Shares in Oxford Cannabinoid Technologies soared on the Snoop Dogg-backed cannabis research firm's London debut today.
The company, which creates cannabinoid-based medicines for pain relief and aims to be able to sell its first drug by 2027, is the latest in a string of companies in the space to opt for a UK listing this year, after regulator the Financial Conduct Authority gave permission for medicinal cannabis firms to float.
OCT, which was founded in 2017 and has a partnership with Oxford University, placed 960.4 million shares at 5p per share, implying a market value of around £48 million.
Shares jumped by 50% to 7.5p in early trading, before settling back at around 5p later on Friday morning.
The company made £16.5 million from the IPO. Snoop Dogg is a partner in cannabis-focused VC firm, Casa Verde, which invested $10 million in OCT back in 2018 and will own around 2% of the company post-IPO. Backers also include tobacco giant, Imperial Brands, which will have a holding of nearly 11% after the float.
Cannabidiol, the non-psychoative compound in cannabis plants, is used medicinally to treat conditions including insomnia and to relieve pain. Its pain relief market is thought to be will be worth at least £42.5 billion worldwide.
OCT said it is aiming to "develop a portfolio of four drug candidates for approval as licensed pain medicines".
Co-Founder and executive chairman, Neil Mahapatra, said: "Our aim is to become a global leader in the provision of prescription medicines targeting the endocannabinoid system. This listing is an important step in OCT’s journey."
Other cannabidiol floats have also been well received in recent months.
The David Beckham-backed pain relief and skincare product-maker, Cellular Goods, saw its stock shoot up by 310% within 15 minutes of market open when it floated in March. Israel-based firm Kanabo, which makes a vaping pen to dispense regulated doses of medical-grade cannabis extract for pain and sleep disorders, saw its share price triple in value on its first day of trading.
Cairn Financial Advisers and States Bridge Capital advised on the OCT float.