News Roundup June 2018

A monthly summary of the key events taking place in the Colombian medicinal cannabis industry

Financial

PharmaCielo to raise 60 million USD with Private Placement of Subscription Receipts in partnership with AAJ

PharmaCielo Ltd., the Canadian parent company of Colombia’s major cannabis oil producer, appointed a syndicate of agents led by Echelon Wealth Partners Inc., Cormark Securities Inc. and GMP Securities L.P. to sell subscription receipts of PharmaCielo in a private placement basis. The company expects to obtain gross proceeds of 60 million USD, at a 3.35 USD price per subscription receipt.

Aurora Cannabis (TSX: ACB) and MedReleaf Corp. (TSX: LEAF) join efforts to expand by signing an Arrangement Agreement

Former Canadian competitors Aurora Cannabis and MedReleaf Corp. merged to become a global giant in the cannabis industry. Through the signed Arrangement Agreement, Aurora Cannabis bought MedReleaf Corp. for 2.900 million USD worth in stocks, an operation that promises to increase production capacity up to 570,000 kg of hemp, as well as expand from North America and Europe with currently 11 laboratories to Australia and Latin America.

Aphria Inc. (TSX: AHP) seals supply deal with Colombian pharmaceutical. Aphria Inc., a Canada-based pharmaceutical producer of medicinal cannabis products, signed an exclusive supply and distribution agreement in May with Colcanna SAS, a Colombian licensed trader for cannabis medicine. Via this agreement, Aphria Inc., currently listed in the Toronto stock exchange, expects to enter the Colombian market in a strong position and continue its firstclass growth rates, evidenced by its market capitalization of 2.68 billion USD on the TSX.

International Cannabis Company (TSX-V: ICC) expands to European markets After starting works on a 124,000-sq. ft. greenhouse in a leased land near Bogotá, International Cannabis Company, fully licensed cannabis producer in Colombia, has recently signed a letter of intent for cannabis exports with CanPharma, a licensed narcotics importer based in Germany. ICC expects this exports agreement for cannabis-based medicine, as well as their recent acquisition of 25% of Spanish company Global Group Kalapa S.L., will allow them to expand towards Europe. The company hopes the negotiation of THC products to be culminated and signed by the second half of 2018, a challenge that is not stopping them from growing cross-borders.

Khiron (TSX-V: KHRN): the first fullylicensed company listing in a highly quoted stock exchange.

On May 24th, Khiron Life Sciences, one of the first companies to acquire a full cannabis cultivation and production license in Colombia, announced its entry in the Toronto TSX Venture Exchange. The company expects to promote its growth in Colombia and Latin America after developing a strategic alliance with the Colombian Neurological Association, listing on the Toronto Stock Exchange and acquiring a 7,500-sq. meter land ready for commercial cultivation.

Khiron (TSX-V: KHRN) begins Latin American expansion in one of the biggest markets

One week after listing in the TSX, Khiron Life Sciences Corp. has announced its sponsorship of the Cannamexico World Summit as their first step in entering the 11.7 million patient Mexican market. In the following months, Khiron expects to open a Mexican subsidiary, subject to TSX approval, which will allow the company to keep a competitive advantage even before regulation is fully issued. Khiron has carefully studied the Mexican market in terms of regulations and market needs, and CEO Álvaro Torres has publicly stated the company “sees an attractive opportunity to transfer the wealth of knowledge we have created into this new market.”

Licensing

Khiron (TSX-V: KHRN): the first cannabis producer in Colombia to receive INVIMA approval for CBD products

After going public on TSX and announcing a Latin American expansion, Khiron received approval from INVIMA, the level 4 WHO drugs and food surveillance entity, to produce, sale and export cannabidiol (CBD) based products. This approval will not only reassure Khiron’s advantageous position in the medicinal cannabis industry, but will also allow them to fulfill their objective of launching the first products by the fourth quarter of 2018, in a domestic market with an estimated potential of 530 million USD a year. Moreover, Khiron expects INVIMA’s approval to have positive effects in foreign markets, given it has the same level WHO status as USA’s FDA and Canadian CFIA and Health Canada.