InMed Pharmaceuticals Inc. (“InMed” or the
“Company”) (Nasdaq: INM), a clinical-stage company developing
cannabinoid-based pharmaceutical drug candidates as well as
manufacturing technologies for pharmaceutical-grade rare
cannabinoids, announced that it has entered into a
non-binding letter of intent (the "LOI") to
acquire BayMedica Inc. (“BayMedica”), a private company based in
Nevada and California that specializes in the manufacture and
commercialization of rare cannabinoids.
BayMedica is a revenue-stage biotechnology
company leveraging its significant expertise in synthetic biology
and pharmaceutical chemistry to develop efficient, scalable, and
proprietary manufacturing approaches to produce high quality,
regulatory-compliant rare cannabinoids for consumer applications.
BayMedica is currently commercializing the rare cannabinoid CBC
(cannabichromene) as a B2B supplier to distributors and
manufacturers marketing products in the health and wellness sector.
BayMedica is currently planning additional rare cannabinoid
launches for the coming year.
In addition to their manufacturing and
commercial activities in the health and wellness arena, BayMedica
is researching cannabinoid analogs as potential drug candidates for
pharmaceutical purposes. Those BayMedica proprietary compounds are
based upon the structures of naturally-occurring cannabinoids and
are designed to either augment the potential therapeutic effect
against specific diseases or enhance product safety, or both.
In November 2020, InMed and BayMedica entered
into a reciprocal Research Collaboration Agreement to explore
synergies between their respective technologies. BayMedica has been
assessing specific elements of InMed's proprietary
IntegraSyn™ approach for the production of cannabinoids. InMed
has initiated preclinical investigation of several compounds
selected from BayMedica's extensive library of proprietary
cannabinoid analogs designed to be developed to treat human
disease.
Eric A. Adams, President and Chief Executive
Officer of InMed, stated, “We are very excited about the prospect
of continuing to work with BayMedica and the potential to build a
leading rare cannabinoid company together. Since commencing our
collaboration in November last year, it has become apparent that
our complementary business models and capabilities have the
potential to provide a platform to expedite the growth of both
companies and provide the flexibility of multiple processes for the
manufacturing of rare cannabinoids. We believe that IntegraSyn™,
our pharmaceutical-grade manufacturing process, together with
BayMedica’s revenue generating, consumer-focused processes, would
create a powerful combination.” Adams continued, “The executive
team and employees at BayMedica would contribute decades of highly
relevant experience to InMed’s existing pharmaceutical-focused
team. Upon a successful closing of the proposed transaction, we
expect that the integration of the two teams, the numerous
manufacturing technologies, existing and planned revenues from bulk
cannabinoid sales, and fundamental pharmaceutical R&D
capabilities will position InMed at the forefront of the burgeoning
rare cannabinoid sector.”
Pursuant to the indicative terms of the LOI,
InMed and BayMedica intend to negotiate and enter into a definitive
agreement under which InMed would acquire 100% of BayMedica in
exchange for 1.6 million InMed common shares to be issued to
BayMedica’s equity and convertible debt holders with any such
issued InMed common shares being subject to a six-month contractual
hold period. The total number of InMed common shares issuable in
the proposed transaction may be reduced in the event that
BayMedica’s net liabilities exceed a negotiated threshold following
completion of a financial review of BayMedica’s closing balance
sheet. The LOI further provides that 25% of the InMed common shares
issuable on closing would be held in escrow, subject to
cancellation, to satisfy certain potential post-closing
indemnification claim(s) that InMed may have under the definitive
agreement in the six- and twelve-month period following closing of
the proposed transaction. In addition, BayMedica’s equity and debt
holders would receive Series A warrants to acquire up to 800,000
common shares of InMed priced at 125% of the 20-day volume weighted
average price of InMed’s common shares on closing of the proposed
transaction (the “Deal Share Price”) and Series B warrants to
acquire up to 800,000 common shares of InMed priced at 200% of the
Deal Share Price. Following the completion of satisfactory legal
and financial due diligence and the negotiation of comprehensive
mutually agreeable terms, InMed and BayMedica intend to enter into
a binding definitive agreement, and other ancillary agreements, for
the proposed transaction. Under the terms of the LOI, in addition
to completion of due diligence and negotiation of the definitive
transaction agreements, the closing of the proposed transaction
would be subject to the approval of InMed and BayMedica’s
respective boards of directors, the approval of BayMedica’s
securityholders, the receipt of all necessary third-party and
regulatory approvals, and certain other closing conditions.
Further particulars of the proposed transaction
will be provided upon InMed and BayMedica entering into a
definitive agreement for the transaction. The parties have entered
into a period of exclusivity in order to negotiate the proposed
transaction and definitive agreement. There can be no assurance
that a definitive agreement will be entered into or that the
proposed transaction will be consummated at all or on the terms
contemplated in the LOI.
About BayMedica: BayMedica Inc.
is a revenue-stage biotechnology company leveraging synthetic
biology and pharmaceutical chemistry to develop an efficient,
scalable, and proprietary platform to produce high quality, rare
cannabinoids for consumer applications and cannabinoid-derived new
chemical entities for pharmaceutical applications. For more
information, visit www.baymedica.com.
About InMed: InMed
Pharmaceuticals is a clinical-stage company developing a pipeline
of cannabinoid-based pharmaceutical drug candidates, initially
focused on the therapeutic benefits of cannabinol (“CBN”), and is
developing IntegraSyn™ to produce pharmaceutical-grade
cannabinoids. The Company is dedicated to delivering new
therapeutic alternatives to patients that may benefit from
cannabinoid-based pharmaceutical drugs. For more information,
visit www.inmedpharma.com.
Investor Contact: Colin ClancySenior Director,
Investor RelationsT: +1 604 416 0999E: cclancy@inmedpharma.com
Edison Group:Joe Green/Laine YonkerT:
+1.646.653.7030/+1.646.653.7035E: jgreen@edisongroup.com /
lyonker@edisongroup.com
Cautionary Note Regarding
Forward-Looking Information:This news release contains
"forward-looking information" and "forward-looking statements"
(collectively, "forward-looking information") within the meaning of
applicable securities laws. Forward-looking statements are
frequently, but not always, identified by words such as “expects”,
“anticipates”, “believes”, “intends”, “potential”, “possible”,
“would” and similar expressions. Such statements, based as they are
on current expectations of management, inherently involve numerous
risks, uncertainties and assumptions, known and unknown, many of
which are beyond our control”. Forward-looking information is based
on management's current expectations and beliefs and is subject to
a number of risks and uncertainties that could cause actual results
to differ materially from those described in the forward-looking
statements. Forward-looking information in this news release
includes statements about: BayMedica’s plans for further product
launches; statements regarding future revenues; the results and
potential benefits of the combination of InMed and BayMedica’s
business models and their future growth potential; the proposed
terms and conditions of any binding definitive agreement with
BayMedica and the receipt of all necessary approvals and
satisfaction of all closing conditions for the completion of the
transaction.
With respect to the forward-looking information
contained in this news release, InMed has made numerous assumptions
regarding, among other things: the proposed transaction with
BayMedica may not occur on the terms described in this news release
or at all; if the proposed transaction with BayMedica completes,
the results and potential of BayMedica’s business and the
combination of BayMedica’s business with InMed’s business may not
be as anticipated; and continued economic and market stability.
While InMed considers these assumptions to be reasonable, these
assumptions are inherently subject to significant business,
economic, competitive, market and social uncertainties and
contingencies.
Additionally, there are known and unknown risk
factors which could cause InMed's actual results, performance or
achievements to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking information contained herein. Known risk factors
include, among others: regulatory filings may not be filed or
approved on a timely basis, or at all. A more complete discussion
of the risks and uncertainties facing InMed is disclosed in InMed’s
filings with the Security and Exchange Commission and the most
recent Annual Information Form and other continuous disclosure
filed with Canadian securities regulatory authorities on SEDAR at
www.sedar.com.
All forward-looking information herein is
qualified in its entirety by this cautionary statement, and InMed
disclaims any obligation to revise or update any such
forward-looking information or to publicly announce the result of
any revisions to any of the forward-looking information contained
herein to reflect future results, events or developments, except as
required by law.
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