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Zenabis Provides Operations Update for September 2019

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Zenabis Global Inc. (TSX:ZENA) (“Zenabis” or the “Company“) is pleased to provide an update on its recent facility construction and licensing activities and recent cannabis production results.

Highlights:

  • With respect to production results:

    • Cultivation output in September 2019 was 2,089 kg of dried cannabis, with production at Zenabis Atholville outperforming its revised design capacity by 21.8% (the Performance Ratio1).

    • Cultivation output of 2,089 kg of dried cannabis was 21.2% greater than Zenabis’ revised forecast output (as updated on August 6, 2019) of 1,731 kg of dried cannabis.

  • Zenabis submitted a license amendment application for Zenabis Langley’s existing cultivation license on September 27, 2019 to include additional growing areas totaling 101,300 sq. ft. for Zenabis Langley – Part 2AZenabis’ licensed annual production capacity is expected to increase by 39,400 kg to 96,400 kg once this license amendment is approved by Health Canada.

  • Zenabis continues to focus on construction and licensing of Zenabis Langley. Zenabis has revised its construction timelines at Zenabis Langley to split Zenabis Langley – Part 2B into two phases (Zenabis Langley – Part 2B and Zenabis Langley – Part 2C) in order to preserve cashflow given current market conditions and reduce ramp-up risk, among other reasons detailed below. Zenabis expects to submit a license amendment for Part 2B in November 2019 (14,800 kg of licensed annual production capacity). Zenabis expects to submit a license amendment for Part 2C in February 2020 (32,000 kg of licensed annual production capacity) to the extent this is justified by market demand at economic prices. Zenabis’ total annual cultivation capacity is expected to increase to 143,200 kg of dried cannabis on completion of licensing at Zenabis Langley early in the second quarter of 2020.

Andrew Grieve, Chief Executive Officer of Zenabis, stated, “We continued to see strong cultivation results in September, with output exceeding our forecast of 1,731 kg by 21.8%. Our Performance Ratio decreased month over month as a result of the significant number of harvests from newly licensed rooms in the month (five of the 10 harvests). The Performance Ratio for newly licensed rooms harvested in September was 14.2% while the Performance Ratio for rooms that had previously been operated was 30.0%. Although the variety of cultivation approaches and rapid scale-up at Zenabis Atholville continues to cause room by room variance, steady-state yields for each cultivar are expected in the near-term, with general steady-state operations expected at Zenabis Atholville by the end of 2019.

“Since our last update, we increased our licensed annual cultivation capacity to 57,000 kg and submitted a licence application that is expected to increase our licensed annual production capacity by 69%, from 57,000 kg to 96,400 kg,” continued Andrew Grieve, Chief Executive Office of Zenabis. “While the timeline revision for Zenabis Langley will delay achieving full design capacity at the facility, we expect to have 96,400 kg of capacity licensed and operational by the end of 2019 with approval of the Zenabis Langley – Part 2A amendment. By early in the first quarter of 2020, we expect to have 111,200 kg of capacity licensed and operational with the approval of the Zenabis Langley – Part 2B amendment.”

_________________________

1

To better reflect the actual performance of its facilities, the Company reports a Performance Ratio, calculated as follows: after each harvest, Zenabis calculates the dry weight cannabis output for each room (the “Total Output”), taking into account the amount of days in production through a combination of: (1) the amount of flower room days used (including turnaround time) for that room; and (2) the amount of flower-room equivalent days required from other flower rooms in support of that harvest (together the “Effective Flower Room Equivalent Days”). Zenabis then divides the Total Output by the Effective Flower Room Equivalent Days in order to produce the “Effective Yield Per Day” for each room, and then divides the Effective Yield Per Day by the Design Capacity Yield Per Day for each room in order to determine actual performance versus the Design Capacity Yield Per Day (this ratio being the “Performance Ratio”). Zenabis believes that the Performance Ratio will provide investors with the best measure of actual cultivation performance versus Zenabis’ published design capacity. Zenabis intends to update and publish updated design capacities for each of its facilities when a facility has harvested from all its flower rooms (with the update at that time reflecting the most recent performance from each flower room) and again, if required due to significantly different results, when a facility achieves consistent monthly performance at a level that is different from its published Design Capacity.  Zenabis revised its design capacity at Zenabis Atholville upwards by 35% (equal to Zenabis Atholville’s Performance Ratio for the three months ended June 30, 2019) from 34,300 kg per annum to 46,300 kg per annum. Zenabis no longer reports outperformance relative to original design capacity (the kg/day figure utilized to derive the 34,300 kg design capacity).

Cannabis Production Summary

In September 2019, Zenabis realized a total harvest weight of 2,089 kg of dried cannabis.

The amount harvested at Zenabis Atholville for the three months ending September 30, 2019 exceeded the revised design capacity of the flower rooms by an average of 25.7%, compared to 23.2% in the three-month period from June 2019 through August 2019. A month-to-month comparison of actual harvests compared with harvest forecast based on revised design capacity between January 2019 and September 2019 for Zenabis Atholville is provided in the table below.

Revised Design Capacity

Performance at Zenabis

Atholville

Jan

2019

Feb

 2019

Mar

 2019

Apr

2019

May

2019

June

2019

July

2019

Aug

2019

Sept

2019

Total

Actual Harvest Weight (kg)

474

480

518

809

908

756

1,238

1,912

2,089

9,184

Revised Design Capacity

Harvest Weight (kg)2

467

643

539

796

895

716

1,097

1,357

1,715

8,225

Difference (kg)

7

(163)

(21)

13

13

40

141

555

374

959

Difference (%) – Revised

“Performance Ratio”

1.5%

(25.3%)

(3.9%)

1.6%

1.5%

5.6%

12.9%

40.9%

21.8%

11.7%

2

The Revised Design Capacity Harvest Weight is based on the “design capacity” yield that Zenabis has disclosed to date.  This figure was derived by converting the actual square footage of flower room space and the forecast canopy for each specific flower room into a kilograms per room per day figure based on Zenabis’ historical yield data at the Zenabis Atholville facility based on the yield performance in the three months ending June 2019 for revised design capacity. The Revised Design Capacity Harvest Weight in the table above is the harvest weight that would have resulted if the Design Capacity Yield Per Day for a room was multiplied by the Effective Flower Room Equivalent Days, as defined under “Performance Ratio”. Zenabis has revised its design capacity at Zenabis Atholville upwards by 35% (equal to Zenabis Atholville’s Performance Ratio for the three months ended June 30, 2019) from 34,300 kg per annum to 46,300 kg per annum. Zenabis no longer reports outperformance relative to original design capacity (the kg/day figure utilized to derive the 34,300 kg original design capacity for Zenabis Atholville)

In September 2019, Zenabis completed 10 harvests at Zenabis Atholville. The average Performance Ratio for these harvests was 21.8% relative to the revised design capacity. In September 2019, Zenabis did not complete any harvests at Zenabis Stellarton or Zenabis Langley.

2019 Harvest Forecast – Zenabis Atholville, Zenabis Stellarton and Zenabis Langley Site A – Part 1

For its existing licensed facilities of Zenabis Atholville, Zenabis Stellarton and Zenabis Langley Site A – Part 1, Zenabis expects to produce approximately 16,7335 kg of dried cannabis from October 2019 through January 2020. Zenabis continues to expect to complete its first harvest from Zenabis Langley in November. Zenabis’ forecast harvest output in November includes 1,650 kg from Zenabis Langley. The following table sets out Zenabis’ estimated aggregate monthly harvests for Zenabis Atholville, Zenabis Stellarton and Zenabis Langley Site A – Part 1 for the remainder of 2019 and January of 2020.

July

2019

Aug

2019

Sept

2019

Oct

2019

Nov

2019

Dec

2019

Jan

2020

Total

Forecast (kg)3

1,212

1,579

1,731

3,758

5,199

4,200

3,576

21,255

Actual (kg)

1,238

1,996

2,089

5,323

3 

This forward-looking estimate of future harvest results is based on the following material assumptions: (1) Zenabis Stellarton and Zenabis Langley Site A – Part 1 operate at their published design capacity on a room by room basis for the cultivation space that is licensed and in cultivation at the forward-looking periods noted; (2) Atholville rooms operate based on the current flower schedule and at revised design capacity (a 35% increase relative to original design capacity); and (3) Cultivation commencement at Zenabis Langley Site A – Part 1 in September 2019.   

Zenabis intends to provide a monthly cultivation forecast for Zenabis Langley Site A – Part 2A and Zenabis Langley Site A – Part 2B upon receipt of all cultivation license amendments for these phases.

Cannabis Post-Harvesting and Packaging Discussion

The timeline from harvest to the point at which Zenabis completes a sale of that product ranges from a minimum of three weeks (in the case of a bulk sale to a licensed producer) to more than eight weeks (in the case of soft gel capsules which involve external extraction, processing, filling, packaging and shipment). Zenabis recognizes the revenue from completion of such sales in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board.

In August 2019, Zenabis replaced its original packaging equipment (for bud jar filling) at Zenabis Atholville with new packaging equipment intended to achieve output of 30,000 units per day (equivalent to more than 90,000 grams per day at current average volumes per jar). During September 2019, the new packaging equipment was not able to achieve its expected output. Instead average output in September was 6,276 units per day, resulting in completed bud filling of only 517 kg (this excludes pre-roll packaging and bulk packaging). As a result, Zenabis was not able to package, ship and sell all of its product cultivated in August and September that had been destined for provincial counterparties, causing a delay in achieving the Company’s expected revenues. With focused troubleshooting, Zenabis has now achieved primary packaging output of 11,643 units per day, on average, during the 14 days ending October 20, 2019, with a maximum of 22,416 units per day. In addition, Zenabis has moved the original packaging equipment at Zenabis Atholville to Zenabis Stellarton and is in the process of ramping-up packaging at Zenabis Stellarton (bud filling commenced October 10, 2019 and pre-roll packaging commenced September 11, 2019). Zenabis expects that, as of November 2019, the Company will have surplus packaging capacity, and that there will be no further delays in the Company’s ability to package, ship and sell all of the product cultivated at Zenabis Atholville.

Currently, indicative demand from provincial counterparties exceeds forecast supply of both packaged flower and packaged pre-rolls for October 2019 through January of 2020 without further reductions in price. Indicative demand does not necessarily translate into actual demand, as the planning process with provincial counterparties may not result in firm volume indications until two weeks prior to a shipment, with purchase orders at times being finalized within days of shipments. As ramp-up of Zenabis’ facilities and the facilities of competitors occurs, Zenabis expects continued pressure on wholesale pricing to be applied by provincial counterparties.

In September, Zenabis packaged 650 kg of bulk product and shipped 190 kg, with the remainder held over for shipment to bulk counterparties in October to meet prepaid supply agreement commitments. Zenabis packaged 732 kg of flower and pre-rolls for provincial counterparties in September and shipped 462 kg. Zenabis also shipped 174 litres of oil products in September.

Construction and Facility Update

Zenabis Atholville

Now that construction is substantially complete4 at Zenabis Atholville, Zenabis is focused on operational improvements to reduce operating costs (increasing packaging automation, for example), improve post-harvest processing, increase yield, and improve packaging throughput.

Zenabis Langley

The first phase of Zenabis Langley (Zenabis Langley – Part 1) is licensed and operational. Since Zenabis’ August operations update was released, Zenabis has reached substantial completion of Part 2A4 and submitted a cultivation license amendment for this phase.

Zenabis remains focused on converting the remaining portion of Zenabis Langley but has revised its conversion plan for these phases to split Zenabis Langley – Part 2B into two phases (Zenabis Langley – Part 2B and Zenabis Langley – Part 2C). Zenabis has made this revision for the following reasons:

  • Focus on Cashflow Generation. By revising the timeline for the submission of Zenabis Langley’s final two flower rooms (Zenabis Langley – Part 2C), Zenabis expects to be able to reduce cashflow outflows for capital expenditure as Zenabis works to generate positive cashflow from operations.

  • Staggering Operational Ramp-Up. Further staggering the operational ramp-up at Zenabis Langley is expected to reduce the inherent issues that come with ramping up a facility of this size. As is illustrated by the packaging discussion above (regarding ramp-up at Zenabis Atholville), ramp-up challenges are possible in this industry. While Zenabis is focused on ramping up its facilities in a manner where any commercially possible action is taken to mitigate ramp-up risk, Zenabis believes that staggering the ramp-up at Zenabis Langley is in the best interest of the Company.

  • Defer Budget Overages. Zenabis recently identified that it expects to spend the entirety of its estimated amount remaining at Zenabis Langley (as forecast in Zenabis’ MD&A for the period ending June 30, 2019 at $13,700,000) upon completion of Part 2B. As a result, Zenabis expects capital expenditure amounts remaining to spend relating to Part 2C to be budget overages (estimated to be $4,000,000). This overage was driven by increases in equipment costs relating to HVAC equipment and automated tray tables. Zenabis has made the decision to defer this overage expenditure to a time when it can be funded by operating cashflow as opposed to cash on hand.

Zenabis expects this timeline revision to have the following impact on the cumulative capacity submitted for licensing at Zenabis Langley:

Month

Cumulative Capacity

Submitted for Licensing

(Original Timeline)

Cumulative Capacity

Submitted for Licensing

(Revised Timeline)

Difference

October 2019

49,300 kg

49,300 kg

November 2019

96,100 kg

64,100 kg

(32,000 kg)

December 2019

96,100 kg

64,100 kg

(32,000 kg)

January 2020

96,100 kg

64,100 kg

(32,000 kg)

February 2020

96,100 kg

96,100 kg

A summary of construction status by phase is provided below:

Phase

Design Capacity

Description

Part 1

9,900 kg

– Licensed and operational

Part 2A

39,400 kg

– Consists of 101,300 sq. ft. of flower room space (two flower rooms)

– Substantially complete

– License amendment submitted in September 2019

Part 2B

14,800 kg

– Consists of 38,000 sq. ft. of flower room space (one flower room)

– HVAC, flooring and shade screen installation is ongoing

– Security equipment and lighting installation is substantially complete

Part 2C

32,000 kg

– Consists of 82,200 sq. ft. of flower room space (two flower rooms) and

122,300 sq. ft. of other operational spaces (includes drying rooms,

packaging rooms, mother space and vegetation space)

– HVAC, flooring and shade screen installation is ongoing

– Security equipment and lighting installation is substantially complete

_________________________

4 

Zenabis defines substantial completion as the ability to undertake (subject to licensing) all production activities within the design capacity of the facility.

Zenabis Stellarton

On September 6, 2019, Zenabis received a cannabis processing license for Zenabis Stellarton. Zenabis commenced pre-roll production at Zenabis Stellarton during the week of September 9, 2019. Zenabis’ current pre-roll production capacity at Zenabis Stellarton is estimated at ~600 kg of pre-rolls per month. Zenabis intends to achieve output of 1,200 kg of pre-rolls per month at Zenabis Stellarton by November 2019, subject to market demand for pre-rolls.

In addition, as noted above, Zenabis has installed at Zenabis Stellarton the packaging equipment (for bud jar filling) previously used at Zenabis Atholville. Following completion of the ramp-up of this equipment, combined with the new packaging equipment in operation at Zenabis Atholville, Zenabis expects to have excess packaging capacity.

Zenabis Delta

Zenabis is currently in the process of constructing extraction and post-processing capacity, a product development lab, a formulation design lab, and a full ISO certified analytical testing lab at Zenabis Delta. This construction project is expected to be complete in the first half of 2020.

Licensing Update

Zenabis is currently in the process of various licensing applications for Zenabis Delta, Zenabis Langley, Zenabis Stellarton and the Zen Craft Grow program as outlined in the table below:

License Submission

Submission Month

Annual Design Capacity

Zenabis Delta – Analytical Testing

May 2019

N/A

Zen Craft Grow – Grower 1

July 2019

350 kg

Zenabis Langley – Part 2A

September 2019

39,400 kg

Zenabis Stellarton – Sales License

October 20195

N/A

Zenabis Langley – Part 2B

November 20195

14,800 kg

Zenabis Langley – Part 2C

February 20205

32,000 kg

5

Expected submission timeline subject to receipt of prior license or license amendment for each facility

Zenabis is currently using Zenabis Pitt Meadows, Zenabis Aldergrove and Zenabis Langley for the Company’s propagation and floral business, as well as hemp cultivation activities. All hemp cultivation at Zenabis Aldergrove that uses greenhouse space is currently not being used by the propagation and floral business, and thus will not have a negative impact on Zenabis’ propagation and floral business. Hemp cultivation will neither interfere with the planned cannabis cultivation activities at Zenabis Langley, nor will it reduce the cannabis cultivation design capacity of Zenabis Langley.

 

SOURCE Zenabis Global Inc.

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Valens expands Exclusive Licence Agreement to Bring Leading Cannabis-Infusion Technology to New International Markets

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Valens GroWorks Corp. (TSXV: VGW) (OTCQX: VGWCF) (the “Company” or “Valens“), a cannabinoid-based product company with industry leading extraction, next generation cannabinoid delivery formats and an ISO 17025 accredited analytical lab, is pleased to announce that it has entered an amended manufacturing and sales licence agreement with SōRSE Technology Corporation (“SōRSE“) which grants Valens an exclusive licence for CanadaEuropeAustralia and Mexico to use the proprietary SōRSE emulsion technology (“the Technology“) to produce, market, package, sell and distribute cannabis-infused products (the “Agreement“).

“This Agreement shows Valens’ commitment to invest and broaden its IP portfolio and enable its customers to bring differentiated, next generation products to market,” said Jeff Fallows, President of Valens. “As we move into “Cannabis 2.0” in Canada, we believe the products that offer consistent, high quality and predictable user experiences, like those we are able to create with SōRSE, will capture the lion’s share of attention and be the hallmark for brand development in a strict regulatory environment. With this expanded agreement in place, we have extended this opportunity for our existing customers to key international markets and at the same time established a platform for international consumer brands to add high quality, cannabis infused products to their portfolios.”

The SōRSE Emulsion Technology

The SōRSE emulsion technology transforms cannabis oil into water-soluble forms for use in beverages, edibles, topicals and other consumer products without the burden of cannabis taste, colour or smell. The Technology allows these cannabis infused products to maintain potency when heated, chilled or frozen and provides a number of other key advantages as well, including: (1) a faster observed onset time compared to other infused beverages and edibles, (2) a significant reduction of offset time, (3) an ability to use lower doses of cannabinoids due to the enhanced bioavailability provided by the Technology, and (4) increased consistency and stability with some product formulations achieving more than one-year shelf stability with no evidence of separation.

“We are proud to expand our partnership with Valens and leverage their near-term access to various global markets,” says Howard Lee, CEO of SōRSE. “Over the last year, our team of more than 40 plus professionals has continued to actively focus on creating and developing innovative, desirable products and formats of consumption for cannabis consumers. As emulsion technology becomes more popular through new delivery methods such as ingestion, transdermal, topical and more, it is imperative that quality and safety in consumption leads all innovation in this sector. This is a shared value and mandate that our teams at SōRSE and Valens both prioritize. We look forward to continuing this working relationship with Valens and introducing our award-winning emulsion technology to the global markets.”

Geographic Expansion

The Agreement grants Valens an exclusive licence to use the Technology in CanadaEuropeAustralia and Mexico (except in respect of medical applications requiring clinical trials) during the initial 5-year term, subject to certain performance milestones. This increases the addressable market from 37 million in the current Canada only agreement to 700 million people in the new Agreement, an increase of almost 20x. Furthermore, the Agreement provides a framework for Valens to obtain rights to establish non-exclusive agreements to sell cannabis-infused products using the Technology in the U.S. market and other markets, globally.

Bolstering “Cannabis 2.0” Platform

With the expanded exclusivity, Valens and its white label clients are positioned to not only succeed in the Canadian market, but also in the rapidly emerging legal cannabis and hemp-derived CBD markets in EuropeAustraliaMexico and beyond. The Agreement adds to the Company’s leading white label product offerings across numerous “Cannabis 2.0” categories such as beverages, edibles, transdermal products and more, enabling Valens to better serve its current and future partners.

“We have seen incredible interest from our current and potential clients regarding the SōRSE emulsion technology and we are thrilled to finalize the expanded licence agreement with SōRSE,” said Tyler Robson, CEO of Valens. “We expect the expanded exclusive territory will provide our clients with improved visibility and greater opportunity as they look to build global businesses around cannabis-infused products over the long term.

This is an exciting time in the evolution of ingestible cannabis products such as beverages and edibles. Historically, ingestible products have been lacking the necessary technology to provide a consistent, predictable experience, ultimately giving little reason to consume in this manner. At Valens, we expect that properly formulated, extract-based cannabis products, and infused beverages in particular, could disrupt many established beverage categories such as soft drinks, sports drinks, value-added water and alcohol, the latter of which has a monthly spend per capita that is roughly 16 times higher compared to legal cannabis spend in Canada. We believe the ability to plan an occasion and predict the outcome of use will be a game changer in the market and be the catalyst to bring about the full market potential of cannabis infused beverages and edibles, globally.”

Future White Label Services

The Agreement furthers the existing relationship between Valens and SōRSE and enables Valens to produce and sell SōRSE’s portfolio of branded products in Canada and the other exclusive markets at the option of the Company. These branded products include Happy Apple, a cannabis-infused sparkling cider and Major, a cannabis-infused fruit drink, both recognized as top selling cannabis beverages in the State of Washington, Pearl20, a cannabis-infused food and beverage mixer, and the Utopia line of cannabis-infused sparkling water, among others.

Agreement Summary

The consideration at closing for the exclusivity in the expanded geography was US$10 million, comprised of US$6 million in cash and US$4 million to be issued in common shares of the Company (the “Common Shares“). The Agreement carries an initial 5-year exclusive term with a 2-year renewal of the exclusivity, subject to certain performance milestones related to operational and financial achievements (the “Milestones“). As part of the Agreement, Valens will transfer to SōRSE royalty payments calculated as a percentage of sales (the “Royalty Payments“) and the Royalty Payments will be subject to an annual minimum of $2 million over the 5-year term. The Agreement also provides for a continuation of the Agreement on a non-exclusive basis after the 2-year renewal, subject to annual minimum royalty payments.

All Common Shares pursuant to the Agreement were issued at an indicative price of CDN$3.0471, being the volume-weighted average price of the Common Shares on the TSX Venture Exchange (“TSXV“) for the ten (10) trading days ending December 9, 2019. The Agreement remains subject to approval from the TSXV. All Common Shares issued in connection with the Agreement will be subject to a restricted period of four months and one day. There are no finders’ fees payable by the Company in connection with the Agreement.

 

SOURCE Valens GroWorks Corp.

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Bragar Eagel & Squire, P.C. Reminds Investors That Class Action Lawsuits Have Been Filed Against Energy Transfer LP, Grubhub, Aurora Cannabis, and The RealReal and Encourages Investors to Contact the Firm

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Bragar Eagel & Squire, P.C., a nationally recognized shareholder law firm, reminds investors that class action lawsuits have been commenced on behalf of stockholders of  Energy Transfer LP (NYSE: ET), Grubhub, Inc. (NYSE: GRUB), Aurora Cannabis, Inc. (NYSE: ACB), and The RealReal, Inc. (NASDAQ: REAL). Stockholders have until the deadlines below to petition the court to serve as lead plaintiff. Additional information about each case can be found at the link provided.

Energy Transfer LP (NYSE: ET)

Class Period: February 25, 2017 to November 11, 2019

Lead Plaintiff Deadline: January 20, 2020

On November 12, 2019, the Associated Press reported that Energy Transfer’s Mariner East pipeline project was under investigation by the Federal Bureau of Investigation (“FBI”). Citing interviews with current and former state employees, the Associated Press reported that the FBI’s investigation “involves the permitting of the pipeline, whether [Pennsylvania Governor Tom] Wolf and his administration forced environmental protection staff to approve construction permits and whether Wolf or his administration received anything in return.”

On this news, Energy Transfer’s stock price fell $0.81 per share, or 6.77%, over the following two trading sessions, closing at $11.16 per share on November 13, 2019.

The complaint, filed on November 20, 2019, alleges that throughout the Class Period, defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the company’s business, operational and compliance policies. Specifically, defendants made false and/or misleading statements and/or failed to disclose that: (i) Energy Transfer’s permits to conduct the Mariner East pipeline project in Pennsylvania were secured via bribery and/or other improper conduct; (ii) the foregoing misconduct increased the risk that the Company and/or certain of its employees would be subject to government and/or regulatory action; and (iii) as a result, the Company’s public statements were materially false and misleading at all relevant times.

 

SOURCE Bragar Eagel & Squire, P.C.

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iX Biopharma secures Australian cannabis manufacture licence

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Specialty pharmaceutical company iX Biopharma Ltd (SGX:42C) (“iX Biopharma” or, together with its subsidiaries, “the Group”) is pleased to announce today that its wholly-owned subsidiary, iX Syrinx (“Syrinx”), has been awarded a cannabis manufacture license from the Australian Office of Drug Control under the Narcotics Drugs Act 1967. Under the said licence, the Group is permitted to manufacture and supply extracts and tinctures of cannabis and cannabis resins.

This marks a significant milestone for the Group. Syrinx operates a TGA cGMP certified facility and holds import and export licences for cannabis and State poisons licences; together with the newly granted cannabis manufacture licence, the Group is now able to fully participate in the global medicinal cannabis business.

Importantly, the Group will be able to manufacture and distribute its newly formulated Xativa™ sublingual cannabis wafers in Australia through the Australian Special Access Scheme and in overseas markets. Xativa™ leverages on iX Biopharma’s novel and patented WaferiX™ technology to improve the speed and level of absorption and predictability of effect of medicinal cannabis. Xativa™ provides patients with a more elegant and discreet way to consume medicinal cannabis compared to existing dosage forms for cannabis such as joints, vapes and tinctures, and hence offers a superior user experience. The Group has received feedback from physicians in Australia that the advantages of Xativa™ and its differentiation from the rest of the market offerings are clear and highly desired.

Produced via iX Biopharma’s proprietary freeze-drying technique, the porous and amorphous WaferiX™ matrix holding the active CBD molecules is designed to collapse quickly within the sublingual space. The actives are then transported rapidly across the sublingual membrane into the blood vessels for a rapid onset of action.

“Globally, the use of cannabis for the treatment of a wide range of medical conditions has been growing at an exponential pace. The grant of the cannabis manufacturing licence has come at a most opportune time, allowing us to manufacture, distribute and promote Xativa™ as the gold standard in medicinal cannabis delivery, thereby charting a new growth trajectory for the Group,” said Ms Eva Tan, Director of Corporate and Commercial Strategy of iX Biopharma.

 

SOURCE iX Biopharma Ltd

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