Pharma Focus Europe

Charlotte's Web forms Joint Venture with BAT and AJNA BioSciences to Seek FDA-Approval for Proprietary Full Spectrum Hemp Extract Botanical Drug

Friday, April 07, 2023

Charlotte's Web Holdings, Inc., the market leader in full-spectrum hemp extract wellness products, today announced it has formed a joint venture (the "JV") with AJNA BioSciences PBC ("AJNA"), a botanical drug development company focused on mental health and neurological disorders , and a subsidiary of British American Tobacco PLC, which is contributing US$10 million as the JV's initial investor. AJNA is partially owned and was co-founded by its president, Joel Stanley, the former CEO and Chairman of the board of Charlotte's Web, together with certain other founding members of CW.

The JV was established to pursue FDA-approval for a novel botanical drug to target a neurological condition identified by the JV leadership team, which will be comprised of CW, AJNA and BAT representatives. This novel botanical drug will be developed from certain proprietary hemp genetics of CW. The JV plans to engage with the FDA to file an Investigational New Drug ("IND") application and commence Phase I clinical development in 2023.

BAT holds a 20% equity interest in the form of preferred units following its US$10 million investment and has the right to participate in future equity issuances to maintain its pro rata equity position. Charlotte's Web and AJNA each hold 40% of the JV's voting common units. This is in consideration of contribution by CW of a license permitting the JV to use certain proprietary hemp intellectual properties, including clinical and consumer data, and by AJNA of laboratory and regulatory services, clinical expertise and the provision of clinical services. The JV plans to use the initial US$10 million investment for the clinical development of a novel hemp botanical IND.

Orrin Devinsky, M.D., Ph.D., renowned neurologist and researcher and AJNA's Chief Medical Advisor, will lead the JV's clinical and regulatory strategy. Dr. Devinsky is an early stakeholder in AJNA and is the Director of New York University (NYU) Langone's Comprehensive Epilepsy Center and a Professor of Neurology, Neurosurgery, and Psychiatry at NYU Grossman School of Medicine. He was a principal investigator for the development of the cannabis-based FDA approved drug, Epidiolex®. Epidolex was approved in 2018 for the treatment of seizure disorders, Dravet and Lennox-Gastaut syndromes, which are rare and severe forms of pediatric epilepsy.

"As one of the first clinicians to research novel cannabinoids, I am very excited to work on this project. I believe the properties of cannabis and hemp are well suited for the FDA's new Botanical Drug Development pathway", Dr. Devinsky said.

Jacques Tortoroli, CEO of Charlotte's Web said, "This joint venture is a capital efficient way for Charlotte's Web to unlock the value of its intellectual property to advance development of effective botanical alternatives to current neurological pharmaceuticals."

James Barrett, Commercial Director of Wellbeing and Stimulation at BAT, said: "Our investment in the Joint Venture reinforces our commitment to Charlotte's Web and represents another step for BAT in our exploration beyond tobacco and nicotine. We continue to transform our business, through strategic investments in innovative consumer, new sciences and technology businesses, as part of our purpose to build A Better Tomorrow."



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