It’s less than a month into the new year and the first major digital health SPAC merger of 2022 has arrived. Digital therapeutic company Akili Interactive announced plans to go public in a merger with Social Capital Suvretta Holdings Corp, a SPAC run by high profile venture capitalist Chamath Palihapitiya.
The transaction values Akili at approximately $1B and is structured to provide over $400M in new capital after it closes in mid-2022, after which the company will be listed on the Nasdaq under the ticker symbol AKLI.
- Akili develops video games designed to address cognitive impairments in patients. The games actively adapt to each player’s abilities to deliver individualized regimens for building attention control.
- EndeavorRx is the company’s flagship product targeted at treating ADHD in children by requiring them to manage multiple tasks simultaneously while navigating a character through complex levels. It became the first FDA approved video game in June 2020.
- The proceeds from the merger will support the commercial launch of EndeavorRx later this year and help to expand Akili’s digital therapeutic pipeline to other cognitive impairments such as depression, autism spectrum disorder, and multiple sclerosis.
Industry Impact
SPAC enthusiasm is clearly alive and well, often chosen for the structure’s ability to take companies public quickly while avoiding much of the volatility associated with traditional IPOs. Last year saw a record 23 digital health companies go public, 8 through IPOs and 15 through SPAC mergers, including another DTx-developer Pear Therapeutics.
Prior to its public listing, Akili raised $301M in funding while projecting that the US market for its ADHD solution could generate $500M by 2030, a potentially rosy forecast given that EndeavorRx has yet to be made commercially available.
The public markets have not been very kind to pre-revenue healthcare companies so far this year, but the FDA and investors both seem to agree that Akili’s fresh approach to video game-styled therapeutics offers significant potential.
