Under the deal, FSD Pharma will buy all of Prismic Pharmaceuticals’ outstanding common and preferred shares for an aggregate purchase price of $17.5m.
This price will be satisfied with the issuance of an aggregate of 102.7 million Class B subordinate voting shares in the FSD Pharma capital at an estimated price of $0.1704 per share.
FSD Pharma will assume up to $4m of outstanding Prismic liabilities, while Prismic’s outstanding stock options and warrants will become exercisable into FSD shares.
Prismic Pharmaceuticals is engaged in the development of medications to address opioid addiction. FSD Pharma expects the acquisition to help tackle the opioid crisis with synthetic cannabinoids.
FSD Pharma executive co-chairman and CEO Raza Bokhari said: “This transaction symbolises FSD Pharma’s vision of acquiring a platform company to advance research and development of FDA-approved applications of synthetic cannabinoids and other synergistic molecules.
“Led by Peter Moriarty, one of the founders of Shire Pharmaceuticals, Prismic’s management team has built a solid foundation for a speciality pharmaceutical company, and we look forward to providing them with milestone-based support in order to advance proprietary drug candidates through the various development stages.”
Prismic Pharmaceuticals holds exclusive licensing rights to a type of palmitoylethanolamide, which forms a base for the company’s development platform.
The speciality pharmaceutical firm leveraged this platform to formulate its lead candidate, a 600mg micro-PEA tablet. This was studied in conjunction with Pfizer’s Lyrica during a Phase II/III development programme to treat fibromyalgia.
Prismic Pharmaceuticals co-founder Peter Moriarty said: “We believe our combined resources and highly competent leadership teams will position us to execute on our clinical development programmes and on delivering highly effective products that safely address pain, inflammation and neurological disorders with high unmet clinical needs.”
The acquisition is subject to customary closing conditions and approvals.