- PharmaDrug (PHRX) has signed an agreement with Khiron Life Sciences Corp. (KHRN) to sell all of the outstanding securities of Pharmadrug Production GmbH
- Phamadrug Production is the company’s wholly-owned German subsidiary, a medical cannabis distributor, with a Schedule I European Union narcotics licence
- The transaction will consist of 5,500,000 common shares and a non-interest bearing promissory note in the principal amount of $1,100,000
- The decision to sell Pharmadrug Production was driven by two main issues.
- PharmaDrug is a specialty pharmaceutical company focused on the research, development and commercialization of controlled-substances and natural medicines
- Pharmadrug Inc. was up 14.29 per cent, trading at $0.04 at 11:02 ET
PharmaDrug (PHRX) has signed an agreement with Khiron Life Sciences Corp. (KHRN) to sell all of the outstanding securities of Pharmadrug Production GmbH.
Phamadrug Production is the company’s wholly-owned German subsidiary, a medical cannabis distributor, with a Schedule I European Union narcotics licence and German EuGMP certification allowing for the importation and distribution of medical cannabis to pharmacies in Germany and throughout the European Union.
Under the terms of the share purchase agreement, the company has agreed to sell 100 per cent of the securities of Pharmadrug GMBH for consideration consisting of 5,500,000 common shares in the capital of Khiron and a non-interest bearing promissory note in the principal amount of $1,100,000 which will be payable one year from the date of issue.
The agreement provides for an adjustment to the purchase price at closing to account for certain payments that may be made between the date of signing of the share purchase agreement and the date of closing.
“We are excited to be entering into this transaction with Khiron as it is a major step towards the company’s shift into a pure play biotech strategy,” said Daniel Cohen, Chairman and Chief Executive Officer of PharmaDrug.
“We believe Khiron is perfectly positioned to take full advantage of the asset and believe PharmaDrug should ultimately yield the most value for Pharmadrug Production through and equity ownership in Khiron,” he added.
The decision to sell Pharmadrug Production was driven by two main issues. Firstly, the Board of Directors and Management believes that the cannabis industry is at a point in maturity where critical mass as well as vertical expertise is needed to be able to execute on a successful strategy.
Secondly, Pharmadrug production was a cash drag, and unlike The company’s biotech efforts, management did not believe the cash burn in the German operations added any value to shareholders.
The company is of the opinion that Khiron is perfectly positioned to yield the appropriate value from Pharmadrug Production.
PharmaDrug is a specialty pharmaceutical company focused on researching, developing, and commercializing controlled substances and natural medicines such as psychedelics, cannabis, and naturally-derived approved drugs.
Pharmadrug Inc. was up 14.29 per cent, trading at $0.04 at 11:02 ET.