Better Therapeutics (Nasdaq:BTTX) announced today that it is terminating its employees and will explore strategic alternatives.
Among those alternatives, the company could consider assignment for the benefit of creditors and/or a wind-down of the company. The San Francisco-based digital therapeutics maker came to the decision at a special meeting of its board on March 13.
It faces a similar fate to fellow digital therapeutic maker Pear Therapeutics, which scaled down operations after filing bankruptcy last year.
Better Therapeutics previously faced delisting from the Nasdaq market unless it regained compliance before a hearings panel. It now voluntarily requests the delisting and expects that to occur in the near term.
The decision to shut up shop follows an up-and-down stretch for the company, which managed multiple regulatory milestones recently. Its AspyreRx offering became the first cognitive behavioral therapy (CBT) to receive FDA authorization for treating type 2 diabetes in July. Just last month, the company won FDA breakthrough device designation for its liver disease-treating digital therapeutic.
However, there have been a number of setbacks as well. Just under a year ago, Better Therapeutics announced that it commenced a workforce reduction of approximately 35% of its employees. At the time, CEO Frank Karbe said the move set the company up to extend its cash runway and push toward regulatory milestones.
Karbe went on to say that the company reached a “critical moment” in its evolution ahead of those regulatory nods that did arrive in the end. With challenges spanning the industry, Karbe and the company felt they had to enact the layoffs.
“As we navigate volatility and uncertainty in the markets, it has become clear that we need to take action to preserve our cash runway,” he wrote.