MagicMed’s stock is up 40% since January. It’s first product, a blood-testing device that screens for inflammation markers, has been in clinical trials since 2010, and now Enveric Biosciences is buying the company outright.
The company received a $30 million investment from the main shareholder, the venture capital firm of Vision Venture Partners. The deal values the company at $700 million, the company’s chief executive, Dan Bosworth, told me. Enveric will continue its operations in the San Francisco area, while MagicMed will continue to operate in the Boston area. Bosworth said he didn’t see the MagicMed acquisition as any kind of a takeover. “It’s an all-stock deal,” he said. “It’s a sale of assets, not a sale of the business. It’s one unit.”
Patient-focused biotechnology company Enveric Biosciences (NASDAQ: ENVB) is acquiring MagicMed Industries Inc, a privately held biotechnology company focused on building a library of novel derivatives of psychedelic molecules such as psilocybin, N,N-dimethyltryptamine (DMT) and other molecular derivatives for various indications. The estimated value of the transaction is $30 million.
MagicMed shareholders will receive 9,946,969 shares of Enveric stock, which recently sold for $2.72. Plus warrants, options and restricted stock to buy an additional 9,039,882 shares of Enveric stock. Current Enveric shareholders will own approximately 63.4% of the combined company’s common stock. In addition, Enveric will receive approximately C$4 million in cash from MagicMed’s treasury. Dr. Joseph Tucker is appointed Chief Executive Officer and David Johnson, the current Chief Executive Officer and Chairman, is appointed Executive Chairman.
Our proposed acquisition of MagicMed underscores Enveric’s core mission to create a drug discovery and clinical trials biotechnology company dedicated to developing naturally occurring therapies to improve standards of care and address unmet needs in oncology and CNS disorders, said David Johnson, president and CEO of Enveric Biosciences. Psychedelics and cannabinoids, we believe, have significant beneficial effects on the minds and bodies of patients. We welcome MagicMed’s world-class research and development team, led by Dr. Joseph Tucker, who has expertise not only in psychedelic drug discovery, but also in cannabinoid research.
MagicMed focuses on the discovery and early development of new drug candidates that are structurally related to psychedelics and have significantly improved pharmaceutical properties and commercial potential for the treatment of neurological and psychological disorders. Psybrary is MagicMed’s library of new psychedelic derivatives, developed through a combination of synthetic biology and traditional chemical methods. MagicMed has filed 13 patent applications for psilocybin and DMT derivatives, 2 patent applications for mescaline and MDMA derivatives, and intellectual property protection for mescaline, MDMA, ibogaine and LSD is pending.
At MagicMed, our mission has always been to unlock the full potential of psychedelic drugs to treat neurological and psychological disorders, said Dr. Joseph Tucker, CEO of MagicMed. The collaboration with Enveric, which complements our research capabilities, will allow us to leverage the company’s clinical team, which is focused on bringing our broad range of molecular products into the clinic to help millions of patients with mental health problems around the world. With this acquisition, we have strengthened our project portfolio – to the benefit of our respective teams – and assembled a team of experienced professionals with the leadership skills and knowledge to build a platform that allows us to serve large unmet markets.
The acquisition of MagicMed expands and complements Enveric’s current development program in naturally occurring compounds, which is primarily focused on cannabinoids and now includes a broad portfolio of psychedelic molecules. Enveric plans to continue the development of patient-centered supportive care therapies in oncology and the central nervous system (CNS). Upon closing of the transaction, Enveric intends to begin researching and developing drugs for the treatment of cancer-related post-traumatic stress disorder (PTSD) in patients currently being treated, as well as in patients in remission. It is expected that in the future the PTSD drug development programme will not only be extended to drugs for cancer, but could also be extended to other patient populations, such as military veterans.