MXC to acquire Licensed European Medical Cannabis Company

Published at Apr 27, 2016, in ASX Biotechs

MGC Pharmaceuticals (ASX:MXC) has executed a binding Heads of Agreement (HOA) to acquire Czech-based medical cannabis company, PANAX Pharma s.r.o.,.

Subject to the completion of due diligence, MGC Pharma will receive 25% equity issued up front and 55% equity issued for MXC’s commitment to fund operating costs for the next year up to €700,000 (AU$1,021,080).

The final commercial term is an option to acquire the remaining 20% at MXC’s election for €800,000 of MGC Pharma ordinary shares.

The deal gives MGC Pharma access to the state of the art Vukoz Production facility.

MGC will start immediate work with the government run Vukoz Institute on a research and development program to grow medical grade cannabis. The medical cannabis license includes access to over 1000m2 of indoor growing space at the Vukoz facility.

Growing and cuttings from the Vukoz Institute Laboratory.

The research being conducted at the facility is focused on developing high cannabidiol (CBD) and high THC strains alongside Tissue Culture mediums and protocols. The outcomes of the research and new genetics will be utilised for MXC’s growing operations and for use in the clinical trials of MXC’s Derma Cosmetic products, which will include treatment for psoriasis and acne.

The Derma brand of product are produced in Slovenia.

Through Panax’s licensing agreement, MGC Pharma will also have the ability to take and commercially utilise the waste biomass from the research facilities for the production of CBD extract, combined with a license for the import and export of medical cannabis.

As an indoor operation the Vukoz facility has year-round growing cycles and anticipates being able to treat over 1400kg of medical cannabis biomass waste, which MXC estimates can be processed into 90kg of CBD extract per year.

The acquisition gives MXC the ability to grow different strains of CBD to be used for different purposes and the research and development license enables the production of medical cannabis without the quantity restrictions applied to THC content, which is responsible for the psychoactive effects of cannabis. This open up the door for MXC to produce a large variety of medical grade cannabis products and materials in Europe under the license agreements held by Panax.

“Our acquisition of Panax significantly strengthens MGC Pharma’s medical cannabis research and production capabilities,” said co-founder and Managing Director of MGC Pharmaceuticals Nativ Segev.

“Not only does it build on our outdoor Slovenian growing facility and production capacity, it also allows the company to produce high intensity medical grade cannabis products for our clinical trials and research programs planned for Israel, Europe and eventually Australia.”

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

Conflict of Interest Notice

S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

Publishers Notice

The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.

Australian ASX Small Cap stocks | Why Finfeed.com is Australia’s leading small cap publication

Founded seven years ago, Finfeed.com is Australia’s leading and longest standing website for investor and finance news, education and expert opinion.

Published by StocksDigital, Finfeed was created to report daily on the comings and goings of ASX listed stocks in the small cap market.

As the first digital publication dedicated specifically to this space, Finfeed soon became the most trusted publication in the market, quickly garnering over two million page views – a number that continues to rise.

Finfeed.com provides its readers with informative articles that tackle the latest in market moving #ASX small cap news, plus exclusive content you won’t find anywhere else. It is aimed at those with an interest in investing, market education, company performance, start-ups and much more.

Finfeed.com is the only media organisation operating under the strength of a Financial Services License and is backed by leading journalists and analysts all with brands of their own.

The website aims to inform, educate and entertain with content that drills down into the heart of financial matters.

Finfeed is a leading source of investor and market information, with everything investors need to know about how to invest written in a way that anyone can understand. 

Over the years, the website has expanded beyond exclusively reporting on small caps, to profile Australia’s leading ASX listed small, mid and large caps as well as some of the country’s most successful CEOs and business leaders to find out what makes them tick.

Every day you will find fresh content covering:

Fast Facts

Over 4,000 articles published

Over 2.3 Million Page Views and counting

Over 10,000 followers on social media

Subscriber list growing by 2% monthly

Thanks for subscribing!

X