largest manufacturer of professional dental products and technologies, and former CFO at Cardinal Health, one of the largest distributors of pharmaceuticals, a global manufacturer and distributor of medical and laboratory products, and a provider of performance and data solutions for healthcare facilities.
The Business Combination was unanimously approved by each of Thimble Point’s Board of Directors and Pear’s Board of Directors, and is expected to be completed in the second half of 2021. The Business Combination will be subject to approval by Thimble Point’s shareholders and satisfaction or the waiver of the closing conditions identified in the Business Combination Agreement.
Advisors
BofA Securities and Citi are acting as financial advisors to Pear and placement agents on the PIPE Transaction. BTIG and Chardan are serving as co-advisors. Citi and Cowen are serving as a capital markets advisors to Pear. Goodwin Procter LLP and Foley Hoag LLP are acting as legal advisors to Pear. Shearman & Sterling LLP is acting as legal advisor to the placement agents.
Credit Suisse is acting as financial advisor to Thimble Point. Sullivan & Cromwell LLP is acting as legal advisor to Thimble Point.
