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Cannabis startup launches $3M crowdfunding with buy-in to build medicinal hub

Contributor:
Fuseworks Media
Fuseworks Media

Highlights

TetraMed holds approved licenses from seed to sale for medicinal cannabis.

Initial projections estimate cost to be 50% lower than competitors at $0.50 per gram.

First harvest and extraction targeted for Q3 2020.

Having recently signed a 3 year supply agreement, line of sight to positive revenue is confirmed.

Perth, Australia - 19 February 2020: Perth-based aspiring biopharma company TetraMed has announced it’s looking to raise a further $3 million to fuel growth as it seeks to capitalise on the nation’s progressive medicinal cannabis regulations.

Late last year, the Western Australian Government announced changes to its prescription approval process with the aim of making it easier for patients to access regulated medicinal cannabis products.

"We are seeing Perth rapidly becoming a centre for excellence for medicinal cannabis and bio-pharmaceutical sectors. TetraMed is collaborating with other entities in this space as we seek to take advantage of regulatory changes that are having a positive impact on investment and interest in this sector," said TetraMed CEO Vince Falbo.

The company is proposing a list on a stock exchange in 2020 and has already raised $3 million. It’s now seeking to raise an additional $3 million from a mix of sophisticated investors, complemented by an equity crowd sourced funding campaign with OnMarket.

The minimum buy-in for the crowdfund raise is set at $420.

"The scientific evidence is clear that there is extraordinary potential for medicinal cannabis for use in a range of conditions," said TetraMed Lead Technical Advisor Professor Cameron Scadding.

Australia is seeing strong growth in the number of patients using medicinal cannabis, with figures from the TGA showing at least 28,000 patients were approved for medicinal cannabis use last year.[0: https://www.tga.gov.au/access-medicinal-cannabis-products-1]

The aspiring biopharma company has been granted licenses to cultivate, manufacture, supply, distribute, export, import and transit cannabis and resin for medicinal and scientific use within the International Narcotics Control Board (INCB) framework. The INCB is the independent and quasi-judicial monitoring body for the implementation of the United Nations international drug control convention.

Medicinal cannabis has been increasingly integrated within a range of therapies around the world, off the back of a wave of recent regulatory changes that saw America, Canada, Australia and countries across Europe pass legislation legalising medical cannabis.

The global legal cannabis market is expected to be worth US$66 billion by the end of 2025, with medicinal cannabis most commonly prescribed in herbal form, or processed as an oil for use as oral drops or in a capsule, for palliative care and those living with conditions such as cancer, epilepsy and multiple sclerosis. [1: https://www.grandviewresearch.com/press-release/global-legal-marijuana-market]

"The challenge with current medicinal cannabis products on the market, such as oils and vaporizers, is that they are largely dependent on self-dosage, which increases the chances for error of dosage," said Mr Falbo.

TetraMed is seeking to become a vertically integrated medicinal cannabis business, that manages the entire value chain from ‘seed to sale’ - cultivation, through to extraction and high-grade pharmaceutical production.

"TetraMed has been granted all the licenses required to legally cultivate cannabis and we have secured a supply agreement to sell medicinal cannabis into the European market. The next stage is to construct our production facility." said Mr Falbo.

The company has already secured 400,000m2 of leased land in Lesotho, Africa, with licenses permitting 60,000 square metres of cultivation to produce high quality medicinal cannabis on a very economic cost basis.

"Lesotho is one of the only countries in the world that supports an all-inclusive from ‘seed to sale’ license, which gives us a significant competitive advantage as a lot of other countries operate under multiple licenses that require ongoing reviews and renewals," said Mr Falbo.

"TetraMed has identified Lesotho as a low-cost, high-quality country to base cultivation operations. Cannabis grows there naturally as well as the country's low taxes levy on exportation and local products," he said.

The company’s initial projections have estimated production costs to be at $0.50 per gram, significantly lower than other medicinal cannabis producers that incur costs of around $1.00 per gram.

The funds from the company’s initial raise will be used to commence construction of Phase 1 of the production facility at its site in Lesotho. Phase 1 will consist of a greenhouse and extraction facility with an annual production capacity of 4 tonnes of dry cannabis flower. Supporting infrastructure will also be constructed to enable rapid expansion of the production facility to 12 tonnes of annual capacity by the end of 2020.

"In its goal of becoming a vertically integrated biopharmaceutical business TetraMed will be looking to develop a medicinal final dose formulation.

"Once the cannabinoid medicines have been developed, they will be provided to pharmaceutical companies on exclusive manufacturing and distribution arrangements" said Mr Falbo.

TetraMed is an early stage business and is currently seeking investment to scale its production facilities, following a capital raise with equity crowdfunding platform OnMarket. TetraMed’s first harvest and extraction is targeted for Q3 2020.

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