Ethicann Pharmaceuticals’ lead product is EPI-002, for the treatment of spasticity resulting from multiple sclerosis (MS Spasticity). Spasticity refers to a feeling of stiffness and a range of uncontrollable muscle spasms/contractions of arms and legs, which can be painful. There are existing treatments for MS Spasticity, which afflicts 2.2 million persons worldwide, and the market globally is $2.2 billion. Three drugs have been approved by the FDA, Baclofen in 1971, Botulinum toxin in 1990 and trizanadine in 1996 … these three drugs constitute 55% of the global market, as other drugs – including a THC/CBD drug (Sativex®) are used off-label in the US.
The problem in this market is that the approved drugs are only marginally effective and have known safety issues. Baclofen, the market leader, is only 40-50% effective and carries an FDA Black Box warning label – for being addictive and risk of serious cardiovascular adverse events if abruptly withdrawn as a treatment. Sativex, approved in over 30 countries, has enjoyed some success in this market, but it is an impure drug (oral spray) suspended in 50% (by volume) alcohol – causing oral pain, oral inflammation, tooth discoloration, and patients complain that it just tastes bad.
Ethicann’s solution is reformulation of the Sativex THC and CBD dosages into a proprietary Zydis® oral rapid dissolving tablet (ODT). Zydis is a proprietary ODT technology owned by Catalent, Inc., a global world leader in pharmaceutical development technologies and services. Zydis is used in some 20 drugs approved in 60 countries, and is a leader in ODT delivery technology.
EPI-002 Zydis tablets, for which a THC 2.7 mg: CBD 2.5 mg dose formulation and manufacturing process have been developed, contain no ethanol, have a strawberry flavoring, and dissolve sublingually within seconds, assuring rapid absorption in the oral tissue and delivery of therapeutic effect – surpassing all the competition. Absorption by the oral tissue provides rapid delivery to the brain and bypasses the “liver first pass effect” which removes 30-45% of the cannabinoids in the blood absorbed through the stomach.

Ethicann’s Zydis EPI-002 formulation is covered by Catalent’s extensive world patent portfolio. It is the Catalent internal policy not to produce competing products.
Achievements to Date
To date, Ethicann has developed reliable sources of cGMP-compliant active pharmaceutical ingredients (APIs), CBD and THC, both synthetic and botanical. Our partner Catalent has successfully formulated synthetic CBD and THC into Zydis tablets, as described above, to match the dosage of the existing and approved Sativex formulation.
Ethicann has performed an exploratory non-GLP pharmacokinetic (PK) study, in dogs, at Charles River Laboratories (Scotland). The purpose of this study was to demonstrate that blood levels of the active ingredients, over time, between Sativex and EPI-002 – administered to dogs – were substantially equivalent. This was an exploratory study not to be submitted to any regulatory authority, inasmuch as the full GCP study will have to be performed in humans. Dog studies can serve as a model for the human situation.
Regulatory Plan Going Forward
It is Ethicann’s intention to first register this product in Canada, using the abbreviated Submission Relying on Third-Party Data (SRTD) pathway, similar to the Paper NDA concept which predated the 505(b)(2) regulatory pathway. In this case, the comparator product will be the approved Sativex. In order to do this, we will first have to conduct a short “pilot variability” study in humans to determine measurement parameters and numbers of patients for a “full BE” study in humans, to show that pharmacokinetic (PK) parameters are essentially equivalent between Sativex and EPI-002. Concurrently, we will provide comparative human safety data to Health Canada, in the form of a short “Phase 2” safety study in humans that also measures phamacodynamic effects, safety and palatability of the two formulations. The safety data will be used in the labeling of EPI-002, providing market differentiation that EPI-002 does not cause oral adverse events, such as those induced by the 50% ethanol in Sativex. We expect that these critical studies can be completed during the second half of 2023 and that an SRTD submission to Health Canada for approval in Canada can be made during Q1-Q2, 2024. The Canadian data can be used for concurrent submissions in the UK, which will use the Canadian dossier as a basis for their approval, and in Germany, which has indicated to Ethicann that Canadian data can be used for an approval against the European Sativex drug.
In the United States, Ethicann will be seeking a Pre-IND (Investigational New Drug) meeting with the US Food and Drug Administration (FDA) in Q2-Q3, 2022, to discuss plans to bring EPI-002 to market in the US, where Sativex is not approved. Ethicann already understands that FDA will require a Phase 2 dose-ranging study, to confirm the optimum therapeutic dose ratio of THC:CBD, before it can progress into a pivotal Phase 3 study. In addition, Ethicann plans to use the abbreviated 505(b)(2) New Drug Application (NDA) pathway and believes it can obtain FDA approval in 3 ½ -4 ½ years for the MS spasticity indication. At the Pre-IND meeting, Ethicann intends to ask FDA to comment on its planned clinical protocol, and confirm the 505(b)(2) NDA pathway.
Manufacturing Plan Going Forward
Ethicann, based on the above successful dog pharmacokinetic (PK) study of EPI-002 verses Sativex, has authorized Catalent to initiate GMP scale-up of its manufacturing process for EPI-002. Catalent will use the formulation specifications and manufacturing process used to produce the same EPI-002 tablets as those used in the dog pharmacokinetic study. Secondary packaging will be decided after consultation with Health Canada. The scale-up manufacturing process, once established, will also be used to make three validation batches, and also provide tablets for long-term stability studies required for Health Canada approval.
Go-To-Market Strategy
Ethicann does not plan to become a fully-integrated pharmaceutical company. The company has begun to identify interested companies in Canada, United Kingdom and Germany, who may license the EPI-002 product and be responsible for sales and distribution in their geographical markets.
In the US, Ethicann will initiate the Phase 2 dose-ranging study, but also seek a partner to in-license the drug and possibly fund the Phase 3 pivotal study. Depending on the amount raised in the Series A round, Ethicann believes it can complete the Phase 2 dosing-ranging study in 2023-2024, the pivotal study in 2025-2026, and seek approval by 2027-2028.
Revenue Projections for EPI-002
As noted above, the existing annual market for MS Spasticity drugs is USD $2.2 billion. Ethicann plans, through its licensing partners, to be entering the Canadian market in 2025, the EU market in 2026 and the US market in 2028. Shown below are cumulative revenue (sales) projections (in USD $million) for the period 2025-2030 in all three markets. In these partner revenue projections, we assume a conservative 40% total addressable market of all MS spasticity patients, and a market penetration, by 2030, of a bit less than 10% in all markets. It is anticipated; however, that there will be licensing partners in certain Asian and Latin Markets, and that there may be off-label use for the much larger general spasticity market – but such is not included here.
