- Flora Growth and Avaria Health and Beauty form a joint venture
for the sale of its award-winning KaLaya brand across Latin America
(“LATAM”), increasing the value of Flora Labs’ 2,500+ Colombian
distribution channels
- Flora Lab, Flora Growth’s wholly-owned GMP-certified
manufacturing facility, will be responsible for producing the
cannabinoid-infused products for the JV, with an emphasis on
incorporating cannabidiol (“CBD”) into its product
formulations
- KaLaya has sold over a million units and is distributed across
Canada via major retailers including Loblaws and Walmart, where
they hold the number two customer loyalty rate in Loblaws’ natural
value skin care category
Flora Growth Corp. (NASDAQ: FLGC) (“Flora” or the “Company”), a
leading all-outdoor cultivator and manufacturer of global cannabis
products and brands, is pleased to announce it has entered into a
definitive agreement with Canada-based Avaria Health & Beauty
Corp. (“Avaria”) to form FloVaria Corp. (“FloVaria”), a joint
venture company equally owned by Flora and Avaria.
Through FloVaria, Flora will provide distribution, supply chain,
and marketing support of KaLaya products in Colombia, Mexico, and
other LATAM countries, while Avaria will initially supply the
finished product to FloVaria. In the event that manufacturing costs
from Canada become materially higher than the cost to produce in
Colombia, FloVaria will explore moving its supply chain activities
of Avaria products to Flora Lab. Any profits from the sale of
KaLaya products via FloVaria will be divided equally between Flora
and Avaria, increasing the value of Flora’s existing distribution
channels.
Further, Flora Lab will work to produce FloVaria’s
cannabinoid-infused products, with an emphasis on incorporating
cannabidiol (“CBD”), using cannabis from Flora’s cultivation
facility. These products are expected to be distributed across
LATAM using Flora Lab’s established distribution channels, with the
goal of exporting to the U.S. market, where Avaria recently
launched its KaLaya brand and has seen encouraging sales
metrics.
“Since our initial meeting with Avaria, we were impressed by
their commitment to research, product development, and most
importantly, providing customers with products that work,” said
Luis Merchan, President and CEO of Flora Growth. “Avaria has
achieved impressive and continued growth of its KaLaya brand based
on the quality and efficacy of the product. Our team is very
excited to bring their award-winning topical pain products to our
LATAM distribution network, and to produce cannabinoid-infused
KaLaya products at Flora Lab.”
“We believe that KaLaya products provide the best relief that
you can get without a prescription,” said Dr. Keith Burk, M.D.,
founder and CEO of Avaria. “Our KaLaya pain cream brand has enjoyed
strong success since inception and has garnered much consumer
praise while receiving numerous industry awards. We’re incredibly
excited to partner with Flora Growth to bring our award-winning
KaLaya products to new international markets, and moreover, to
produce cannabinoid-infused versions of these already established
and highly efficacious products that our consumers have been
demanding and looking forward to for some time now.”
KaLaya Observational Study on Pain Relief
A perception study with 48 volunteers was conducted by Avaria at
Beechwood Clinic in Waterloo, Ontario, in 2019. These patients had
acute and/or chronic medical conditions including arthritis,
tendonitis, and joint pain, among others, and were asked to
evaluate their experience of pain relief after application of
KaLaya’s 6x Extra Strength Pain Relief.
The results showed that all volunteers felt improvement in pain
or were free of pain within two minutes of application of K6XPR,
where 52.1% felt pain relief within one minute. The average
reduction in pain is 5 points on a 1-10 point pain score. Results
indicate that K6XPR is an effective and efficient topical pain
treatment for a variety of acute and chronic pain conditions.
About Flora Growth’s Recent Financing
Having received net proceeds of $31.5M from the recent closing
of Flora’s public offering, the Company is well funded for growth
as it continues to execute on its business initiatives including an
expansion into the U.S. CBD market, a growth investment into
recently acquired Vessel Brand, and an expansion into the newly
legalized German adult-use cannabis market.
“Since our IPO in May of 2021, we have made substantial progress
to expand our distribution network, launched new brands and brand
partnerships, and closed or advanced multiple transactions. Looking
forward, we expect to use this capital to amplify revenue growth
from our operating divisions, identify and acquire new accretive
M&A targets, and enter new markets like Germany’s newly formed
adult-use cannabis market as legalization developments continue to
unfold internationally,” commented Luis Merchan, Flora’s CEO.
About Avaria Health & Beauty Corp.
Privately owned and operated since 1995 by experienced medical
professionals, Avaria Health & Beauty Corp., has over 20 years
of experience in the formulation, manufacturing, and sale of
topical creams, oils, emulsions, liquids, lotions, gels, and
salves. Proudly Canadian, Avaria Health & Beauty Corp. is
committed to maintaining its status as a 100% Canadian company.
Research, development, and manufacturing takes place in Waterloo
and Cambridge, Ontario. Avaria Health & Beauty Corp. brands
enjoy distribution at all levels of retail and online,
domestically, as well as in select international markets.
About Flora Growth Corp.
Flora is building a connected, design-led collective of
plant-based wellness and lifestyle brands that delivers the most
compelling customer experiences in the world, one community at a
time. As the operator of one of the largest outdoor cannabis
cultivation facilities, Flora leverages natural, cost-effective
cultivation practices to supply cannabis derivatives to its diverse
business divisions of cosmetics, hemp textiles, and food and
beverage. Visit www.floragrowth.com or follow @floragrowthcorp on
social for more information.
Cautionary Statement Concerning Forward-Looking
Statements
This document contains forward-looking statements. In addition,
from time to time, we or our representatives may make
forward-looking statements orally or in writing. We base these
forward-looking statements on our expectations and projections
about future events, which we derive from the information currently
available to us. Such forward-looking statements relate to future
events or our future performance, including: the size of markets
for cannabis and cannabis products; the expected performance of
FloVaria; the impact of FloVaria on Flora’s business; the market
for KaLaya products; Flora’s cultivation yields; Flora’s ability to
sell cannabis and cannabis products to international markets; the
collaboration with third parties; and our business prospects and
opportunities. You can identify forward-looking statements by those
that are not historical in nature, particularly those that use
terminology such as “may,” “should,” “expects,” “anticipates,”
“contemplates,” “estimates,” “believes,” “plans,” “projected,”
“predicts,” “potential,” or “hopes” or the negative of these or
similar terms. In evaluating these forward-looking statements, you
should consider various factors, including: our ability to change
the direction of the Company; our ability to keep pace with new
technology and changing market needs; and the competitive
environment of our business. These and other factors may cause our
actual results to differ materially from any forward-looking
statement. Forward-looking statements are only predictions. The
forward-looking events discussed in this document and other
statements made from time to time by us or our representatives may
not occur, and actual events and results may differ materially and
are subject to risks, uncertainties and assumptions about us. We
undertake no obligation to publicly update or revise any
forward-looking statement, whether as a result of uncertainties and
assumptions, or the forward-looking events discussed in this
document and other statements made from time to time by us or our
representatives not occurring, except as may be required by
applicable law.
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version on businesswire.com: https://www.businesswire.com/news/home/20211126005305/en/
Investor Relations Contact: Evan Veryard
evan.veryard@floragrowth.com
Public Relations Contact: Cassandra Dowell +1 (858)
264-6600 flora@cmwmedia.com
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