- LXRP
subsidiary Lexaria Nicotine LLC enters definitive investment agreement
with large tobacco company to receive R&D funding in exchange for
licensing and equity
- Partner
has provided initial $1 million – with an option for up to $11 million
more – for research on DehydraTECH’s oral forms of nicotine delivery
through a series of private financings
- LXRP
still retains majority equity ownership of Lexaria Nicotine, while partner
receives a minority equity interest in the subsidiary, not in LXRP itself
Lexaria Bioscience Corp.’s (CSE: LXX) (OTCQX: LXRP)
DehydraTECH absorption platform will receive a significant injection of R&D
financing under an investment agreement that wholly owned subsidiary Lexaria
Nicotine LLC has entered into with a large tobacco partner. LXRP has initially
received $1 million toward its research on nicotine consumer products that use
DehydraTECH (http://ibn.fm/Kx7Cm).
Through the agreement, the partner also has the option to
provide up to $11 million in additional research through multiple phased
private financings to underwrite LXRP’s R&D. In exchange, the partner will
receive certain license rights to commercialize these DehydraTECH products
exclusively in the United States and non-exclusively elsewhere. The partner,
the largest cigarette company in the U.S., will be obligated to pay LXRP a
royalty on sales of all products that use DehydraTECH.
The partner will have the option to buy full ownership of
LXRP’s subsidiary, but no equity in LXRP itself, per the terms of the
agreement. Additionally, the partner will have the right to appoint one of the
seven directors of LXRP, and, as the phased additional investments are made, it
may have the right to appoint up to three directors.
Lexaria Nicotine plans to conduct a series of clinical
investigations into oral forms of nicotine delivery using DehydraTECH
technology. In a news release, John Docherty, LXRP president, said, “Lexaria
Bioscience has repeatedly demonstrated the powerful effects of its patented
DehydraTECH technology for enhancing the palatability and speed of onset of
orally consumed bioactive substances such as nicotine.”
Based in British Columbia, Canada, LXRP is a biotechnology
company and drug-delivery platform innovator focused on out-licensing its
disruptive delivery technology, which promotes healthier ingestion methods.
LXRP holds a patent for the oral delivery of all cannabinoids and has a growing
IP portfolio that includes 10 patents granted in the United States and
Australia, with more than 50 patent applications worldwide across 10 patent
families. DehydraTECH is its proprietary absorption technology platform.
For more information, visit the company’s website at www.LexariaBioscience.com
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