ABOUT CANNABIS-BASED MEDICINES

HISTORY OF CANNABIS-BASED MEDICINES

Cannabis-based medicines have a long history, including as a widely used treatment in 19th century Britain. Scientific breakthroughs around the endocannabinoid system in the past 40 years have helped shape recent legalisation and the development of new medicines. 

2737 BC

Earliest record of cannabis being used as a medicinal drug, with Chinese Emperor Shen-Nung recognising the treatment for over 100 ailments (e.g. gout, rheumatism, and malaria).

2000-200 BC

Evidence of usage in Ayurvedic Medicine and Egypt for epilepsy, anxiety and inflammation. Greco-Roman empire usage from 450-200 BC for toothache and labour pains.

1025

Avicenna’s Canon of Medicine in Persia recommends cannabis as an effective treatment for gout, edema, infectious wounds and severe headaches. The work had a profound impact on Western medicine during 13-19th centuries. Arabic scholars al-Mayusi and al-Badri prescribe cannabis as an effective treatment for epilepsy.

1839

Sir William O’Shaughnessy introduces cannabis to Western medicine, with publications in the BMJ and The Lancet, after extensive studies in India. By late 1800s in Victorian Britain, medical cannabis was used pharmaceutically to treat pain, epilepsy, nausea, rheumatism and labour pain.

1937

Marihuana Tax Act bans the use and sale of cannabis in the U.S. This was the culmination of DEA and puritanical efforts to ban narcotics (including cocaine and opiates), which doubled down at the end of alcohol prohibition in the U.S.

1961

United Nations Single Convention on Narcotic Drugs creates the international framework for controlled drugs. Four Schedules are created governing the controls and usages of each drug (e.g. medical/research), as well as the quantities that can be manufactured and imported for each country.

1964

The molecular structure of THC, an active component of cannabis, is discovered and synthesised by Israeli chemist Dr Raphael Mechoulam.

1970-71

Cannabis is categorised as a Schedule 1 drug in the US under the Controlled Substances Act, indicating it has “no accepted medical use”. The Misuse of Drugs Act in the UK similarly denotes cannabis as a controlled drug. These acts are largely in reaction to 1960s counter-culture, and hugely limit further research into cannabinoids.

1988

CB1 and CB2 cannabinoid receptors are discovered; these are some of the most abundant neuroreceptors in the brain. Shortly after, Dr Mechoulam discovered the body’s first endocannabinoids (anandamide and 2-AG).

2000-16

Legalisation of medicinal cannabis across multiple geographies: Canada (2001), USA (30+ states), Australia (2016) and Germany (2016).

2018

Legalisation of medicinal cannabis in UK. Celadon Pharmaceuticals is founded.

2018

FDA approves Epidiolex (CBD) for the treatment of seizures associated with two rare and severe forms of epilepsy, Lennox-Gastaut syndrome and Dravet syndrome.

2021-22

Jazz Pharmaceuticals acquires GW Pharma for $7.2bn.

Pfizer acquires Arena Pharmaceuticals for $6.7bn, including their cannabinoid pipeline (CBD) and investigational drug Olorinab.

The Endocannibinoid System

What is the endocannabinoid system

The endocannabinoid system (ECS) is composed of endogenous cannabinoids, endocannabinoid receptors, enzymes and transporters. These are made by the human body and are very similar to the cannabinoids found naturally in the cannabis plant.

The ECS plays a role in the regulation of a range of processes and functions including mood, appetite, sleep, cardiovascular system function, memory and reproduction. These functions all contribute to the stability of your internal environment – homeostatis. So, for example, if you become ill from an injury or disease your body’s homeostatitis is thrown off – so your ECS kicks in to help your body return to normal operations.

How does the endocannabinoid system work

Endocannabinoids are not ‘stored’ but are synthesised as needed in response to a trigger (e.g., postsynaptic membrane depolarisation).

They then migrate through intracellular compartments and across membranes to presynaptic receptor sites by diffusion, and possibly also by the agency of lipid-binding proteins. They then undergo binding and then are degraded by a range of catabolic enzymes.

The ECS appears to function primarily as a retrograde control system that operates via negative feedback loops, wherein postsynaptic neurons are activated to synthesise and release endocannabinoids (eCBs) which then travel across synapses to bind to presynaptic CBRs and suppress further neurotransmitter release.

Endocannabinoids (eCBs) are lipid molecules that are present in all organs, tissues and bodily fluids, and are biochemical messengers of the Endocannabinoid System (ECS). While phytocannabinoids such as Δ9-THC and CBD are chemically distinct to endocannabinoids, they can act as mimics and exert similar effects on the ECS, and this is the basis for their therapeutic activity.

These include: N-acylethanolamines (e.g. AEA, Anandamide), N-Eicosapentaenoylethanolamine (e.g. EPEA), N-Docosahexaenoylethanolamine (e.g. DHEA), 2-acylglycerols (e.g. 2-AG), and N-acyldopamines (e.g. NADA).

CB1Rs are found in brain cells, as well as in Central Nervous System (CNS), Peripheral Nervous System (PNS) and Immune System (IS) cells.

CB2Rs are broadly distributed in the CNS, PNS and IS, and in Leukocytes.

Transient Receptor Potential Receptors (TRPA, TRPM and TRPV) are distributed across organ and tissue systems, particularly brain cells, and CNS and PMS neurons.

Peroxisome Proliferator-Activated Receptors (PPARα, PPARγ) are found in adipose tissue, and in the heart, liver, kidneys, spleen, large intestine and skeletal muscles.

Biosynthetic Enzymes: Enzymes involved in the synthesis of eCBs, including N-Acyl Transferase (NAT), N-Acyl-Phosphatidylethanolamine-Hydrolyzing Phospholipase D (NAPE-PLD), Lyso-PLD, Diacylglycerol Lipase α/β (DAGLα/β) and Phospholipase Cβ (PLCβ).

Catabolic Enzymes: Enzymes which degrade eCBs, including Fatty Acid Amide Hydrolase (FAAH), N-cylethanolamine Acid Hydrolase (NAAH), Cyclooxygenase-2 (COX-2), Lipoxygenase (LOX) and α/β-Hydrolase (ABDH).

Transporters: Proteins that may transport eCBs within cells, across membranes and between cellular junctions, including FAAH-Like Anandamide Transporter (FLAT), Sterol Carrier Protein-2 (SCP-2) and Fatty Acid Binding Proteins (FABPs).

POTENTIAL Therapeutic uses for cannabis-based medicines

Inflammatory Bowel Diseases (Crohn’s)
 

Chronic pain (musculoskeletal, neuropathic, cancer)
 

Autism Spectrum Disorder
 

Rheumatoid Arthritis
 

Cancer (glioblastomas, pancreatic)
 

Eczema / Psoriasis
 

PTSD
 

Anxiety
 

Sleep
 

Chemo-induced nausea and vomiting (CINV)

Multiple Sclerosis (Spasticity)
 

Opioid Use Disorder
 

Rheumatoid Arthritis
 

Therapeutic uses for cannabis-based medicines

Sleep

Anxiety

PTSD

Opioid Use Disorder

Chronic pain (musculoskeletal, neuropathic, cancer)

Multiple Sclerosis (Spasticity)

Epilepsy

Inflammatory Bowel Diseases (Crohn’s)

Autism Spectrum Disorder

Rheumatoid Arthritis

Chemo-Induced Nausea & Vomiting

Cancer (glioblastomas, pancreatic)

Eczema/Psoriasis

GLOBAL MARKET

Core Markets for cannabis-based medicines

Medical Cannabis Market, Transparency Market Research May 20221

Legalised in 2001
 

Legalised in 37 States
Limited Federal legalisation
 

Legalised in 2016
Rapid growth to >200k patients (2019-21)
 

Legalised in 2016
 

Legalised in 2016
 

Legalised in 2018
 

Global market is currently worth over $8bn and is forecast to grow at ~27% CAGR to $53bn by 2027, driven by pain management patients1.

Legalised in 2018

Legalised in 2016

Legalised in 2016

Legalised in 2016
Rapid growth to >200k patients (2019-21)

Legalised in 37 States
Limited Federal legalisation

Legalised in 2001

CELADON’S INTIAL FOCUS ON CHRONIC PAIN

Stannard et al, (2016) Traditional opioids for chronic non-cancer pain: untidy, unsatisfactory, and probably unsuitable2

Over 40% of UK population suffer from a form of chronic pain, with 8 million reporting pain that is moderate or severely disabling.

This figure is expected to grow due to aging populations, sedentary lifestyles and growing mental health issues.

CBMPs can have a huge impact on society:

Improved patient outcomes: opioids only work for an estimated 5-10% of chronic pain patients2

Fewer adverse effects: > 75k opioid overdose deaths in US in 2013

Reduced costs to health service and economy: fewer doctor consultations and in-patient stays, and more patients back to work

~50m with chronic
pain in the USA

~100m with chronic
pain in Europe

STATUS IN THE UK

Cannabis-based medical products (CBMPs) were legalised in 2018 by the UK Government under the “Specials” framework. CBMPs were made immediately available for as prescription medicines for several conditions (e.g. epilepsy, spasticity from multiple sclerosis, chronic pain). This means that in the UK, the distribution of CBMPs as a Special do not require marketing authorisation (i.e. the typical three-phase clinical trial).

These prescriptions are made on a named patient basis and recognises the need for CBMPs today where the current standard of care is failing patients.

The current market for CBMPs in the UK today suffers from three main problems, which Celadon is focused on solving:

Lack of quality UK domestic product

Patient access to product

Awareness of the benefits

PATIENT ACCESS

LVL Health is one of the UK’s leading clinics offering cannabis-based medicines. It is also currently running a unique MHRA trial of these medicines for non-cancer chronic pain.

 

ENVIRONMENT

Celadon uses a highly controlled indoor cultivation environment in order to produce plants to the tightest pharmaceutical tolerances and cannabinoid content. Hydroponics is used to grow plants in a soilless substrate, with mineral salts dissolved into high quality filtered water and delivered direct to the roots of the plant. Micro-zoned sensors monitor every aspect of the environment in real time; from the room’s temperature, lighting cycles and humidity, to the plant’s mineral absorption and transpiration rates. This allows Celadon to build a data bank of optimal growing conditions for each strain, as well as adjust the room automatically.

TRACKING

Celadon has a bespoke “track and trace” system throughout the production process, providing complete transparency. Each plant is given a unique QR code, allowing it to be traced from its origins through to the final product. IOT boxes are used to automatically feed data into the system, from environmental data to the product’s weight, at each stage of production. This provides full visibility over the production process, as well as inventory tracking and accurate cost analysis which feeds into our accounting systems.

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Medical Cannabis Market, Transparency Market Research May 2022

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Stannard et al, (2016) Traditional opioids for chronic non-cancer pain: untidy, unsatisfactory, and probably unsuitable

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Stannard et al, (2016) Traditional opioids for chronic non-cancer pain: untidy, unsatisfactory, and probably unsuitable

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Stannard et al, (2016) Traditional opioids for chronic non-cancer pain: untidy, unsatisfactory, and probably unsuitable

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ENVIRONMENT

Celadon uses a highly controlled indoor cultivation environment in order to produce plants to the tightest pharmaceutical tolerances and cannabinoid content. Hydroponics is used to grow plants in a soilless substrate, with mineral salts dissolved into high quality filtered water and delivered direct to the roots of the plant. Micro-zoned sensors monitor every aspect of the environment in real time; from the room’s temperature, lighting cycles and humidity, to the plant’s mineral absorption and transpiration rates. This allows Celadon to build a data bank of optimal growing conditions for each strain, as well as adjust the room automatically.

TRACKING

Celadon has a bespoke “track and trace” system throughout the production process, providing complete transparency. Each plant is given a unique QR code, allowing it to be traced from its origins through to the final product. IOT boxes are used to automatically feed data into the system, from environmental data to the product’s weight, at each stage of production. This provides full visibility over the production process, as well as inventory tracking and accurate cost analysis which feeds into our accounting systems.

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Legalised in 2018

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Legalised in 37 States Limited Federal legalisation

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Legalised in 2016

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Legalised in 2016

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Legalised in 2016 Rapid growth to >200k patients (2019-21)

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Legalised in 2001

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BUSINESS DESCRIPTION

 

Celadon Pharmaceuticals Plc is a UK based pharmaceutical company focused on the research, cultivation, manufacturing, and sale of breakthrough cannabis-based medicines. Its primary focus is on improving quality of life for chronic pain sufferers, as well as exploring the potential of cannabis-based medicines for other conditions such as autism.

Its 100,000 sq. ft UK facility operates to an EU-GMP standard and comprises indoor hydroponic cultivation, proprietary GMP extraction and manufacturing and an analytical and R&D laboratory. The Company's subsidiary, LVL, owns a MHRA conditionally-approved clinical trial using cannabis based medicinal products to treat chronic pain in the UK. Celadon also has a minority interest in early-stage biopharma Kingdom Therapeutics which is developing a licenced cannabinoid medicine to treat children with Autism Spectrum Disorder.

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COUNTRY OF INCORPORATION/OPERATION

 

Celadon Pharmaceuticals Plc is incorporated in England and Wales and is listed solely on the London Stock
Exchange Alternative Investment Market (AIM), and is subject to the UK City Code on Takeovers and Mergers.

TIDM: CEL.L
ISIN: GB00BDQYGP38

There are no restrictions on the transfer of Celadon Pharmaceutical’s shares.

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AIM SECURITIES IN ISSUE

 

The following information is correct as at 10th January 2023.

The Company’s issued share capital comprises

61,669,773 ordinary shares

Each with a nominal value of 1 pence

So far as the Company is aware, 71% of its issued share capital is not in public hands.

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