Pfizer Inc., one of the largest American pharmaceutical companies has announced its recent venture into the cannabis market. The billion dollar corporation has gained momentum as the leading COVID-19 vaccine manufacturer in North America, known for producing some of the world’s most prominent prescription medicines and vaccines, specializing in cancer, heart and diabetes treatments, and has recently delved into a new territory—cannabis.
How Pfizer is moving into cannabis
According to a company press release on December 13, 2021, Pfizer announced their definitive agreement with Arena Pharmaceuticals, Inc. Pfizer will acquire Arena, a clinical-stage biotechnology company, and all of their outstanding shares, valued at approximately $6.7 billion. The board of directors of both Pfizer and Arena have unanimously approved this business arrangement.
“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 Global President of Inflammation & Immunology at Pfizer, Mike Gladstone. “Utilizing Pfizer’s leading research and global development capabilities, we plan to accelerate the clinical development of etrasimod for patients with immuno-inflammatory diseases.”
Arena Pharmaceuticals and its leading-edge in gastrointestinal diseases research has a few promising cannabis-based treatments in the development pipeline. Olorinab, a drug used to treat Irritable Bowel Syndrome (IBS) is in phase 2 of development, and Etrasimod, used to treat Ulcerative Colitis and Crohn’s disease, is in the later stages of development. There have been several recent studies investigating the effects of cannabis on IBS, Crohn’s diseases and ulcerative colitis. The results of these studies indicate that cannabis could indeed benefit those diagnosed with IBS and Crohn’s disease and could also aid in the treatment of pain relief from the associated symptoms with these gastrointestinal diseases.
Big Pharma and Legalization
Big Pharma companies may feel overwhelmed by the growing popularity of cannabis-based treatments as they have been proven effective for many conditions that are usually treated with pharmaceutical medication. As of now, according to the National Conference of State Legislators, 36 states and four out of five territories in the U.S. and the District of Columbia have legalized the use of cannabis for medicinal purposes. If all 50 states legalized medical cannabis, it has been projected that the pharmaceutical industry would lose $18.5 billion.
As many pharmaceutical companies may have mixed feelings regarding the fact that prescription drugs could effectively be replaced with cannabis-based treatments, companies such as Pfizer are taking advantage of this booming industry, embracing it instead of evading it. The size of the global medical cannabis market was predicted at a whopping $16.47 billion in 2021, and only continues to flourish with a forecasted worth of $46.18 billion by the year of 2026.
The Future of Big Pharma and Cannabis
Pfizer’s acquisition of Arena may be the beginning of many big pharma companies dipping their toes into the pool of medical cannabis. According to an interview with Nawan Butt, a portfolio manager of The Medical Cannabis and Wellness ICTIS ETC, he mentions the importance of this deal in regards to the progress for medical cannabis research opportunities and treatment.
“This acquisition displays the interest big pharma is taking in the fast-evolving world of cannabinoids. We are encouraged by the acquisition as it provides more resources and a wider platform for pharmaceutical development of cannabinoids. Overall, this transaction is in line [with] Pfizer’s long-term focus on innovative research and a great win for our investors,” he told Proactive Investors.
The medical cannabis industry is on the fast-track with new studies and treatments underway, and many pharmaceutical companies may miss out on the opportunity to capitalize in this market if they continue to ignore the growing trends and benefits of cannabis-based medicine. As the number of countries legalizing cannabis continues to grow, so does the scientific evidence to support the use of medical cannabis for many therapeutic treatments.