|RapidMist device--Courtesy of Generex|
Generex's proprietary RapidMist buccal drug delivery device is finding its mark in the medical marijuana arena. The company announced its second medical marijuana outlicensing agreement, this time with Smoofi, a consultant to licensed U.S. medical and recreational marijuana operators and retail dispensaries.
Generex will receive Smoofi common stock worth $10 million and a warrant to acquire 15 million additional shares of the company's stock on the OTCQB stock market, where the stock trades for about $2.75.
Smoofi is responsible for financing the buccal cannabis product's R&D and conducting its marketing, distribution, and sales. It will pay Generex a 20% royalty on the product's net revenues.
The RapidMist drug delivery device contains pharmaceutical agents in an aerosolized liquid formulation that are absorbed via the inner cheek. According to the Generex website, the key to drug delivery through the buccal membrane is not the device but the use of enhancers called surfactants. Surfactants are organic chemicals that have both hydrophobic (water-hating) and hydrophilic (water-loving) ends, and under certain conditions form a structure known as a micelle, in which the hydrophilic ends arrange themselves in a protective shell that can be used to transport large molecules through cell membranes and cell walls.
In addition, Generex said that its medical marijuana outlicensing agreement with Canadian medical marijuana company CannScience Innovations has been modified. CannScience will pay Generex royalties of 15% in exchange for a license to market buccal marijuana products in Canada.
Generex and CannScience will also jointly research buccal marijuana products for Smoofi. In return Generex will transfer half of its royalties from Smoofi to CannScience. And Smoofi will initially provide $1 million for R&D.
The companies say buccal delivery of medical marijuana is better than oral administration because it enables faster relief, better control over dosing and more predictable absorption.
Generex's most advanced candidate is its Phase III Generex Oral-lyn for the treatment of Type 1 and Type 2 diabetes via the RapidMist. The medicine is outlicensed to India's Shreya Life Sciences, which markets it as Oral Recosulin in that country.
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