BIOTECH company Oxford Cannabinoid Technologies to float on the London Stock Exchange in a listing which is set to value it at £51.5m
It says it will raise £16.5m from a ‘heavily oversubscribed’ initial public offering and enter the market this Friday.
OCT was founded in 2017 with backing from Kingsley Capital, a London private equity and venture capital business.
Its main research focus is on using cannabinoids to treat pain – a global market worth a potential £7bn a year.
Buoyant Market For Cannabis
Proceeds of the IPO will be used to prepare its two most advanced drug candidates to begin clinical trials in the third quarter of 2022, reports the Financial Times.
Neil Mahapatra, OCT co-founder and executive chair, and Managing Partner at Kingsley Capital, told the FT it had been thinking about a ‘private funding round but market conditions appear buoyant for our type of company’.
Existing investors in OCT include UK tobacco company Imperial Brands, which has 16.9% stake and Snoop Dog’s specialist cannabis investment firm Casa Verde with 3.2%.
OCT’s stated goal is to ‘become a global leader in the development of safe and effective prescription medicines to treat serious and life-threatening human diseases and conditions.
Its aim is to deliver ‘licensed cannabinoid medicines’ using both natural plant and synthesized cannabinoids.
Severe, Chronic Pain
Its mission statement continues: “OCT’s primary focus is on the drug development for indications in severe, chronic pain conditions, that are one of the biggest challenges facing society today.”
OCT’s role model will be GW Pharmaceuticals which was launched over 20 years ago and has recently been sold to Jazz Pharma for $7.2bn.
In September, last year the Financial Conduct Authority announced it was easing restrictions on cannabis companies floating on the London Stock Exchange.
This has led to three flotations so far this year with MGC Pharmaceuticals making history by being the first on to the LSE followed by Kanabo and Cellular Goods – with all three seeing their stock prices rise sharply
OCT’s board of directors include Gavin Sathianathan as a non executive director. It was advised by States Bridge Capital, lawyers Penningtons and financial advisors Cairn.
Main image L-R; Neil Mahapatra and Gavin Sathianathan