FSD Pharma Inc. (OTC: FSDDF), a Canada-based licensed producer of marijuana, reached an agreement to acquire nano-cap company Therapix Biosciences ADR (NASDAQ: TRPX), an Israel-based specialty clinical-stage pharmaceutical company with a focus on cannabinoid pharmaceuticals.
What Happened
Therapix Biosciences investors will receive $48 million worth of FSD Pharma stock. The companies said in a joint press release the merger is intended to:
Why It's Important
The merger represents a "pivotal step" in the evolution of FSD Pharma's business as it's shifting from a direct to consumer retail cannabis company to develop cannabinoid-based treatments for several central nervous system disorders, said Dr. Raza Bokhari, Director of FSD Pharma.
Prof. Raphael Mechoulam, chairman of Therapix Scientific and dubbed the "Godfather of Medicinal Cannabis" said, "I hope this proposed transaction will help unlock the full potential of the endocannabinoid system within the human body in enhancing quality of life and improving treatment outcomes."
Reuters noted Therapix in April announced positive results from a mid-stage trial of its cannabinoid-based drug to treat Tourette syndrome.
What's Next
The transaction is expected to close by the first quarter of 2019, but remains subject to standard customary conditions, including regulatory approvals and a vote among Therapix investors. Upon completion, FSD intends to continue listing its stock on the Canadian Securities Exchange and Frankfurt Stock Exchange but also plans on applying to list on the Nasdaq exchange.
Therapix's stock was up 46 percent to $7.25 in Tuesday's pre-market session.
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