Mr. David Pidduck reports

MEDIPHARM LABS UPDATE ON $9M SETTLEMENT AGREEMENT - ALL TILRAY SHARES SOLD AND CONVERTED TO CASH

Medipharm Labs Corp. has now received $7.27-million in gross cash proceeds from the settlement agreement announced on Oct. 2, 2023, to resolve a claim in connection with a commercial agreement dispute. Additional consideration includes products and services described below.

On Oct. 2, 2023, Medipharm and Tilray came to a mutually agreeable resolution and established a long-term supply relationship. Following the settlement agreement, Medipharm has now received $7.27-million in cash, consisting of:

• $3-million cash payment;
• 1,573,152 total Tilray common shares that have been sold for gross proceeds of $4.27-million.

Non-cash elements also included in the settlement agreement are continuing product considerations:

• $1-million in Tilray products (including, but not restricted to, high-quality flower and extractable biomass);
• $500,000 four-year supply agreement to provide Tilray with Medipharm products and services.

Medipharm has already started working closely with Tilray management to add Medipharm Labs products to Tilray's medical platform, and to qualify the most appropriate products to be sourced from Tilray.

The long-term supply agreement allows Medipharm to establish a positive continuing business relationship with a global leader in the cannabis industry. This supply agreement allows Tilray to access Medipharm's unique pharmaceutical products and services, both domestically and internationally, including products produced under the company's United States FDA (Food and Drug Administration) foreign drug site registration and Canadian drug establishment licence.

This non-dilutive cash infusion further strengthens the company's balance sheet. Medipharm's cash balance as of Oct. 20, 2023, was approximately $19.5-million. In addition, Medipharm has less than $3-million of debt and full ownership of its assets. Management believes this gives Medipharm a very strong position to continue to invest in the pharmaceutical and clinical pipelines, and to thoughtfully consider approaches to the many available consolidation opportunities in the industry.

Management commentary

David Pidduck, chief executive officer of Medipharm Labs, commented, "With a Q2 burn rate of about $3-million per quarter and this recent cash settlement, we are now in an even stronger position to consider organic and inorganic growth investments."

About Medipharm Labs Corp.

Founded in 2015, Medipharm Labs specializes in the development and manufacture of purified, pharmaceutical-quality cannabis concentrates, active pharmaceutical ingredients (API) and advanced derivative products utilizing a good manufacturing practices certified facility with ISO standard-built clean rooms. Medipharm Labs has invested in an expert, research-driven team, state-of-the-art technology, downstream purification methodologies, and purpose-built facilities for delivery of pure, trusted and precision-dosed cannabis products for its customers. Medipharm Labs develops, formulates, processes, packages and distributes cannabis and advanced cannabinoid-based products to domestic and international medical markets.

In 2021, Medipharm Labs received a pharmaceutical drug establishment licence from Health Canada, becoming the only company in North America to hold a commercial-scale domestic good manufacturing licence for the extraction of multiple natural cannabinoids. The company carries out its operations in compliance with all applicable laws in the countries in which it operates.

In 2023, Medipharm acquired VIVO Cannabis Inc., which expanded Medipharm's reach to medical patients in Canada via Canna Farms medical e-commerce platform, and in Australia and Germany through Beacon Medical Pty. and Beacon Medical GMBH. This acquisition also included Harvest Medical Clinics in Canada, which provides medical cannabis patients with physician consultations for medical cannabis education and prescriptions.

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