Avicanna Reports Q2 2022 Financial Statement
August 15 2022 - 5:00PM
Avicanna Inc. (“
Avicanna” or the
“
Company”) (TSX: AVCN) (OTCQX: AVCNF) (FSE: 0NN),
a commercial stage, international biopharmaceutical company focused
on the commercialization of evidence-based, cannabinoid-based
products, is pleased to announce the filing of its interim
financial statements for the three-month period ending June 30,
2022 (“
Q2 2022”).
“We are pleased to report on our continued
progress and global commercialization efforts where we primarily
focused on, and achieved, growth of our four brands in the Canadian
marketplace. We also pursued continuous optimization of our
operations which was demonstrated by significant cost reductions
over the quarter, with the goal of self-sufficiency,” stated Aras
Azadian, CEO at Avicanna Inc.
Q2 2022 highlights:
- 6-month
revenue of $2.14M, representing 101% increase from the
same period in the prior year, supported by increased international
and licensing revenue and through further progress across the
Canadian commercialization efforts.
-
Progression of cost reduction initiatives,
including a 35% reduction in South American headcount and expected
reduction of global operating expense (“OPEX”). This was coupled
with approx. $1M in proceeds from the sale of non-core subsidiary
Sativa Nativa and the divestment other non-core and non-strategic
business units including its medical cannabis division in
Colombia.
-
Exclusive License and Supply Agreement with Major South
American Pharmaceutical Company, to commercialize up to
four (4) of Avicanna’s proprietary cannabinoid-based pharmaceutical
preparations. Through the license and supply agreement, Avicanna
will license the Company’s intellectual property and supply final
products starting initially with its proprietary 10% cannabidiol
oral preparation. In connection with the partnership Avicanna can
earn up to $1.3M CAD in initial licensing fees through achieving
near-term milestones.
-
Progression of international expansion, with
entrance into the 18th international market for all Avicanna’s
products. The new markets include Aureus branded exports to Lesotho
with standardized genetics and Portugal with THC and CBD extracts,
which supported the supported a 92% growth in international
revenues over the same period last year.
-
Expansion RHO Phyto formulary with the Cannabigerol (CBG)
products into the Canadian market, including sublingual,
and transdermal formulations, which are available in Ontario and
will be made available through various medical and channels across
Canada during Q3 2022.
-
Expansion of the partnership with Bio-Gate AG to launch
Pura H&W into Europe. The exclusive distribution
agreement includes 5 SKUs from Pura H&W’s evidence-based
derma-cosmetics portfolio which will be commercialized through
Bio-Gate’s existing distribution channels.
-
Progression of Epilepsy research including the
initiation of new pre-clinical research collaboration with Dr. Mac
Burnham and the University of Toronto to analyze the potential role
of specific rare cannabinoids in epilepsy models. The on-going
research on epilepsy is coupled with RHO Phyto Micro drop 50
formulation achieving the company’s best performing SKU on the
Medical Cannabis by Shoppers™ platform mainly due to its adoption
by Canadian neurologists for their pediatric epilepsy
patients.
- Advancements in the
pharmaceutical and medical cannabis pipeline, including
the completion the submission of the company’s first international
drug dossier for Trunerox into Brazil under the RDC327 legislation
and in Colombia, and Ecuador as generic pharmaceutical.
- $1.5M
Strategic private placement with lead investor Ei.
Ventures, Inc., a technology company which seeks to
empower mental wellness through psychoactive compounds,
nutraceuticals, and technology, and with additional participation
from other investors.
Other highlights subsequent to Q2 2022
-
Agreement to Develop and Commercialize Adaptogen
Nutraceuticals. In partnership with Ei.
Ventures Avicanna will be utilizing existing scientific platform
and drug delivery systems to develop and commercialize Psilly™
branded functional fungi-based products. The initial focus of the
research and development efforts will be on functional,
apoptogenic, fungi-based formulations in the form of consumer
friendly and single dosed products.
-
The NBA players association announced Re+play as an
official partner. The performance-based wellness and
recovery line created by Harrington Wellness has partnered with the
NBPA to bring topicals and technologically advanced products to
consumers in the US via Amazon and Walmart in the US. Avicanna’s
technology and formulations are the basis of
the Re+Play products and the Company will be earning
royalties for its technology, supplying the CBD in the US market in
addition to commercializing Re+Play in Canada where the
products are already launched on the Ontario Cannabis Store (“OCS”)
and Medical Cannabis by Shoppers™ platforms.
Management commentary
During the second quarter the company continued
to make commercial progress across all its business units, opened
new international markets and demonstrated consistent increase in
the number Canadian commercia listings across medical and adult use
channels. The company did however face industry wide price
compression and faced stocking challenges with one of its
manufacturing partners in Canada which resulted delay of delivery
of specific commercial SKU’s and ultimate need to change the
manufacturing partner for during the second quarter, the results of
which is in the short terms is a reduced expectation of 2022
revenue of $6M CAD. Long term the management believes that the
change of manufacturer in Canada will result in improved margins
and more consistent delivery of its proprietary products as
commercial efforts and revenue continue to scale up. The company
also continued to expand its scientific platform, progress its
pharmaceutical pipeline further establish its brands at an
international level.
About Avicanna Inc.
Avicanna is a commercial-stage international
biopharmaceutical company focused on the advancement and
commercialization of evidence-based cannabinoid-based products for
the global medical and pharmaceutical market segments. Avicanna has
an established scientific platform including R&D and clinical
development that has led to the commercialization of more than
thirty products across various market segments:
Medical Cannabis & Wellness
Products: Marketed under the RHO Phyto™ brand these
medical and wellness products are a line of pharmaceutical-grade
cannabinoid products containing varying ratios of cannabidiol
(“CBD”) and tetrahydrocannabinol (“THC”). The product portfolio
contains a full formulary of products including oral, sublingual,
topical, and transdermal deliveries that have controlled dosing,
enhanced absorption and stability studies supported by pre-clinical
data. The formulary is marketed with consumer, patient and
medical-community education and training.
Pharmaceutical
Pipeline: Leveraging Avicanna’s scientific platform,
vertical integration, and real-world evidence, Avicanna has created
a pipeline of patent-pending drug candidates that are
indication-specific and in various stages of clinical development
and commercialization. These cannabinoid-based drug candidates look
to address unmet medical needs in the areas of dermatology, chronic
pain, and various neurological disorders. Avicanna’s first
pharmaceutical preparation (Trunerox™) is in the drug registration
stage in South America.
Click to watch Avicanna’s Corporate Video
2022
SOURCE Avicanna Inc.
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Cautionary Note Regarding
Forward-Looking Information and Statements
This news release contains “forward-looking
information” within the meaning of applicable securities laws.
Forward-looking information contained in this news release may be
identified by the use of words such as, “may”, “would”, “could”,
“will”, “likely”, “expect”, “anticipate”, “believe, “intend”,
“plan”, “forecast”, “project”, “estimate”, “outlook” and other
similar expressions. Forward-looking information contained in this
news release includes, without limitation, statements related to
the Offering, the use of the proceeds of the Offering, the receipt
of all approvals of the Toronto Stock Exchange in connection with
the Offering, statements with respect to the Company’s future
business operations, potential collaborations, the opinions or
beliefs of management and future business goals. Although the
Company believes that the expectations and assumptions on which
such forward looking information is based are reasonable, undue
reliance should not be placed on the forward-looking information
because the Company can give no assurance that they will prove to
be correct. Actual results and developments may differ materially
from those contemplated by these statements. Forward-looking
information is subject to a variety of risks and uncertainties that
could cause actual events or results to differ materially from
those projected in the forward-looking information. Such risks and
uncertainties include, but are not limited to, current and future
market conditions, including the market price of the common shares
of the Company, and the risk factors set out in the Company’s
annual information form dated March 31, 2022, filed with the
Canadian securities regulators and available under the Company’s
profile on SEDAR at www.sedar.com. The statements in this news
release are made as of the date of this release. The Company
disclaims any intent or obligation to update any forward-looking
information, whether as a result of new information, future events
or results or otherwise, other than as required by applicable
securities laws.
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