#Australia #Melbourne #CBD Capsules #Avecho Biotechnology #Sandoz Group

Avecho and Sandoz Join Forces to Tackle Insomnia with CBD

In a groundbreaking move in the medicinal cannabis sector, Avecho Biotechnology has announced an exclusive ten-year licensing and development agreement with Sandoz Group AG. This collaboration is focused on bringing Avecho's unique pharmaceutical cannabidiol (CBD) capsules for insomnia to market in Australia.

This agreement marks a significant step in the realm of CBD as a therapeutic option, emphasizing the potential for unlocking new pathways in drug delivery and treatment for insomnia.

Financial Commitment and Market Potential

Under the terms of the agreement, Avecho will receive an upfront payment of US$3 million (approximately A$4.8 million) from Sandoz. Additionally, the agreement includes milestone payments reaching up to US$16 million before the product hits the shelves. Once commercialized, Avecho will benefit from tiered royalties ranging from 14% to 19% based on net sales of the product.

The Australian market for over-the-counter cannabidiol has shown immense promise, with forecasts estimating annual sales could exceed US$125 million. This highlights not only the growing awareness and acceptance of CBD but also the increasing demand for effective solutions to insomnia, which affects an estimated 9.5 million Australians, out of which about 3.6 million are considered chronic sufferers.

The Partnership's Structure and Strategic Vision

In this agreement, Avecho retains commercial rights to market the CBD product outside of Australia, while Sandoz has been given the right of first refusal for any commercial proposals received by Avecho in other territories. This dual-faceted market strategy allows Avecho to maintain its broader business interests while capitalizing on Sandoz's extensive distribution network and marketing capabilities within Australia.

Dr. Paul Gavin, CEO of Avecho, expressed enthusiasm about the partnership, stating, "This collaboration illustrates the remarkable commercial potential of our proprietary drug delivery platform. Together with Sandoz, we are committed to offering innovative treatments for insomnia."

Avecho, who will continue to oversee the ongoing Phase III clinical trials for the capsules, is poised to collaborate with Sandoz to secure regulatory approval from the Therapeutic Goods Administration (TGA) once the clinical trials conclude successfully.

Future Developments and Investor Insights

With the first phase of the partnership rolled out, Avecho will be hosting an investor webinar on March 4, 2025, at 11:00 AM AEDT. During this session, Dr. Gavin will further unveil details about this major milestone and what it means for the trajectory of the company and the cannabidiol market at large. Investors and interested stakeholders are encouraged to register for the webinar to gain deeper insights into the collaboration.

This partnership not only paves the way for novel insomnia treatments but also positions both companies to effectively tap into the burgeoning demand for therapeutic CBD solutions in Australia. As the market continues to evolve, the strategic efforts undertaken by Avecho and Sandoz will be instrumental in defining the future landscape of the medicinal cannabis industry.