Harvest One Cannabis Inc. (TSXV:HVT), a developer of cannabis lifestyle and wellness products, acquired Israeli-based Phytotech Therapeutics Ltd. last week. Founded in 2014 to develop advanced cannabinoid-based prescription oral formulation drugs, Phytotech holds an exclusive worldwide licensing agreement with Yissum Research Development Company for a proprietary lipid nanotechnology delivery method.
Harvest One now owns 100 percent of Phytotech, having acquired the company from the Australian-based MMJ Group Holdings Ltd., formerly known as MMJ Phytotech Limited, paying 1 million Canadian dollars cash ($756,000) and 8.3 million common shares of Harvest One stock.
The latest in a collection
A known commodity in regulated markets around the world, Harvest One has three wholly-owned subsidiaries, including licensed producer United Greeneries, medical and nutraceutical company Satipharm and consumer product company Dream Water Global. The company also has a minority interest in Burb Cannabis’ retail operations.
The binding agreement with Phytotech was previously announced in June. MMJ Holdings completed the sale to Harvest One on November 19.
As a result of the sale, MMJ now beneficially owns approximately 30 percent of issued and outstanding Harvest One common shares. The large majority of those shares, approximately 27 percent, are held through MMJ’s wholly-owned subsidiary Phyto UK. MMJ maintains the option to increase or decrease its beneficial ownership, but the company currently has no intention to increase share ownership or control direction of the company.
A strategic acquisition
The acquisition may be decisive for Harvest One. With Phytotech added to the mix, their wholly-owned subsidiary Satipharm will be able to accomplish some new objectives. First, because of PTL, Satipharm will now have access to advanced patients in certain jurisdictions around the world; these patients can participate in R&D and product development, allowing Satipharm to more aggressively pursue the cannabis oils market.
Satipharm serves as the health and medical division of Harvest One, and as such, PTL and Satipharm already have a history together. PTL administered Satipharm’s first clinical trial of their proprietary CBD capsules. Known as GelPells, the capsules are available in 10mg, 50mg, and 100mg strengths, and were one of the first prescription cannabis products available in Australia, and are now widely used in the EU. The capsules are engineered with microgels to have the most effective and consistent delivery technology and to overcome the consistency and bioavailability issues that have been associated with oral delivery of cannabinoids.
The Phase 1 clinical trials effectively showed the delivery profile of the CBD oral capsule technology, and Phase 2 clinical trials were completed in 2017 for pediatric epilepsy. The company has two additional Phase 2 trials in development now – one for a specific form of epilepsy called pediatric refractory epilepsy and another trial on multiple sclerosis which is about to begin. Initial results from both trials have been positive.
CEO of Harvest One, Grant Froese, spoke favorably in a press release about his company’s latest acquisition of Phytotech: “Harvest One's acquisition of PTL gives all of our businesses access to valuable IP and capabilities that can be used to augment our health and wellness strategy as well as our medical offerings.” Froese went on to say that this latest acquisition demonstrates Harvest One’s global nature; the company has a presence in the U.S. and Canada, as well as the EU and now Israel.