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Following the recent drug rescheduling from the Trump Administration, medicinal marijuana companies are preparing to raise nearly $20 million in private funding.
On April 24, Acting Attorney General Todd Blanche and the U.S. Department of Justice proposed a rescheduling of medical marijuana products, bringing cannabis from a Schedule I drug to a Schedule III classification. Companies are now taking advantage of the opportunity and looking for investors to take their cannabis companies to the next level.
Chief Executive Melissa Sturgess of Ananda Pharma, a company developing cannabis-based treatment for endometriosis-related pain, told Reuters, “We have calls lined up already with a (venture capital) investor interested in endometriosis and with a significant U.S.-based family office.”
Following the reschedulingAnanda Pharma is preparing to raise $10 million to $20 million in private funding within six months. The company told Reuters it is looking to use the funding to accelerate U.S. regulatory engagement and manufacturing of CBD, which does not have the psychoactive compound THC.
High Bar
The government’s new rescheduling moves cannabis to Schedule III, labeling it a substance with a moderate-to-low chance of dependence, alongside drugs like ketamine and Tylenol with codeine, which can be easily accessible through a doctor and medical advisory. Marijuana’s previous schedule classification allowed it to be placed next to heroin and LSD, classifying it as a drug with a high risk of misuse and dependence.
CEO Aras Azadian of Avicanna, a company developing a cannabis drug for rare seizure disorders, told Reuters the Schedule I designation of marijuana made it “quite difficult” to run U.S.-based studies. “The major gating factor here has been the fact that there was no federal pathway to enter without a substantial amount of investment or red tape,” said Azadian.
The company is looking to enter the U.S. market and partner with local companies. Other drug companies, like IGC Pharma, are still testing products. IGC Pharma is looking to make a low-dose THC liquid to treat agitation in patients with Alzheimer’s disease. Its CEO Ram Mukunda has estimated its product at $1 billion to $10 billion, and is attempting to raise $50 million by the end of the year from investors.
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