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InMed Pharmaceuticals Inc. (NASDAQ: INM) Signs Definitive Agreement to Acquire 100% of BayMedica Inc., Positioning it to Stand Distinct in Rare Cannabinoids Manufacturing, Become a Revenue-Generating Company, Expand Drug Development Capabilities
September 17, 2021

InMed Pharmaceuticals Inc. (NASDAQ: INM) Signs Definitive Agreement to Acquire 100% of BayMedica Inc., Positioning it to Stand Distinct in Rare Cannabinoids Manufacturing, Become a Revenue-Generating Company, Expand Drug Development Capabilities

  • InMed Pharmaceuticals recently announced it has entered a definitive agreement to acquire 100% of BayMedica Inc.
  • BayMedica is a private company that specializes in the manufacture and commercialization of rare cannabinoids
  • Upon closing, the transaction will make InMed a global leader in the manufacturing of rare cannabinoids in addition to transforming it into a revenue-generating company
  • Acquisition provides InMed with the complete flexibility across multiple manufacturing approaches

On September 13, InMed Pharmaceuticals (NASDAQ: INM), a company developing cannabinoid-based pharmaceutical drug candidates and manufacturing technologies for pharmaceutical-grade rare cannabinoids, announced it has signed a definitive agreement to acquire 100% of BayMedica Inc., a US-based private company that specializes in the manufacture and commercialization of rare cannabinoids, in a stock-based transaction expected to close in the coming weeks, subject to various customary closing conditions (https://ibn.fm/ckdlh).

Upon closing, the transaction will cement a relationship that began in late 2020 when InMed and BayMedica announced they had entered into a broad collaborative research agreement (https://ibn.fm/dpuuO).

Under the terms of the 2020 agreement, InMed would undertake the preclinical investigation of multiple therapeutic compounds selected from BayMedica’s extensive library of proprietary cannabinoid analogs in addition to exploring the therapeutic potential of specific analog compounds in selected disease models. On its part, BayMedica would be given access to particular elements of IntegraSyn(TM), InMed’s proprietary platform for producing cannabinoids using novel proprietary enzyme(s), in order to assess the potential of one or more of InMed’s high-efficiency enzyme sequences in BayMedica’s systems for the production of cannabinoids in BayMedica’s catalog. 

This collaboration led to an announcement, issued June 29 this year, that InMed had entered into a non-binding letter of intent (“LOI”) to acquire 100% of BayMedica (https://ibn.fm/PBV55). At the time, InMed’s President and CEO, Eric A. Adams, noted that the existing collaboration had made it apparent that the two companies’ business models and capabilities could provide a platform to expedite their growth, as well as provide 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 process, would create a powerful combination,” Adams added. 

Upon closing, the transaction, as detailed in the most recent announcement, will indeed create a powerful combination. It will make InMed a global leader in the manufacture of rare cannabinoids, with expertise in three distinct and complementary cannabinoid manufacturing approaches. InMed’s IntegraSyn combined with BayMedica’s synthetic biology and chemical synthesis capabilities will offer InMed the complete manufacturing flexibility to choose the most appropriate, cost-effective manufacturing method based on prevailing conditions. 

At the same time, the combined company will continue to explore the therapeutic potential of cannabinoids and novel cannabinoid analogs for pharmaceutical drug development. It will also increase commercial sales of rare cannabinoids to the consumer health and wellness sector.

“This is a transformative transaction for InMed. The acquisition gives us a breadth of synthetic cannabinoid manufacturing capabilities to deliver high quality, cost-effective rare cannabinoids for any segment of the market from consumer packaged goods (‘CPG’) to prescription pharmaceuticals,” said Adams. “BayMedica brings unparalleled cannabinoid manufacturing expertise in both chemical synthesis and biosynthesis together with industry veterans who have been pioneers in this space.”

Adams further noted that the transaction will transform InMed into a revenue-generating company, offering value to its shareholders. BayMedica commenced the sale of Prodiol(R) cannabichromene (“CBC”), its initial rare cannabinoid product, in December 2019. Since then, the sales revenues have grown steadily, with the cumulative figure currently exceeding $2.5 million. BayMedica also boasts an industry-leading batch production of CBC, the ability to expand the capacity as market demand increases, and multiple high-value non-intoxicating rare cannabinoids in various stages of commercial manufacturing scale-up.

As part of the agreement, InMed will issue 1.78 million of its common shares to BayMedica’s equity and convertible debt holders; any such issued InMed common shares will be subject to a six-month contractual hold period. Notably, however, the total number of InMed common shares issuable in the proposed transaction may be reduced depending on the findings of a financial review of BayMedica’s closing balance sheet (go through the press release for a more detailed breakdown of the terms of the transaction).

Eric Adams and BayMedica CEO Shane Johnson will offer more information about this transaction in an Edison Research-hosted webinar slated for Thursday, September 16, 2020, at 11:00 AM ET. Listeners should also expect to hear more about InMed’s future developments. To register for the webinar, please visit (https://ibn.fm/RqKhJ). 

For more information, visit the company’s website at www.InMedPharma.com.

NOTE TO INVESTORS: The latest news and updates relating to INM are available in the company’s newsroom at https://ibn.fm/INM

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