OBJ inks‘landmark’ deal to develop medicinal cannabis patches

By

Danica Cullinane

-

June19, 2019

OBJ hassigned a deal with Australian medicinal cannabis grower Little Green Pharma toexplore using its patch technology to deliver cannabinoid therapy to patients.

Medical solutions company OBJ Limited (ASX: OBJ) is teaming up with Australian medicinal cannabis producer Little Green Pharma to explore using OBJ’s transdermal (patch) technology to deliver cannabinoid therapy.

Describing the deal as a “landmark collaboration”, OBJ said asigned term sheet for a funding and option agreement will see the two companieswork together along with research and development experts at Curtin Universityin Western Australia.

The agreement also includes proposed joint funding of theR&D activities with a view to establish a formal 50:50 joint venture forthe ownership and commercialisation of cannabis and transdermal technologies inthe event of successful trials.

Operating a cultivation facility in Western Australia, LittleGreen Pharma is the first Australian medicinal cannabis company to producelocally grown and GMP-manufactured cannabis products for patients.

OBJ founder and managing director Jeffrey Edwards said thecompany was “thrilled” to work alongside this well-established company.

“Backed by R&D efforts from Curtin University, thisopportunity holds significant potential for all parties involved and could wellrepresent a unique Western Australian solution to be utilised in one of thebiggest growth markets in the world today,” he said.

In a supplementary announcement, OBJ told the market the termsheet represents the proposed indicative basis upon which the parties proposeto negotiate a fully termed funding and option agreement.

Neither company will be legally bound until they have entered afully termed agreement outlining acceptable financial contributions, OBJstated.

A newfrontier

OBJ said the deal was a “unique strategic opportunity” given theglobal legal cannabis market is forecast to reach $232 billion by 2027.

“This is an excellent opportunity for OBJ given the momentumwe’ve witnessed in medicinal cannabis as a therapeutic in Australia, but moresignificantly in North America and Europe,” Mr Edwards said.

Current and emerging cannabinoid-based treatments includevaping, tablets, capsules, chewing gums, oil and non-diamagnetic patches.However, many of these are limited in their ability to deliver an accurate doseand not be impacted by first pass metabolism in the case of anything isingested or inhaled, the company said.

If the Curtin University trials are successful in demonstratingthat cannabinoids can effectively use OBJ’s technology, the company said thiscould result in “one of the most advanced and effective medical cannabisdelivery systems developed in the world to date”.

In addition,the joint venture could rapidly develop its ownproducts as well as licence the technology to third parties for worldwidedistribution.

Little Green Pharma managing director Fleta Solomon said thiscould be a “new frontier for medicinal cannabis”.

“The benefits of medicinal cannabis are well known andincreasing, therefore combining this with the experts in transdermal technologyat OBJ has the potential to create some exciting possibilities,” she said.

Patchtechnology

According to OBJ, transdermal patches target concentrateddelivery of a drug by a more effective penetration through the skin.

The patches are designed to release cannabinoids slowly over anumber of hours. This means the medicinal effects are expected to last longerthan other methods of consumption, where effects can peak quickly but thentaper off, requiring frequent dosage.

The patches use OBJ’s patent-protected diamagneticmicroarray technology, which has already been sold in more than a millionskincare products under a deal with consumer goods firm Proctor & Gamble.

By early afternoon trade, OBJ shares were up 14.29% to $0.016.