Jazz Pharmaceuticals’ planned $7.2 billion takeover of United Kingdom-based GW Pharmaceuticals could kick a wave off of deal-making between pharma and medical cannabis businesses, analysts and industry sources state.
But in place of all cannabis manufacturers benefiting, just organizations which have marketable property that is intellectual an established foothold in the medical cannabinoid arena will draw serious interest.
In the case of GW, for example, Ireland-based Jazz was attracted to the British company’s cannabis-based epilepsy medicine, Epidiolex.
“In The term that is short you’re likely likely to see numerous LPs benefiting from GW’s news, whenever in fact it has little, if any, effect on a lot of them, unless they’ve deep expertise in R&D, plant genetics and medical trials,” David Kideckel, an analyst for Alberta-based ATB Capital Markets, told Marijuana Business frequent.
“There are going to be upside that is much however, for specific companies playing in GW’s wheelhouse.”
Kideckel highlighted New Brunswick-based Organigram and biosynthetic player Hyasynth Biologicals to its partnership, Ontario-based Cardiol Therapeutics and Alberta-headquartered Willow Biosciences as three types of the type of businesses which may draw some interest.
Kideckel, whom covers GW for ATB, views the Jazz deal as a validation of kinds for the drugmaker that is u.K.-based
“This is a clear testament to what GW has done, and we think it will transform the industry over time,” he said.
“We Know pharma companies are already engaged, but very few of them will say so publicly.*) that is”(While its well-capitalized Canadian peers paid significant premiums for greenhouses, GW ended up being money that is pouring research and development for its pipeline of cannabinoid-based medicines.
GW spent approximately $560 million on R&D between 2017 and 2020, financial statements show.
R&D Accounts for the portion that is biggest of its workers; 278 associated with the company’s 901 employees are involved in R&D. The category that is next-biggest commercial, or sales.
GW has leased, not purchased, three cultivation facilities in the U.K. measuring 1.9 million feet that are square 900,000 square foot and 330,000 square legs.
“Just What this does is it validates the science that is cannabinoid-based mid- to large-cap pharma, so I think this could open the floodgates to other unique deals,” Kideckel said.
He warned that only cannabis that are certain stay to gain.
“GW is in a global on it’s own. Even though there aren’t other programs that perform like GW, just what it will is it lends credibility towards the industry of cannabis for pharma,” Kideckel said.
“It took GW two decades to be GW. Rightfully or wrongfully, plenty of cannabis names will play away from GW’s news that is positive think it benefits them positively.
“But from a perspective that is fundamental we don’t begin to see the synergies that GW will provide towards the general industry using the exceptions of a couple of particular names.”
He sees potential for collaborations or joint ventures between pharma companies and cannabis businesses with the mix that is right of.
“i believe much more companies that are pharma move into the space. We’ve got an opioid crisis raging, but it really hasn’t moved they have gotten stronger as the space has evolved because it requires medical oversight,” Weisbrod told
“There are companies in Canada that have remarkable capabilities to do that, and. Those businesses will stick out and then go internationally as API (active ingredient that is pharmaceutical manufacturers, potentially (joint venturing) with pharma companies.”
The GW-Jazz deal is “a validation of cannabinoid therapy,” Weisbrod said, “but it also sends a message that it, you have to go down that road (proving clinical efficacy) – that’s the right way to do it.
“Jazz if you want to get doctors to prescribe demonstrably sees that and GW has demonstrated just how to do it.”
Paul Pedersen, CEO of British Columbia extractor Nextleaf Possibilities, stated pharma is throwing the tires, but there is however a gap that is huge intense curiosity and active investment.
“Pharmaceutical firms engaging in due diligence with Nextleaf are mature in their approach and are taking a approach that is measured the cannabinoid market,” he stated.
Pedersen thinks the GW purchase will spur more interest from pharma, though he included that“pharma does care about growing n’t plants.”“What pharma cares about specifically is standardized molecules and products that can be taken to market; what GW has done is a example that is perfect” he said.Intellectual propertyZyus Life Sciences, an organization located in Saskatchewan, is purchasing medical research, medical studies and process that is advanced.
“We’re building the company around intellectual property that, once secured, affords the company to make investments in the step that is next which will be the info you need to create from preclinical and medical trials, ”
- CEO Brent Zettl told
- Marijuana Business frequent
Zettl stated pharma is after three primary things, including:
U.S. or European Union-Good Manufacturing Practice.
An internet protocol address profile.
Preclinical and data that are clinical
“You look at GW, one of the things they did successfully is they spent north of $100 million a on trials year. That’s just what generated the info,” he said.
“There ended up being a good investment which has become done.”
Other organizations are collecting property that is intellectual biosynthesis, and those with active pharmaceutical ingredient expertise might see further interest from pharma, industry sources say.
“Several of the Canadian LPs, even though they’ve misspent cash over the years, I would argue that their plant genetics go much deeper,” analyst Kideckel said.
Organigram is involved in biosynthesis via its investment in Hyasynth Biologicals, a private biotechnology company in the field of cannabinoid science and biosynthesis.
Cronos Group, a Toronto company, has a partnership with Ginkgo Bioworks in Boston to produce cannabinoids that are cultured
The big concern
The medical markets in Canada, america and Europe are developing in various means, which is challenging professionals to generate business that is adaptable.In Europe, and in most markets outside North America, medical cannabis is distributed in pharmacies. In Canada, however, pharmacy sales remain out of bounds, and most products have to directly be shipped through the producer towards the client.Beyond Distribution, standardization and efficacy play a much bigger role outside North America than they currently do in Canada.
British Columbia-based Tilray was perhaps the first cannabis producer to strike an alliance with a pharma company, Quebec-based Sandoz Canada, in 2018.
“The big question I’m asking myself is, two or three years from now, will the cannabis that are medical within the U.S. look a lot more like European countries or higher like Canada?” Tilray CEO Brendan Kennedy told MJBizDaily.[email protected]“I don’t have actually the clear answer, but I’m obtaining the inkling it could look a bit that is little like Canada than most people are assuming.”
Matt Lamers is (*)Marijuana Business Daily(*)’s worldwide editor, based near Toronto. They can be reached at (*).(*)