NetworkNewsWire Editorial Coverage: Morgan Stanley’s research team in January 2017 forecast that biotech-pharmaceutical companies – with a combined $75 billion in cash on hand – would strategize to boost revenue growth through mergers and acquisitions of smaller companies with high-potential product pipelines (http://nnw.fm/mN24x). Growth via strategic acquisition makes more sense to cost-conscious Big Pharma than does shelling out $2.55 billion (http://nnw.fm/3Qr3S) to develop a new drug in-house. With growing interest in the convergence of cannabis and medicine, companies like InMed Pharmaceuticals, Inc. (CSE: IN) (OTCQB: IMLFF) (IMLFF Profile), which has an innovative biosynthesis technology that addresses the regulatory concerns associated with consistent pharmaceutical-grade cannabinoids and logistical constraints on development, may find themselves on the radar of Big Pharma. Mid-tier cannabinoid developers such as Zynerba Pharmaceuticals, Inc. (NASDAQ: ZYNE) and Axim Biotechnologies, Inc. (OTCQB: AXIM) are also developing cannabinoid-based therapies, possibly on track for the same opportunity seen in the $847 million acquisition of Scioderm by Amicus Therapeutics, Inc. (NASDAQ: FOLD). According to Thompson Reuters, pharma deals in 2015 increased 94 percent to $59.3 billion over the prior year, which adds weight to Morgan Stanley’s projections, and GW Pharmaceuticals’ (NASDAQ: GWPH) position as the leader of the Marijuana Index biotech sector demonstrates how biotechs continue to drive value in the broader, acquisition-hungry pharmaceutical sector.
Global pharma and life sciences M&A values slumped over 60 percent in Q3 of this year, as compared to Q2, in all subsectors except biotech, according to Pricewaterhouse Coopers. Large companies losing revenue amid expiring patents and facing costly R&D is a pattern baked into the biotech market. As such, the acquisition of revenue-producing biotechs as a solution is a trend that will most likely hold fast in upcoming years. Such a robust, underlying market environment is great news for cannabinoid biosynthesis pioneer InMed Pharmaceuticals, Inc. (CSE: IN) (OTCQB: IMLFF), the developer of a proprietary, scalable biosynthesis process capable of manufacturing all of the more than 90 naturally-occurring cannabinoids at pharmaceutical grades in-house – a rare and possibly unattained ability for everyone else in the industry. What this means is that InMed provides a solution to a main hindrance of U.S. FDA approval of cannabinoid-based therapies: producing consistent, pharmaceutical-grade cannabinoids that are identical to those found in nature.
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Biotech M&A Momentum Attractive for Cannabinoid R&D Space
