Heritage Cannabis Holdings Corp. has entered into an agreement to acquire all of the issued and outstanding equity of Opticann Inc., a Colorado-based oral and topical cannabinoid company with the rights to exclusively sell CBD and CBG products made with the patented VESIsorb(R) drug delivery system for optimized absorption and stability.
Under the terms of the Agreement, Opticann will receive initial consideration of up to CDN$5.0 million of common shares and warrants of Heritage. The Agreement additionally includes a series of possible earn-outs with a potential value of up to CDN$30.0 million contingent upon achieving significant financial and enterprise milestones over the next five years. Opticann was founded by several former executives of MedReleaf Corp., a Canadian medical cannabis company that was acquired by Aurora Cannabis Inc. for $3.2 billion in 2018.
Opticann has a supply and distribution agreement with Geocann LLC, a global cannabis organization with the exclusive worldwide rights to the patented VESIsorb(R) delivery technology for cannabinoids, terpenes, and flavonoid formulations. The agreement between Opticann and Geocann provides Opticann exclusive distribution rights to brand and market a select portfolio of VESIsorb(R) formulated oral and topical CBD and CBG products to major U.S. retailers that dominate the U.S. food, drug, and mass retailer market, including CVS, Walgreens, Rite-Aid, and Walmart, among others.
VESIsorb(R) is a leading delivery system innovation for dramatically improving the stability and absorption (bioavailability) of natural ingredients like cannabinoids, and is backed by a robust body of supporting scientific evidence spanning several decades. Most recently, the peer-reviewed journal, Molecules, published the results of a double-blind, cross-over study (Molecules 2019,24(16), 2967;https://doi.org/10.3390/molecules24162967) comparing the absorption parameters (pharmacokinetics) of a CBD extract formulated with VESIsorb(R) to that of the same CBD extract formulated with industry standard (MCT) oil. Overall, the VESIsorb(R) formulation showed statistically significant improvements for all measured parameters, including much higher total absorption (a 440% increase in maximum plasma CBD concentration (Cmax), and a 285% increase in total CBD exposure over 8 hours [area under the curve (AUC)]) and the time to reach the peak concentration 300% faster than the standard formulation (1 hour for VESIsorb(R) versus 3 hours for the standard to reach Tmax).
Opticann was founded by former MedReleaf executives including Neil Closner (founder and former CEO), Umar Syed (former SVP Corporate Development), Angelo Fefekos (former SVP ofClinical Affairs & Quality Compliance) and Ori Sher (former Sr. Director of Procurement and Security). Following the completion of the acquisition, Opticann will nominate a person to join Heritage’s Board of Directors, and Messrs. Closner, Syed, Fefekos, and Sher will remain as special advisors to Heritage. Prior to being acquired in July 2018, MedReleaf was one of the most successful Canadian LPs in the industry with strong sales and development in the medical cannabis market and was the creator of some of the dominant brands in today’s adult-use market.
“The patented VESIsorb(R) technology enables the creation of next generation CBD and CBG products that are proven to be far superior in performance over other products in the market,” said Neil Closner, Chairman of the Board of Opticann. “These products are backed by human clinical data published in a peer reviewed scientific journal showing enhanced absorption and performance versus other CBD and hemp products. These products are manufactured within Geocann’s advanced GMP compliant and highly scalable supply chain, and are ideal for building leading brands at large national U.S. retailers. We are looking forward to bringing the Opticann team and this technology to Heritage and to successfully executing the business plan.”
“The acquisition of Opticann is a strategically significant move, and an important milestone for Heritage as we expand our expertise and look to advance our plan to grow our U.S. presence and participate in the rapidly growing multi-billion dollar U.S. CBD market,” stated Clint Sharples, CEO of Heritage. “We are excited to have Opticann join the Heritage family and have the talented and proven medical cannabis executives and team members from the former MedReleaf as part of Heritage’s future success. Heritage will also leverage Opticann’s international experience and relationships with plans to build an international medical product sales footprint.”
“The increased awareness, acceptance and utilization of science-backed formulations is emerging in the cannabinoid marketplace, and the exceptional pedigree of Heritage and Opticann will make VESIsorb(R) branded hemp products as market leaders in the pharmacy mass market,” said Jesse Lopez, founder and CEO of Geocann. “The founders of Opticann have a successful track record of building brands for mass retailers and delivering value to the cannabis and hemp industries with a focus on differentiation based on superior innovation, unmatched quality, consumer education, and strategic retail partnerships.”
Heritage Cannabis Holdings Corp. is a vertically integrated cannabis company that owns two Health Canada approved licenced producers, Voyage Cannabis Corp. and CannaCure Corp., both of which also have industrial hemp licenses.
Opticann is dedicated to bringing medical hemp-based cannabinoid products backed by objective scientific data on safety, performance, and effectiveness to the market.