Canada’s FSD Pharma Inc (CSE:HUGE, OTCMKTS:FSDDF) signed a letter of intent (LOI) Wednesday to acquire Therapix Biosciences Ltd (NASDAQ:TRPX), an Israeli clinical-stage pharma company focusing on the development of cannabinoid-based treatments, for approximately $48 million in stock.
The shareholders of Therapix will receive FSD stock upon closing of the transaction. The letter of intent will be superseded by a definitive agreement, which the companies intend to execute within 30 days. The deal is expected to be completed by the first quarter.
Investors sent Therapix stock up 11.1% to $6 in premarket trade Wednesday, while FSD Pharma closed 16.08% higher to $0.43 on Tuesday.
"We are excited to join FSD Pharma to be part of one of the fastest growing, most forward-thinking companies in this sector," said Therapix chairman Ascher Shmulewitz. "Our combined resources and highly competent scientific and business leadership teams, position the combined entity well to execute upon our shared vision to deliver groundbreaking, proprietary cannabinoid platform technologies to both the professional and retail markets globally. As a result, we have suspended all negotiations with Cure Pharmaceutical Holding Corp."
Therapix in April announced positive results from a mid-stage trial of its cannabinoid-based drug to treat Tourette syndrome, a nervous system disorder involving repetitive movements or unwanted sounds.
Raza Bokhari, Director of FSD Pharma and Chairman of the M&A committee saw the intended acquisition of Therapix Biosciences as a “pivotal step” in the evolution of the company by entering the “high-value medical cannabis market."
"With this acquisition, FSD Pharma is signaling our commitment to furthering very high-value pharmaceutical R&D clinical programs centered on cannabinoid molecules,” said Bokhari.
FSD Pharma through its wholly-owned subsidiary FV Pharma, is a licensed producer of marijuana under the Access to Cannabis for Medical Purposes Regulations. The company is based in Cobourg, Ontario.
Contact Uttara Choudhury at [email protected]