Nashville-based health care virtual reality firm BehaVR has signed an agreement with a Japanese pharmaceutical company that could be worth as much as $140 million.
The deal, with Osaka-based Sumitomo Dainippon Pharma Co., is for the companies to develop and commercialize prescription digital therapies and general wellness products for the treatment of anxiety disorders, according to a news release.
Founded in 2016, BehaVR uses virtual reality, cloud computing and machine learning combined with neuroscience to develop treatments to help people make improvements to their health, in areas such as stress reduction, maternal health and addiction recovery. The company was founded by CEO Aaron Gani and counts former U.S. Senate Majority Leader Dr. Bill Frist as a board member and founding partner.
As part of the deal, Sumitomo Dainippon will pay BehaVR $5 million upfront and as much as $18 million to develop the virtual reality therapies, according to the release. Up to an additional $140 million in milestone payments could also be paid to BehaVR, continent upon commercial success. BehaVR will also, receive royalties on global sales of products on the market.
“In my opinion, Sumitomo Dainippon Pharma is one of the most forward thinking and innovative pharmaceutical companies in the world today,” Gani said in the release. “We are thrilled to deepen our relationship to jointly increase our impact on health via clinically validated, FDA-cleared Virtual Reality-based digital therapies. Sumitomo Dainippon Pharma’s clinical and commercial expertise in this space will advance our joint objective of successfully scaling effective treatment options for anxiety and depression.”
Founded in 1897, Sumitomo Dainippon is one of Japan’s largest pharmaceutical companies, with more than 3,000 employees and 516.0 billion yen (more than $4.5 billion) in revenue for the fiscal year ending March 31, according to the company’s website.
The deal builds on an initial June 2020 agreement between Sumitomo Dainippon and BehaVR to co-develop a wellness product for people with social anxiety, according to the release.
“This continued investment in our collaboration with BehaVR demonstrates Sumitomo Dainippon Pharma’s commitment to meet patients’ unmet behavioral health needs by developing digital therapies that go beyond pharmacological interventions. There is inadequate access to high quality mental health therapists in every country across the world. Our goal is to deliver high-impact digital VR therapies that are evidence-based to a broad global population of patients that continue to struggle with SAD, GAD, and MDD,” Hiroyuki Baba, Sumitomo Dainippon senior executive officer, said in the release. “We are excited and proud to be pioneering the use of this fast-moving new medium of Virtual Reality to develop treatments for anxiety and depression related mental illnesses. I could not be more pleased with this extension to our important partnership with BehaVR, who share our vision of the impact that these new products will make.”
