Tech-enabled hearing aid companies Eargo and hearX have announced their merger to form LXE Hearing, a new entity that has secured $100 million in financing from Patient Square Capital. The merger combines Eargo's direct-to-consumer hearing aid business with hearX's digital mobile technologies for hearing loss detection and diagnosis.

The newly formed company is positioning itself as the "first notable combination for the over-the-counter (OTC) hearing aid market" since the FDA established this regulatory category in 2022, opening up new pathways for hearing aid distribution without requiring medical prescriptions.

Leadership of LXE Hearing will be headed by Nic Klopper, CEO and cofounder of hearX, who has been appointed CEO of the new venture. Bill Brownie, previously COO and interim CEO of Eargo, will serve as COO of LXE Hearing. The company will maintain both established consumer hearing aid brands—Eargo and Lexie Hearing—under its corporate umbrella.

"The merger between Lexie and Eargo is founded on our shared mission to create hearing health solutions for everyone, everywhere," Klopper said in a statement. "Eargo's cutting-edge design, emphasis on clinical quality and customer-first approach to service perfectly complement hearX's suite of Bose-powered products and its award-winning mobile app. Together, we are going to revolutionize hearing aids and hearing health."

Brownie emphasized the complementary nature of the merger, stating, "The combination of our experience, talent and technology will make hearing health solutions more accessible and affordable for the estimated 44 million American adults who experience hearing loss."

This merger builds on Patient Square Capital's previous investment in Eargo. In 2022, Patient Square Capital became the majority owner of Eargo, holding nearly 76.3% of Eargo stock through the conversion of senior secured convertible notes. That offering generated approximately $32.3 million, including a $5.5 million investment from Patient Square.

The same year, Eargo launched its sixth-generation hearing aid featuring "mask mode," designed to address communication challenges when speaking with masked individuals. The device was priced at $2,950.

The hearing aid market has seen increasing innovation and competition in recent years. Soundwave Hearing received FDA 510(k) clearance in 2023 for its Sontro Self-Fitting OTC Hearing Aids, which incorporate mobile technology and artificial intelligence calibration capabilities for individuals with mild to moderate perceived hearing impairment.

Additionally, Apple entered the hearing health space last year after receiving FDA clearance for over-the-counter hearing aid software embedded in its AirPods Pro headphones, further expanding consumer options in this growing market segment.

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