Pear Therapeutics: The Billion-Dollar Lesson in VBC Reimbursement

The cautionary tale of Pear Therapeutics, once a darling of the digital therapeutics (DTx) space, serves as a stark reminder for investors and health plan executives alike: innovation, even when FDA-cleared, does not automatically translate into sustainable value-based care (VBC) reimbursement. Its collapse, despite pioneering FDA De Novo clearances for prescription digital therapeutics, illuminates critical gaps in the pathway from regulatory approval to widespread payer adoption and financial viability within a value-based framework.

The Unraveling of a Pioneer

Pear Therapeutics’ journey from a venture-backed startup to bankruptcy liquidation is a case study in the perils of misaligned incentives and an underdeveloped reimbursement infrastructure. The company filed for Chapter 11 bankruptcy in April 2023, and its assets were sold at auction in May 2023. Pear achieved significant regulatory milestones, including FDA De Novo classification for reSET and reSET-O for substance use disorder, and Somryst for chronic insomnia. These were groundbreaking achievements, establishing the category of prescription digital therapeutics. Yet, despite these regulatory successes, Pear struggled immensely with commercialization. The core issue, as highlighted by the relationship claim “Pear FDA-cleared but no VBC pathway,” was the profound disconnect between regulatory validation and established mechanisms for reimbursement, particularly within value-based care models. Other prominent DTx companies like Omada Health, Big Health, Akili Interactive, and Click Therapeutics have also navigated this challenging landscape, each confronting varying degrees of success and similar hurdles in securing consistent and scalable payer coverage. Akili Interactive, for instance, was acquired by Virtual Therapeutics in 2024 and delisted, shifting its business model. Big Health, however, secured new funding in February 2026 for its FDA-cleared and Medicare-reimbursable solutions, SleepioRx and DaylightRx. Omada Health has seen positive analyst ratings and listed publicly, ending a digital health IPO drought. Click Therapeutics raised a Series D round in April 2026 and launched Rejoyn, an FDA-cleared DTx for major depressive disorder. The DTx reimbursement failure became a systemic risk, impacting investor confidence across the sector.

Root Causes: Regulatory Milestones vs. Reimbursement Realities

The fundamental challenge for Pear and many of its peers stemmed from the nascent nature of DTx reimbursement. While the FDA provided a pathway for novel digital interventions through processes like De Novo classification, CMS Reimbursement Rules and the broader payer ecosystem lagged significantly. However, this landscape has evolved. In 2025, CMS introduced Digital Mental Health Treatment (DMHT) codes, allowing clinicians to bill for regulated, software-delivered mental health treatment under clinical supervision, marking the first formal Medicare reimbursement pathway specifically for digital therapeutics. Furthermore, the CPT 2026 code set, effective January 1, 2026, includes 288 new codes that reflect advancements in digital health, offering more granular options for reporting these services. For Calendar Year 2026, CMS expanded payment policies for DMHT to include DTx for ADHD, and is exploring coverage for other digital therapy devices. This created a scenario where a product could be proven safe and effective through rigorous clinical trials, earning FDA clearance, but lack a clear, consistent, and remunerative path to market. The absence of robust, outcomes-based payment models for DTx meant that even when products demonstrated clinical efficacy, translating that into quantifiable financial performance that payers would readily reimburse under VBC arrangements was exceptionally difficult. Rock Health’s analyses consistently pointed to reimbursement as a primary hurdle for digital health innovation, a sentiment echoed by the challenges faced by companies like Akili Interactive and Click Therapeutics in securing broad payer adoption for their FDA-cleared products. The SEC filings of publicly traded digital health companies further underscored these commercialization struggles, revealing significant cash burn rates against often modest revenue growth.

Expert Perspectives on the DTx Dilemma

The struggles within digital therapeutics were not unforeseen by industry veterans. Vinod Khosla, a prominent venture capitalist, has often emphasized that technology alone is insufficient; it must integrate seamlessly into existing workflows and demonstrate clear economic value to achieve widespread adoption in healthcare. For DTx, this meant not just clinical efficacy, but also demonstrable cost reduction or improved outcomes that payers could readily measure and pay for. Similarly, Dr. Eric Topol has consistently championed the potential of digital health to transform medicine but has also cautioned that meaningful integration requires overcoming systemic inertia and proving tangible, patient-centric benefits that justify new payment structures Eric Topol’s commentary on digital health adoption. The Pear experience illustrates that while the clinical promise was there, the economic argument, particularly within a VBC framework demanding clear outcomes data and cost savings, was not sufficiently compelling or standardized for rapid uptake. The lack of a clear, codified pathway for outcomes-based contracting for digital tools proved to be a critical flaw.

Implications for Investors, VCs, and Health Plans

The implosion of Pear Therapeutics offers critical lessons. For Investors and VCs, it underscores that FDA clearance, while a necessary de-risking step, is far from sufficient. Due diligence must extend deeply into the reimbursement landscape, scrutinizing not just clinical evidence but also the specific CPT codes, payer coverage policies, and the demonstrable financial performance under various payment models. The relationship “DTx reimbursement failure = systemic risk” is a stark warning: the absence of a standardized, value-based reimbursement pathway for digital therapeutics creates significant market uncertainty. Health Plan Executives must recognize that simply having an FDA-cleared digital solution does not automatically qualify it for value-based contracts. The onus remains on the solution provider to present compelling, peer-reviewed outcomes data that clearly articulates cost reduction, improved health outcomes, and measurable financial performance. This requires a shift from traditional fee-for-service thinking to demanding robust evidence of value, aligning with the core mission of value-based care. Without transparent, verifiable outcomes data demonstrating tangible savings or superior health improvements, even the most innovative digital tools, like those from Omada Health or Big Health, will struggle to secure long-term, scalable reimbursement within VBC arrangements Health Affairs analysis of digital health reimbursement. The Pear saga is a forceful reminder that in value-based care, outcomes and their financial implications are paramount, and solutions without clear, published evidence of both will struggle to survive.