The update outlines the company’s position related to commercial revenue generating activities as well as an operational update on the status of the cultivation, extraction and testing facilities.
It states that, as a result of the ILANS acquisition and launch of the Kuida cosmeceutical brand, Khiron remains the only Colombian company that generates cannabis revenues derived from legally approved production.
Medical Cannabis Products
Khiron has endorsements from six Latin American medical associations, which represent more than 5,000 doctor relationships and approximately 1 million patients. This positions the company with the most established potential addressable patient network in Latin America and one of the largest established networks on a global basis.
The network provides the company a competitive and defensible advantage, which has been established in advance of commercializing its medical cannabis products. It is anticipated the company will commercialize its medical cannabis products in the third quarter.
Khiron was the first company to launch medical cannabis trials for product development initiatives targeted at key indications within the Latin American market. These efforts will be completed in coordination with Khiron’s ILANS neuropathic clinics in Bogota, which includes over 119,000 patients and over 60 in-house physicians and clinicians.
Khiron is focused on working with medical, government and financial organizations within the Latin American market, to increase access and affordability of medical cannabis products.
As part of its efforts, Khiron signed a letter of intent with Copservir Ltd., a Colombian government administered pharmacy chain, which is the largest in the Colombian pharmacy network based on its 900 stores throughout the country. It is anticipated that the arrangement will ensure critical infrastructure for Khiron to distribute its made-to-order pharmaceutical compounds to more than five million potential patients in Colombia.
Khiron is the first company to introduce CBD skin care products in the Colombian market. Since the initial exclusive launch of the product with Colombian retailer Farmatodo, the company has secured distribution arrangements with many of the largest retailers in the Colombian market. These include Farmatodo, Fedco, Linio, Droguerias Cafam, Habib, Galenos, and Salud Market. Collectively, these companies represent over 176 retail points of sales as well as significant online distribution platforms.
Further, Khiron is advancing discussions with other top retailers in Colombia to reach 700 points of distribution in Colombia by the end of 2019. The company has also launched six pop-up stores in key retail malls within four priority cities. It plans to have 20 pop-up stores by the end of 2019.
Meanwhile, Khiron continues to expand its wellness product lines, with additional product development activities underway and new international product markets identified. New product development initiatives including expanding the wellness portfolio to include products specifically for men. These products will also be positioned within North American, European and Latin American markets outside Colombia.
Cultivation and Extraction
Khiron has established cultivation activities within Colombia, Uruguay and Chile. The cultivation sites allow the company to provide cannabis consumers and patients with a full variety of flower and extract-based products for domestic and international consumption. The cultivation areas will facilitate upwards of approximately 25,000 kilograms of annual dried flower production capacity.
At full capacity under the modular model, on completion of full construction of all licensed cultivation areas, the company would have internally sourced capacity of producing upwards of 158,000 kilograms of annual dried flower at its disposal when needed.
The Colombian testing and extraction facilities have been completed and are currently operational and are positioned for significant expansion of extraction and purification capabilities, according to the company.
Khiron is currently working on GMP certification for the extraction facilities. Full commercialization of the grow site is anticipated in the third quarter. This will enable the company to integrate its production into the established medical cannabis product distribution channels.