Philip Morris acquires cannabis vaporizer maker Syqe Medical for $650 million

Philip Morris, the international tobacco giant, is acquiring Israeli company Syqe Medical in a deal worth up to $650 million, the company has learned. Calcalist. Syqe's main product is a metered-dose inhaler to treat pain using cannabis vaporization.

The agreement has several stages. Philip Morris will first 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 purchase all shares in the Israeli company for $650 million.

The transaction will be carried out through Philip Morris' Vectura subsidiary, which specializes in 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 Israel's medical technology sector. If the $650 million valuation is reached, Syqe will become one of the top ten cannabis companies worldwide, joining the ranks of Tilray and Aurora.

This exit is very significant for all Syqe investors, given that total investment in the company to date stands at just $80 million. The company's founder and CEO, Perry Davidson, holds a relatively large stake in the company, over 10%.

Founded in 2011 by Mr Davidson, who is still CEO, Syqe holds around 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, rather than its processed products, and in the ability to measure an exact dose for the patient, aiming for a minimum effective dose.

For the moment, Syqe's inhaler is available in Israel and Australia, which are relatively small markets. Syqe's main target market therefore lies outside Israel, and the FDA approval process in the USA would be a crucial step. If successful, Syqe would be the first company in the world to obtain FDA approval for the use of raw cannabis inflorescences as medicine.