Organigram Signs New Agreement for Access to 60,000kg of CBD-rich Hemp
- New advance purchase agreement with 1812 Hemp for access to as much as 60,000kg of hemp flower to be harvested in calendar 2019
- Organigram maintains right of first refusal on 1812 Hemp’s future harvests
- In 2018 Organigram purchased 4,300 kg of hemp flower from 1812 Hemp with exceptional levels of CBD which has been extracted into isolate and is being formulated for medical and recreational sale
MONCTON, JULY 26, 2019 — Organigram Holdings Inc. (NASDAQ Global Select; TSX-V: OGI) the parent company of Organigram Inc. (collectively the “Company” or “Organigram”), a leading licensed producer of cannabis, is pleased to announce that it has entered into an advance payment and purchase agreement (the “Payment Agreement”) with 703454 N.B. Inc. (carrying on business as 1812 Hemp) (“1812 Hemp”) under which the Company will pre-fund hemp purchases to receive access to as much as 60,000 kilograms of dried hemp flower to be harvested in calendar 2019 for extraction into cannabidiol (“CBD”) isolate.
Organigram is already a party to a purchase agreement entered into in January 2019 with 1812 Hemp (the “January Purchase Agreement”), in which Organigram was granted a right of first refusal on 1812 Hemp’s production of certain hemp cultivars.
Access to CBD-rich hemp flower is being facilitated through the Payment Agreement as the Company will advance funds to 1812 Hemp for their purchase of specialized large-scale hemp harvesting and processing equipment to maximize crop yields, contribute to increased efficiency and improve preservation of harvested cannabinoids. Purchase conditions for the dried hemp flower continue to be governed by the January Purchase Agreement which secures supply and supports research and development on the genetic improvement of hemp through traditional plant breeding methods. Funds advanced by Organigram will be credited toward future hemp flower purchases under the January Purchase Agreement.
Under the terms of the January Purchase Agreement, Organigram obtained access to a supply of hemp flower which contains significant and exceptional levels of CBD, as compared to other Health Canada-approved cultivars currently in commercial production in Canada. CBD is a naturally occurring active ingredient in hemp and cannabis that is currently being studied for various therapeutic uses.
Access to a large, consistent volume of CBD-producing hemp has become increasingly important as Canadians express their demand for CBD-rich products for use in both recreational and medical capacities. We’ve heard the call for CBD in the market and this agreement positions Organigram to meet that demand.
Greg Engel, CEO, Organigram
About 1812 Hemp
1812 Hemp is a New Brunswick based industrial hemp company focused on furthering the genetic development of existing, and new hemp cultivars for various applications including natural products, fibres and medicinal products. For more information, visit 1812hemp.ca.
About Organigram Holdings Inc.
Organigram Holdings Inc. is a NASDAQ Global Select and TSX Venture Exchange 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, Ankr Organics, Trailer Park Buds and Trailblazer. Organigram’s primary facility is located in Moncton, New Brunswick and the Company is regulated by the Cannabis Act and the Cannabis Regulations (Canada).