Zelira secures US$8.6 million cornerstone funding for FDA clinical trials for HOPE-1(R) Cannabinoid Medicine for Autism


Zelira Therapeutics Ltd (ASX:ZLD, OTCQB:ZLDAF), a global leader in the development and commercialization of clinically validated cannabinoid-based medicines, is delighted to announce that it has received a binding term sheet from Cantheon Capital LLC (Cantheon) to provide an initial US$8.6 million cornerstone funding for Zelira to conduct FDA Phase 2 and Phase 3 clinical trials for Zelira’s proprietary and patented protected HOPE®️ 1 product (Term Sheet), via a special purpose vehicle (SPV). Zelira will contribute to the SPV its HOPE®️ 1 product, IP and real-world data for 55% equity ownership of the SPV. Cash investors will contribute a total of circa US$35 million to fund the SVP and US FDA trials for HOPE®️ 1 in exchange for a cumulative equity interest of 45% of the SVP. Zelira will manage the SVP as part of its business platform. Cantheon’s Term Sheet represents approximately 25% of the total US$35 million US FDA trial cost to be raised for the SVP. Cantheon’s Term Sheet, representing US$8,639,400, is structured as a convertible note (Cantheon Convertible Notes) that can be converted into a maximum of 12.93% of the SPV’s common stock. Zelira has also executed a mandate with SW4 Advisors Limited (SW4 Partners) to raise the remaining circa US$26 million required for the SVP, on standard commercial terms.

Summary of the Term Sheet


The Term Sheet gives Cantheon the right to subscribe for circa US$8.6 million in convertible notes in the SPV subject to terms and conditions set out in the Annexure. The SPV has appointed iNGENū CRO Pty Ltd (iNGENū) as its Contract Research Organisation (CRO) to lead the clinical validation and regulatory registration of the study product with the US FDA through the submission of an Investigative New Drug (IND) application. In addition, iNGENū will partner with the SPV to drive the execution of required clinical trials and pivotal studies for approval and licenses required for commercialisation.

Zelira Therapeutics Chairman, Osagie Imasogie, commented: “I am very pleased that we are now at the third stage of our LAUNCH, LEARN & DEVELOP strategy for validation and commercialisation of cannabinoid based medicines. We LAUNCHED HOPE®️ 1 into the market in three US States, Pennsylvania, Louisiana and Washington D.C. approximately three years ago and in Australia in 2020, where it is available to prescribers and patients through the Therapeutic Goods Administration (TGA) Special Access and Authorised Prescriber Schemes for use with the symptoms of Autism Spectrum Disorder (ASD). During this period, we LEARNED from patients who use HOPE®️ 1 for essential data points – the dose they used, their frequency of dosing, any side effects they experienced, and the efficacy of our product. Zelira, published positive results detailing the analysis of longitudinal, real-world studies (RWD) generated from patients using HOPE®️. The results support the safe and effective use of HOPE®️ 1. In addition, 70% of patients in the study cohort were rated by clinicians as having achieved at least ‘moderate’ therapeutic effect after 5 months on HOPE®️ 1. In the state of Pennsylvania, our licensee has sold and dispensed over 9 million doses of HOPE®️ over the past three years with no negative safety signal. These doses have been bought and paid for, out of pocket, by parents who have administered HOPE®️ to their children with ASD, on a monthly basis. Now we are proceeding, with a high level of comfort, based on our learning and RWD, including positive before and after videos of children with ASD that have been administered HOPE®️, to the formal DEVELOPMENT of HOPE®️ 1 under the US FDA process. Our target is a potential eventual approval of HOPE®️ 1 in the US as a drug forASD, within approximately 36 months from the commencement of our trials. We expect that the next months will be exciting and value enhancing for our patients and shareholders, as we proceed with our clinical development of HOPE®️ 1.“

Zelira Therapeutics Managing Director, Dr Oludare Odumosu, commented: “Zelira continues to deliver on our unique drug development strategy with the decision to advance HOPE®️ 1 through formal clinical trials and seek FDA approval. We are pleased to have searched for and selected a world class specialist research organization, iNGENū, to partner with us to drive the clinical and regulatory activities for what we hope will be a successful clinical trial that results in the US FDA approval of HOPE®️ 1 as a frontline solution for patients living with ASD. iNGENū, coupled with their US affiliate, Benuvia, have the experience of successfully taking the Syndros®️ cannabinoid product through the US FDA to approval. In addition, they hold the FDA and DEA licenses required to manage schedule 1 products in the US. Lastly, they have an FDA and DEA approved manufacturing site that can supply both our clinical trial and commercial products for what we hope will be an FDA approved product. In preparing for this US FDA trial, we reformulated HOPE®️ 1 into a pharmaceutical grade capsule, using our proprietary Zyraydi™️ technology. Not only does this provide a more convenient and traditional pharmaceutical dosage form for patients and the market, but it also provides us with additional IP protection for our already patented formulation of HOPE®️. Using Zyraydi™️ to reformulate HOPE®️ 1 into a free-flowing powder and then a capsule also provided us with a more competitive cost basis for manufacturing HOPE®️ 1. We expect to deliver our IND to the FDA by the end of 2023 calendar year.” We are equally pleased that Zelira’s unique value proposition resonated strongly with US-based Cantheon Capital, who have agreed to cornerstone the funding required for the SPV.”

Zelira Therapeutics Ltd (ASX:ZLD, OTCQB:ZLDAF) Zelira is a leading global biopharmaceutical company in the research, development and commercialisation of clinically validated cannabinoid based medicines. Zelira owns a portfolio of proprietary revenue generating products and a pipeline of candidates undergoing clinical development positioned to enter global markets. The Company is focused on developing and clinically validating branded cannabinoid-based medicines in its prescription [Rx] business for the treatment of a variety of medical conditions including insomnia, autism and chronic non-cancer pain as well as offering over the counter [OTC] products. Zelira’s Rx business generates revenue from two proprietary medications, HOPE®️ and ZENIVOL®️. The Company has two proprietary formulations under the HOPE®️ brand that are generating revenue in Australia, Washington, D.C., Pennsylvania and Louisiana. Zelira is also generating revenue in Australia from its proprietary and patented ZENIVOL®️ – the world’s first clinically validated cannabinoid drug for treatment of chronic insomnia. Zelira will also be expanding commercialisation of ZENIVOL®️ into Germany via its German commercialisation partner Adjupharm GmbH following recent approval from German regulatory authority BfArM. Zelira’s OTC products in the oral and dermatology health care sectors are also generating revenue. Zelira, in partnership with SprinJeneCBD, launched a full line of oral care products, currently generating revenue in the US. The SprinJeneCBD toothpaste product is the first of several scientifically formulated, hemp-derived, oral care products containing cannabinoids, blackseed oil and zinc utilizing proprietary and patented technology. Zelira also launched in 2021 the RAF FIVE™️ brand, which consists of five OTC acne treatment products using a proprietary formulation incorporating cannnabidiol (CBD).