Israel-based companies IMC (International Medical Cannabis) and Kadimastem announced an agreement for a nonbinding reverse merger and loan, signaling new opportunities for development in biotech-driven medical cannabis and psychedelics innovation.
Under this partnership, the newly formed subsidiary company, which will shift its focus towards biotechnology instead of medical cannabis, will consist of 12% ownership by IMC shareholders, leaving Kadimastem shareholders with an 88% stake.
Kadimastem, a clinical-stage cell therapy company, recently received approval from the U.S. Food and Drug Administration (FDA) to conduct a Phase 2A multisite clinical trial for their treatment of Lou Gehrig’s disease (amyotrophic lateral sclerosis).
Restructuring IMC’s Medical Cannabis Operations: Prelude to Biotech Potential
In light of the merger deal, IMC has plans to restructure or spin out its existing medical cannabis operations in Israel and Germany as a contingent value right (CVR). The holders of the CVR will gain entitlement to receive cash, equity, or other forms of value when the legacy cannabis business is sold. To facilitate this sale, IMC’s board has established a special committee. Once all debts are settled, the remaining sale proceeds will be distributed among the CVR holders.
The executive chair of Kadimastem shared that their decision to steer towards a Nasdaq listing shows dedication to fully maximizing the potential of diabetes and amyotrophic lateral sclerosis (ALS) product candidates.
Loan Agreement between IMC and Kadimastem: Stepping Stone for Merger Completion
Kadimastem’s loan agreement with IMC dictates an initial amount of $650,000 disbursed in two phases: a sum of $300,000 upon signing the agreement in late February, followed by an additional $350,000 after the execution of a final agreement. Such actions indicate that the completion of this transaction relies heavily on approvals from various entities, including regulatory bodies, both companies’ shareholders, and Israeli government authorities, as well as adherence to all regulatory requirements.
This move marks yet another turning point as IMC shifted its focus away from the Canadian cannabis market towards opportunities in the Israeli and European regions, particularly Germany, last year.
Taking Aim at Progress in Cannabis and Psychedelics Medical Research
By extending their reach into the biotechnology sphere, IMC and Kadimastem unveil new avenues for fundamental research and advances in medical cannabis and psychedelics-derived treatments. This strategic pivot focuses on expanding business operations and aims to benefit patients suffering from life-altering diseases such as diabetes and ALS through innovative approaches.
Collaboration Spurs Potential Breakthroughs in Evidence-Based Medicine
Joining forces, IMC and Kadimastem are poised to bring their respective expertise in cannabis and cell therapy together, with the potential to propel forward evidence-based medical research in cannabis and psychedelics science. This critical partnership reimagines the landscape of medicine while pursuing solutions for rare and complex diseases and optimizing the therapeutic potential of medicinal substances traditionally stigmatized or underutilized for compassionate care.
The merger positions the resulting company at the epicenter of groundbreaking scientific advancements that could reshape conventional therapeutic methodologies. It seeks to provide a competitive edge in the marketplace and offer the potential for life-saving medical interventions to patients worldwide.
The Future of Medical Cannabis and Psychedelics is Here
Supported by this merger between IMC and Kadimastem, which puts biotechnology at the forefront of emerging research and innovation, the future holds promise to revolutionize not only medical cannabis but also to delve further into the realm of psychedelic-driven therapies.
With careful research, sound clinical practices, and regulatory approvals in place, this marriage between biotech firms and cannabis and psychedelics-based treatments could unlock new windows of opportunities for many suffering from chronic or terminal illnesses as the industry faces a new era of drug discovery and validation.
Rita Ferreira
Rita is a seasoned writer with over five years of experience, having worked with globally renowned platforms, including Forbes and Miister CBD. Her deep knowledge of hemp-related businesses and passion for delivering accurate and concise information distinguish her in the industry. Rita's contributions empower individuals and companies to navigate the complexities of the cannabis world, and her work remains a valuable resource for those seeking a deeper understanding of its potential.
