PharmaCielo Ltd. (“PharmaCielo” or the “Company”) (TSXV: PCLO) (OTCQX: PCLOF), the Canadian parent of Colombia’s premier cultivator and producer of medicinal-grade cannabis extracts, PharmaCielo Colombia Holdings S.A.S., today announced that potential customers from Germany, Poland, and Australia have scheduled EU-GMP and GMP validation audits of PharmaCielo’s processes. These confirmatory audits are typical of those conducted by pharmaceutical companies prior to entering new commercial relationships with B2B suppliers. The Company also provided updates regarding its previously announced GMP confirmatory audits in Colombia and Mexico.

The growth in requests for customer initiated GMP validations demonstrates that PharmaCielo’s refocused sales strategy is gaining traction. As a result, the Company is securing opportunities to collaborate with pharmaceutical companies early in their product development cycle. This early collaboration is expected to result in a sustainable competitive advantage for those products that are ultimately registered based on PharmaCielo’s APIs².

“The efforts of our team in combination with a focused sales strategy, have generated early success and resulted in increased demand for confirmatory GMP audits by potential customers, particularly in the pharmaceutical sector,” said Henning von Koss, CEO of PharmaCielo Ltd. “As we noted in the recent announcement regarding our shipments to two Brazilian customers, sophisticated end-product producers are starting to come to market looking for high quality, commercial scale cannabinoid supply. These organizations are also following well-established procedures used in the global pharmaceutical industry to evaluate potential suppliers, including the proprietary confirmation of GMP compliance. We look forward to completing the process with each of these potential customers and expect that each success will feed our sales pipeline and build PharmaCielo’s global reputation as a supplier of choice.”

Germany

In April 2021, PharmaCielo hosted a Rionegro site visit to familiarize a well-established Phyto-pharmaceutical company with the Company’s processes and products. Following that visit, the potential customer has expressed interest in advancing to the next phase and conducting a formal audit to confirm PharmaCielo’s EU-GMP compliance.

Poland

The Company is engaged in late-stage sales discussions with a potential pharmaceutical customer in Poland. This potential customer has booked an EU-GMP validation audit during May 2021.

Australia

PharmaCielo is engaged in late-stage sales discussions with the Australian arm of a well-known cannabis company and is expected to schedule a GMP validation audit in early Q3 2021.

Mexico

As previously disclosed, following a Colombian site visit by MINO Labs S.A. de C.V. (“MINO Labs”), the Company’s joint venture partner in PharmaCielo S.A. de C.V. (“PharmaCielo Mexico”), PharmaCielo has submitted a request to initiate the Mexican GMP audit process, which the Company expects to be complete during Q2 2021 or Q3 2021, depending on the Mexican Authorities’ availability to travel to the facility. The pre-audit has been completed and PharmaCielo Mexico is currently in the process of obtaining an import license for cannabis products in Mexico.

Brazil

As disclosed in the Company’s press release dated April 26, 2021, titled PharmaCielo Makes Initial Shipments to two Brazilian Customers, one of Brazil’s largest Phyto-therapeutics companies recently completed a review of PharmaCielo’s processes to confirm GMP compliance. In the same press release, PharmaCielo disclosed that it had also recently shipped product to a well-established Brazilian pharmaceutical company.

Colombia

The Company’s Colombian GMP certification is still in process and PharmaCielo expects to achieve certification by the end of Q2/beginning of Q3.