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©Reuters.
TORONTO – Avicanna Inc. (TSX: AVCN) (OTCQX: AVCNF) (FSE: 0NN), a biopharmaceutical company specializing in cannabinoid-based products, has entered into an exclusive supply agreement with an unnamed multinational pharmaceutical company to develop its proprietary We sell two types of products: A popular product in the European market. The agreement also includes a right of first refusal for Avicanna’s self-emulsifying drug delivery system (SEDDS) technology capsules in the region.
The partnership introduces Avicanna’s Ultra CBD Cream and CBG Transdermal Gel, both of which have been enrolled in observational real-world evidence clinical trials for skin and musculoskeletal conditions, respectively. The first launches of these products will take place in six European countries within 2024, with further expansion planned in the region.
Under the terms of the agreement, the multinational pharmaceutical company, which operates across four continents, will leverage its established commercial infrastructure in Europe for product launches. In return, Avicanna receives licensing fees tied to certain milestones and sets minimum order quantities for drug companies to maintain exclusivity.
The product is already commercialized in Canada under the RHO Phyto brand and will be manufactured using Avicanna’s Colombian operations. The company’s majority-owned subsidiary, Santa Marta Golden Hemp SAS, will supply the cannabinoids. These products will be registered and commercialized under applicable cosmetics legislation and are expected to enter the market in the first half of 2024.
Avicanna CEO Aras Azadian expressed confidence in the strategic relationship and highlighted its potential to accelerate the expansion of their products into several international markets.
This agreement signifies Avicanna’s continued commitment to advancing and commercializing evidence-based cannabinoid products. The company’s scientific platform supports a wide range of formulations, with a drug pipeline for dermatology, chronic pain, and neurological diseases.
Information regarding this announcement is based on Avicanna Inc.’s press release statement. The company cautions that forward-looking statements involve various risks and uncertainties that could cause actual results to differ materially from expectations.
Investment Pro Insights
As Avicanna prepares to enter the European market with cannabinoid-based topical products, investors and stakeholders may be intrigued by the company’s financial health and market performance. Avicanna’s market capitalization is modest at $21.56 million, reflecting the company’s size and scale in the biopharmaceutical industry, according to real-time data from InvestingPro. Notably, the company has recorded an impressive revenue growth of 187.54% over the past twelve months as of Q3 2023, which indicates the expansion of the company’s business scope. However, despite this growth, Avicanna’s operating margin remained negative at -88.37%, highlighting the challenges the company faces in achieving profitability.
According to InvestingPro Tips, analysts expect sales to increase this fiscal year, which is in line with Avicanna’s strategic expansion into the European market. But they don’t expect the company to be profitable this year, and there are financial hurdles to overcome as short-term debt exceeds current assets. The company also trades at a high price/book value of 28.3x, which may suggest an expensive valuation relative to book value.
For those looking to learn more about Avicanna’s financial health and future prospects, InvestingPro provides additional insight. Now’s the perfect time to subscribe as we’re having a special New Year’s sale with up to 50% off.Use promo code SFY24 Get an extra 10% off a 2-year InvestingPro+ subscription, or SFY241 Get an extra 10% off your 1-year subscription. Apart from the highlighted tips, InvestingPro lists several other valuable tips to guide your investment decisions.
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