Zelda (ASX:ZLD) is preparing for a future in the US, signing a binding agreement with a US pot company to open up a market there.

The US heads of agreement, with Ilera Healthcare, will look at co-developing full spectrum products and putting them through clinical trials (‘full spectrum’ in cannabis refers to using the whole plant, rather than a synthetic version or a specific extract).

They will also discuss licensing “clinically validated” product and sharing joint intellectual property.

The deal is not a commercial arrangement. It doesn’t include any upfront payments but a commitment to negotiate separate commercial agreements for different products.

It doesn’t outline when any of these goodies might come to fruition.

The non-medication trade

The biotech initially set a commercialisation course via Germany, which legalised medical cannabis in March 2017, to sell products with clinical data behind them but which hadn’t been yet been registered as drugs.

Zelda managing director Dr Richard Hopkins says the deal could fast-track the path to commercialisation, but they’re still focused on the unregistered medical product route first not making registered medicines.

“If successful [in opioid addiction and insomnia trials], we will license the outcome of these Phase II trials to companies such as Ilera who will then sell these clinically-validated products in the unregistered products market,” he told Stockhead.

“By targeting the world’s largest markets for medicinal cannabis (eg the US, Germany – where the costs are fully reimbursable), the goal is to generate significant revenues in the short term, which will be used to support longer term goal of product registration.”

Validating US medical cannabis

Dr Hopkins said his company could help Ilera bypass the restrictions on cannabis clinical trials in the US, where the plant is still federally illegal.

“Zelda can help fast-track clinical validation of Ilera products while Zelda potentially gains access to a significant North American market for its products,” he said.

Zelda has a variety of trials on the boil, from pre-clinical research into breast, pancreatic and brain cancer to testing cannabidiol (CBD) on animals with diabetes.

Human clinical trials are under way or soon to be under way in insomnia, autism, and opioid reduction.

Mr Hopkins says Ilera is interested in the insomnia, opioid reduction and autism treatments, as well as a mouth spray they’re making with Suda Pharma (ASX:SUD).

Ilera, on the other hand, is based out of Pennsylvania and Louisiana. They grow and manufacture medicinal cannabis products, and are led by former pharmaceuticals executives from companies including GlaxoSmithKline and DuPont Merck.

Mouth sprays and dotcom bombs

The biotech also has a deal with Aussie viagra mouth spray-maker Suda to make a cannabis mouth spray, and HAPA Medical, the German company bought by tech-wreck 1-Page last year.

Zelda has given up one of its own to HAPA, with chairman Harry Karelis taking a step back from the day-to-day at the biotech to chair the German company.

Zelda has been contacted for comment

The company’s shares rose 3 per cent on Tuesday morning to 5.9c.

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