Graft Polymer (UK) PLC (LSE:GPL) has finalised its operational review, resulting in a commercial collaboration with Awakn Life Sciences Corp.
This partnership aims to advance Awakn's novel aminoindane new chemical entity (NCE) series, which has shown promise in treating post-traumatic stress disorder (PTSD), affecting around 13 million people in the US alone.
The plan is to leverage Graft's expertise in drug delivery systems. Specifically, Graft will invest £300,000, which Awakn will use for pre-clinical actions to enhance the bioavailability and pharmacokinetics of the aminoindane NCEs.
In return, Graft will receive 40% of any future net income from Awakn's drug programme, led by Professor David Nutt, the company's chief scientific officer and the UK's leading neuropsychopharmacologist.
Nutt said: "This collaboration is a significant step forward for our new chemical entity programme. Graft Polymer's expertise in drug delivery systems will be invaluable as we advance our research.
"We are confident that this partnership will accelerate the development of new therapeutic options for addiction and mental health, areas in desperate need of innovative solutions."
Graft's chief executive, Anthony Tennyson, also serves as CEO of Awakn. To mitigate any potential conflict of interest, Tennyson recused himself from the selection process and negotiation of the collaboration agreement, which was overseen by Nicholas Nelson, an independent director.
Nelson and Yifat Steuer, the company's CFO, concluded the terms of the transaction to be fair and reasonable and in the interest of the company.
Nelson told investors: "Today's collaboration agreement aligns perfectly with Graft Polymer's objective of leveraging its existing drug delivery system to enhance the effectiveness of therapeutic treatments.
"We believe our investment and expertise will promote the success of Awakn's novel aminoindane NCE programme, potentially making a substantial positive impact on the treatment of trauma-related mental health disorders."