Pfizer is to enter the medical cannabis industry betting on a promising cannabinoid-based bowel disease treatment.

Last week, American multinational pharmaceutical and biotechnology corporation Pfizer signed an agreement with the clinical-stage company Arena Pharmaceuticals for a total equity value of around $6.7 billion.

 

Under the agreement terms, Pfizer acquires all shares for $100 per share in an all-cash transaction. Moreover, the press release reads that the proposed transaction will be subject to customary closing conditions, including receipt of regulatory approvals and approval by Arena's stockholders.

Arena Pharmaceuticals is a biotech company with one pipeline dedicated to cannabinoid-type therapeutics. The core of its cannabis operation consists of Olorinab (APD371), an investigational, oral, full agonist of the cannabinoid type 2 receptor (CB2), which aims to treat patients with diseases affecting the stomach and intestine. As Arena's website states, Olorinab is an investigational drug and is not currently approved for use by any health authority.

Arena's team is developing this cannabinoid-based drug with an initial focus on visceral pain associated with gastrointestinal disorders. Arena's website reads that this compound, through its selectivity for CB2 versus CB1, is under investigation for pain relief without psychoactive adverse effects.

CB1 and CB2 receptors bind to the endocannabinoid system, a complex cell-signaling system. These receptors are present throughout the human body. Endocannabinoids, such as THC and CBD, can bind to both receptors to signal that the endocannabinoid system needs to take action. However, the effects depend on the endocannabinoid receptor and the cannabinoid's interaction with the receptor.

MORE FOR YOU

European Union Increases THC Level For Industrial Hemp. Why Does It Matter?

Producing Cannabis Biomass Without Growing A Cannabis Plant: How One Company Is Doing It

Buy Cannabis On A Blockchain Metaverse And Get It Delivered To Your Real Home

"The proposed acquisition of Arena complements our capabilities and expertise in Inflammation and Immunology, a Pfizer innovation engine developing potential therapies for patients with debilitating immuno-inflammatory diseases with a need for more effective treatment options," said in the press release Mike Gladstone, Global President of Inflammation & Immunology at Pfizer.

Amit D. Munshi, President and Chief Executive Officer (CEO) of Arena, said that Pfizer's capabilities would accelerate Arena's mission t