Jupiter Wellness, Inc. JUPW announced Thursday that it is acquiring Next Frontier Pharmaceuticals, Inc., through a merger with a subsidiary of Jupiter Wellness.
Under the terms of the agreement, Next Frontier Pharmaceuticals' stockholders will receive convertible stock of Jupiter Wellness - convertible into 65 million shares of Jupiter Wellness common stock and no cash at the closing of the transaction.
In addition, the shares will be subject to a six-month standard lock-up agreement.
Jupiter Wellness has loaned $10.2 million to Next Frontier Pharmaceuticals, as part of the transaction, under a note secured by Next Frontier Pharmaceuticals' Texas-based synthetic cannabinoid manufacturing facility.
The transaction, which is expected to close in the first three months of 2022, has been unanimously approved by the boards of directors of both companies and is subject to the approval of Jupiter Wellness stockholders and other customary closing conditions.
Why It Matters
The transaction enables the expansion of drug development and formulation capabilities focused on cannabinoids and psychedelics. Next Frontier Pharmaceuticals is the owner of the only U.S.-based FDA-approved CII Tetrahydrocannabinol, a liquid cannabinoid SYNDROS used in adults to treat chemotherapy-induced nausea and vomiting in adult patients and anorexia associated with weight loss in adult patients with AIDS.
Jupiter Wellness said the deal also creates the leading platform for active pharmaceutical ingredient manufacturing based on synthetic cannabinoids and psychedelics.
Moreover, Next Frontier has two patents that have received notices of allowance, including a foundational method of cannabigerol synthesis and a unique broad-spectrum hemp powder, and 14 patents pending surrounding cannabinoid synthesis and cannabis production methodologies.
In addition, Next Frontier's 83,000 square foot manufacturing facility in Texas is FDA registered and licensed by the DEA to manufacture Schedule I to III controlled substances in a cGMP facility, with a DEA-exemption permit to export globally.
"With its industry-leading cannabinoid platform, innovative products, and pipeline, we strongly believe that Next Frontier Pharmaceuticals positions us well for long-term stockholder value creation," Brian John, CEO of Jupiter Wellness said.
Shannon Soqui, executive chairman of Next Frontier Pharmaceuticals, believes that "Jupiter Wellness is an ideal growth partner that is committed to supporting our commercial efforts, as well as ongoing clinical and research programs."
Now, as a public company, Next Frontier Pharmaceuticals has "resources and opportunity to reach and impact more patients through a broader portfolio of cannabinoid-focused therapies than ever before."
JUPW Price Action
Jupiter Wellness' shares traded 2.2222% higher at $1.38 per share at the time of writing Thursday morning.
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