Novartis blazes Big Pharma trail, striking deal with Canadian company to distribute medical marijuana products

Novartis will use its expertise to educate pharmacists about the products and to help Tilray develop new products and dose forms. (Tilray)

In what may be the first foray by Big Pharma into the sale of medical marijuana products, Novartis has struck a deal with a Canadian company that sells medical cannabis products not only in its home country but also in Europe.

Nanaimo, British Columbia-based Tilray announced today that it has a binding agreement with Sandoz Canada to be its exclusive supplier of “non-smokable/non-combustible medical cannabis products.”

While Canadian law only allows companies to mail their products directly to patients, the company said that “subject to future regulatory changes,” Sandoz Canada will wholesale and distribute the products to Canadian hospitals and pharmacies. It also calls for the Swiss company to use its expertise to educate pharmacists about the products and to help Tilray develop new products and dose forms.

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No financial details were provided, but a Tilray spokesperson told the Financial Post that Sandoz has not taken a financial stake in the company.  

In an email, a spokesperson for Sandoz Canada today said that the agreement was a "local one" focused on Canada.  "I am not aware about any long-term plans from Novartis," she said.

“We are thrilled to form a strategic alliance with Tilray to strengthen our portfolio,” Michel Robidoux, president and GM of Sandoz Canada, told the newspaper in a statement. “We are committed to making every reasonable effort to respond to patients’ medical needs by increasing the number of high-quality, adequately dosed non-smokable, non-combustible medical cannabis products at the disposal of doctors.”

RELATED: Teva inks trailblazing cannabis pact with Israel's Syqe Medical

Tilray claims to be the first Canadian cannabis company to get manufacturing approval from the European Medicines Agency and says it sells products in 10 countries “across the continents.” It also has a deal with a German wholesaler to distribute its products to pharmacies in that country.

“To have the Sandoz logo co-branded on some of our products will help establish trust with patients and pharmacists and physicians who are used to seeing that Sandoz brand on products that they consume and trust,” Tilray CEO Brendan Kennedy told the Post.

Given Sandoz’s expertise in manufacturing dose forms like patches, sprays and creams, Kennedy said he expects the two companies to develop new cannabis-based products over time.

While Novartis may be the first Big Pharma player to step into the new but burgeoning world of medical marijuana, it is not the only drugmaker to make a bid for the business. In 2016, Teva struck a deal to be the sole distributor in Israel of a cannabis inhaler developed by Syqe Medical. At the time, Syqe had 26,000 medical cannabis consumption licenses but projected that number would double by 2018.

Insys Therapeutics, which got into a world of hurt over past marketing practices of opioid drug Subsys, won FDA approval in 2016 for a liquid formulation of dronabinol, a pharmaceutical version of THC, the active ingredient in marijuana.

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