Shares of Tilray (TLRY) are rising after Tilray Canada announced it had signed an agreement with Sandoz, a part of the Novartis Group (NVS), to collaborate on medical cannabis.
TILRAY, SANDOZ ANNOUNCE COLLABORATION: On Tuesday, Tilray Canada announced that it entered into a global framework agreement to collaborate with Novartis unit Sandoz to increase availability of high quality medical cannabis products globally. The agreement is “an evolution of an existing alliance between Tilray and Sandoz Canada" and represents the intentions of the two companies to jointly operate in jurisdictions where cannabis is or will be approved for medical purposes, the companies said. The framework agreement outlines the opportunity for the companies to agree to collaborate in different forms. Sandoz may support the global commercialization of Tilray's non-smokable/non-combustible medical cannabis products and may also co-brand certain products. Tilray may supply non-smokable/non-combustible medical cannabis products and license rights to and from Sandoz in relation to such products. Both companies may partner to leverage knowledge to educate pharmacists and physicians about products and may collaborate to develop new innovative medical cannabis products.
MANAGEMENT COMMENTS: "This agreement represents a major milestone in the movement to provide access to safe, GMP-certified medical cannabis to patients in need across the world,” said Tilray Chief Executive Officer Brendan Kennedy. "Tilray is a global company and we’re thrilled to build upon the success and momentum from our existing agreement with Sandoz Canada by taking our partnership global. Sandoz AG will be a valuable partner as we work together to improve access to the highest quality medical cannabis products in countries all over the world." In an interview with Bloomberg, the CEO added, “It just made sense for us to reach an agreement with a company like Sandoz, which is known for its focus on patients, its reliable supply chain, a well-established sales force and a global distribution network. If a product comes into a pharmacy with the Sandoz logo co-branded on it, or if a pharmaceutical sales rep is talking to a physician about a product that’s branded as Tilray and Sandoz, it lends credibility to that product.”
WHAT'S NOTABLE: Tilray and Sandoz Canada have been working together since March, when they announced a partnership for medical cannabis products as well as research and education and the companies also co-branded eight oil and capsule products. Additionally in September, the company announced that the U.S. Drug Enforcement Agency had granted approval to import a cannabinoid study drug into the U.S. for a clinical trial at the University of California San Diego Center for Medicinal Cannabis Research examining its safety, tolerability and efficacy for Essential Tremor. The study is expected to begin in early 2019. IntelGenx also announced the execution of a definitive license, development and supply agreement with Tilray in November, under which the companies will co-develop and commercialize oral film products infused with adult-use and medical cannabis, or cannabis-infused VersaFilm. Additionally in December, Tilray announced that it partnered with researchers at the Lambert Initiative for Cannabinoid Therapeutics at the University of Sydney to complete a study examining the effects of cannabis on driving and cognitive function. The trial phase of this study was completed in 2018 and the published results are expected in 2019.
OTHER CANNABIS STOCKS: Other publicly traded companies in the space include Aurora Cannabis (ACB), Aphria (APHA), CV Sciences (CVSI), CannTrust Holdings (CNTTF), Canopy Growth (CGC), Cronos Group (CRON), General Cannabis (CANN), India Globalization Capital (IGC), ICC International Cannabis (KNHBF), MedMen Enterprises (MMNFF), Biome Grow (ORTFD), MediPharm Labs (MLCPF), Indiva (NDVAF), OrganiGram (OGRMF), Innovative Industrial Properties (IIPR) and KushCo (KHSB).
PRICE ACTION: Tilray rose nearly 9% to $71.70 in morning trading.
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Tilray
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