Argent BioPharma Licenses CannEpil® Globally for US$5.5M Upfront and 15% Royalties

Debt Forgiveness Unlocks Immediate Value

Argent BioPharma (ASX:RGT) has cleared a major financial hurdle by converting US$5.5 million of convertible notes into an upfront payment for the global licensing rights to CannEpil®, its neurological drug-resistant epilepsy therapy. This transaction extinguishes Argent’s principal secured debt held by Mercer Street Global Opportunity Fund, significantly cleaning up the balance sheet and removing related security interests.

The debt forgiveness arrangement replaces the convertible notes with preferred equity issued by Splash Beverage Group (NYSE American: SBEV), the new global licensee. This clever financial engineering strengthens Argent’s capital structure, removing a long-standing overhang that had constrained strategic flexibility.

Retaining Control While Sharing the Spoils

Despite granting Splash exclusive global commercialisation rights, Argent retains 100% ownership of CannEpil®’s existing and future intellectual property, manufacturing knowhow, and regulatory assets. The company will continue manufacturing CannEpil® through its EU-GMP certified facilities, securing manufacturing revenues and maintaining a vital role in the product’s supply chain.

Argent will also receive a 15% royalty on net revenues from CannEpil® sales globally. This perpetual royalty arrangement ensures ongoing participation in CannEpil®’s commercial success without the operational burden of direct marketing or development, which Splash will now lead.

CannEpil® Positioned for US Market Push

CannEpil® is a pharmaceutical-grade 20:1 CBD:THC oral solution designed for drug-resistant epilepsy, a condition affecting roughly one-third of epilepsy patients worldwide. The product already has commercial presence and reimbursement in several jurisdictions including Ireland, the UK, Germany, and Australia, backed by real-world clinical evidence and an active FDA IND program.

Under the deal, Splash is responsible for advancing CannEpil®’s clinical development and regulatory approvals, prioritising the US market. They must initiate Phase I and II clinical trials within 24 and 48 months respectively, and file a New Drug Application (NDA) with the FDA if trials succeed. This shifts the costly and risky clinical development burden away from Argent, while preserving upside through royalties and manufacturing.

Strategic Implications for Argent’s Portfolio

Chairman Roby Zomer emphasised the deal’s milestone status, noting it simultaneously delivers upfront capital, removes secured debt, and preserves Argent’s long-term economic interest in CannEpil®. The transaction also supports Argent’s broader neuro-immune portfolio ambitions and its strategy to list on a US national exchange.

With the debt overhang lifted and a clearer strategic focus, Argent is better positioned to advance its pipeline, including assets like CimetrA® and its recently acquired veterinary epilepsy programme. The ongoing manufacturing role and royalty stream provide a stable commercial foundation as Argent navigates clinical development and market expansion.