The list of Canadian licensed producers (LPs) of cannabis expecting to go public just got longer. CanniMed Therapeutics, the parent of CanniMed Ltd. and Prairie Plant Systems, issued a press release and filed a 193-page preliminary prospectus regarding its pending IPO that is being underwritten by Alberta-based AltaCorp Capital. Other Canadian LPs that have announced plans to go public, joining the existing nine publicly-traded companies, include Emblem Health, Hydropothecary, United Greeneries (spin out) and WeedMD. A B Labs last week agreed to a deal to sell 1/3 of itself to publicly traded Invictus MD Strategies (CSE: IMH).
CanniMed has a long history in the Canadian medical cannabis industry, having been the sole commercial producer sanctioned by the federal government since 2000 under the old MMAR system, which also permitted home grow and non-commercial production by caregivers, and the first approved for MMPR, the predecessor of the current ACMPR, in 2013, before the program officially launched in April 2014. CanniMed Therapeutics, formed last month, acquired all of the shares of Prairie Plant Systems on November 1st.
In addition to CanniMed Ltd., which holds licenses to sell dried cannabis and oils, and Prairie Plant Systems, which holds licenses to cultivate cannabis and produce oils, the company also has a subsidiary SubTerra LLC, which is incorporated in Michigan and owns a 35K sq. ft. production facility and office space with an additional 19K sq. ft. underground growth chamber currently under construction. Its Canadian assets include a 97K sq. ft. production facility and a 96K sq. ft. support building in Saskatoon, Saskatchewan.
The terms of the deal aren’t yet available, but the company plans to use the proceeds of the IPO to fund facility expansions in Saskatchewan and Michigan, to purchase additional equipment and to fund further clinical trials. CanniMed Therapeutics reported pro forma sales in the first nine months of its fiscal year ending 10/31 of $6.635mm, which represented growth of 54% over the first three quarters of FY15. The company employs 137, with 132 working in Saskatchewan and the balance in Michigan. Key leadership includes Chairman Donald Ching, who is associated with Golden Opportunities Fund, which owns 25% of the 14.67mm outstanding shares, and CEO Brent Zettl, who has been a Director since the company was formed in 1988.