Proactive Investors - PharmaDrug Inc (CSE:PHRX) has announced a $300,000 investment in its Sairiyo Therapeutics biotech subsidiary by PharmaTher Inc, a wholly-owned unit of PharmaTher Holdings (CSE:PHRM).
Under the agreement reached on July 17, 2023, PharmaDrug said PharmaTher will subscribe for 144,117,647 of Sairiyo’s common shares for a 49% stake in the company.
Sairiyo plans to use the investment funds for the ongoing development of cepharanthine as it finalizes production of the current good manufacturing practice (cGMP) batch of lead drug candidate PD-001 and prepares it for potential in-human trials, it added.
“We believe that aside from the financial contribution, PharmaTher's scientific and overall drug development acumen will provide a synergy that will ultimately yield the best value for shareholders for both the cepharanthine and psychedelic pharmaceutical programs,” PharmaDrug chairman and CEO Daniel Cohen said in a statement.
“This investment will enable PharmaDrug to reactivate its program and reaccelerate its cepharanthine development.”
As well as the investment, PharmaDrug said PharmaTher will also provide drug development, regulatory, clinical and scientific expertise for Sairiyo. While cepharanthine is the current prime focus, the company said Sairiyo's combined leadership will continue to develop its psychedelic assets, such as the N,N-Dimethyltryptamine (DMT) glaucoma initiatives and microneedle patch development that PharmaDrug and PharmaTher had already begun collaborating on.
PharmaDrug said it will also enter into a unanimous shareholders agreement with PharmaTher concerning their holdings of Sairiyo.
While the shareholders will be entitled to subscribe for any future new share issuances, it said that if it elects not to particulate in any new issuance, PharmaTher may increase its ownership from 49% to 51% with an investment of $250,000. Either side may increase its ownership by 10% for additional $100,000 investments and neither side may be diluted beyond a 10% carried interest, it added.
PharmaDrug is a specialty pharmaceutical company focused on the research, development, and commercialization of controlled substances and natural medicines such as psychedelics and previously approved drugs.