Zelira Therapeutics Ltd (ASX:ZLD, OTCQB:ZLDAF) has opened new pathways to develop pharmaceutical-grade cannabidiol capsules and tablets with its proprietary Enhanced Distillate Capture and Dissolution Matric (EDCDM) technology.
The EDCDM technology solves a non-uniformity problem that causes cannabidiol distillate to separate from the powder bed when attempting to create solid oral dosage forms such as capsules and tablets.
“A very exciting development”
“We strongly believe that the cannabinoid-based medicine market will scale up significantly when the ability to consistently formulate, validate and commercialise dosage forms that closely resemble current pharmaceutical drugs and in formats such as capsules and tablets, becomes available,” Zelira Therapeutics global managing director and CEO, Oludare Odumosu said.
“Reflecting Zelira’s biopharmaceutical business strategy, we have solved two key issues holding back wider acceptance and usage of cannabinoid medicinal products – the difficulty in formulating solid oral dosage drugs with distillate, and the low rate of dissolution into the body from capsules and tablets.
“We have now demonstrated that Zelira’s proprietary Enhanced Distillate Capture and Dissolution Matrix technology substantially traps the distillate in a free flow powder matrix and increases the rate of dissolution.
“This is a very exciting development as it opens multiple product development and commercialisation paths for medicinal cannabinoids.”
A US$1 million foundational licensing deal for the new technology has already been secured with DRCN Holdings and its affiliated operating medical cannabis licences in Maryland, West Virginia, Pennsylvania and Michigan.
“Substantial and immediate value”
“The licensing arrangement with DRCN Holdings reflects the substantial and immediate value of Zelira’s technology given the multiple products that can now be commercialised. We look forward to partnering with DRCN Holdings to bring new products to market that enhance people's lives,” Odumosu continued.
“The success of Zelira’s EDCDM, and results showing its efficacy, reinforce Zelira’s commitment to world-class science and position as a global biopharmaceutical leader in the development and marketing of clinically validated cannabinoid-based medicines.
“We have only just started to explore the breadth and depth of Zelira’s biopharmaceutical technologies and products in development that we will bring to market soon.
“Receipt of the upfront, non-refundable, non-contingent fee under this transaction, will further strengthen Zelira’s cash position. This puts the company in an increased strong position to continue to accelerate both our prescription (Rx) and Over The Counter (OTC) businesses/strategies.”
Zelira Therapeutics will receive an upfront, non-refundable non-contingent fee of US$1 million, giving DRCN Holdings the option to develop up to three commercial products using EDCDM for up to three years.
ZLD will receive a 20% royalty on net sales from commercialised products, with the requirement that a minimum of US$1 million in net sales per annum is produced. If net sale targets aren’t reached, both companies have the right to cancel the licensing deal.
How does it work?
Solid oral dosage forms of cannabidiol have thus far been undermined by the non-uniformity of cannabidiol distillate, which causes the distillate to separate from its powder bed when being encapsulated or compressed into a tablet.
The addition of ZLD’s EDCDM results in a free-flowing powder base that will not separate when being encapsulated or compressed, utilising nanoporous silicate particles to effectively trap the distillate within the structure of the silicate, rendering the powder bed dry.
This stabilising effect improved the average dissolution of cannabinoid capsules in comparative analytical testing carried out by the Zelira laboratory in Pennsylvania, US:
As demonstrated by the foundational deal signed with DRCN Holdings, these enhanced dissolution characteristics of Zelira’s EDCDM technology presents an opportunity for rapid commercialisation opportunities.
Licensing agreement with DRCN
DRCN Holdings LLC is a privately held, vertically integrated parent company with controlling interest in several West Virginian cannabis companies and affiliate cannabis entities in Maryland, Michigan and Pennsylvania.
These states have approved legal medical cannabis programs with additional focus on research, development, manufacturing, agricultural genetics and human clinical trials for cannabinoid-based, FDA approved, prescription medications.
DRCN is led by experienced industry experts Reggie Alston and Neil Cooper, with experience in medical cannabis products, growing, manufacturing, processing and dispensary operations as well as research, development and technology improvements.
Key terms of the licensing agreement include:
- Zelira to receive an upfront, non-refundable, non-contingent licensing fee of US$1 million from DRCN Holdings;
- DRCN Holdings has an option to designate up to three product target profiles for Zelira to develop products;
- 3-year period to exercise product development options, with a possible 2-year extension;
- Products must generate a minimum of US$1 million in net sales each year after commercialisation, otherwise, either party has right to cancel licence; and
- Zelira to receive a 20% royalty on net sales from commercialised products created under the licence.