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A month after announcing it was seeking strategic alternatives, Akili Interactive, maker of a video game designed to treat ADHD, said it will go private in a merger with Virtual Therapeutics. The deal is expected to net Akili’s shareholders $34 million.

Akili made headlines in 2020 when it received Food and Drug Administration clearance for EndeavorRx, a video game designed to treat pediatric ADHD. Akili went public in 2022 in a deal that valued the company at about $1 billion. But despite several strategic pivots, including shifting to direct-to-consumer sales, the company failed to build a sustainable business model. Akili in April announced it would wind down its existing commercial operations and focus on a licensing deal with Japanese pharma company Shionogi while it figured out the best path forward.

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Akili is just one of many health tech companies that are struggling following an explosion of investor interest in digital health during the Covid-19 pandemic. In the last month alone, Better Therapeutics, another company making digital treatments, sold its assets for an undisclosed amount after failing to build a business around its app for type 2 diabetes, and Cue Health, a diagnostics startup, shut down after funding interest in its Covid-19 tests evaporated.

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