MediPharm Labs - President and CEO, Pat McCutcheon
President and CEO, Pat McCutcheon
Source: Kahner Global
Market Herald logo

Subscribe

Be the first with the news that moves the market
  • MediPharm Labs (TSX:LABS) has completed a private placement with an institutional investor for gross proceeds of C$37.8 million
  • 50 per cent of the funds are currently held in escrow and will be released to the company upon the satisfaction of certain requirements
  • The proceeds will be used to build on the launch of the company’s Cannabis 2.0 products and strengthen its balance sheet
  • MediPharm is also looking to increase its involvement in a range of clinical trials
  • MediPharm Labs (LABS) is currently steady at $1.87 per share

MediPharm Labs (TSX:LABS) has completed a private placement with an institutional investor for gross proceeds of C$37.8 million.

50 per cent of the offering, or approximately $18.9 million, is related to the placement of a $20.5 million unsecured convertible note and a warrant to purchase up to 3.6 million common shares.

The remaining 50 per cent is currently held in escrow a licensed Canadian trust company, and is related to the placement of a subscription receipt. Upon the satisfaction of certain escrow release conditions, the holder will receive a further $20.5 million unsecured convertible note and a warrant to purchase an additional 3.6 million common shares.

Issued at a discount of 7.75 per cent, the notes have a three-year term and are convertible at a price of $2.28 per share. Likewise, the warrants are also exercisable at a price of $2.28, and will expire of October 9, 2023.

MediPharm plans to use the proceeds to build on the launch of its Cannabis 2.0 range, including the introduction of new product formats. The proceeds will also bolster the company’s Active Pharmaceutical Ingredient exports and strengthen its balance sheet.

Pat McCutcheon, CEO of MediPharm Labs, said the additional capital will enable the company to move forward with a position of increased strength and flexibility.

“I continue to be excited about the global market opportunity and leveraging our multi-jurisdictional pharmaceutical-quality manufacturing platform in a nascent cannabis market.

“We are building on our global customer partnerships and market share, providing international distribution expertise and delivering innovative products and brands,” he said.

Pat also noted that MediPharm intends to expand its participation in a wide range of clinical trials, offering the potential to develop new cannabis-based prescription products.

MediPharm Labs (LABS) is currently steady at $1.87 per share, as of 9:41am EDT.

More From The Market Herald

" Innocan Pharma (CSE:INNO) reports successful efficacy test for vaginal derma product

Innocan Pharma (INNO) has announced successful results from a controlled efficacy test of its vaginal derma product.

" VIVO Cannabis (TSX:VIVO) cleared to be acquired by MediPharm (TSX:LABS)

VIVO (VIVO) has been approved by the Ontario Superior Court of Justice to be acquired by MediPharm.

" The Market Herald’s Weekly Cannabis Report – Mar 24, 2023

HEXO Corp. (TSX:HEXO) slid 2.0 per cent since a sobering report about its place in the cannabis industry.

" Ascend Wellness (CSE:AAWH.U) expands Michigan presence

Ascend (AAWH.U) has announced the opening of its eighth dispensary in Michigan, located in Grand Rapids.