This week, British pharmaceutical cannabis firm Oxford Cannabinoid Technologies (OCT) announced that the ‘final dose’ in its crucial Phase I clinical trial had been administered, with no ‘drug adverse effects observed’.
OCT is now poised to publish the results of its study in the coming weeks (October 16) as it gears up to raise more funds to keep its pipeline of products moving forward.
It capped what the company has described as a ‘defining year’, through which it has not only transitioned from a ‘pre-clinical stage to a clinical-stage pharmaceutical company’, but also emerged from a period of both financial and managerial volatility.
A defining year
A little over a year ago, speaking to Business of Cannabis about the company’s financial future as it prepared for its second fundraise, then-CEO Dr John Lucas explained that the company was ‘looking at all options’ to stay afloat, with questions raised as to whether its four programmes would be ‘delayed, if not terminated’.
Weeks later, OCT announced that it had launched a ‘strategic budget review’, seeing the company prioritise its lead compound and delay the launch of Phase 1 clinical trials for its secondary programme in order to extend its financial runway.
These decisions were made on the assumption that the company’s share price would recover at ‘inflection points’ throughout its clinical pathway, and followed an industry-wide share price drop of around 80%.
A year on, these decisions have proven prudent. Unlike the rest of its cohort of cannabis stablemates which were the first to list on the London Stock Exchange in 2021, OCT has managed to see some recovery in its stock price, currently up around 80% on lows seen in October last year.
Despite the budget restructuring and suggestions that its other programmes would be ‘put on hold’ in its half-year report, OCT is continuing to pursue all four of its drug programmes, and is gearing up for a new round of funding to continue their progress.
Delighted to share this news – successfully completing the final dose in our first #PhaseI trial is a huge milestone and I’m so proud of our brilliant team & @SimbecOrion too! #OCTP #pain #CIPN #cannabinoids https://t.co/udHkZvkOsW
— Clarissa Sowemimo-Coker (@clarissamapson) September 25, 2023
As OCT’s current CEO Clarissa Sowemimo-Coker explained to Business of Cannabis recently: “I think we’ve had a bit more of a strategic look at it, but I think what’s great about the pipeline is we have got things coming through at different stages.”
This includes its lead compound, just about to complete Phase I clinical trials, which will focus on the $1.61bn chemotherapy-induced peripheral neuropathy (CIPN) market, and its secondary programme using synthetic phytocannabinoids to tackle chronic pain, now ready to begin Phase I trials.
OCT’s third and fourth programmes, which have spawned from a 2021 licensing deal with Canopy Growth, giving it access to its entire cannabinoid derivative library, are also showing promise.
In July 2023, OCT announced that it had identified a potential ‘first in class’ immunotherapy treatment for solid tumours as part of its Programme 4, which it suggested could be ‘much, much more cost-effective from a healthcare provider point of view’, leading to a bump in stock price.
“Our cash runway still extends out to April 24. Obviously, there’s no secret that we need to raise some money before then. So as part of that, whatever the strategies in terms of the next raise, we will certainly factor in the continuing development of Programme 4 because we are so excited about it,” Ms Sowemimo-Coker said.
“With this sort of staged pipeline, we’ve got more opportunities for commercialisation or monetisation of those assets along the way, but we don’t have to take all of those in a linear fashion all the way through to commercialise ourselves. There’s a lot of different ways we can monetise those along the way.”
The pre-revenue company, which raised net proceeds of £14.8m when it listed in May 2021, saw its cash absorbed by operations rise from £5.4m to £7m in the year to April 30, 2023, ‘in line with expectations’.
While the growing losses are no surprise given the increase in research activity, the company is now preparing to launch a further raise ahead of the end of its projected cash runway in April 2024.
A key focus of this raise will be pushing its lead compound through Phase II trials, which Ms Sowemimo-Coker emphasises ‘is not a cheap undertaking’.
While the market has shown signs that it is warming up to the cannabis industry once again, raising the entire sum needed to complete Phase II trials is a significant risk, which the company is looking to avoid.
“I don’t want to go to the market and ask them for however many millions of pounds I need for phase two immediately, because at the moment the market isn’t really there.
“But you’ve got to continue to raise money into the business to continue to grow it. So there is a balance there, and the board’s very carefully weighing that. As to the scope and the shape of the next raise, I think from my perspective, it’s more likely to be a smaller raise to get a few potential inflection points under our belt.”
Once Phase II is completed, with suggestions OCT could launch a ‘multiple jurisdiction trial’ in the UK and the US in order to potentially ‘speed along an FDA approval’, the company hopes it can draw the eye of Big Pharma.
“It’s very likely that at a Phase III stage, we’d be partnering with a big pharma company. There’s lots of opportunity, particularly once we get that Phase I out of the way; we’ll become quite a bit more attractive to those big pharma companies which want to come in and scoop up a programme that’s more advanced.”