Key Takeaways; Cannabis Sector

• Institutional mortgage REIT AFC Gamma committed $82.5 million for Florida marijuana MSO Bloom Medicinals.
• Decibel announced Q4 results with strong revenue growth and sixth period of consecutive positive adjusted EBITDA.
• Red White & Bloom took steps to enhance its financial position.

Key Takeaways; Psychedelic Sector

• Mindset Pharma strengthened its portfolio by filing a new provisional patent application for its Next-Generation DMT and 5-MeO-DMT drug candidate compounds.
• Awakn provided shareholders with a business update on its 3 ketamine-assisted therapy clinics.

Top Marijuana Companies for Week

#1: AFC Gamma

Cannabis real estate lender AFC Gamma, Inc. (NASDAQ: AFCG) announced a senior secured credit facility worth up to $82.5 million for Florida-based multistate marijuana company Bloom Medicinals, which is a family-owned company with three cultivation facilities, two processing facilities, and 12 dispensaries. AFC Gamma stated that the facility is secured by first-lien mortgages on Bloom’s real estate properties and other commercial security interests.

According to a news release issued by AFC Gamma on Thursday April 21, 2022, Bloom aims to use the funds from the new credit facility to settle existing debt, finance development activities, acquire a Level 1 Cultivation license in Ohio, and provide extra operating capital.

AFC Gamma also said that, Bloom’s five Ohio medical marijuana dispensaries would benefit from the cultivation facility and the acquisition would make Bloom’s Ohio operations vertically integrated.

AFC Gamma, which is situated in West Palm Beach, Florida, recently announced that it was refinancing two outstanding debts with Bloom, which is based in Boca Raton, a city on Florida’s southeastern coast. In addition, AFC Gamma recently announced $46.4 million in loans to other cannabis companies.

The lender reported $419.2 million of loan commitments as of the end of 2021. The company’s shares trade on the NASDAQ exchange as AFCG.

#2: Decibel

On April 22, 2022, Decibel Cannabis Company Inc. (TSXV: DB) (OTC: DBCCF) released its audited financial results for the fourth quarter and year ended December 31, 2021. Decibel’s net revenue increased 5% sequentially to $14 million in the fourth quarter, which was a 23% rise compared to the same period in 2020. Moreover, the Calgary, Alberta-based company recorded its third straight growth in quarterly net sales in 2021, with annual sales of CA$52.5 million.

In addition to the growing cannabis sales, the company also reported a net profit of 1.7 million Canadian dollars ($1.3 million) for the fiscal year 2021 and a positive adjusted EBITDA of CA$7.4 million.

Despite Decibel having positive financial results, competitors suffered significant declines in cannabis sales over the same period of time. Unlike its larger and better-funded rivals Tilray Brands, Hexo Corp., and Canopy Growth Corp., Decibel stated on Friday that it has increased its market share in the past six months, rising from around 4% last summer to around 5% in March 2022, which is also better than Cronos and Aurora Cannabis.

According to Decibel, the launch of Decibel’s new infused pre-roll lines, as well as continuous growth in demand for flower, vape, and concentrate products, contributed to the 5% increase in revenues over the previous quarter. However, price compression in the floral market and slower retail sales due to greater competition had a negative impact.

In the first-quarter 2022 business outlook, Decibel forecasts net revenue to reach between $16.5 and $17.5 million in the first quarter of 2022, up from $12.6 million in the first quarter of 2021. Additionally, the company expects to end the quarter with a record 4.0% recreational national market share.

#3: Red White & Bloom

Red White & Bloom Brands Inc. (CSE: RWB) (OTC: RWBYF) announced on April 20, 2022, that it had completed a number of restructuring and operational decisions that are intended at strengthening the balance sheet and reducing costs significantly in 2022. The measures taken include, selling the Illinois property, paying off $51.7 million in debt, decreasing manpower, and focusing on its own brands.

According to the Toronto-based company, these moves strengthen its balance sheet by removing $115 million in liabilities and over $22 million in yearly expenses. As a result, Red White & Bloom expects to have a positive EBITDA before the end of the year.

One of the moves by the company include, selling its Granville, Illinois, cultivation facility for $56.1 million to New Branches of California. Moreover, the company plans on paying off $51.7 million of secured debt, a move that will eliminates $6.3 million of annual interest. The company also announced that it was aiming to save more than $2.5 million through reductions in workforce, suppliers and consultants; however, the exact employee head-count reductions weren’t announced. In addition, the company also stated that it was working on eliminating $60 million in future royalty payments by streamlining brands.

Red White & Bloom still has operations in Illinois as well as Arizona, California, Florida, Michigan and Oklahoma. In addition, the company recently completed the acquisition of a marijuana company in Michigan.

Top Psychedelic Company for Week

#1: Mindset Pharma

On April 19, 2022, Mindset Pharma Inc. (CNSX: MSET) (OTC: MSSTF), a drug discovery and development company focused on developing optimized and patentable next-generation psychedelic medicines to treat neurological and psychiatric disorders with unmet medical needs, filed a new provisional patent application that covers new chemical entities (NCEs), which expands the Company’s next-generation DMT and 5-MeO-DMT platform that is currently in the development stage.

This latest patent application demonstrates Mindset’s corporate objective to expand the therapeutic psychedelic toolkit for patients with mental health disorders who are waiting for transformative drugs.

Mindset has a large IP footprint in the psychedelic sector, with novel chemical entities in development that mirror the functioning of first-generation psychedelic drugs while also having enhanced pharmacological and safety profiles to suit a variety of in-clinic needs.

On its patent-pending new compounds, the company performs a differentiated battery of highly specialized in-vitro and in-vivo testing to choose the best psychedelic medication candidates for human clinical trials.

#2: Awakn

Awakn Life Sciences Corp. (NEO: AWKN) (OTC: AWKNF), a biotechnology company dedicated to researching, developing, and delivering revolutionary therapeutics to treat addiction, provided shareholders with an update on its three fully operational ketamine-assisted therapy clinics, two in the United Kingdom and one in Norway. Below is a breakdown report on the three clinics.

Awakn Clinics Bristol was Awakn’s and the UK’s first medical psychedelic-assisted therapy clinic. The clinic began in the fourth quarter of 2021 and is currently in its sixth month of operation, with high demand for both its evidence-based ‘KARE’ protocol for the treatment of AUD and its ketamine-assisted therapy for the treatment of depression, anxiety, PTSD, and eating disorders.

Awakn Clinics Oslo (previously Axonklinikken) was bought by Awakn in late 2021 and is one of the premier ketamine-assisted therapy clinics in the Nordics. Awakn completed the integration of Axonklinikken into its clinic network in the first quarter of 2022, and the clinic was officially rebranded as Awakn Clinics Oslo in March 2022. Clients from all over Norway can now receive Awakn’s evidence-based ‘KARE’ and ketamine-assisted therapy at Awakn Clinics Oslo.

After getting regulatory approval to begin operations in March 2022, Awakn Clinics London, which is Awakn’s flagship facility, was officially opened and is now, treating clients. It, like the other of Awakn’s clinics, provides evidence-based therapies for a variety of mental diseases and addictions.

Dr. Ben Sessa, Awakn’s Chief Medical Officer, said; “To have three clinics operational and delivering ketamine-assisted therapy in such a short space of time is hugely gratifying.” He also said that the clinics provide a fantastic potential for Awakn’s growth, and he believes this is due to the fact that Awakn serve a broad group of people who have struggled to find an effective therapy for their sickness.

Key Takeaways; Cannabis Sector

• Jushi expands Nevada presence by closing on $53.6M acquisition of NuLeaf.
• American Green is developing its own cryptocurrency.
• Cannabis real estate investor, NewLake, acquired cultivation property in Missouri for $34.0 million.
• InterCure reported record breaking $89 million revenue for 2021.

Key Takeaways; Psychedelic Sector

• Awakn successfully completed phase one of its drug discovery program.

Although the legal cannabis sector has grown swiftly, it is still in its early phases. Nevertheless, the combination of federal legalization delays and unpredictable capital markets disruptors have created a difficult environment that is always changing. Despite these challenges, operators on the other hand, are finding new methods to compete, grow, and advance the sector. Below is a full weekly roundup on the top movers and shakers of the cannabis and psychedelics sectors.

Top Marijuana Companies for Week

#1: Jushi

On April 07, 2022, Jushi Holdings Inc. (OTC: JUSHF), which is a Florida-based marijuana multistate operator, bolstered its operations in Nevada by the completion of its $53.6 million acquisition of Nevada-based NuLeaf, Inc.

In the Las Vegas area, NuLeaf has two high-performing adult use and medicinal retail dispensaries, as well as one in Lake Tahoe. NuLeaf also owns a third licensed retail dispensary located directly on the Las Vegas Strip that is expected to open in the second quarter. In addition, the company operates a 27,000-square-foot growing plant in Sparks, Nevada, as well as a 13,000-square-foot processing facility in Reno, Nevada.

This is Jushi’s latest move to solidify its position in the $1 billion Nevada industry. Moreover, the NuLeaf acquisition comes on the heels of the recently completed Apothecarium Nevada acquisition. As a result of these acquisitions, Jushi now has four dispensaries in Nevada, three of which are in the Las Vegas area, which is a high tourist-friendly city. The company said that the NuLeaf acquisition will enable Jushi to sell its branded products on the wholesale market in Nevada.

Just a couple of weeks ago, Jushi reported that its total revenue rose 104% in the fourth quarter to $65.9 million over last year and increased 22% sequentially. However, some analysts believe that the company’s revenue was slowing as the year began. But there’s no doubt that the addition of NuLeaf will help bolster those revenue numbers.

#2: American Green

On April 7, 2022, American Green, Inc. (OTC: ERBB) president David G. Gwyther said that the company is working on developing its own cryptocurrency dubbed The American GreenBack.

American Green recently completed the second cash payment under the terms of a binding letter of intent (LOI) to acquire VendWeb. The company wants to develop a new crypto coin that will be used in age-verified transactions for alcohol sales at sporting events, concerts, and nightclubs, as well as other age-restricted locations like cannabis dispensaries and smoke shops.

The company said that, The American GreenBack crypto, as designed, would combine biometric data (ID, fingerprint, retinal scan, palm print, etc.) with Know Your Customer (KYC) and Anti-Money Laundering (AML) compliant verification software, all of which would be stored on a single, unalterable blockchain. The company added that only other KYC/AML-verified counterparties will be able to exchange the crypto.

In 2009, American Green, Inc. became the country’s second publicly traded cannabis company. With over 77,000 verified beneficial owners, the company is currently one of the largest cannabis companies in terms of shareholder count. The objective of the company is to be the leader in the cannabis and premium CBD industries. The management hopes that the use of American GreenBack crypto as their proprietary vending solutions will help them achieve that goal.

#3: NewLake

Connecticut-based NewLake Capital Partners, Inc. (OTC: NLCP) plans to invest as much as $34 million in a marijuana cultivation operation in Missouri. On Wednesday, April 06, 2022, the company announced the completion of part one of a three-part commitment for a cultivation property in Missouri. Part of the commitment include, the purchase of a 40,000-square-foot industrial property in O’Fallon, Missouri, and the signing of a long-term, triple-net lease with an affiliate of C3 Industries, Inc, which is guaranteeing the lease.

The $34.0 million aggregate commitment from NewLake will be split into three parts. Part one begins with NewLake’s $7.3 million purchase of the company’s flagship Missouri cultivation facility, along with a pledge to pay an additional $5.2 million to finish construction by June 2022.

Part two helps to fund a proposed expansion of the facility by providing up to $16.5 million to buy an adjacent piece of property and build a 65,000 square foot cultivation facility (subject to normal and customary closing conditions and regulatory approvals). The combined property will be a state-of-the-art 105,000 square foot growing facility once completed. Finally, part three is a $5.0 million interest-only loan that can be accessed over the next year.

NewLake CEO David Weinstein said in the press release that the company is making the investment because it has been impressed by C3 Industries’ success in limited-license states such as Michigan and Oregon.

NewLake, which went public, last year, trades on the U.S. over-the-counter (OTC) markets as NLCP.

#4: InterCure

Israeli-based cannabis company InterCure Ltd. (NASDAQ: INCR), also known as Canndoc, reported its financial and operating results for the fourth quarter and year ending December 31, 2021 on April 06, 2022.

InterCure announced revenue of $33 million (NIS 80 million), which was higher than preliminary figures and three times that of the fourth quarter of 2020, indicating a 29% sequential growth. In addition, the expected net income was $1 million (NIS 3 million) for the quarter.

InterCure also reported revenue and adjusted EBITDA for fiscal year 2021 of $89 million (NIS 220 million) and $23 million (NIS 55 million), respectively, indicating increases of 230% and 250% year over year. Also for 2021, the expected net income was $5 million (NIS 13 million). In addition, the company said it had $89 million (NIS 217 million) in cash at the end of the year.

InterCure also said it received 5.2 million shares back from the sponsor of its SPAC transaction in the third quarter. The shares were susceptible to forfeiture from the SPAC sponsor depending on share price target conditions, according to the agreement. Nonetheless, the free return of the shares to the company provided a considerable value of about $56 million to all InterCure shareholders based on the current share price.

Since the quarter ended, InterCure has struck a definitive agreement with Altman Health, which is the leading Israeli wellness brand with over 1,700 points of sale that focus on the new Israeli CBD product market. In addition, the company added three new medical cannabis devoted pharmacies to its chain, bringing the total number of retail locations in Israel to 23, with 15 of them currently dispensing medical cannabis.

Top Psychedelic Company for Week

#1: Awakn

On April 6, 2022, Awakn Life Sciences Corp. (NEO: AWKN) (OTC: AWKNF), a biotechnology company focused on researching, developing, and delivering revolutionary therapeutics to treat addiction, announced the successful completion of phase one of its new chemical entity (NCE) development program. This key development bolsters Awakn’s pipeline for the treatment of a wide range of both substance and behavioral addictions.

Awakn announced that it had completed a hit to lead program that met its primary objectives of finding and patenting novel chemistry scaffolds. In addition, the company said that it had also established drug discovery assays that have the potential to make lead optimization more efficient.

This historic discovery by Awakn is an important first step toward the development of new, faster-acting, and safer entactogenic medications for the market.

During this NCE development program, several chemical scaffolds were identified using a combination of computational screening and medicinal chemistry techniques, as well as in vitro pharmacology and DMPK testing. And as a result of this successful research, several patents have now been filed with several of these chemical scaffolds, demonstrating in vivo activity and offering a great starting point for lead optimization.

This announcement builds on Awakn’s acquisition in March 2021 of a significant body of proprietary research from Prof. Nutt’s Equasy Enterprises, which included details of newly discovered actions of MDMA and gave Awakn an advantageous starting point for this phase of development.

Key Takeaways; Psychedelic Sector

• Stifel analyst issued a speculative buy on Awakn with $8 price target.

Key Takeaways; Cannabis Sector

• RIV Capital bought New York cannabis company Etain for $257 million.
• Trulieve reported record Q4 and full year earnings results; revenue increased 36% sequentially to $305 million after acquisition of Harvest.
• IM Cannabis reported record fourth quarter and fiscal year, 2021, financial results; the company also provided first quarter, 2022, outlook.
• Cannabis manufacturer, Valens, raised $22.5 million in bought deal offerings.

Marijuana stocks have taken a beating in the past year, getting pummeled as hopes evaporated for federal marijuana legalization before inflation worries and the war in Ukraine tanked the broader market. However, the tide seems to be turning. This is because, The Marijuana Opportunity, Reinvestment and Expungement, ‘The MORE Act’, which was initiated by the House Judiciary Chairman, Jerrold Nadler, was passed through a House vote on Friday, April 1, 2022. There’s high hope that the passing of this bill will bring huge optimism in the cannabis sector, and even push us further to the federal legalization of marijuana.

Moreover, there was also another key development in the psychedelics sector, where Stifel Financial Corp., which is an American multinational independent investment bank and financial services provider company, initiated a speculative buy rating coverage on Awakn Life Sciences, with a target price of C$8.00.

Below is the full weekly roundup on the top business stories that dominated the psychedelics sector and the cannabis industry.

Top Psychedelic Company for Week

#1: Awakn

Awakn Life Sciences Corp. (NEO: AWKN) (OTC: AWKNF) made the news headlines this week after a well-known analyst upgraded the buy ratings on the company’s shares. Awakn is expected to have an optimistic future, according to Stifel Financial Corp. analyst, Andrew Partheniou. The stock market analyst issued a Speculative Buy rating on the psychedelics stock, with a price target of $8 for the stock.

For various reasons, Partheniou believes Awakn is one of the top psychedelics stocks to invest in. The company’s prospects were underlined in his Initiation of Coverage analyst report, which described it as a “pure play” psychedelic company that is succeeding in creating addiction treatments. He also highlighted Awakn’s elite management team that includes Professor David Nutt. He believes that the elite management is giving Awakn an edge against its competitors. Partheniou has set an $8 price target for Awakn. The stock is currently trading at $1.26.

The psychedelics industry is slowly but steadily approaching a mainstream global legalization and adoption. In a few years, self-medicating using psychedelics like those developed by Awakn may be routine for persons suffering from post-traumatic stress disorder, depression, alcohol addiction, and anxiety.

Awakn, which was founded in Canada in 2020, is a biotechnology company focused on researching, developing, and delivering psychedelic therapeutics to treat behavioral addictions. Shares of Awakn trade as AWKN on the Canadian stock exchange NEO and also trade as AWKNF in the over the counter (OTC) markets in the USA. The company is currently based in Toronto, Canada.

Top Marijuana Companies for Week

#1: RIV Capital

On March 30, 2022, RIV Capital, Inc. (CSE: RIV) (OTC: CNPOF) announced a definitive agreement to purchase Etain LLC and Etain IP LLC, which are owners and operators of legally registered cannabis production and retail outlets in New York, the deal is worth $247 million.  Etain was the only woman-owned and operated cannabis company in New York. In addition, it was one of the state’s first five medical cannabis license holders.

According to the terms of the definitive agreement, after receiving regulatory clearances from the New York Cannabis Control Board and the New York State Office of Cannabis Management, RIV Capital will acquire full ownership and control of all Etain companies. The deal is subject to these approvals because a restriction that a minority-owned cannabis company could only sell to another minority-owned cannabis company existed in New York at one point; however, it is unclear whether this restriction will be enforced.

Scotts Miracle-Gro (NYSE: SMG) is funding RIV Capital in this acquisition deal. This means that Scotts is essentially the company buying Etain. As per the terms of agreements, RIV Capital will make a cash payment of $212 million and an additional stock payment of $35 million.

RIV Capital said it will put more money and resources into four new dispensaries, as well as assist the creation of a new state-of-the-art flagship indoor cultivation facility suited to the high-end New York market.

#2: Trulieve

Trulieve Cannabis Corp. (OTC: TCNNF), a leading and top-performing multi-state cannabis company in the United States, released its quarterly and full-year results on March 30, 2022.

Trulieve reported revenue of $305.3 million in the fourth quarter, which was up 81% from the fourth quarter of 2020 and a 36% increase from the third quarter. In addition, the company reported a net loss of $71.5 million and an adjusted net income of $1.8 million for the quarter, which excluded $73.3 million in non-recurring fair value of inventory step-up, transaction, acquisition, and integration losses that are principally related to the Harvest acquisition. The loss per share was $0.49, which missed the average analyst forecast of $0.18 cents per share on Yahoo Finance.

Trulieve announced that revenue for the full year of 2021 increased by 80% year over year to $938.4 million. The company also reported $18 million in net income and $123.4 million in adjusted net income, excluding $105.4 million in non-recurring compensation, the fair value of inventory step-up, and transaction, acquisition, and integration charges primarily related to the Harvest Health & Recreation Inc. (“Harvest”) acquisition.

In addition, the company said that it had rebranded and reopened fourteen legacy Harvest dispensaries in Florida in the month of October, following the Harvest acquisition.

#3: IM Cannabis

On March 31, 2022, IM Cannabis Corp. (NASDAQ: IMCC), a leading medicinal and adult-use recreational cannabis company with operations in Israel, Canada, and Germany, released its financial results for the quarter and fiscal year ended December 31, 2021.

Revenues in the fourth quarter were $20.0 million, up 309% from the fourth quarter of 2020 and up 35% sequentially. The fourth-quarter net loss was $12.5 million, compared to a net loss of $20.0 million in 2020. Additionally, the basic and diluted loss per share was $0.19 which was up compared to $0.13 in the fourth quarter of 2020.

Moreover, revenues in 2021 were $54.3 million, up 242% from the previous year. Furthermore, total dried flower sold for the year ended December 31, 2021 was 8,410kg at an average selling price of $4.90 per gram, compared to 2,586kg for the same period in 2020 at an average selling price of $5.75 per gram. Also, in 2021, the net loss was $18.5 million, which reduced significantly compared to $28.7 million net loss in 2020. In addition, the basic and diluted loss per share in 2021 was $0.31 and $0.66, respectively, compared to $0.74 for basic and diluted loss per share in 2020.

Additionally, the company said that cash and cash equivalents were $13.9 million on December 31, 2021, which was a huge increase compared to $8.9 million on December 31, 2020.

Looking forward IMC Cannabis forecasts sales and gross margin to rise sequentially in the first quarter of 2022. And the company said that they expect to reveal their first quarter financial results on or around May 16, 2022.

#4: The Valens Company

The Valens Company Inc. (NASDAQ: VLNS), a Canadian cannabis product maker, launched a $22.5 million (28.1 million Canadian dollar) purchase deal offering with an over-allotment option.

According to Valens, which is based in British Columbia, the net proceeds from the offering deal will be used to continue to pursue strategic expansion plans in North America, and also provide funding for working capital, and for general business reasons.

Under the bought deal offering, underwriters Stifel GMP and Alliance Global Partners will purchase 10,613,207 Valens units for CA$2.65 ($2.13) each. Each unit consists of one common share and half of a common share purchase warrant, which can be used to purchase another common share for CA$3.20 within 48 months of the closing price.

In addition, an over-allotment option will allow the underwriters to purchase an additional 15% of the units sold for 30 days after closing. The offering is expected to close in early April 2022, subject to approvals.

Moreover, Valens plans to list the new common shares and warrant shares (VLNS) on both the Toronto Stock Exchange and the NASDAQ exchange, where it has been listed since late 2021.

Key Takeaways; Cannabis Sector

• Agrify secured $135 million debt facility.
• TerrAscend reported full year 2021 net sales of $210.4 million; an increase of 42% YOY.
• Ayr Wellness reported solid Q4 and full year 2021 results.
• Canadian cannabis firm High Tide reported $72 million in revenue for first quarter.
• Glass House Brands reported a 44% increase in Q4; the company expects positive cash flow this year.

Key Takeaways; Psychedelic Sector

• Awakn received regulatory approval for flagship clinic in London to begin delivering treatments; the company also appointed Kevin Lorenz as U.S. head of commercial development.

Since the World Health Organization declared the COVID-19 outbreak a global pandemic in March 2020, it’s been a roller coaster ride for many cannabis companies. Despite the setbacks, majority of the companies in the sector have shown strong resilience and they continue to thrive as major states continue to legalize adult-use and sale of cannabis. Below is a weekly roundup of the top business stories from the cannabis and psychedelics sectors. It was another busy week in the sector as more companies reported their quarter earnings results.

Top Marijuana Companies for Week

#1: Agrify

Agrify Corporation (NASDAQ: AGFY), a cannabis ancillary company, signed a definitive agreement to fund up to $135 million in debt financing to bolster its balance sheet and support sustained expansion. According to a news release that was issued on Monday, March 14, 2022, the Massachusetts-based developer of indoor agriculture technologies, said that under the senior secured debt facility, $65 million will be available at closure. And depending on certain conditions, the remaining $70 million can be accessed in $35 million increments.

The note, which has a favorable annual interest rate of 6.75 percent, will mature in March 2026. Additionally, it also includes stock warrants that will be issued to the lender. The warrants can be exercised at $6.75 each, which is equivalent to 110% of Agrify’s stock closing price on the day before the definitive agreement. In addition, the warrants, which have a term of 5.5 years, are potentially exercisable for a number of shares equal to 65% of the funding amount, divided by the closing stock price on the trading day before the definitive agreement.

The agreement also requires that Agrify should pay the interest on the loan in cash and on a quarterly basis for the first year. Moreover, under the agreement terms, Agrify should make payments equal to 4% of the original principal on a monthly basis starting in February 2023. It was also reported that Alliance Global Partners will be the placement agent for the financing.

Agrify produces hardware and software for use in cannabis cultivation and other crops. The company went public in January 2021 and has raised additional capital and made acquisitions since. Agrify shares trade as AGFY on the NASDAQ exchange.

#2: TerrAscend

On March 16, 2022, TerrAscend Corp. (OTC: TRSSF) (CSE: TER) released its financial results for the fourth quarter and full year ended December 31, 2021. In the fourth quarter, net sales were $49.2 million, up from $49.1 million in the third quarter and $49.6 million in the same period the previous year.

The net loss was $5.9 million, compared to $94 million the previous year. TerrAscend attributed the loss to a $3.3 million one-time loss in lease termination fees, $6.9 million in finance and other expenses, $6.9 million in accumulated income taxes, and $2.0 million in transaction costs, all of which were predominantly linked to the Gage Growth Corp. acquisition. These costs were partially offset by a non-cash gain of $14.4 million on the fair value of warrant liabilities.

Net sales for the entire year 2021 were $210.4 million, up 42 percent from the previous year. As a result, the company made a $6.1 million profit. The 42 percent increase in net sales was attributed to the company’s first full year in the New Jersey medical cannabis market and retail expansion in Pennsylvania. In addition, the net sales also reflected the profits from the acquisition of KCR in May 2021, as well as a full year of operations at the three existing Apothecarium shops. Total revenue was further boosted by the late 2020 expansion of State Flower production in California and the acquisition of HMS Health in Maryland in May of 2021.

Cash and cash equivalents totaled $79.6 million as of December 31, 2021, compared to $102.6 million as of September 30, 2021 and $59.2 million as of December 31, 2020, indicating that the company has enough cash and cash equivalents to fund planned organic and inorganic expansion plans.

During the quarter, the Company completed the partial acquisition of its New Jersey partnership for $25 million, increasing its ownership to 87.5 percent from 75 percent.

TerrAscend is a prominent North American cannabis company with vertically integrated operations in Pennsylvania, New Jersey, Michigan, and California, as well as licensed cultivation, processing, and production in Maryland and Canada. The company’s key markets are retail dispensaries The Apothecarium and Gage, as well as scaled cultivation, processing, and manufacturing facilities.

#3: Ayr Wellness

On Thursday, March 17, Ayr Wellness Inc. (OTC: AYRWF) reported a 133 percent increase in fourth-quarter revenue to $111.8 million from $47.8 million the previous year. It was a 16 percent rise from the $96.2 million in revenue in the third quarter. The company also said that it earned $23 million in net income for the quarter and $0.35 in earnings per share. This was also an improvement from the $3.3 million net deficit in the third quarter.

In addition, the revenue for the fiscal year 2021 was $357.6 million, up from $155.1 million the previous year. The year’s net deficit was reduced to $17 million, down from $24.6 million in 2020. Irrespective of these solid Q4 results, the company predicts that the first half of the year will be flat, but that the second half will pick up.

Given previous construction delays and uncertain regulatory timelines for key revenue-generating initiatives, such as regulatory approval for adult-use sales and cultivation expansions in both Massachusetts and New Jersey, Ayr Wellness expects financial results to remain relatively flat in the first half of 2022, in line with industry trends, followed by a step-function in growth beginning in Q3 2022 and continuing through Q4 2022.

Ayr Wellness reported that if everything goes according to plan and the company receives approvals in the third quarter, the fourth quarter of 2022 may see an annualized run-rate of $250 million in Adjusted EBITDA, $100 million in operating income, and $800 million in revenue. On an annually basis, the company expects $250 million in Adjusted EBITDA, $800 million in Revenue, and $100 million in US GAAP Operating Income, based on the run rate forecast in the fourth quarter of 2022.

#4: High Tide

After the stock market closed on Thursday, March 17, 2022, High Tide Inc. (NASDAQ: HITI) (TSXV: HITI), a Canadian cannabis company, released its financial results for the first fiscal quarter of 2022, which ended January 31, 2022. In the first quarter of 2022, revenue grew to $72.2 million, up from $38.3 million the previous year. In comparison to the fourth quarter of 2021, revenue increased by 34% sequentially. A net loss of $7.3 million was also reported by the company. All figures are in Canadian dollars.

Geographically, $52.4 million in revenue was earned in Canada in the first quarter of 2022, $17.4 million in the United States, and $2.3 million internationally. Revenue increased by 53% in Canada, 346% in the United States, and 1,016% globally compared to the first quarter of 2021. In comparison to the fourth quarter of 2021, income earned grew by 22 percent in Canada, 65 percent in the United States, and 455 percent globally.

“This past quarter’s results, showcasing 34% sequential revenue growth and 80% sequential increase in Adjusted EBITDA, re-affirm our exponential, yet sustained growth trajectory. We continue to execute on our business plan quarter after quarter by strategically expanding our business in Canada and internationally through organic growth and accretive M&A across our diversified ecosystem. Our forward-thinking approach makes us a leader amongst our peer group in Canada, as we keep introducing innovative retail concepts such as our discount club model, while remaining agile and pivoting quickly when needed due to the constantly evolving dynamics in the global cannabis landscape,” said Raj Grover, President and Chief Executive Officer of High Tide.

High Tide reported that it aims to expand revenue through organic growth and accretive M&A throughout the second fiscal quarter of 2022, as well as the rest of the year. The company plans to expand its Canadian retail store portfolio to at least 150 locations by the end of the calendar year 2022, with a major concentration on the province of Ontario. The company also stated that it intends to enter the British Columbia market in the near future and that it will continue to grow strategically in the provinces where it now operates. Despite the fact that hurdles exist as a result of the ongoing COVID-19 epidemic, the Company is optimistic in its ability to maintain a strong growth trajectory.

#5: Glass House Brands

Glass House Brands Inc. (OTC: GLASF) announced on March 17, 2022 that revenue for the fourth quarter ended in December increased by 7% sequentially to $18.4 million. This was a 44 percent increase compared to the same period the previous year.

Wholesale biomass sales, which climbed 31% over Q3 2021, were credited with driving the sequential revenue improvement, according to Glass House. In addition, the adjusted EBITDA loss was $9.1 million, up from $5.4 million in the previous quarter. Lower wholesale price and inventory reserves in the quarter severely impacted gross margin, resulting in a $3.8 million decline sequentially.

As for the full year results, Glass House said that in 2021, the company had a 44 percent rise in revenue to $69.4 million, an increase of $21.2 million. The growth was due to an increase in the company’s CPG and retail activities. Because of the high rise in Glass House Farms branded sales, Glass House’s CPG business surged by 93%.

Glass House also said that the full-year impact of the company’s Berkeley store, which opened in January 2021, generated $6.8 million in revenue during the year. Subsequently, this boosted retail sales by 50%. In addition, during 2021, adjusted EBITDA was a loss of $11.8 million, up from a loss of $0.3 million in 2020. The rise was due to a combination of decreased gross profit and greater non-excludable operational expenses.

Finally, Glass House said that Looking ahead, they expects to be able to fully utilize the Phase 1 capacity of the SoCal Facility this year and next, assuming wholesale and CPG pricing stay steady. The company also said that production will be in line with existing production metrics. And according to Glass House, this will put the company on track to generate positive cash flow from operations by early 2023.

Top Psychedelic Companies for Week

#1: Awakn

On March 17, 2022, Awakn Life Sciences Corp. (NEO: AWKN) (OTC: AWKNF), a biotechnology company that is researching, developing, and delivering psychedelic therapeutics to treat addiction, announced that Awakn Clinics London has received formal approval from the Care Quality Commission (CQC) to begin addiction and mental health treatments.

The flagship London clinic is Awakn’s third, joining the company’s two other clinics in Bristol, UK, and Oslo, Norway (Norway). The facilities provide ketamine-assisted therapy for addiction and a variety of mental illnesses. Awakn’s breakthrough treatment protocol, established in their newly published Phase II a/b clinical trial, will be given to clients seeking therapy for Alcohol Use Disorder.

Anthony Tennyson, Awakn’s CEO, commented, “This is a very exciting moment for Awakn and for ketamine-assisted therapy overall as it starts to become a more accessible option for patients. Most importantly, it provides an effective treatment option for so many when other current therapies or treatments fall short. The CQC giving us this recognition again signals a positive direction for the UK and Europe toward embracing ketamine-assisted therapy as a mainstream treatment.”

Following the CQC approval, Awakn will apply to the Home Office for a schedule 2 license, allowing ketamine to be administered in the London clinic.

In addition to these great developments, the company announced on Tuesday, March 15, 2022 that it had appointed Kevin Lorenz as its U.S. Head of Commercial Development, with immediate effect. Mr. Lorenz will be in charge of Awakn’s therapeutics commercialization activities in the United States, beginning with the launch of its Licensing Partnership business in the second half of 2022, which is projected to generate revenue.

Mr. Lorenz joins Awakn with extensive commercial biotech experience, having worked in the pharmaceutical sales industry for over two decades, specializing in the addiction treatment market in the United States. He formerly worked at Alkermes as a Senior Regional Sales Director, where he oversaw a team of executives and representatives responsible for Vivitrol, an FDA-approved medicine for the treatment of Alcohol Use Disorder and Opiate Use Disorder, across 32 states. Mr. Lorenz was in charge of half of Alkermes’ Vivitrol sales in the United States, which totaled $170 million each year. In addition, Mr. Lorenz formerly worked at Cephalon Inc. and Janssen Pharmaceuticals, among other companies. He holds a degree from Lambuth University.

Key Takeaways; Cannabis Sector

• TerrAscend entered Michigan cannabis market with the completion of Gage Growth acquisition.
• Acreage Holdings reported Q4 2021 results; revenue increased 21% to $58.1 million.
• Scotts Miracle-Gro expects Hawthorne sales to decrease 15-25% in fiscal 2022.

Key Takeaways; Psychedelic Sector

• Awakn announced that the company will participate at upcoming March 2022 conferences.
• Numinus added Ayahuasca & San Pedro to Federal license for psychedelic research.

Over the last few years, the cannabis sector has gone through various ups and downs. Recently the sector has seen some optimism as news emerged that the opening of adult-use sales in New Jersey could happen as early as May. This will no doubt be one of the big catalysts for the sector in 2022. Below is a roundup of the top business stories from the cannabis and psychedelics industry for this week.

Top Marijuana Companies for Week

#1: TerrAscend

TerrAscend Corp. (OTC: TRSSF) (CSE: TER) is now the official owner of Gage Growth Corp., which is based in Michigan. On March 10, 2022, shares of Gage ceased trading following the completion of the previously announced deal with TerrAscend. After the closing of this deal, TerrAscend now owns and manages operations in California, Michigan, Maryland, New Jersey, Pennsylvania, and Canada, as well as 7 cultivation and processing facilities and 25 functioning shops serving the medicinal and adult-use cannabis markets in the United States and Canada.

As a result of the deal, TerrAscend made Gage a wholly-owned subsidiary. And in conjunction with the transaction, Gage shares were delisted from the CSE at the close of trading day on March 10, 2022. Additionally, Gage filed an application with the applicable securities regulators to cease to be a reporting issuer and terminate Gage’s public reporting responsibilities.

This acquisition is no doubt a defining moment for TerrAscend. This is because Gage had swiftly positioned itself as a market leader in Michigan, which grew to become the third largest cannabis market in the United States as of December 2021, with recorded cannabis sales of $168 million, reflecting a yearly market size of more than $2.0 billion. In addition, Gage has exclusive licensing agreements with Cookies, Blue River, Pure Beauty, Khalifa Kush, and others in Michigan.

The acquisition is expected to provide financial flexibility to TerrAscend, which is predicted to result in above-average long-term margins and cash flow for the company.

#2: Scotts Miracle-Gro

Shares of Scotts Miracle-Gro Company (NYSE: SMG) were down 6% on Tuesday, March 08, 2022, after news emerged that the company had cut its full-year sales estimates for its hydroponic segment, Hawthorne. Furthermore, Scotts stated that the reduction would most certainly result in lower adjusted earnings per share than originally forecasted. Shares of the company are currently trading for $115.05, which is a significant decline from the year’s high of $254 that was set earlier this year.

Speaking at the Raymond James 43rd Annual Institutional Investors Conference, CFO of Scotts Miracle-Gro, Cory Miller, said that the company now anticipates Hawthorne sales to decrease 15% to 25%, including the benefits of acquisitions. Sales in the segment have been hampered for several months, according to the company, due to an oversupply of cannabis, which has caused a halt in both indoor and outdoor cultivation.

During the presentation, Miller stated that as a result of this decline, a large purchase to boost the company’s footprint in the live goods category is no longer expected in fiscal 2022. Scotts Miracle-Gro had been actively pursuing such a possibility, over the last year; however, those talks have come to a stop.

Because of the lowered Hawthorne sales expectation, Scotts Miracle-Gro’s guidance for non-GAAP adjusted earnings per share is unlikely to be met. However, Miller stated that management is confident about the U.S. Consumer segment’s sustained strength and is striving to close the profitability gap caused by the Hawthorne sales shortfall, with a goal of non-GAAP adjusted earnings per share of at least $8.00.

In addition, the company said it expects to provide a further update on May 3, 2022, when it releases its second-quarter results.

#3: Acreage Holdings

On March 10, 2022, Acreage Holdings, Inc. (OTC: ACRHF) released its financial results for the fourth quarter of 2021, and full year ended December 31, 2021. Total revenue for Q4 2021 was $58.1 million, an increase of $26.6 million or 84% compared to Q4 2020.

Acreage said that the acquisitions of Ohio, California, and Maine operations over the last 12 months, as well as extra revenue from the completion of expansions at several of their cultivation sites, along with increased demand and production across several states, was what drove the year-over-year rise for the company.

In addition, the company reported that the revenue growth was somewhat offset by revenue declines due to divestitures and declines within its operations that were being held for sale. Additionally, they said that total revenue for Q4 2021 improved sequentially by $9.9 million or 21% compared to the third quarter of 2021. The company also had total gross profit of $27.6 million, which is an increase of $13.1 million or 90% compared to Q4 2020.

In terms of balance sheet and liquidity, Acreage ended the year with $44.3 million in cash and cash equivalents and restricted cash. The Company also reported that they secured a $150 million Credit Facility with a syndicate of lenders. Under the terms of the Credit Facility, $100 million was available for immediate use and a further $50 million will be available in future periods under a committed accordion option once certain, predetermined milestones are achieved. Acreage said that it intends to use the proceeds of the Credit Facility to fund expansion initiatives, repay existing debt, and provide additional working capital.

Top Psychedelic Companies for Week

#1: Awakn

Awakn Life Sciences Corp. (NEO: AWKN) (OTC: AWKNF), a biotechnology company, researching, developing, and delivering psychedelic therapeutics to treat addiction, announced on March 09, 2022, that Anthony Tennyson, Chief Executive Officer, is scheduled to present at some upcoming March 2022 investor conferences.

Some of these investor conferences include; 34th Annual ROTH Conference, which will happen on Sunday, March 13th to Tuesday, Match 15^th, Oppenheimer’s 32nd Annual Healthcare Conference, which will be held on Wednesday, March 15th to Thursday, March 17^th, and Maxim’s 2022 Virtual Growth Conference which will occur on Monday, March 28th to Wednesday, March 30^th.

If you are interested in learn more about Awakn’s goals and progress of using psychedelic therapeutics to better treat addiction, you can register here, and you will get to learn more about the company  and the progress they are making, from the CFO, Anthony Tennyson.

#2: Numinus Wellness

Numinus Wellness Inc. (TSX: NUMI) (OTC: NUMIF), a mental health company focused on developing innovative treatments and safe, evidence-based psychedelic-assisted therapies, announced on March 9, 2022 that it had received approval from Health Canada to conduct research on Ayahuasca and San Pedro at its licensed, state-of-the-art research facility, Numinus Bioscience.

This license expansion will help Numinus cement its reputation as a leading global research center for natural psychedelic medicines, and it will complement Numinus’ present work on Psilocybe species and intrinsic synergistic chemicals.

Numinus Bioscience has been granted permission to work with San Pedro cactus, the beta-carbolines harmaline and harmalol, and the botanical materials Banisteriopsis caapi, Psychotria viridis, Diplopterys cabrerana, and Mimosa tenuiflora, thanks to the renewal of its Dealers’ License.

The botanical ingredients are noteworthy for their use as admixtures in Ayahuasca, a hallucinogenic beverage prepared from a variety of plant components that is used in Amazonian Indigenous traditional practices for ceremonial, medical, and spiritual purposes.

Since 2020, Numinus Bioscience’s license has been significantly revised to broaden the scope of its research activities, with prior permissions permitting the study of DMT, Ketamine, LSD, MDMA, Mescaline, Psilocin, and Psilocybin. Approved activities for these include possession, analytical testing, production, assembly, sale, export and delivery.

Key Takeaways; Cannabis Sector

• iPower reported fiscal second quarter 2022 results.
• Ayr Wellness closed $20 million acquisition of Levia cannabis infused seltzer.
• Trulieve bought Arizona cultivation facility for $13.75 million.
• InterCure to acquire Israeli Cannabis Company Better for $35 million.

Key Takeaways; Psychedelic Sector

• Awakn’s Prof. Celia Morgan named ‘one of the most influential women’ in psychedelics; the company also filed a patent for a new chemical series of entactogen-like molecules.

People were bemoaning the poor start to 2022 for cannabis stocks only a few weeks ago. Since then, the cannabis stocks have rebounded, resulting in some significant gains. The increase, which has been aided by increased trading volumes, has outperformed the larger stock market and other high-risk sectors, and cannabis stocks are now the strongest performers’ year-to-date. Below is a weekly roundup for the companies that made the headlines this week in the cannabis and psychedelics sectors.

Top Marijuana Companies for Week

#1: iPower

iPower Inc. (NASDAQ: IPW), a leading online hydroponic equipment supplier and reseller, released financial results for the fiscal second quarter ending December 31, 2021 on February 14, 2022.

From the results that were announced, total revenue increased 52 percent to $17.1 million in the fiscal second quarter of 2022, compared to $11.3 million in the same time of fiscal 2021. Greater in-house product sales and increased demand for ventilation products drove the growth.

Additionally, in the fiscal second quarter of 2022, gross profit climbed by 53% to $7.6 million, up from $4.9 million in the same quarter of fiscal 2021. Gross margin was 44.1 percent as a proportion of revenue, up from 44.0 percent the previous quarter. A larger percentage of in-house product sales offset higher freight and input expenses, resulting in a slight gain in gross profit.

The company also reported that, in the second quarter of fiscal 2022, net income increased by 39% to $0.8 million, or $0.03 per diluted share, compared to $0.6 million, or $0.03 per diluted share, in the same period of fiscal 2021.

In addition, at December 31, 2021, cash and cash equivalents totaled $1.0 million, compared to $6.7 million at June 30, 2021. The drop was due to the timing of accounts receivables with the Company’s major channel partner, and it is not indicative of any other business or operating trend. Total long-term debt was $7.4 million as of December 31, 2021, up from $0.5 million as of June 30, 2021. Increased working capital expenses were to blame for the rise.

On Monday, February 14, 2022, at 4:30 p.m. Eastern time, the Company held a conference call to discuss the results of its fiscal second quarter ended December 31, 2021.

#2: Ayr Wellness

On February 15, 2022, Ayr Wellness Inc. (OTC: AYRWF), a leading vertically integrated multi-state cannabis operator (MSO) in the United States, announced the completion of its acquisition of Cultivauna, LLC, the owner of Levia branded cannabis infused seltzers and water-soluble tinctures.

Levia makes use of a proprietary technology that allows for a faster onset of THC effects, typically 15-20 minutes, with effects lasting up to 3 hours, providing for a more consistent consuming experience than many edible products.

The Massachusetts Cannabis Control Commission (“CCC”) approved the ownership shift on Thursday, February 10, 2022. Ayr Wellness announced this deal on September 7, 2021, and the company management must be very happy to see the deal through.

Ayr is a rapidly growing, vertically integrated, multi-state cannabis company in the United States, committed to providing the greatest quality cannabis products and customer service across its entire territory. The Company is focused on superior cultivation to create superior branded cannabis products, based on the concept that everything starts with the quality of the plant. In addition, Ayr aims to improve people’ lives every day by introducing them to the benefits and wonders of cannabis.

#3: Trulieve

Trulieve Cannabis Corp. (OTC: TCNNF), a prominent and top-performing cannabis company in the United States, said on February 15, 2022 that it had finalized the acquisition of a 64,000-square-foot cultivation facility in Phoenix, Arizona. Trulieve will pay $13.75 million in cash, with potential milestone payments contingent on earn-out and escrow conditions.

The new cultivation facility boosts the company’s supply chain capacity and becomes Trulieve’s fifth in Arizona. It will also help in providing flower for medical patients and adult-use clients at the company’s 17 dispensaries across the state. Avondale, Casa Grande, Chandler, Cottonwood, Glendale, Guadalupe, Lake Havasu, Mesa, Peoria, Phoenix, Scottsdale, Tempe, and Tucson are among the Arizona Trulieve locations.

Trulieve is a vertically integrated cannabis company and multi-state operator in the United States, operating in 11 states and with market positions in Arizona, Florida, and Pennsylvania. Trulieve is positioned for rapid development and expansion, leveraging its hub model to gain scale in retail and distribution in new and existing countries. The company’s shares are traded on the OTC market under the symbol TCNNF and they are listed on the Canadian Securities Exchange (CSE) under the symbol TRUL.

#4: InterCure

Israeli-based cannabis producer InterCure Ltd. (NASDAQ: INCR) also known as Canndoc is buying medical cannabis company Cann Pharmaceutical Ltd. also known as Better in a deal valued at $35 million. It is expected to close at the beginning of the third quarter of 2022.

InterCure is Israel’s largest licensed cannabis producer and one of the first to offer Good Manufacturing Practices (GMP) certified and pharmaceutical-grade medical cannabis products. InterCure leverages its market-leading distribution network, international partnerships, and a high-margin vertically integrated “seed-to-sale” model to lead the fastest growing cannabis global market outside of North America. Better is a pharmaceutical-grade medical cannabis company, with leading expertise in cannabis cultivation, marketing, commercialization, and research of medical cannabis products for a variety of medical indications.

InterCure said that the acquisition of Better is expected to further strengthen InterCure’s leadership position in the pharmaceutical-grade medical cannabis market. In addition, the acquisition is expected to create an immediate value creation opportunity with revenue synergies estimated at NIS 50 million for the upcoming year.

Better’s leading brand, Better is driven by a unique genetic portfolio that is consistently in high demand among medical cannabis patients both in Israel and internationally. Better also has advanced pesticide-free cultivation methods with both patient health and environmental advantages.

Better are pioneers in formulating cannabis into a medical product in Israel and the rest of the world. In clinical research regarding the treatment for refractory epilepsy in children and adolescents who have not responded to pharmacological treatment, patients supplied with Better’s lead therapy strain EP1 had greater efficacy of reducing seizures and less adverse effects as compared to other medical cannabis-based products including Epidiolex.

Amos Cohen, InterCure CFO said: “InterCure is continuing its growth momentum while leading the consolidation of the medical cannabis market. This acquisition is a first of its kind and is another step in the implementation of our strategy and strengthens InterCure’s position.”

InterCure shares are traded on the NASDAQ (INCR), Toronto Stock Exchange (INCR.U) and Tel Aviv Stock Exchange (INCR).

Top Psychedelic Companies for Week

#1: Awakn

Awakn Life Sciences Corp. (NEO: AWKN) (OTCQB: AWKNF), a biotechnology company that researches, develops, manufactures, and distributes psychedelic medications to treat addictions, announced on 15 February, 2022, that Professor Celia Morgan, Head of Ketamine-Assisted Therapy for Addiction at the company, was named one of Insider’s 16 most prominent women driving the future of psychedelics.

Professor Morgan recently published data from a Phase II A/B trial in the American Journal of Psychiatry, demonstrating the efficacy of ketamine-assisted therapy for the treatment of alcoholism. The results showed that Ketamine-assisted therapy resulted in total abstinence in 162 of 180 days during the next six months, an increase in abstinence from roughly 2% prior to the experiment to 86 percent six months afterwards.

Professor Morgan is also the principal investigator for the world’s first ketamine therapy research for gambling addiction, which was announced in August 2021. This is the first study of its kind to look into psychedelics as a therapy for a behavioral addiction. The study’s expansion to other behavioural addictions, such as Binge Eating Disorder, Compulsive Sexual Behavior, and Internet Gaming Disorder, was approved last month. Morgan’s work has received approximately $8 million in grant funding from the UK government and other sources.

In addition, Awakn announced on February 17, 2022 that the company aims to strengthen its intellectual property portfolio and pipeline for the treatment of addictions with the filing of a patent application for a new chemical series of entactogen-like molecules. Entactogen-like molecules are a class of psychoactive substances that produce distinctive emotional and social effects that Awakn believes has great potential to treat both substance and behavioural addictions.

This Awakn’s recent patent application, which covers the new chemical series, marks yet another important step forward in the creation of next-generation entactogens and marks a significant milestone in the company’s therapeutic research program. The application adds to Awakn’s pipeline and position as a global leader in the field of psychedelic biotechnology.

Key Takeaways; Cannabis Sector

• Schwazze completed $75 million acquisition.
• Israeli medical cannabis company InterCure reported its preliminary Q4 financial results.
• Cannabis REIT Chicago Atlantic lent $34 million to FarmaceuticalRX.
• Red White & Bloom closed the acquisition of Michigan marijuana operator PharmaCo.
• Weak cannabis sales drove Canopy Growth Q3 revenue 8% lower to C$115 million.
• Aurora cannabis Q2 revenue decreased by 10%; However, they beats estimates.
• Harborside closed $77.3 million debt.

Key Takeaways; Psychedelic Sector

• Awakn to host fireside chat with Dr. Ben Sessa.
• Cybin announced grant of U.S. patent.

It was a busy week in the cannabis sector. The week was full of action as more companies in the sector reported their earnings while others closed some acquisitions deals. Below is a weekly roundup on the cannabis and psychedelics sectors. Make sure you follow through to the end to get the latest updates in these sectors.

Top Marijuana Companies for Week

#1: Harborside

Harborside Inc. (OTC: HBORF), a vertically integrated marijuana company situated in Oakland, California, has completed the first tranche of a $77.3 million loan financing agreement.

The move came as part of the company’s previously announced merger with Urbn Leaf, a San Diego-based retailer, and Loudpack, a Los Angeles-based cultivator, processor, and distributor.

Harborside said in a news release that the first tranche of financing from Pelorus Equity Group is worth $45.4 million, with around $15.5 million coming to Harborside, $16.4 million to Loudpack, and $13.5 million to Urbn Leaf.

When the business combination is finalized, the California Corporation expects to change its name to StateHouse Holdings. The deal is expected to finalize in March, pending shareholder and regulatory clearances, among other things, according to Harborside.

The company used some of the financing to pay off $12 million outstanding under a senior secured revolving credit facility.

“Proceeds from the first tranche of the roll up financing will be used to retire certain existing loans, to fund closing costs and interest reserves, and to provide additional working capital to the three companies,” according to the Harborside release. “Proceeds from the second tranche will be used primarily for working capital purposes and for growth capital of StateHouse.”

The second tranche of financing from Pelorus will be worth $31.9 million.

Harborside also announced it was terminating a $10 million private placement of equity units that it announced along with the business combination in November. In addition, Pelorus said in a release that its financing to Harborside carries a nominal interest rate of 10.25%.

#2: Canopy Growth

Canopy Growth Corporation (NASDAQ: CGC) lost 115 million Canadian dollars ($90 million) in the quarter ending December 31, 2021, due to reduced cannabis sales in its key Canadian market.

The company’s third-quarter net revenue was CA$141 million, which was somewhat above than analysts’ projections. However, compared to the same period previous year, this constituted an 8% drop.

Once again Canopy continued to have difficulty selling cannabis in Canada. Recreational cannabis sales dropped to CA$47.8 million, the lowest level in over a calendar year, and a 25% drop from the same period a year earlier. Medical cannabis sales in Canada declined 7% year over year in the third quarter, to CA$12.9 million.

In Canada, gross sales of dry bud plunged almost 30% to CA$47 million in Q3, but sales of oils and softgels inched higher, to CA$8.8 million.

One of the biggest areas of concern for Canopy is the so-called 2.0 category, consisting of beverages, edibles, topicals and vapes. The company once had ambitions to rule the category, but gross sales of 2.0 products declined to CA$5.8 million, 40% lower year-on-year.

In a conference call to discuss the quarter, analyst Owen Bennett asked the company what went wrong. Canopy CEO David Klein said that “the key unlock is if we get movement on equivalency in Canada, because we just can’t sell the volumes across the market that would be necessary to get the kind of returns that we want.” He’s hopeful that comes in the not-too-distant future.

In addition, the company’s global cannabis net revenue fell 20% year-over-year to only CA$83 million in the October-December quarter. Storz & Bickel, Canopy’s vaporizer device brand, provided a bright spot, with sales rising in the quarter to CA$25.2 million.

The company’s sports nutrition brand, BioSteel, provided another area of strength. BioSteel sales soared 130%, year-over-year, to CA$17 million in the third quarter. Canopy also booked asset impairment and restructuring costs worth CA$36.4 million. The company had CA$1.4 billion in cash as of Dec. 31, 2021.

Canopy shares trade as WEED on the Toronto Stock Exchange and CGC on the Nasdaq.

#3: Medicine Man Technologies “Schwazze”

Since late December, Medicine Man Technologies, Inc. (OTC: SHWZ), a Denver-based vertically integrated cannabis company, has closed on three big acquisitions totaling $75 million, including purchasing one of the region’s most distinguished stores and expanding across of state.

The announced purchases come at a time when Colorado’s cannabis industry is undergoing strong consolidation, and they buck a trend that has seen out-of-state companies buy their way into the Mile High market through acquisitions.

On Thursday, February 10, Schwazze announced that it had completed the purchase of Emerald Fields (officially registered as MCG LLC), a two-store chain with outlets in Manitou Springs and Glendale. The total compensation for the two stores is $29 million, paid 60 percent in cash and 40 percent in Schwazze common stock, according to the business.

In addition, Schwazze reported on Tuesday that it had closed on a $42 million deal in New Mexico, acquiring “virtually all the operating assets” of Reynold Greenleaf & Associates LLC, as well as the stock of Elemental Kitchen & Laboratories LLC. Schwazze now has a significant presence in the state, with ten dispensaries, four cultivation facilities, and a manufacturing facility.

These acquisitions officially make Schwazze one of only a few Colorado-based cannabis multistate operators, referred to within the industry as MSOs.

“With our regional expansion into New Mexico now complete, we have firmly graduated to the MSO category but with a differentiated regional focus which we and our stakeholders believe will be successful as we continue to position the company for rapid expansion as the market opens for adult use consumption,” Schwazze CEO and Chairman Justin Dye said in the statement announcing the deal.

#4: Red White & Bloom

Red White & Bloom Brands Inc. (OTC: RWBYF), a multistate cannabis corporation located in Canada, completed the acquisition of PharmaCo, a Michigan marijuana company. RWB, based in Toronto, declared its intention to purchase PharmaCo in July 2020, exercising its right to do so as part of a financing contract.

Red White & Bloom will issue 37 million units as part of the all-stock deal, each unit having one common share and one convertible preferred share in RWB. In addition, to satisfy obligations, RWB is issuing new units to some of PharmaCo’s debtors.

The acquisition includes: Eight cannabis stores in operation, plus two more that are ready to open; two indoor cultivation facilities; one outdoor cultivation site; and other owned properties that could be used as cultivation or retail sites. RWB already operates a manufacturing facility in Michigan.

In a news release, RWB Chair and CEO Brad Rogers said the company’s Michigan plans “include extending our branded product lines, updating our dispensaries to heighten the customer experience, creating supply chain efficiencies and growing revenue and profitability.”

Red White & Bloom shares trade on the Canadian Securities Exchange as RWB and on U.S. over-the-counter markets (OTC) as RWBYF.

#5: InterCure

InterCure Ltd. (NASDAQ: INCR), an Israeli company, released preliminary financial results for the fourth quarter of 2021 on February 8. Revenue is expected to be more than $31 million, which is three times higher than the fourth quarter of 2020 and represents a sequential increase of more than 24%. The company did not say whether it had made a profit or lost money.

The company also announced that full-year revenue is expected to reach $87 million, representing a nearly 250 percent increase year over year (YOY). The company’s revenue growth is predicted to continue beyond 2022.

On Tuesday, March 15, 2022, InterCure aims to file its full financial statements for the fourth quarter and full year of 2021.

“InterCure continues to execute, achieving record growth in the quarter ended December 31, 2021, with preliminary revenue anticipated to be $31 million, up by over three times from the fourth quarter of 2020,” said InterCure’s Chief Executive Officer, Alexander Rabinovitch. “We have now achieved eight consecutive quarters of double-digit revenue growth and increased profitability, while also crossing the one-ton mark in GMP medical cannabis products dispensed monthly during the fourth quarter, which is a world record in the GMP-certified cannabis markets. Going forward, we remain focused on maintaining our market-leading position in Israel’s cannabis market while continuing with our international expansion plans. By executing on our profitable growth strategy, InterCure is well positioned to build shareholder value as one of the leaders of the international cannabis industry.”

InterCure Ltd and its subsidiaries are involved in medicinal cannabis research, cultivation, manufacture, marketing, and distribution in Israel and overseas. It also invests in the biomedical field. The company was founded in 1994 and is based in the Israeli city of Herzliya.

#6: Aurora

Aurora Cannabis Inc. (NASDAQ: ACB) released results for the second quarter fiscal 2022, which ended December 31, 2021, after the market closed on Thursday.

Aurora reported $60.6 million in total cannabis net sales in the second quarter, up 1% year over year but down from $67 million last year. According to Yahoo Finance, this exceeded analysts’ revenue projections of $46 million. As a result, the stock is currently trading at $4.70, up over 2% from its previous close.

The company also reported a net loss of $75 million for the quarter, down from a net loss of $300 million the previous year. The average net selling price per gram of dried cannabis fell 10% to $4.20 in the first quarter of 2022, excluding the effect of bulk wholesale of excess mid-potency cannabis flower throughout the quarter, reflecting sustained downward pricing pressures due to competition.

“During the second quarter, we improved our Adjusted EBITDA by $2.5 million over Q1, moving us closer to our profitability goal. Our focus remains on further cost reductions, and we are pleased to announce today that we expect to reach the high end of the $60 to $80 million range. Our balance sheet remains among the strongest in the industry, with approximately $445 million in cash as of yesterday. This gives us significant working capital to support organic growth and positions us to pursue strategic M&A opportunities,” stated Miguel Martin, Chief Executive Officer of Aurora.

Aurora Cannabis Inc. is a Canadian company that manufactures, distributes, and sells cannabis and cannabis-derived products both domestically and abroad. It also participates in cannabis breeding, research, production, derivatives, product development, wholesale, and retail distribution.

Top Psychedelic Companies for Week

#1: Awakn

On Wednesday, March 2nd at 11:00 a.m. EST, Awakn Life Sciences Corp. (NEO: AWKN) (OTCQB: AWKNF), a biotechnology business that is studying, developing, and delivering psychedelic therapies to treat addiction, will conduct a fireside chat with Dr. Ben Sessa, Chief Medical Officer.

Dr. Sessa, author of ‘The Psychedelic Renaissance,’ among other works, is widely regarded as one of the most prominent personalities in the psychedelic industry, having spent the last 15 years at the fore. He also oversaw the first MDMA-assisted therapy clinical trial for the treatment of Alcohol Use Disorder in the world.

Dr. Sessa will address the psychedelic industrial environment and Awakn’s unique and differentiated approach to developing psychedelic therapies to treat addiction during the video webinar. He’ll also go through some of the company’s expected milestones for 2022, as well as the company’s strategy for realizing its mission of researching, producing, and providing psychedelic therapies as more than a therapy choice.

The webinar is free and open to the general audience. During the Q&A phase of the webinar, participants will have the opportunity to ask questions. If you are interested participating in this informative and educative webinar, please go here to register for the event.

#2: Cybin

On February 09, Cybin Inc. (NYSE: CYBN), a biopharmaceutical company focused on advancing “Psychedelics to Therapeutics,” announced that the United States Patent and Trademark Office granted U.S. patent 11,242,318 to the Company’s investigational deuterated dimethyltryptamine (“DMT”) compound CYB004. The company said that, a variety of deuterated variants of DMT, as well as 5-MeO-DMT, are authorized.

The patent, which covers composition of matter and protects the CYB004 drug substance as a putative new chemical entity, is set to expire in 2041 before any term extensions are considered.

Cybin’s lead experimental proprietary DMT molecule is CYB004. CYB004 has shown potential efficacy at lower doses while also enhancing the duration of pharmacological action in preclinical trials, resulting in a therapeutic profile that may mitigate the unpleasant effects commonly associated with traditional DMT.

In the second quarter of calendar year 2022, Cybin plans to file a clinical trial application for a pilot study of CYB004, with the pilot study expected to begin in the third quarter of calendar year 2022.

The Company is continuing to pursue several avenues to establish and support its patent position for research and development testing deuterated tryptamines for potential psychedelic-based mental disorder treatments.

Key Takeaways; Cannabis Sector

• Agrify raised $27 million in private placement.
• Jushi raised $10 million selling shares at $3.68.
• High Tide Q4 revenue increased 117% to C$53.9 million.
• Trulieve borrowed additional $75 million at 8%.

Key Takeaways; Psychedelic Sector

• Awakn filed a patent application for a new class of entactogen-like molecules that could be used to treat a variety of addictions.

Stocks are having their worst January since 2008, and this is putting a strain on the cannabis industry. At the beginning of this year, many cannabis stocks have lost more than 18% of their value.

Cannabis equities are generally considered speculative, and speculative assets have taken the worst of the losses in the last four weeks. Four weeks into the year, 2022 is looking a lot like 2020, with a historic downturn extending.

Despite the downtrend, some companies are still thriving in the midst of the chaos. Below is a weekly roundup on the top companies in the Cannabis and Psychedelics sectors.

Top Marijuana Company for Week

#1: Agrify

In a private placement transaction, Agrify Corporation (NASDAQ:AGFY), the most innovative and vertically integrated provider of premium cultivation and extraction solutions for the cannabis and hemp industries, announced on January 26 that it had entered securities purchase agreements with an institutional investor and other accredited investors.

According to a company statement, Agrify will issue and sell 4,020,994 shares of common stock or, in lieu of Common Stock, pre-funded warrants and accompanying warrants exercisable six months from closing to purchase up to 3,015,745 shares of Common Stock for a period of five years at an exercise price of $7.48 per share for a period of five years at an exercise price of $7.48 per share. The Common Stock and Warrants will be sold at a combined purchase price of $6.80

Members of management and the Board of Directors, including Raymond Chang, the Company’s Chairman and Chief Executive Officer, took part in the Offering on the same terms as ordinary investors, with the exception of a combined purchase price of $6.90.

Before deducting placement agent fees and estimated offering expenses, the Company anticipates to receive gross proceeds from the Offering of approximately $27.3 million.

#2: Jushi

On January 26, 2022, Jushi Holdings Inc. (OTC: JUSHF) raised $10 million in a non-brokered private placement after the company’s shares began to rise from their 52-week low of $2.95.

The offering of 2,717,392 subordinate voting shares, were sold at a price of $3.68 per share to Graticule Asset Management Asia for gross proceeds of $10 million. According to Jushi, the funds acquired will be utilized for possible strategic acquisitions as well as general company purposes.

As of December 31, 2021, the company’s pro forma cash balance, including proceeds from the Offering, was approximately $104 million.

This announcement came just a few weeks after, Jim Cacioppo, Chief Executive Officer, Chairman, and Founder of Jushi, announced that he had purchased 66,800 Class B Subordinate Voting Shares of the company on the open market for $220,000. In total, he now owns about 19.2 percent of the issued and outstanding Subordinate Voting Shares.

Jushi is a vertically integrated cannabis firm run by a management team with extensive experience in the industry. Jushi is concentrating its efforts in the United States on acquiring branded cannabis properties across multiple states through opportunistic purchases, distressed workouts, and competitive applications.

#3: High Tide

On January 27, 2022, High Tide Inc. (NASDAQ: HITI), a major retail-focused cannabis company with bricks and mortar and worldwide e-commerce assets, released its unaudited year-end financial results for 2021. The Company had not been able to finalize its income tax provision to date due to personnel problems emerging from the pandemic. However, the company anticipates completing the work related to this matter and filing its full set of audited consolidated financial statements and management’s discussion and analysis on or before January 31, 2022.

With 109 sites across Canada, High Tide continues to hold a dominant position in the Canadian cannabis retail sector. To date, the Company’s debut of an innovative discount membership model in its retail outlets near the end of the fourth fiscal quarter of 2021 has yielded encouraging results, with same-store sales increasing during the first fiscal quarter of 2022. Due to this, High Tide plans to generate at least $70 million in revenue in the first fiscal quarter of 2022, equating to an annual run rate of more than $280 million.

The Company plans to expand its Canadian retail store portfolio to at least 150 locations by the end of the calendar year 2022, with a particular concentration on the province of Ontario. In the near future, the company wants to enter the British Columbia market, and it will continue to grow strategically in the other provinces where it now operates. Despite the fact that High Tide’s brick-and-mortar retail businesses continue to confront major obstacles as a result of the ongoing COVID-19 outbreak, the company is optimistic in its ability to maintain a favorable growth trajectory.

#4: Trulieve

Trulieve Cannabis Corp. (OTC: TCNNF), a multistate operator, announced the closing of a $75 million private placement offering, the second tranche of a $425 million debt raise, which is a marijuana industry record.

The senior secured notes have an annual interest rate of 8%, which is among the lowest in the cannabis business. They are due in 2026. The notes also have the same terms as the $350 million first tranche that closed in October.

The revenues will be used for capital expenditures and other company reasons, according to Trulieve, which is based in Florida. “This additional funding provides greater flexibility as we execute on our strategic initiatives in 2022,” CEO Kim Rivers said in a news release.

Trulieve rivals Massachusetts-based Curaleaf Holdings as the largest marijuana operator in the United States based on sales after acquiring Arizona-based Harvest Health & Recreation last year.

Trulieve is a vertically integrated cannabis company and multi-state operator in the United States, operating in 11 states and with market leadership in Arizona, Florida, and Pennsylvania. The company is positioned for rapid development and expansion, leveraging its hub model to gain scale in retail and distribution in new and existing countries. In addition, Trulieve provides ideal customer experiences and expands access to cannabis by providing innovative, high-quality products across its brand portfolio, allowing patients and customers to live without limitations.

Trulieve is listed on the over-the-counter (OTC) market under the symbol TCNNF and is listed on the Colombo Stock Exchange under the symbol TRUL.

Top Psychedelic Companies for Week

#1: Awakn

Awakn Life Sciences Corp. (NEO: AWKN) (OTCQB: AWKNF), a biotechnology company focused on researching, developing, and delivering psychedelic therapeutics to treat addiction, announced on January 26 that it had filed a patent application for a new chemical series of entactogen-like molecules, bolstering Awakn’s intellectual property portfolio and pipeline for the treatment of a wide range of addictions, including but not limited to substance addictions such as Compulsive Sexual Behavior and Gambling Disorder.

The new chemical series, which Awakn has patented, represents a big step forward in the production of entactogens and marks a significant milestone in Awakn’s drug discovery research and development. Awakn’s novel pipeline of NCEs extends Awakn’s position as a global leader in the psychedelic-biotechnology business, adding to current patent applications and active clinical development programs.

In October, Awakn and their research partner Evotec stated that the NCE initiative would be expanded towards lead optimization. This research program will include the development of one or more novel entactogen-like molecules for which a patent has been filed, with the goal of moving one or more drugs into clinical development.

Key Takeaways; Cannabis Sector

• Curaleaf completed the $210 million acquisition of Bloom Dispensaries in Arizona.
• Canadian retail cannabis sales fell 3% from October in November, rising 36% from a year ago.

Key Takeaways; Psychedelic Sector

• Awakn signs MOU with MAPS: The company also announced publication of paper; “Debunking the myth of ‘Blue Mondays’.”
• Numinus announced key milestones in MAPS-sponsored MDMA-AT for PTSD trial; the company also reported Q1 2022 results.
• BetterLife obtained positive preclinical data: Additionally, it received FDA response on pre-IND application.

Top Marijuana Company for Week

#1: Curaleaf

Curaleaf Holdings, Inc. (OTC: CURLF), a marijuana multistate operator, completed the previously announced acquisition of Bloom Dispensaries, a vertically integrated Arizona cannabis company.

According to a news release issued on Wednesday, January 19 2022, the addition of Bloom’s four Arizona retail outlets gives Curaleaf a total of 13 marijuana businesses in the state. This in turn means that in Arizona, Curaleaf gains two cultivation and processing facilities.

The total sale value was $211 million, with $51 million in cash upon closing. The remaining $160 million will be paid by Curaleaf issuing promissory notes payable on the first, second, and third anniversaries of the transaction. The third promissory note, valued at $13.85 per share, may be paid in Curaleaf shares.

Additionally, Bloom’s income in 2021 is expected to be over $66 million, according to Curaleaf.

“Arizona represents a significant market opportunity with strong long-term growth potential, and we believe the combination of our two companies will enable Curaleaf to accelerate our growth strategy in the state,” Curaleaf CEO Joseph Bayern said in a statement.

Curaleaf Holdings, Inc. is a fully integrated medical and wellness cannabis company. Cannabis Operations and Non-Cannabis Operations are the two segments in which it works. The Cannabis Operations segment is responsible for the cultivation and distribution of marijuana through retail and wholesale channels.

The Massachusetts based multistate operator, trades as CURA on the Canadian Securities Exchange and as CURLF on over-the-counter (OTC) markets in the United States.

Top Psychedelic Companies for Week

#1: Awakn

On January 19, 2022, Awakn Life Sciences Corp. (NEO: AWKN) (OTCQB: AWKNF), a biotechnology company developing and delivering psychedelic therapeutics (medicines and therapies) to treat Addiction, announced that it had signed a Memorandum of Understanding (“MOU”) with the Multidisciplinary Association for Psychedelic Studies (MAPS) to explore a partnership to use MDMA-assisted therapy to treat Alcohol Use Disorder (AUD)

Under the terms of this MOU, Awakn will explore a data licensing agreement with MAPS to support Awakn’s Phase IIb and anticipated Phase III studies for MDMA-assisted therapy for AUD in Europe.

Awakn and MAPS will also consider forming a partnership in order to obtain marketing authorization and regulatory clearance for the ethical commercialization of MDMA-assisted therapy for the treatment of AUD in Europe.

AUD is a chronic condition that affects 40 million Europeans and 390 million individuals worldwide. Alcohol use is one of the top five causes of the disease and disability in the majority of European countries, making it a ubiquitous and chronic public health issue. And for every AUD sufferer, there is a friend, a partner, or a family member who is also badly affected by it.

Awakn published the favorable results of the BIMA Phase IIa study studying MDMA-assisted therapy for the treatment of AUD in February 2021, citing a 21% relapse rate at 9 months compared to a 75% relapse rate in a separate observational group.

Additionally, MAPS reported in May 2021 that the first of two Phase III trials for MDMA-assisted therapy for the treatment of severe persistent PTSD had yielded positive findings. In this study, 88 percent of patients who had three MDMA-assisted therapy sessions, as well as twelve 90-minute non-drug preparation and integration therapy sessions, saw clinically relevant improvements in their symptoms. 67 percent of those who took part no longer met the criteria for a PTSD diagnosis.

In addition to this news, Awakn also announced the publication of a paper supporting the overall safety and tolerability of clinically administered MDMA and debunking the myth of ‘Blue Mondays’.

#2: BetterLife

BetterLife Pharma Inc. (OTCQB: BETRF), an emerging biotech company focused on the development and commercialization of 2nd-generation non-hallucinogenic psychedelic analogs for the treatment of neuropsychological disorders, reported on January 18, that an in vivo oral bioavailability and food-effect pharmacokinetic (PK) study on BETR-001 in beagle dogs had yielded positive results.

BETR-001 (2-bromo-LSD, formerly TD-0148A) is a lysergic acid diethylamide derivative that is non-hallucinogenic (LSD). BETR-001’s PK has never been studied before in a published study. It was also unknown whether the presence of meals would influence the bioavailability of BETR-001 when taken orally.

Additionally, on January 20, the company announced that it had received a written response from the US Food and Drug Administration (FDA) on its pre-investigational new drug (pre-IND) application for BETR-001’s treatment of MDD.

BETR-001 (2-bromo-LSD, formerly TD-0148A) is a non-hallucinogenic lysergic acid diethylamide (LSD) derivative that is now conducting IND-enabling non-clinical investigations as well as GMP manufacture in preparation for clinical trials.

The FDA’s answer is generally in line with the Company’s planned approach for the development of BETR-001, and it offers advice on the BETR-001 IND-enabling non-clinical toxicological studies, manufacturing strategy, and initial suggested clinical trial parameters.

#3: Numinus

Numinus Wellness Inc. (TSX: NUMI), a leader in psychedelics-focused mental healthcare, announced on January 19, that it had completed key steps to prepare to enroll participants at its clinics in the Multidisciplinary Association for Psychedelic Studies (MAPS) “A multi-site open-label extension study of MDMA-assisted psychotherapy for PTSD (MAPPUSX)”.

The Canadian study sites, led by MAPS Public Benefit Corporation (MAPS PBC) as study sponsor, have recently received regulatory approval from Health Canada, ethical approval from an Institutional Review Board (IRB), and a Section 56 exemption from the Controlled Drug and Substance Act (Canada), which will allow the use of MDMA throughout the duration of the trial.

Numinus will host the MAPPUSX Canadian sites, which will be handled through Numinus’ two newly acquired, purpose-designed clinics, allowing the Canadian phase of the MAPS-sponsored study to be completed quickly.

In other news, on Jan 20 2022, the company announced its fiscal first quarter results for the three months ended November 30, 2021.