News Roundup November 2018
A monthly summary of the key events taking place in the Colombian medicinal cannabis industry
Khiron secures endorsement from the leading Palliative Care Association in Colombia
On October 26, Khiron Lifesciences Corp. announced they signed an exclusive agreement with the Colombia Association of Palliative Care (ACCP), a leading network of pain and palliative care professionals in Colombia. According to the exclusive agreement, Khiron will be the only cannabis company marketing and participating in ACCP events and activities in Colombia. Dr. Maria Fernanda Arboleda, Medical Director of Khiron, is a pain and palliative care physician who believes the agreement will help Khiron “support the use of medical cannabis and improve patient care standards.” The Latin American Association of Palliative Care (ALCP) estimates 4 million patients require palliative care in the region.
Finance and Acquisitions
Organto Foods Inc. enters agreement to acquire Medicannabis SAS
Canadian and TSX: V listed Organto Foods Inc., an organic fruits and vegetables company, announced early November it had entered an agreement to acquire Colombian Medicannabis SAS. According to the terms of the agreement, during the first stage of acquisition Organto shall acquire Medicannabis shares and undertake the final stages of the licensing process. Still subject to due diligence completion, this stage is expected to be completed the week of November 5. During the second stage, still subject to TSX: V and shareholder approval, Organto will issue up to 8,000,000 shares to the original Medicannabis SAS shareholders upon receipt of cultivation license from the Ministry of Justice. Shares will be subject to a 4-month holding period before securities regulation is applied, and a contractual release limitations period of 3 years.
VerdeMed announced 5 million offering to finance acquisition of Colombian cannabis producer
Canadian pharmaceutical cannabis company VerdeMed Holdings Inc. announced early October it is undertaking an equity offering for gross proceeds up to USD$5 million. Until this moment, the company had received USD$600,000 in commitments from Brazilian and Colombian qualified investors, which they plan to use to acquire strategic assets in both Colombia and Brazil. VerdeMed holds rights to acquire a significant stake in a Colombian licensed producer with a 3,000-sq. ft. indoor growing and extraction facility, fully licensed to grow, extract, formulate and sell cannabis extracts. VerdeMed also plans to use gross proceeds to assist the Colombian producer in its expansion plans, which include: acquisition of 130,000-sq. ft. of land, building 29,000- sq- ft. of greenhouses, and 29,000-sq. ft. of Hemp for CBD oil extraction in August 2019. The company also owns rights to acquire a pharmaceutical laboratory in Brazil, and intends to continue expanding in Latin America to Argentina, Mexico and Peru.
Wayland Group enters acquisition agreement with Colombian Company
Wayland Group announced they will be entering the South American cannabis market through the acquisition of Colombian company Colma Pharmaceutical SAS, who hold licenses to cultivate and process THC cannabis on leased land in Ibagué. According to the definitive agreement, Wayland will issue 11 million common shares at a price of CAD$2 each. Upon completion, Wayland expects to cultivate THC cannabis in a 125-ha land and invest in a 415,000-sq. ft. processing lab to export crude extraction to Wayland’s global Active Pharmaceutical Ingredient (API) facilities in Germany.
USA Real Estate Holding Company completes acquisition of Colombian Green Pharma Colombia SAS
USA Real Estate Holding Company (OTC PINK: USTC), a diversified holding company, announced in late October it signed the final agreement to acquire Green Pharma Colombia SA, which will merge into USTC as a wholly owned subsidiary. Under the terms of the agreement, USTC will issue 25 million common shares to Green Pharma Colombia SA, fully licensed to cultivate and extract, as well as produce tinctures, creams and body products with different concentrations of both THC and CBD.
Broadway Gold Mining Ltd. announced proposed acquisition of Medcolcanna Corp.
Canadian Broadway Gold Mining Ltd. Entered a binding letter agreement with Medcolcanna Corp, based in the British Virgin Islands, who fully owns Medcolcanna SAS, their Colombian subsidiary. Medcolcanna SAS is in the process of establishing itself as a producer of THC and CBD cannabis, after receiving licenses for cultivation (psychoactive and non-psychoactive) and extraction (including exports and national use) in their 4ha land near Bogotá. The transaction between Broadway Gold Mining and Medcolcanna Corp. is expected to be a way of a share exchange, only after Medcolcanna completes two additional securities offerings. The combining entity is expected to continue to focus on the current business and affairs of Medcolcanna SAS.
Khiron launches Kuida, the first CBD cosmetics brand in Colombia
At the beginning of October, Khiron Lifesciences announced the launch of Kuida, a cosmetics product line based on the benefits of non-psychoactive cannabis component CBD. With support from dermatologist Edwin Bendek, and public figure Catalina Artiztizábal, the company launched a line of 7 products using CBDERM®, an exclusive antioxidant technology in the cosmetics industry. Khiron plans to invest over USD$180,000 in the following three months, and has already presence in over 56 Farmatodo sales points, as well as an online store.
Canadian Mandala Pharma invests in Colombian company
Cosmetic cannabis company Mandala Pharma has expanded and entered Valle del Cauca. “The company will have 17ha of land and is currently undergoing the seed characterization process with ICA”, Colombian executive and leader Gilberto Iragorri recently stated. Mandala Pharma, which is already present in Popayán and participates in research agreements with University of Cauca, is expected to invest USD$12-15 million in cultivation and extraction facilities. It will also launch cosmetic products the following year and create R&D alliances with Imbanaco Clinic to further research on 5 pathologies.