CHC-Cannabis HealthCare Plans to Raise PLN 2.2M from a Public Share Offering

CHC-Cannabis HealthCare was established as a result of cooperation between experienced managers from the pharmacy and pharmaceutical markets to implement an investment project involving the introduction of medical cannabis (THC-containing products) to the Polish market.

The issuer’s subsidiary Interfarmed Cannabis signed a cooperation and distribution agreement with PharmaCann Polska sp. z o.o., a subsidiary of the international holding company PhCann International B.V., in 2019. This holding has one of the largest and most modern medical cannabis production and processing lines in Europe.

If you want to read more about the Polish cannabis market and to find the most important cannabis news from around the world, download for free the Hemp.im mobile app.

As part of the signed agreement, Interfarmed Cannabis was granted exclusive rights to sell the producer’s medical cannabis in Poland

At the same time undertook to assist it from the logistical and administrative side in product registration and popularization of the therapy. The parties also envisioned the possibility of expanding operations to another 17 states in the future.

“The first products, already registered with the URPL, will be delivered for sale in the form of oils taken orally by patients. According to the agreement, in the first year of operations, we intend to float 70,000 10 ml packs of 5 percent or 10 percent THC. It is worth noting here that we are talking about thoroughly tested prescription drug products. Due to their narcotic content, marketing them requires meeting a number of requirements and obtaining appropriate permits,” commented Lukasz Maciejewski, president of CHC-Cannabis HealthCare.

Medical cannabis was legalized in 2017, but in reality, it is still in short supply and is only available in dried form, which requires the use of a vaporizer and often evokes negative associations. According to the company’s management, convincing doctors and patients to use drugs with THC requires building awareness of the product’s existence, and its applicability and breaking down false stereotypes. The liquid form of the drugs offered is expected to facilitate this task.

“In the case of prescription drugs, the most important target group for the information provided are doctors, who, guided by medical considerations and patient welfare, create the final demand. The developed strategy for launching the product on the market assumes, on the one hand, the organization of congresses and symposia for doctors, where medical authorities will expand their knowledge of medical marijuana therapy. On the other hand, the company is building a distribution network and a sales team that will operate in the field,” commented Luke Maciejewski, president of CHC-Cannabis HealthCare.

Prior to the publication of the offering document, CHC Group organized a number of symposia for doctors (including in Krakow, Lodz, and Warsaw) and enlisted authorities from the medical industry. The main lecturers at the industry meetings were Prof. Jaroslaw Voron and Prof. Jaroslaw Fedorowski. As part of the established Medical Council, a number of articles were prepared and published for doctors in trade journals in the areas of pain management, migraine, or the areas of cannabinoid treatment of epilepsy and multiple sclerosis.

“Even before the first delivery of the product to Poland, we have already built a distribution network based on wholesalers and pharmaceutical companies, which includes companies with an annual turnover of more than PLN 100 million, as well as those with experience in selling imported dried product to large foreign players. The first orders amount to almost 3,000 packages,” said Lukasz Maciejewski, president of CHC-Cannabis HealthCare.

Maintenance of the sales team and marketing activities, as well as the first deliveries, are to be financed from the ongoing share issue. Subscriptions for the offered securities will last until December 16th, and the company plans to raise nearly $488,000 (PLN 2.2 million).

“We have a series of activities planned for this period, which will allow investors to get to know the company well and make an informed decision on investment. The roadshow involves appearances in investor media (stockwatch, investor zone), as well as specialized media (biotechnoligia.pl). We are aware that the key to placing an issue is to build trust, so at the end of the campaign we will also organize a stationary meeting, during which investors will be able to talk to us face-to-face,” enumerated Rafal Prejsnar, vice president of CHC-Cannabis HealthCare.

The company’s Board of Directors declares care for the interests of minority shareholders. They are to be ensured, among other things, by the right to demand joining the transaction in the event of the sale of shares by existing owners, e.g. to an industry investor, or a ban on selling shares for 12 months after the debut on the NewConnect market.

“We are targeting the issue to professional, informed investors. After consultations with advisors, we decided to implement mechanisms to protect their interests, such as lock-up, or the right to join (Tag Along). The issue price includes a discount to the valuation prepared for the issue by an auditor. We are also planning a debut on the NewConnect, which will give investors the opportunity to exit their investments,” said Rafal Prejsnar, vice president of CHC-Cannabis HealthCare.

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(Featured image by NickyPe via Pixabay)

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