TIDMAPOL
RNS Number : 2913D
Apollon Formularies plc
02 March 2022
02 March 2022
Apollon Formularies Plc
Joint Venture with Tri-Medi Canna, South Africa
Apollon Formularies plc (AQSE: APOL, "Apollon" or the
"Company"), a UK based international pharmaceutical company trading
on the Aquis Stock Exchange, is pleased to announce that it has
signed a Joint Venture Agreement (the "Joint Venture") with
Tri-Medi Canna Pty Ltd. ("Tri-Medi Canna"), a South African based
medical cannabis company, to establish a jointly-owned incorporated
South African company, Apollon SA Pty Ltd. (the "JV Company").
Transaction Highlights:
-- The Joint Venture represents Apollon's first international
expansion, with the potential to reach over 350 million people in
the Southern African Development Community ("SADC")
-- Apollon will receive a gross royalty on sales for all Apollon
products sold within South Africa before extending its commercial
reach to the wider SADC region under a renewable, mutually
exclusive license agreement, the initial term of which is 12
months
-- To strengthen commercial ties between the parties, Tri-Medi
Canna will become a shareholder in Apollon via share subscription
totalling GBP300,000 over two tranches, the first of which will be
for GBP150,000 at 2.5p per share
Joint Venture Highlights:
-- The Joint Venture will give Apollon a commercial footprint in
South Africa, offering the Company an additional avenue to monetise
its proprietary medical and technical experience
-- Tri-Medi Canna is a South African-based medical cannabis
company in the process of gaining a large volume (256 hectares)
cultivation license from the South African Health Products
Regulatory Authority ("SAHPRA") and has engaged with both national
and local arms of government in South Africa
-- Apollon will own 49% of the JV Company with Tri-Medi Canna owning the remaining 51%.
-- All future operating licenses along with any future
intellectual property developed under the JV Company will be
jointly owned
-- Africa's medical cannabis sector is forecast to be worth up
to $7.1 billion by 2023 [i] with South Africa potentially making up
70% of the current market [ii]
-- The Joint Venture will open additional opportunities for
Apollon to undertake clinical trials on its proprietary medicinal
cannabis formulations for treating cancer
Background
Apollon has been seeking opportunities to expand its operations
internationally into growth markets where it can make its
proprietary medical cannabis formulations for various cancer
conditions available to a wider patient base while continuing to
collect valuable clinical data. Apollon's Joint Venture with
Tri-Medi Canna will provide the Company access to the South African
market as well as the wider SADC region which has a population in
excess of 350 million people. The Joint Venture will seek to
establish a strong foothold in Africa which is widely considered to
be the last remaining significant region of pharmaceutical growth
globally. Tri-Medi Canna will apply for licenses to replicate those
held by Apollon in Jamaica through the SAHPRA and/or an applicable
overseeing body in South Africa.
The Joint Venture will be mutually beneficial, with Tri-Medi
Canna gaining access to Apollon's vast experience across the value
chain, from skill transfers in extraction and processing,
pharmaceutical level drug development, clinical trials, patient
treatment centres, experienced physicians with medical cannabis
treatment experience and the exclusive Licensed distribution of
Apollon's proprietary products and formulations once the necessary
licenses have been granted by SAHPRA. When these License milestones
have been achieved, Tri-Medi Canna will also benefit from Apollon's
ongoing international exposure to European markets.
Tri-Medi Canna will also engage with the South African
Government to obtain letters of support from the Department of
Trade and Industry, Agricultural Research Council and clinical
specialists working collaboratively on cannabis research at the
University of Kwazulu Natal amongst other leading academic
institutions to bolster continuing research and development in the
medical cannabis sector.
Transaction and Share Subscription
The Joint Venture has an initial contract term of 12 months and
shall be governed by a definitive joint venture agreement (the
"Definitive Joint Venture Agreement"). Amongst other things, the
Definitive Joint Venture Agreement shall provide for:
-- the incorporation of Apollon SA Pty Ltd which will be owned
49/51 between Apollon and Tri-Medi Canna respectively;
-- signature of a shareholders agreement regulating the parties' ongoing relationship;
-- a gross royalty agreement on sales revenue from Tri-Medi
Canna for Apollon products distributed and sold in South Africa and
the wider SADC region; and
-- Joint ownership of newly devopled intellectual property and operating licenses.
To strengthen commercial ties between the parties, Tri-Medi
Canna will become a shareholder in Apollon via an ordinary share
subscription totalling GBP300,000 over two tranches. The first
tranche will be executed shortly after signature of the Definitive
Joint Venture Agreement for GBP150,000 at 2.5p per share.
Tri-Medi Canna will also subscribe for a further GBP150,000 in
ordinary shares in Apollon upon entering into the Definitive Joint
Venture Agreement which will be based on the market price of
Apollon's ordinary shares on the date of the Definitive Joint
Venture Agreement being made.
Stene Jacobs, COO of Apollon Formularies for Europe and Africa,
commented, "This is a major step forward in Apollon's plans to
reach global markets and the African market which still remains
largely untapped. Tri-Medi Canna's relationship with necessary key
stakeholder in South Africa will provide Apollon with the platform
to infiltrate this market, whilst providing the local community
with access to training, knowledge and skills and contribute to
local employment.
"South Africa has the opportunity to build on its reputation as
the regional best in class operator and to showcase its already
successful cultivation and plant genetics abilities. In conjunction
with this, the South African medical fraternity is deeply admired
for being at the forefront of medical advancements, with deep
scientific knowledge in conventional and alternate medicine.
"This Joint Venture Agreement validates Apollon's business model
in Jamaica and our ability to replicate and scale up operations to
other international jurisdictions. We look forward to keeping the
market updated on our progress as we enter this exciting chapter in
Apollon's journey."
Thokozani Shongwe, CEO of Tri-Medi Canna, stated, "We are
delighted to be working with Apollon Formularies as we expand our
offering across South Africa and grow our knowledge and skill base
through this partnership. Apollon has forged firm routes in Jamaica
and its proprietary formulas have consistently proven to be
effective during rigourous testing on pre-clinical third-party
pharmaceutical laboratory testing conduced in the US on 3D Cell
cultures.
"This is a crucial time in the development of the African
cannabis sector, and I am proud that Tri-Medi Canna can work with
Apollon to establish a strong foothold from which to expand into
the SADC and beyond."
The Directors of the Company accept responsibility for the
contents of this announcement.
For additional information, please visit www.apollon.org.uk or
contact:
Apollon Formularies
Tel: +44 771 198 0221
Stene Jacobs stene@apollon.org.uk
Peterhouse Capital Limited (Corporate Adviser)
Tel: +44 207 220 9795
Guy Miller gm@peterhousecapital.com
BlytheRay (Financial PR/IR-London)
Tel: +44 207 138 3204
Tim Blythe/Megan Ray apollon@blytheray.com
About Apollon Formularies and Apollon Formularies Jamaica
Apollon Formularies plc is an international medical cannabis
company headquartered in the United Kingdom. Apollon Formularies
Jamaica Limited is a pharmaceutical company incorporated and
operating in the Commonwealth of Jamaica. Apollon Jamaica is
licensed by the Jamaican government's Cannabis Licensing Authority
(CLA) to cultivate, perform research and development, process, and
sell medical cannabis therapeutic products that include legal
medical cannabis to treat various illnesses under medical
supervision. Apollon and Apollon Jamaica are parties to a
Commitment Agreement whereby Apollon is entitled to 95% of Apollon
Jamaica's Net Profits, and per a Stock Pledge Agreement that
includes Stephen D. Barnhill, M.D., Apollon is to be assigned the
entire 49% equity interest of Apollon Jamaica held by Dr. Barnhill,
which is the maximum interest in a medical cannabis company allowed
to be held by a non-Jamaican, upon the CLA approving the
assignment.
About Tri-Medi Canna
Tri-Medi Canna is a subsidiary of Trisab Pty Ltd a South African
medical cannabis initiative established in the Kwazulu Natal
province of South Africa. Tri-Medi Canna aims to develop
sustainable local economies through cultivation, processing and
distribution of Cannabis based Medicinal Products (CBMP's) in South
Africa and the greater SADC region. They are a sustainable, focus
driven business that aims to revolutionise the pharmaceutical
industry in South Africa while uplifting previously disadvantaged
local communities through education, employment creation and
dignity restoration.
[i] Prohibition Partners, Africa Cannabis Report, March 2019
[ii] Department of Trade and Agricultural Research Council,
South Africa
- Ends -
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