Philip Morris, the international tobacco giant, is in the process of acquiring Israeli company Syqe Medical in a deal that could reach $650 million, Calcalist has learned. Syqe’s main product is a metered dose inhaler to treat pain using cannabis vaporization.
The agreement has several stages. Philip Morris will initially invest $120 million to support the process of obtaining FDA approval for Syqe’s inhaler. If approval is obtained after conclusive clinical trials, Philip Morris will buy all the shares of the Israeli company for 650 million dollars.
The transaction will be made through Philip Morris’ subsidiary Vectura, which specializes in the field of inhalers.
Philip Morris had already invested $20 million in Syqe in 2016.
The acquisition of Syqe is one of the largest transactions in recent years in the field of medical technology in Israel. If the $650 million valuation is reached, Syqe will become one of the ten largest cannabis companies globally, joining the ranks of Tilray and Aurora.
This exit is very important for all investors in Syqe, given that the total investment in the company to date amounts to only 80 million dollars. The company’s founder and CEO, Perry Davidson, owns a relatively large share of the company, over 10%.
Founded in 2011 by Mr. Davidson, who is still its CEO, Syqe holds approximately 120 patents resulting from more than eight years of development. The main innovation of Syqe’s inhaler lies in the use of raw cannabis flowers, and not its processed products, and in the possibility of measuring an exact dose intended for the patient, in order to aim for a minimum effective dose.
For now, Syqe’s inhaler is available in Israel and Australia, which are relatively small markets. Syqe’s main target market is therefore outside of Israel, and the FDA approval process in the United States would be a crucial step. If successful, Syqe will be the first company in the world to obtain FDA approval for the use of raw cannabis inflorescences as a medicine.
