Canopy Growth sells pharmaceutical company C3 Cannabinoid Compound Company

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Sale supports the company’s strategic direction to drive demand for consumer cannabis and cannabinoid products

SMITHS FALLS, ON and NEUMARKT-IN-DER-OBERPFALZ, Germany, December 15, 2021 / PRNewswire / – Canopy Growth Corporation (“Canopy Growth” or the “Company”) (TSX: WEED) (NASDAQ: CGC) has entered into an agreement to sell its subsidiary, C³ Cannabinoid Compound Company GmbH (“C3”), to Dermapharm Holding SE (“Dermapharm”) (WKN: A2GS5D, ISIN: DE000A2GS5D8), a European pharmaceutical company headquartered in Grünwald, Germany. The C³ activity develops and manufactures pharmaceutical products and is made up of Spectrum Therapeutics GmbH, based in Neumarkt-in-der-Oberpfalz, Germany, THC Pharm GmbH The Health Concept, based in Frankfurt, germany, and Spectrum Therapeutics Austria GmbH, based in Vienna, Austria.

Canopy Growth Corporation logo (CNW Group / Canopy Growth Corporation)

With the sale of C³, Canopy Growth continues its evolution towards an organization based on the CPG model and pursues its strategy of concentration and consistency of activities in its main markets. The Company will continue to leverage its high-quality supply of Canadian cannabis products for the medical circuit in its key international markets, including Germany, while also serving adult consumers in Canada.

Following the divestiture, Canopy Growth is expected to avoid the future operational complexities associated with C³ and significantly reduce short-term capital investment requirements.

With the sale of C³, Canopy Growth continues its evolution towards an organization based on the CPG model and pursues its strategy of concentration and consistency of activities in its main markets. The Company will continue to leverage its high-quality supply of Canadian cannabis products for the medical circuit in its key international markets, including Germany, while also serving adult consumers in Canada.

With the sale of C³, Canopy Growth also removes its obligation to separate C3 operations of those of its former owner, Bionorica SE. Therefore, the Company should avoid future operational complexities and reduce its short-term capital investment requirements by more than 50 million Canadian dollars.

“Canopy is maturing as a consumer products company – leveraging our market focus, innovation and R&D strength to produce cannabis and cannabinoid products that have an impact. positive on the lives of consumers, ”said David Klein, CEO, Canopy Growth. “We remain committed to serving the medical cannabis market as a channel and will continue to do so by leveraging our existing offering of high quality Canadian cannabis products to meet patient demand globally. I would like to thank the members of the C³ team for their hard work. , dedication and commitment to building the successful business that is C³ today. “

Overview of transactions

  • An upfront payment of 80 million euros (about. CAD $ 115.5 million1), subject to customary cash and debt adjustments, will be made upon closing of the transaction in addition to a earn-out of up to € 42.6 million (about. CAD $ 61.4 million1) subject to the achievement of certain milestones by activity C³.

  • Assuming the timely receipt of the required regulatory approvals and the satisfaction of other closing conditions, the transaction is expected to close by January 31, 2022.

  • As part of the agreement, all C³ employees will be retained by Dermapharm after the transaction closes.

About canopy growth
Canopy Growth (TSX:GRASS, NASDAQ: CGC) is a global leader in diversified cannabis and cannabinoid consumer products with a passion to improve lives, end Prohibition, and strengthen communities by unleashing the full potential of cannabis. . Leveraging consumer knowledge and innovation, we offer product varieties in dried flower, oil, softgel, infused, edible and topical beverage formats, as well as sprays from Canopy Growth and industry leader Storz & Bickel. Our global medical brand, Spectrum Therapeutics, sells a range of full spectrum products using its color coded classification system and is a market leader in both Canada and Germany. Through our award-winning Tweed and Tokyo Smoke banners, we are reaching our adult consumers and building a loyal following by focusing on top quality products and meaningful customer relationships. Canopy Growth has entered the health and wellness consumer space in key markets including Canada, United States, and Europe through BioSteel Sports Nutrition and This Works Skin & Sleep Solutions; and introduced additional hemp-derived CBD products to United States through our brands First & Free and Martha Stewart CBD. Canopy Growth has partnered with Fortune 500 liquor leader Constellation Brands. For more information visit www.canopygrowth.com.

About Dermapharm
Dermapharm is a rapidly growing manufacturer of brand name pharmaceuticals. Founded in 1991, the company is based in Grünwald near Munich. The Company’s integrated business model includes the in-house development, production and distribution of branded products by a skilled pharmaceutical sales force. In addition to its main location in Brehna near Leipzig, Dermapharm also operates other production, development and distribution sites in Europe (mainly in Germany) and United States.

In the “Branded pharmaceuticals and other health products” segment, Dermapharm has approximately 1,300 marketing authorizations with more than 380 active pharmaceutical ingredients. Dermapharm’s portfolio of pharmaceuticals, medical devices and food supplements is suited to selected therapeutic areas in which the Company is a market leader, particularly in Germany.

In the “Plant extracts” segment, Dermapharm benefits from the expertise of the Spanish company Euromed SA, world leader in the manufacture of plant extracts and active ingredients of plant origin for the pharmaceutical, nutraceutical, food and cosmetic industries.

Dermapharm’s business model also includes the “parallel import activity” segment which operates under the “axicorp” brand. In terms of turnover, Dermapharm was among the top five parallel import companies in Germany in 2020.

With a coherent R&D strategy and numerous successful acquisitions of products and companies and by intensifying its internationalization efforts, Dermapharm has continuously optimized its activity over the last 30 years and has sought external growth opportunities in addition to the organic growth. Dermapharm is firmly committed to continuing on this path of profitable growth in the future.

Notice regarding forward-looking information
This press release contains “forward-looking statements” and “forward-looking information” within the meaning of applicable US and Canadian securities laws (collectively, “forward-looking statements”), which involve certain known and unknown risks and uncertainties. Forward-looking statements predict or describe our future operations, business plans, business and investment strategies and the performance of our investments. These forward-looking statements are generally identified by the use of terms and expressions such as “intention”, “objective”, “strategy”, “estimate”, “expect”, “project”, “projections”, “the forecast ”,“ plans ”,“ seeks ”,“ anticipates ”,“ potential ”,“ proposed ”,“ will ”,“ should ”,“ could ”,“ should ”,“ could ”,“ likely ”,“ designed to “,” foreseeable future “,” believe “,” foreseen “and the like. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which the statement was made. Forward-looking statements are necessarily based on a number of estimates and assumptions which, although considered reasonable by management, are inherently subject to significant business, economic and competitive risks, financial results, results, performances or achievements expressed or implied by these statements p rospectives. forward-looking statements and statements are not guarantees of future performance. Therefore, there are or will be significant factors that could cause actual results to differ materially from those shown in such statements. A discussion of some of the significant factors applicable to Canopy Growth Corporation (“Canopy”) can be found in the section titled “Risk Factors” in Canopy’s Annual Report on Form 10-K for the year ended. March 31, 2021, filed with the Securities and Exchange Commission and with applicable Canadian securities regulatory authorities, as these factors may be updated from time to time in its periodic filings with the Securities and Exchange Commission and regulatory authorities of applicable Canadian securities, which can be found at www.sec.gov/edgar and www.sedar.com, respectively. These factors should not be construed as exhaustive and should be read in conjunction with the other caveats included in this press release and in the filings. Any forward-looking statement included in this press release is made as of the date of this press release and, except as required by law, Canopy disclaims any obligation to update or revise any forward-looking statement. Readers are cautioned not to place undue reliance on forward-looking statements. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement.

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Based on the Bank of Canada daily exchange rate on December 14, 2021

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SOURCE Canopy Growth Corporation


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