Argent BioPharma (RGT), formerly MGC Pharmaceuticals, has sold the global commercialisation rights of its leading epilepsy drug, CannEpil, in order to clear a sizable chunk of its debt.
Earlier this month (July 07), the ASX-listed pharmaceutical manufacturer announced a US$5.5m licensing deal with Splash Beverage Group, handing it the responsibility for development and regulatory approval of CannEpil in new markets, with a focus on the United States.
Rather than receiving an upfront cash payment, Splash will forgive convertible loan notes Argent owes to Mercer Street Global Opportunity Fund, reducing the outstanding balance by around 60%. The number of convertible notes on issue, each with a face value of A$1.00, will fall from about 9.3m to 3.8m once the Mercer notes are cancelled.
While Argent will maintain a foothold in CannEpil’s future, retaining full ownership of the intellectual property, regulatory assets and manufacturing know-how, the deal was born more of necessity for the biopharma operator than opportunity.
The deal
Fort Lauderdale-based Splash, is a drinks business whose brands include Copa di Vino wine and SALT tequila, is casting the CannEpil licence as the centrepiece of a pivot into cannabinoid wellness and pharmaceuticals.
While Argent continues to face its own financial precarity, Splash takes on the deal in a fragile state of its own. It reported negative stockholders’ equity of about US$15.3m at December 31, 2025, and its 2025 annual report carries a going-concern qualification, while facing delisting from the NYSE until its share price quadruples in value.
As part of this deal, Splash is settling the US$5.5m consideration through a debt-for-equity restructuring routed through Argent’s own financiers. Mercer Street Global Opportunity Fund, which holds Argent’s convertible notes and is the company’s largest shareholder, has agreed to forgive about US$5m of that debt.
In return, Splash will issue US$5.5m of newly created preferred equity, while C/M Capital Partners has committed a US$1m strategic investment to fund CannEpil’s US development.
The parties on the other side of the table are the same ones Argent already owes. Mercer has financed the business since 2020 and holds a convertible-note facility that the company most recently valued at A$14.6m.
C/M Capital is Argent’s second lender, behind the A$11m convertible facility from which the company drew a further A$350,000 on 14 July, days after the CannEpil deal.
In its filing with the US financial regulator, the SEC, Splash calls C/M Capital ‘its affiliate’. So both of the lenders that fund Argent are also backing Splash, the company now taking Argent’s most valuable asset.
Splash is now recasting itself as a ‘cannabinoid health, wellness and biopharmaceutical platform’ with the CannEpil licence as its centrepiece.
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CannEpil’s future
Developed by MGC Pharmaceuticals before rebranding to Argent in 2024, CannEpil is a pharmaceutical-grade, standardised 20:1 cannabidiol-to-tetrahydrocannabinol oral solution for drug-resistant epilepsy, and is manufactured directly by Argent.
In Ireland it became the first product available under the national Medicinal Cannabis Access Programme (MCAP). In the United Kingdom it has reached patients with severe treatment-resistant epilepsy through the named-patient route and specialist clinics, and it has also been supplied in Germany and Australia.
In March the company shipped its largest commercial batch to date, 1,000 units to Ireland, which it valued at about A$783,000 in reimbursed retail terms. CannEpil has also been assigned a US investigational new drug number following pre-IND engagement with the Food and Drug Administration.
Under the licence, that pathway now belongs to Splash for an initial 20 years. Splash assumes responsibility for development and regulatory approval, with the United States its priority, and must make ‘commercially reasonable efforts’ to begin a Phase I trial within 24 months and a Phase II within 48, before filing a new-drug application with the FDA.
C/M Capital’s US$1m is earmarked for that early regulatory work and for finding a pharmaceutical partner able to run US trials. Argent keeps ownership of the intellectual property, continues to manufacture the drug under EU-GMP, and collects a 15% royalty on Splash’s worldwide net sales for at least a decade in each market.
What next for Argent Biopharma?
Argent closed the March 2026 quarter with A$736,000 in cash against a quarterly operating outflow of A$788,000, and its 31 December accounts showed negative net assets of about A$8.4m against accumulated losses of A$150.4 million.
It has been surviving on convertible drawdowns with punishing terms. Under those notes, the lender can choose to be repaid not in cash but in new Argent shares, priced at 90% of the shares’ recent low.
The weaker the share price, the more shares the lender receives for the same debt, and the more existing shareholders are diluted. With Argent’s stock stuck around A$0.05, barely above the A$0.04 floor written into the notes, any conversion would hand over close to the maximum number of new shares, further diluting other investors.
Clearing the Mercer notes removes roughly 60% of Argent’s convertible debt at a stroke, but falls short of ending the company’s reliance on financing.
With revenue from CannEpil now significantly reduced, Argent will now be looking towards the rest of its portfolio and pipeline.
CimetrA, an anti-inflammatory that drew emergency-use demand during the pandemic, is now framed as a Phase III clinical candidate. The dementia oral spray CogniCann remains at Phase II, and CannPal, the veterinary epilepsy asset bought from AusCann in April, is pre-commercial.
According to Argent’s own projected launch dates, it won’t be until at least 2030 until meaningful sales are achieved for its earlier stage products.
The company is repositioning to match, describing itself now as a clinical-stage developer of nano-engineered neuro-immune therapies rather than a cannabis commercial operator, and has lodged a US provisional patent for a NanoBodies platform targeting septic shock.
