Pear Therapeutics, the developer of Somryst for the treatment of chronic insomnia, has filed for Chapter 11 bankruptcy. The company intends to pursue a sale of the business or assets under section 363 of the US Bankruptcy Code.
Pear is not accepting new prescriptions for its products—Somryst, reSET, and reSET-O—nor will refills be dispensed at this time, according to a statement on the company’s website. “We will attempt to keep our products available for patients who are already using the products for the duration of the current fill of their prescription, but there can be no assurance that we will be able to do so,” reads the statement.
Prior to the filing, Pear evaluated strategic alternatives and reduced operating expenses, according to a press release from the company. With the protections afforded by the US Bankruptcy Code, Pear intends to continue marketing efforts to potential purchasers interested in specific assets, as well as continuing to seek a sale of the business. Any of those sales would be subject to review and approval by the US Bankruptcy Court and compliance with bidding procedures to be approved by the US Bankruptcy Court for the District of Delaware.
Pear plans to continue scaled-down operations during the Chapter 11 as it seeks to execute an expedited sale process. Having reached a settlement prior to the filing with its lender, Pear intends to use available cash to fund post-petition operations and costs in the ordinary course of its business.
Pear also intends to file various “first-day” motions with the US Bankruptcy Court requesting customary relief that will enable it to transition into Chapter 11 without material disruption to its ordinary course operations. Such motions are typical in the Chapter 11 process, and Pear anticipates the company will be heard in the first few days of its Chapter 11 cases.
Pear is represented by Foley Hoag LLP as counsel, Gibbons PC as co-counsel, Sonoran Capital Advisors as restructuring advisor, and MTS Health Partners, LP as restructuring investment banker.