The crop consists of 400 plants across eight strains that are being grown at a 30-hectare facility south of Chile’s capital city, Santiago.
This product is intended to supply third parties for use in clinical trials and depending on results lead to registered product with the Chilean National Institute of Public Health, and subsequent commercial sales.
Elaine Darby, managing director, commented: “The harvest of our first crop in Chile represents a key milestone for AusCann.
“Through our partnership with Fundacion Daya we are excited about the opportunities that lay ahead for both the Chilean and international market.”
Fundacion Daya joint venture
AusCann and Fundacion Daya have formed a 50:50 joint-venture company, DayaCann, which will focus on becoming South America's leading medical cannabis group.
The crop was planted in Chile with the joint venture partner in November 2016 and has been progressing well with the plants now nearing maturity.
Chile provides a framework supporting the entire production chain from cultivation, processing, formulation, trials, research and registration.
This provides a cost-efficient model allowing access to high quality, affordable medicines for those patients in need.
Under current regulations, Chile allows the export of products, once registered as medicines locally, together with exporting extracts as raw material for the international pharmaceutical industry.
Early mover advantage
AusCann has an early mover advantage and a demonstrable position in the global supply chain.
The regulatory landscape for medical cannabis globally is still evolving, both domestically and internationally and the expertise and background of the AusCann board and its partners means it has a clear advantage in navigating this opportunity.
AusCann is well positioned to take advantage of the developing market by bringing together a strong team with relevant and complementary skill sets.
The team includes the largest legal producer of medicinal cannabis in North America, Canopy Growth Corp and Chilean medicinal cannabis grower Fundación Daya.
AusCann has joined the Canopy family of companies and partners that includes Tweed (the most recognised cannabis production brand in the world), Bedrocan, DNA Genetics, Cann Science, Indoor Harvest and Mettrum Health Corp (following its recently announced CAD$430 million acquisition by Canopy).
Medical cannabis company, AusCann, commenced trading on the ASX earlier this month after completing a successful reverse takeover of TW Holdings.
The company raised the maximum $5 million under its prospectus offering by issuing 25 million shares priced at $0.20.
AusCann’s research activities will drive the company’s future earnings.
Results and knowledge gained from AusCann’s research activities are to continuously feed into current and potential commercial activities to optimise revenue and profit from these commercial activities.
Prior to AusCann being able to cultivate and manufacture Australian, it intends to import product suitable for chronic neuropathic pain, chronic pain and treatment resistance epilepsy from its Canadian partner Canopy to meet demand.
Given the maximum of $5 million was raised in the prospectus offering, this provides Auscann with total cash of $8.3 million.
Funds are to be allocated as follows:
- Horticulture research and development: $1.8 million
- Chilean joint venture: $1.35 million
- Analytical testing: $0.33 million
- Clinical trials: $2.77 million
- Medical education: $0.33 million
- Licence applications and fees: $0.21 million
- Termination fee: $0.2 million
- Working capital and offer costs: $1.3 million