DANISH medical cannabis company DanCann Pharma has raised a further £1m-plus from shareholders as it looks to bring its first commercial products to the market in the second half of 2022.
The funds will also be used to support the integration of fellow Danish firm CannGros into the business following its purchase for over £15m last autumn.
DanCann has also announced that it will focus its efforts on nine selected cultivars – after in-house tests reduced the number of initial varieties from 95.
At the end of January, DanCann said it had converted 1,917,271 warrants into new shares at a price of DKK 4.8685 per share warrant, which corresponds to a total amount of DKK 9,334,233.94 – a little over £1m.
European Market Entry
In a market release the company said: “The proceeds from the transaction will be used to invest further in the company’s ongoing development and operations towards its milestones in 2022, where commercial production capacity is the future key in connection with the company’s upcoming entry into the European and German markets.”
CEO Jeppe Krog Rasmussen said: “We saw a golden opportunity to strengthen our financial position by pre-exercising the issued warrants.
“The proceeds allow us to implement our plans with peace of mind in 2022 while keeping focus on the milestones that await us. This includes the EU GMP certification of Biotech Pharm1 (its cultivation facility), which is expected in mid-2022 and later the commercial introduction of our in-house produced biomaterial in selected export markets.”
Chairman of the Board Carsten Trads who took part in the share warrant conversion, said: “I am absolutely convinced that DanCann Pharma is facing a bright future. The company has reached many milestones in a short time, but we have only just begun.”
Last October DanCann announced it had entered into an agreement to acquire CannGros, which sells medical cannabis through Denmark’s pilot programme.
In a market announcement it said the acquisition will allow it to obtain all of the necessary licences to import and distribute medical cannabis, as well securing three products included in the country’s pilot program, and an ongoing CannGros application to the Danish Medicines Agency for approval of an oil extract in the trial.
The release said: “The acquisition is paid for through DKK 7m which is issued entirely in DannCann Pharma shares, at a price of DKK 3.67 per share, and DKK 6m, which is paid in cash on a total of two occasions.”
CanGross says it posted sales of DKK 4.5m in the Danish market in 2021 and the the company’s annual growth rate since it was founded in 2017 has been around 55%.
DanCann says that after reducing the cultivated cannabis strains to nine it will now undertake several final tests to ’ensure uniform deliveries when the company goes from tests and analysis to actual production of bio-materials’.
It says it expects to be able to sell a ‘bulk product’ in ‘commercial volumes’ during the second half of 2022.
DanCann’s Biotech Pharma1 cultivation facility adheres to the principles of Vertical Farming and Controlled Environment Agriculture.
This sees cultivation undertaken in in multiple vertical layers, which means floorspace utilization is increased by 200%.
DanCann Pharma also utilises aeroponics which sees plants grown without the use of soil or aggregate. The roots are left to dangle freely in the air, where they are frequently sprayed with a nutrient rich mist. Aeroponics reduces water usage by 90% and fertiliser usage by 70%.