MGC Pharma acquires clinical trials research company MediCaNL
Health & Biotech
Health & Biotech
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Medicinal cannabis company MGC Pharmaceuticals (ASX:MXC) is expanding its business with the acquisition of worldwide pharmaceutical clinical research company MediCanNL for about $6m.
The Israel-based research company will design, manage and run all of MGC Pharma’s clinical trials for its cannabinoid medical treatments in line with European, Israeli and US health regulations.
“The acquisition of MediCaNL is a strategically important moment and is crucial in being able to deliver on our ambitious plans for MGC Pharma,” company co-founder and managing director, Roby Zomer, said.
By incorporating the clinical research company into its business, MGC Pharma will be able to speed up the process of bringing new cannabinoid medicines and products to the market.
MediCaNL will become an integral business unit of MGC Pharma, delivering significant and immediate cost savings as it eliminates the need to pay third party clinical research organisations.
“By acquiring MediCaNL and bringing their services and expertise in house, we not only cut significant costs from our forecasted clinical trial expenditure but also remove much of the red tape involved in the preclinical and clinical trial process,” said Zomer.
The transaction terms include a payment of $6m in MGC Pharma shares, with 30 per cent paid on the settlement of the deal, and the remaining 70 per cent payable in instalments.
MGC Pharma’s $6m equity consideration in the deal is based on its volume weighted share price over a 10-day period from settlement.
MGC Pharma is undertaking multiple clinical trials for its cannabinoid products in 2021 including two Phase I and II trials and one Phase III trial for its CannEpil, CogniCann and CimetrA treatments.
“MediCaNL is led by some of the world’s most renowned doctors and scientists who will be a great asset to the MGC Pharma team,” said Zomer.
The clinical research company has 11 clients, excluding MGC Pharma, and 40 ongoing projects including seven investigational new products with two approved by the Federal Drug Administration.
“The operate at the highest levels of quality and integrity, enabling MGC Pharma to establish and nurture stronger relationships with regulators in the years to come as we expand our suite of products and undergo more clinical trials,” added Zomer.
MediCaNL chief executive, Dr Nadya Lisodover, has been working with MGC Pharma for the past two years, guiding its clinical trials and as a consultant to the company on regulatory matters.
Dr Lisodover will become MGC Pharma’s chief research officer to work full time on its clinical trials to streamline processes and improve their cost effectiveness.
The acquisition provides MGC Pharma with a number of significant advantages such as reducing lead times for pre-clinical research, allowing it to better define clinical trial protocols and to build stronger relationships with regulators.
By increasing its throughput capability for medicines, and making clinical trial performance and design an in-house activity, the acquisition will deliver a host of advantages and cost savings.
MediCaNL generated revenue of $1m in 2020 and the business has a profit margin of 25 per cent.
The company is based in Israel and provides specialist services to the pharmaceutical sector for the development of new medicines including the provision of pre-clinical and clinical trial services.
It has 18 years of expertise in handling clinical trials and research management and research data from past studies of Phase I to IV clinical trials using a variety of treatment methods.
All of the trials MediCaNL will carry out for MGC Pharma will be to the most rigorous clinical standards in accordance with the European Medicines Agency, US Federal Drug Administration, ICH Good Clinical Practice, and Israeli health regulations.
MGC Pharma recently entered a three-year deal with Swiss PharmaCan for the worldwide distribution of its cannabis-based anti-inflammatory product that can be used to treat COVID-19.
CannEpil is a treatment for epilepsy in children and adolescents, while CogniCann is a treatment for dementia and Alzheimer’s disease, and CimetrA is a treatment to offset the cytokine reaction in patients including those with COVID-19.
In February, MGC Pharma launched a new clinical study into its proprietary nano-delivery system to treat glioblastoma, an aggressive form of brain cancer.