Mr. David Shpilt reports
INTERNATIONAL CANNABIS STRENGTHENS COLOMBIAN PHARMACY PORTFOLIO WITHIN LATAM DISTRIBUTION FOOTPRINT; PROVIDES GUIDANCE ON EXPANSION STRATEGY
ICC International Cannabis Corp. has entered into a definitive agreement to acquire 100 per cent of Grupo Pharma Colombiano Inc., further augmenting its Latin American pharmacy distribution network.
Grupo Pharma controls 75 per cent of an existing pharmacy operation, located in the El Poblado area of Medellin, Colombia, which is a centrally located, affluent community that has a population of approximately 128,000 consumers within a nine-square-mile radius. The area is also a top tourist destination and benefits from the influx of the approximately 550,000 annual visitors that Medellin receives.
The acquisition of Grupo Pharma represents International Cannabis's second flagship Colombian brick-and-mortar pharmacy operation, with eight additional locations expected to be secured and retrofitted by the end of fiscal 2019.
Grupo Pharma is equipped with an experienced operations team, focused on deploying a patient-centric distribution strategy, coupled with optimized supply chain channels. International Cannabis plans to drive prescription and brand loyalty to its flagship Colombian pharmacies, while addressing priority medical conditions within the Latin American theatre by combining:
Patented delivery systems and technologies;
Extensive consumer product goods (CPG) and branded product market entrance experience;
Global scientific expertise;
Comprehensive doctor detailing and educational campaigns.
Grupo Pharma has established a strong presence and client base, servicing the local populous, and is now preparing to execute on a comprehensive expansion campaign, targeting high-density, consumer-friendly zones across the Antioquian region of northwest Colombia. The Antioquian region is home to approximately 6.6 million inhabitants, and is widely revered for its robust health care infrastructure, universities and diverse industries.
Grupo Pharma's flagship pharmacy is equipped with retail, wholesale and on-line distribution channels, and boasts the following industry accolades:
Top-10 individual sales location in all of Antioquia;
Top-10 vendor of Abbott y LaFrancol & CoopiDrogas pharmaceuticals;
Over 2,000 unique SKUs on offer;
Referral network of over 400 certified medical professionals;
30-minute in-house pharmaceutical delivery and medical visit outreach infrastructure;
Relationships with major pharmaceutical brands.
By leveraging proprietary data science techniques and advanced regression analytics derived from demographic and consumer information repositories, Grupo Pharma has developed a comprehensive expansion stratagem with the objective of capturing increased market penetration across the Antioquian region.
Pending appropriate licensing and regulatory approval, Grupo Pharma's strategic growth plans include introducing premium cannabis flower and cannabidiol (CBD) products derived from International Cannabis's library of native Colombian cannabis genetics.
ICC's Colombian genetics portfolio consists of 20 unique strains that include both prominent tetrahydrocannabinol (THC) and CBD varietals, such as:
As both the World Health Organization and many countries around the world shift their stance in favour of the medical use of CBD-dominant cannabis oils and CBD-derived health and wellness products, the demand for high-yield CBD strains is expected to increase geometrically.
David Shpilt, chief executive officer of International Cannabis, stated: "The astute acquisition of Grupo Pharma furthers our mandate in bolstering distribution touch points, as well as solidifying early-mover advantages in burgeoning cannabis locales, such as Colombia. According to a report by New Frontier Data, the total addressable LATAM cannabis market represents approximately $9.8-billion (U.S.) and accounts for 600 million people, further validating Colombian's high-profile market opportunity.
"Grupo Pharma further bolsters ICC's downstream LATAM capabilities by securing a turnkey solution to establish a baseline presence within Colombian's burgeoning medical cannabis and health and wellness verticals.
"In conjunction with our data-driven LATAM expansion plan, the company will undertake material efforts to strengthen our Colombian doctor outreach programs, as well as institute high-profile corporate and university drug plan outreach initiatives. ICC will continue to leverage its advanced global downstream capabilities, including its European distribution footprint of 80,000 pharmacies and retail end points to market premium cannabis under the company's diverse brands and banners."
On closing, ICC shall issue to the shareholders of Grupo Pharma 15 million common shares in the capital of the company. When issued, 50 per cent of the closing payment shares will be subject to a hold period of six months from the date of issuance, and the remaining 50 per cent of the closing payment shares will be subject to a hold period of 12 months from the date of the issuance. The company will also pay $230,000.
A finder's fee is payable on this transaction.
About ICC International Cannabis Corp.
ICC International Cannabis, through its subsidiaries, has operating assets, and is developing a world-class platform for cultivation, extraction, formulation and distribution across the globe in the United Kingdom, Denmark, Poland, Switzerland, Germany, Macedonia, Bulgaria, Serbia, Croatia, Greece, Italy, Portugal, Malta, Colombia, Argentina, Australia, South Africa and Lesotho.
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