Oxford Cannabinoid Technologies Holdings PLC (LON:OCTP), a medical marijuana firm backed by rapper Snoop Dogg, debuted on the London Stock Exchange today. The British firm is developing prescription cannabinoid drugs aimed at relieving pain.
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Oxford Cannabinoid Technologies debuts
OCT raised £16.5 million (US$23.4 million) in its initial public offering, starting with a market value of a little over £48 million (US$69.1 million). The stock opened at around 8 pence and fell to hover around 5 pence toward the middle of the day.
OCT is a pre-revenue pharmaceutical company working on prescription medications based on cannabinoids, and it offered about 960 million ordinary shares. The proceeds of the offering will fund pre-clinical drug development, clinical trials and the development of other non-addictive pain relievers. OCT is preparing to take two of its drug candidates into clinical trials soon, according to City A.M.
The Evening Standard noted that other cannabidiol floats have also done well in their market debut in recent months. Cellular Goods, a pain relief and skincare company backed by David Beckham, saw its shares skyrocket by more than 300% in just 15 minutes of trading when it debuted in March. Israel-based Kanabo, which produces a vaping pen for medical-grade cannabis extract used for sleep disorders and pain, saw its stock price triple in its debut.
Backing cannabis companies
According to CNBC, Snoop Dogg has invested in multiple cannabis startups through Casa Verde. His venture capital firm also backed plant-based food companies like Outstanding Foods and tech companies like Robinhood and Reddit.
OCT CEO John Lucas told CNBC's Squawk Box Europe today that the key is "about getting cannabinoids into the hands of patients." He also said the way to do that is by developing drugs. Lucas explained that the problem with medical cannabis is that doctors can't prescribe it, so they want to develop a drug they can "get into the hands of physicians, into the hands of patients."
He told City A.M. that they are "pushing back the frontiers of cannabinoid-based drug development," adding that being listed will provide new investors opportunities to participate in the "next chapter of our exciting story." Lucas also said the IPO would enable them to take their pipeline of drugs through the next stage of development.
In its listing, OCT said its primary target market is "the total addressable pain market," which is estimated to be worth at least £42.5 billion through the commercialization of its first drug. The company expects the first drug to be introduced to the market in 2027. OCT's first two drugs target about £1.55 billion of the chronic pain market.
