Hyasynth Investment
As an early investor in biosynthesis, Organigram Holdings Inc.
(NASDAQ: OGI) (TSX: OGI), the parent company of Organigram Inc.
(the “Company” or “Organigram”), a leading licensed producer of
cannabis, is pleased to announce it has funded an additional $2.5
million investment in Hyasynth Biologicals Inc. (“Hyasynth”), a
private biotechnology company and pioneer in the field of
cannabinoid science and biosynthesis. The announcement comes as
Hyasynth makes the first sale of CBDa1 produced and extracted from
yeast.
In addition to the investment, Organigram continues to have the
right to purchase potentially all of Hyasynth’s cannabinoid or
cannabinoid related production at, subject to the terms of its
agreement with Hyasynth, a 10% discount to the wholesale market
price for a period of ten years from Hyasynth’s commencement of
commercial production.
Organigram initially advanced $5 million to Hyasynth in
September 2018 in accordance with the terms of a Debenture Purchase
Agreement (the “Agreement”) between the Company and Hyasynth.
Today’s announcement represents the second of three tranches
outlined in the Agreement and brings Organigram’s total investment
in Hyasynth to $7.5 million. Organigram has a right to purchase a
remaining $2.5 million of convertible secured debentures (the
"Debentures") which would bring its total investment in Hyasynth to
$10 million upon the achievement by Hyansynth of another designated
milestone and compliance by Hyasynth with other specified terms and
conditions.
Biosynthesis is most commonly known as the primary production
methodology for insulin used in the treatment of diabetes. Unlike
chemical synthesis, or agriculture methods, biosynthesis results in
products and final ingredients that are pesticide-free and are
based on natural ingredients. Hyasynth’s biosynthesis process uses
patent-pending yeast strains and enzymes to produce pure
cannabinoids (not synthetic) without relying on cannabis plants. In
addition to the major cannabinoids such as CBD and THC, Hyasynth
has also demonstrated and submitted patent applications on the
production of minor cannabinoids for which traditional cultivation
is cost prohibitive since these cannabinoids are found in only very
low levels in cannabis plants. The minor cannabinoids are believed
to be the next frontier of cannabis research and novel cannabis
product development.
The advantages of biosynthesis compared to traditional plant
cultivation are expected to be as follows:
- Feasible production of minor cannabinoids;
- Reduced operating and capital costs;
- Consistency and purity of products;
- A smaller environmental footprint; and
- Leverages the existing infrastructure and techniques already
popular for food and pharmaceutical production.
“While we believe there will always be a sizeable market for
dried flower and derivative based products produced at our indoor
facility, it is exciting to watch Hyasynth’s progress in
biosynthesis. We believe biosynthesis has the potential to redefine
the cannabinoid production landscape by setting a scalable and
reliable platform of supply that cannabis producers and
pharmaceutical companies can leverage for success,” says Greg
Engel, CEO, Organigram. “As the demand for large-scale, pure and
consistent supply grows in both the pharmaceutical and consumer
sectors, we are pleased to continue to support Hyasynth’s
work.”
Executive Changes
The Company also announces that Julie Chamberlain, Vice
President, Marketing will be leaving Organigram effective November
6, 2020 for a General Manager role in a non-competing industry.
“Julie’s contributions to Organigram as a seasoned marketer and
brand leader have been immeasurable and we wish her well” said Greg
Engel, CEO, Organigram. On an interim basis, Eric Williams,
Director of Brand, will assume many of Julie’s responsibilities
within the marketing team.
Cameron Bishop, Vice President, Public Affairs and Stakeholder
Relations has also left Organigram to pursue other interests as a
consultant.
“Cameron’s leadership in advancing cannabis legalization and
awareness, while supporting positive policy development and
promoting the sector as a key economic driver of the Canadian
economy, has contributed to both the growth of Organigram and the
evolution of the industry overall,” said Greg Engel, CEO,
Organigram. “We wish him well in his future endeavours and we look
forward to opportunities to continue to work with him in his new
role.” Mr. Bishop’s board position on the American Trade
Association for Cannabis and Hemp is expected to be filled by
another representative of the Company.
Organigram would like to thank Ms. Chamberlain and Mr. Bishop
for their service.
About Hyasynth Biologicals Inc.
Hyasynth Biologicals Inc. is a Montreal, Canada based
biotechnology company that produces sustainable products through
fermentation. It was founded in 2014 to satisfy a growing demand
for cannabinoids by the pharmaceutical and consumer markets.
Hyasynth's Better Cannabinoids technology enables scalable, low
cost production of THC, CBD, CBG, and rare cannabinoids not
typically accessible by plant cultivation. Investors in Hyasynth
include the venture capital firm SOSV and IndieBio, AngesQuebec,
and the strategic investor, Organigram Holdings Inc. For more
information see www.hyasynthbio.com.
About Organigram Holdings Inc.
Organigram Holdings Inc. is a NASDAQ Global Select and TSX
listed company whose wholly owned subsidiary, Organigram Inc., is a
licensed producer of cannabis and cannabis-derived products in
Canada.
Organigram is focused on producing high-quality, indoor-grown
cannabis for patients and adult recreational consumers in Canada,
as well as developing international business partnerships to extend
the Company's global footprint. Organigram has also developed a
portfolio of legal adult use recreational cannabis brands including
The Edison Cannabis Company, SHRED, Ankr Organics and Trailblazer.
Organigram's facility is located in Moncton, New Brunswick and the
Company is regulated by the Cannabis Act and the Cannabis
Regulations (Canada).
This news release contains forward-looking information. Often,
but not always, forward-looking information can be identified by
the use of words such as “plans”, “expects”, “estimates”,
“intends”, “anticipates”, “believes” or variations of such words
and phrases or state that certain actions, events, or results
“may”, “could”, “would”, “might” or “will” be taken, occur or be
achieved. Forward-looking information involves known and unknown
risks, uncertainties and other factors that may cause actual
results, events, performance or achievements of Organigram to
differ materially from current expectations or future results,
performance or achievements expressed or implied by the
forward-looking information contained in this news release. Risks,
uncertainties and other factors involved with forward-looking
information could cause actual events, results, performance,
prospects and opportunities to differ materially from those
expressed or implied by such forward-looking information include
Hyasynth’s prospects and future prospects for biosynthesis,
changing consumer preferences, changing market conditions and other
factors and risks as disclosed in the Company’s most recent annual
information form, management’s discussion and analysis and other
Company documents filed from time to time on SEDAR (see
www.sedar.com) and filed or furnished to the Securities and
Exchange Commission on EDGAR (see www.sec.gov). Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this press release.
Although the Company believes that the assumptions and factors used
in preparing the forward-looking information in this news release
are reasonable, undue reliance should not be placed on such
information and no assurance can be given that such events will
occur in the disclosed time frames or at all. The forward-looking
information included in this news release are made as of the date
of this news release and the Company disclaims any intention or
obligation, except to the extent required by law, to update or
revise any forward-looking information, whether as a result of new
information, future events or otherwise.
1 CBDa is the naturally occurring form of CBD, which is
converted to CBD in processing.
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version on businesswire.com: https://www.businesswire.com/news/home/20201023005095/en/
For Investor Relations enquiries, please contact: Amy Schwalm
Vice President, Investor Relations Amy.Schwalm@organigram.ca
(416) 704-9057
For Media enquiries, please contact: Marlo Taylor
mtaylor@gagecommunications.ca
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