IntelGenx (TSX-V:IGX; OTCQX:IGXT) executed a non-binding letter of intent with Tilray (NASDAQ:TLRY) to co-develop and commercialize oral film products infused with recreational and medical cannabis in anticipation of amended cannabis regulations, which would allow adult-use consumers to purchase edible products.
Under the accord, IntelGenx and Tilray will fund 20% and 80% of the costs associated with the development of the cannabis-infused VersaFilm products, respectively.
IntelGenx will have rights to manufacture and supply the co-developed products to Tilray, and will also receive a fixed single-digit royalty on net product sales. Tilray will have exclusive, worldwide marketing and distribution rights for the co-developed products.
On entering a definitive agreement, Tilray will make a strategic investment in IntelGenx through a private placement, purchasing 1,250,000 common shares of IntelGenx at a price of 80 cents (U.S.) a share.
IntelGenx intends to use proceeds from the private placement for cannabis-infused VersaFilm product development.
“Our proprietary VersaFilm drug delivery platform offers a number of proven advantages, including increased bioavailability, precision dosing, accelerated onset of action, reduced side effects, child-resistant packaging and easier, more discrete administration, all of which we believe have the potential to improve the way people may use and experience cannabis in the future,” Dr. Horst Zerbe, president and CEO of IntelGenx, said in a statement.
“This LOI marks the first step in forming an exciting partnership with Tilray, a global leader in the medical and recreational cannabis industry,” he added.
