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MediPharm Labs to sell Australian facility in $6.2m purchase agreement

MediPharm Labs, a pharmaceutical company specialising in precision-based cannabinoids, has entered into a share purchase agreement with OneLife Botanicals PTY for the sale of its Australian facility.

MediPharm Labs Australia, a wholly-owned subsidiary of MediPharm is to be sold to OneLife Botanicals for a minimum value of $6.9M AUD. The deal is anticipated to close within 90 days.

The agreement includes the assets of the Australian facility, specialised licensing, operational knowledge and Australian and New Zealand customers currently served from the facility.

Following a review of its international manufacturing platform, the company said it identified significant potential savings in moving its domestic and international manufacturing to its Canadian facility in Barrie, Ontario.

In July 2021, MediPharm Labs was the first purpose-built cannabis facility to receive a pharmaceutical Drug Establishment License. Awarded by Health Canada, the license is recognised in over 50 countries as part of the Pharmaceutical Inspection Co-operation Scheme.

David Pidduck, CEO of MediPharm Labs commented: “This sale represents a major milestone for MediPharm Labs as it continues to focus on rightsizing the business to achieve profitability. As we look to maintain our strong cash balance, this transaction paired with corporate restructuring completed in June 2022 should allow us to reduce our quarterly burn rate as we improve sales.

“I want to personally thank our Australian team. This group of professionals are trailblazers in the Australian and international medical cannabis market, achieving major milestones such as multiple customer product launches and our first deliveries to Germany. OneLife Botanicals is gaining one of the most capable medical cannabis manufacturing teams in Australia.”

OneLife Botanicals is an emerging leader in the Australia region for cannabis-based wellness and medical products, with plans to launch over-the-counter CBD products across Australia. Purchasing the Australian facility is expected to accelerate OneLife Botanicals’ path to commercialisation, the company said.

The two companies will enter into a transition services agreement to allow for both to smoothly transition products and services produced in the facility and to work together on future commercial opportunities

“This purchase aligns and expedites the strategic aim of our organisation to produce high-quality medicinal cannabis products by integrating manufacturing into the end-to-end supply chain,” OneLife Botanicals CEO Andrew Grant said. “The integration of a fully operational facility brings forward our objectives to take our products and brand to the market.

“Our company undertook extensive research in considering this important acquisition and is highly confident about the capabilities and capacity of the operation to manufacture products in accordance with all compliance and quality standards.

“The integration of this business with our existing cultivation facility facilitates savings in capital investment, access to operational efficiencies and establishes us as a significant supplier in the Australian medicinal cannabis industry.

“We intend to build on the existing customer base and develop additional product distribution opportunities to become a formidable participant in the market,” Grant added.

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