Toronto-based Greenbrook TMS Inc. (Nasdaq: GBNH), once considered a pioneer in transcranial magnetic stimulation (TMS) therapy, is officially off the Nasdaq Stock Market amid ongoing financial troubles. On Friday, the mental health services provider, grappling with Greenbrook TMS financial troubles, announced that it had received a final delisting notice, effective as of the opening of trading on February 26. The company opted not to appeal the decision, stating in a press release that doing so was not in its best interest.
This development marks a significant milestone in a series of escalating Greenbrook TMS financial troubles that have plagued the company over the last two years. Once operating nearly 183 clinics across the United States and employing more than 850 staff, Greenbrook’s fall from grace underscores how difficult it is to scale a business built solely on intervention-based psychiatric care.
A Quick Descent: From Expansion to Retrenchment
The roots of Greenbrook TMS financial troubles can be traced back to May 2022, when the company acquired a competitor that added nearly 50 locations to its portfolio. This acquisition seemed promising at the time, but the financial strain quickly became apparent. By March 2023, Greenbrook implemented a restructuring plan aimed at achieving sustainable profitability—a move that was too little, too late.
Throughout 2023, the company began trimming operations by closing underperforming clinics and cutting staff. According to financial disclosures, the workforce shrank to 699 employees, and the number of clinics dropped to 150 by September 30, 2023. More recent updates suggest that the current clinic count stands at just 122, a nearly 33% decline from its peak.
Despite these efforts, Greenbrook TMS financial troubles only deepened. The company has racked up mounting losses over the years, posting a $62.4 million loss in 2022—more than double the $30.4 million loss reported in 2020. In the first nine months of 2023 alone, Greenbrook lost $34.2 million.
Nasdaq Violations and Delisting
The final delisting was the result of two major violations: Greenbrook’s share price fell below $1, and its market capitalization dropped under $35 million for 30 consecutive trading days. The company had until November 13, 2023, to remedy these issues but failed to do so. On February 26, 2024, trading of Greenbrook’s shares was officially suspended.
As of the last trading day, Greenbrook’s shares were priced at just $0.13—reflective of investor confidence eroded by ongoing Greenbrook TMS financial troubles.
Structural and Industry-Wide Challenges
Greenbrook’s downfall can’t be chalked up to internal missteps alone. The company’s business model, which depends heavily on psychiatric interventions like TMS and Spravato, is inherently vulnerable. Dr. Owen Muir, founder of Fermata and an expert in TMS, noted that the lack of recurring revenue and the absence of long-term patient relationships make profitability a steep hill to climb.
Unlike other mental health providers that offer a continuum of care, Greenbrook’s model is almost entirely referral-driven. According to company documents, it relies heavily on clinicians to send patients for treatment, which means Greenbrook doesn’t maintain consistent, ongoing relationships with its clients. This makes it harder to achieve stable revenue per site—especially when factoring in payer reluctance to reimburse TMS services without stringent prior authorizations.
“The financials don’t work because the payers don’t want to pay for a thing like that because it’s either really expensive or not expensive enough, depending on the payer,” Muir said, summarizing the economic tightrope these clinics must walk.
Debt and Operational Costs Add Pressure
Further complicating the situation, Greenbrook borrowed extensively to finance equipment and operations. Notably, the company took out loans from Neuronetics Inc. (Nasdaq: STIM), the manufacturer of TMS devices. These devices come with their own cost pressures—each use incurs a fee of about $70, adding yet another layer to Greenbrook’s already bloated cost structure.
Spravato treatments, while promising in theory, introduced additional operational hurdles. The protocol requires patients to remain in the clinic under observation for two hours, limiting the number of patients that can be seen each day. These space and staffing requirements further eroded potential profit margins and contributed to ongoing Greenbrook TMS financial troubles.
A Pioneer in an Unforgiving Market
Founded in 2011, Greenbrook was one of the earliest and most aggressive players in the interventional psychiatry space. It helped normalize the use of TMS and ketamine-based treatments in mainstream outpatient care. However, innovation alone couldn’t shield it from harsh financial realities.
While the need for effective mental health interventions continues to rise, the economics of running a standalone TMS business remain shaky. Many payers are still hesitant to fully embrace coverage for TMS or ketamine-based treatments, often citing limited long-term data and high treatment costs.
This has created a paradox: demand for the service exists, but reimbursement pathways are too uncertain to build a scalable business on. Greenbrook’s experience is a cautionary tale of what happens when clinical innovation outpaces market readiness.
What Comes Next?
For now, Greenbrook TMS shares will likely move to over-the-counter (OTC) markets, though the company has not specified a timeline. Delisting from Nasdaq doesn’t mean the business will vanish overnight, but it does limit access to new capital and investor confidence—two things Greenbrook sorely needs.
Unless the company can radically restructure or secure new funding, Greenbrook TMS financial troubles may continue to deepen. The clinic closures, layoffs, and shrinking presence suggest that survival, not growth, is now the main goal.
Ultimately, the saga of Greenbrook TMS highlights the fragile economics of mental health innovation in the U.S. Without stable reimbursement structures and a diversified service model, even clinically effective treatments may not be enough to sustain long-term business viability.
For industry observers, Greenbrook serves as both a pioneer and a warning—a company that saw the future of mental health care but couldn’t build a financial model sturdy enough to support it.
