Greenfern Eyes FDA-approved Cannabinoid Medicine Opportunity As Part Of Multi Deal

Patients in New Zealand, Australia and the Pacific Islands could soon have access to Syndros, one of only four Food and Drug Administration-approved (FDA) cannabinoid medicines.

Greenfern Industries (GFI) is looking to expand its pharmaceutical offering by considering a number of major international deals that would in part provide a pathway to a Schedule 3, over-the-counter registration using a novel cannabinoid medicine for its subsidiary, GFI Pharma. The deals would also provide authorisation for GFI Pharma to distribute Syndros.

Syndros is liquid cannabinoid for adults that is used to treat cancer patients who suffer from chemotherapy-induced nausea and vomiting, and to treat loss of appetite (anorexia) in people with AIDS who have lost weight.

On August 26, GFI entered into a non-binding term sheet with Australian-based Cannvalate which would see Cannvalate incorporate a new entity (“NewCo”). NewCo would then acquire the exclusive right and licence to distribute Syndros throughout New Zealand, Australia and the Pacific Islands. GFI would then acquire NewCo subject to conditions, including that GFI obtains regulatory and shareholder approvals.

GFI managing director Dan Casey said cannabinoid medicines are useful treatments for a wide variety of indications including pain, anxiety, and insomnia.

“Syndros is widely used in North America and is one of the few cannabinoid-based drugs that are approved by the FDA. Given the stringent and laborious process of having a drug approved with the FDA, there’s extensive data that can be used for GFI to pursue a similar authority with the Therapeutic Goods Administration (TGA) in Australia and Medsafe in New Zealand. GFI have performed extensive due diligence on this opportunity and the company recognises this as a significant opportunity.”

Should the deal go ahead, GFI will pay NZ$5m to Cannvalate in respect of the Syndros licence and distribution rights held by NewCo, either in cash and/or through the issue of new GFI shares.

NewCo would also acquire a perpetual licence of an Investigational Medicinal Product (“IMP”) that comes with a Drug Master File (DMF) and pre-clinical data from a United States-based small molecule active pharmaceutical ingredients (API) manufacturer.

Casey said the carefully selected sublingual (under the tongue) formulation would be used to support GFI’s Schedule 3 pursuits to have one of the first over-the-counter registered cannabidiol (“CBD") medications available to Australians that suffer with mild anxiety.

“The fact that we are able to expedite the process by acquiring full and finalised Phase 1 clinical data for a novel cannabinoid medicine will allow us to get to our first in-human trials substantially quicker and at less cost,” Casey says.

The cost to GFI of acquiring the licence (through the acquisition of NewCo) is NZD$1 million, which will be satisfied through the issue of new GFI shares.

The non-binding term sheet with Cannvalate also considers a separate but related transaction – that GFI will enter into a binding contract with Melbourne-based contract research organisation, iNGENu (a wholly owned subsidiary of Cannvalate).

iNGENu will assist GFI Pharma with the phase 2, schedule 3 clinical trial of the Investigational Medicinal Product (through the acquisition of NewCo) for anxiety.

The trial design has an additional arm to the trial which means that if clinical trials are successful and end points are met, GFI may also look to use the data to seek product approvals and registrations with the FDA, Medsafe in New Zealand, or other regulatory bodies.

The binding contract will be subject to acceptance of the clinical trial protocols by the TGA in Australia and to all other shareholder and regulatory approvals.

“It’s important that companies like GFI get behind clinical testing of cannabinoid medicines. It’s because of actual clinical data that doctors have the confidence to prescribe a medicine for a certain indication and knowing that the patient will get the required outcome,” Casey said.

GFI will pay for the services provided to GFI Pharma by iNGENu through the issue [to iNGENu] of GFI shares with a value of NZ$3million and a cash payment of NZ$2.3million. GFI will look to utilise the Australian government research and development rebates to satisfy some of the cash component. Currently a 43.5% rebate (45c in the dollar) is given for companies undertaking clinical research in Australia.

Casey said shareholders could expect to receive an update, including material terms of the arrangements, when the commercial agreement(s) have been finalised and during the course of seeking shareholder approvals.

Darryl Davies, a director of GFI, is also a director of iNGENu, and a director and shareholder of Cannvalate.

“This is a transitional period for Greenfern as we see it mature and expand from a ‘farmer’ to ‘Pharma’ aligned company. As we align ourselves with some large international companies operating in the cannabinoid and biotechnology space, it really shows a dedication to the number of strategic decisions and work that has been going on in the background over the last 10 months since listing on the NZX main board in October 2021.

“As we continue our focus on growing the highest quality medicinal cannabis here in New Zealand in a carbon net zero environment using renewable hydro power, we also understand the growth that can be attained with a successful pivot and bigger focus into the world of biotechnology,” Casey said.

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