Canopy Growth Corporation (TSX: WEED) (NYSE: CGC) is acquiring the German-based, Bionorica SE-founded C3 Cannabinoid Compound Company in an all-cash deal valued at €225.9 million (CDN $342.9 million) or roughly $250 million. The move is intended to expand Canopy Growth’s reach in Europe.
The acquisition will give Canopy immediate access to the intellectual property that C3 has developed in its nearly 20 years of research and development into synthetic and natural cannabis medical products. C3‘s primary medicinal offering is dronabinol, a pure chemical compound with standardized concentrations of tetrahydrocannabinol (THC), one of the active ingredients found in cannabis plants that is responsible for various pharmacological effects.
Dronabinol is sold in the U.S. under the trade names Marinol and Syndros from Solvay Pharmaceuticals. Prescription renewals for patients taking Marinol are low as many complain about the drug’s side effects and have preferred using real cannabis versus the chemical compound.
“What this boils down to is greater choice,” said Bruce Linton, Chairman & Co-CEO, Canopy Growth. “This acquisition will allow us to offer more options to physicians across Europe, accelerate our commercial sales and increase our economic footprint on the continent, and drive forward new innovations. Our goal is to build on C3‘s extraordinary reputation and decades of success as we move to an innovative continuum of medical cannabis therapies that will enable physicians globally to better treat their patients.”
The statement noted that C3 has a total of five medicines in the market and its commercial operations generated €27.1 million (CDN $41.5 million) in 2018. Canopy said that adding dronabinol to its product offering in Europe and potentially other key markets will allow the company’s medical division, Spectrum Cannabis, to present an expanded, medically validated suite of cannabinoid therapies to the benefit of healthcare professionals and patients. “Furthermore, C3‘s infrastructure including production, distribution, and sales & marketing significantly adds to the Spectrum Cannabis footprint in Europe, including an expanding product line and additional reach into pharmacy and medical specialists’ networks,” said the company.
“In the last two decades, we’ve devoted ourselves to the research of cannabinoids and have developed a wide range of valuable cannabinoid compounds and related patents,” commented Professor Michael A. Popp, Owner, and CEO, Bionorica SE. “Combining our knowledge, intellectual property, and reputation amongst clinicians and doctors in Germany, Austria, Switzerland, and Denmark with Canopy Growth’s expertise with natural full-spectrum medical cannabis products and ongoing clinical trials promises to better serve patients globally.”
C3 said that its clinical research programs currently underway are expected to complement Canopy Growth’s own clinical activities and provide data that could potentially be applied to emerging product lines, enhancing the company’s prospects for bringing newly approved products to market sooner. C3‘s founding company, Bionorica SE, one of the world’s leading manufacturers of scientifically researched herbal medicines and Canopy Growth have also entered into a separate cooperation agreement and will be collaborating in areas spanning clinical research, IP development, and distribution opportunities.