Akili Interactive received de novo FDA approval for a prescription video game for the treatment of pediatric ADHD in 2020, and launched publicly in 2022. After a series of financial losses and company restructuring, Virtual Therapeutics - a company offering virtual reality mental health solutions for the workplace - has offered $0.4340 per share, to the tune of $34 million. This will make Akili a wholly owned subsidiary of Virtual Therapeutics

Why it’s notable:

• Though it launched with an approximate $1 billion valuation, Akili Interactive posted revenue of $538,000 in 2021, a mixture of $186,000 from EndeavorRx plus income from a collaboration with Japanese pharmaceutical company Shionogi. This income sank 40% to $323,000 in 2022 following public launch, which was entirely made up of EndeavorRx sales. In 2023, losses led to laying off over 46% of their staff, and a move away from the prescription-only model, launching EndeavorOTC in June for adults at a cost of $129.99 per year. Nevertheless, after over 30 days of shares closing under $1, Akili received a delisting notice from the NASDAQ in October 2023.

• While Akili’s 2023 income rose to $1.7 million (70% from EndeavorOTC), quarterly income declined sharply once more. The company issued a statement that due to reduced advertising expenditure for EndeavorOTC, Q1 income for 2024 was $383,000 as opposed to $749,000 in Q4 of 2023. They announced in April that they were seeking other strategic options for their business. Virtual Therapeutics’ reported offer of $34 million comes in at a 4% premium on Akili’s closing share price, and will lead to Akili becoming a wholly owned subsidiary, and no longer publicly traded.

• Virtual Therapeutics, a relatively unknown private company, specializes in virtual reality games designed for workplace meditation and anxiety reduction. Led by CEO Dan Elenbaas, who has a rich background in game development (KnowWonder, Amaze Entertainment), the company brings a strong portfolio of VR-based mental health solutions. By combining Akili’s expertise in developing and deploying rigorously validated mobile digital therapeutics with Virtual Therapeutics’ gaming and VR capabilities, the merger aims to create a powerful platform to address various high-impact mental health needs.

• Virtual Therapeutics (VT) became majority-owned by UnitedHealth Group (UHG) after UHG acquired Savvysherpa, a consulting and investment firm focused on innovative healthcare business concepts, in 2020. By 2023, UHG-affiliated companies owned approximately 84% of VT's shares. However, UHG reportedly divested its shares late in 2023, selling them back to the company. Despite the strategic narrative, the merger's potential to address Akili's financial and operational challenges remains uncertain, particularly in light of Akili's recent layoffs, restructuring, and UHG's divestment from Virtual Therapeutics.

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