December 2019 Private and confidential - donedeal
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December 2019
Private and confidential
1
Presentation Disclaimer The information contained in this document (the “Presentation”) has been prepared by SV Pharma Limited (“SVP”). SVP is a private limited company. This Presentation has not been verified and is subject to material updating, revision and verification and amendment without notice. This Presentation has not been approved by an authorised person in accordance with Section 21 of the Financial Services and Markets Act 2000 (as amended) (“FSMA”) and therefore it is being provided for information purposes only. Reliance on this Presentation for the purpose of engaging in any investment activity may expose an individual to a significant risk of losing all of the property or other assets invested. While the information contained herein has been prepared in good faith, neither SVP nor any of its current or proposed directors, officers, agents, employees or advisers give, have given or have authority to give, any representations or warranties (express or implied) as to, or in relation to, the accuracy, reliability or completeness of the information in this Presentation, or any revision thereof, or of any other written or oral information made or to be made available to any interested party or its advisers (all such information being referred to as “Information”) and liability therefore is expressly disclaimed. Accordingly, neither SVP nor any of its current or proposed directors, officers, agents, employees or advisers take any responsibility for, or will accept any liability whether direct or Indirect, express or implied, contractual, tortious, statutory or otherwise, in respect of, the accuracy or completeness of the Information or for any of the opinions contained herein or for any errors, omissions or misstatements or for any loss, howsoever arising, from the use of this Presentation. The views of the SVP’s management/directors and/or its partners/representatives set out in this Presentation could ultimately prove to be incorrect. No warranty, express or implied, is given by the presentation of these figures here and investors should place no reliance on SVP’s estimates cited in this Presentation. 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This Presentation should not be considered as the giving of investment advice by the SVP or any of its directors, officers, agents, employees or advisers. In particular, this Presentation does not constitute or form part of any offer or invitation to subscribe for or purchase any securities and neither this Presentation nor anything contained herein shall form the basis of any contract or commitment whatsoever. No reliance may be placed for any purpose whatsoever on the information or opinions contained in these slides or the Presentation or on the completeness, accuracy or fairness thereof. In particular, any estimates or projections or opinions contained herein necessarily involve significant elements of subjective judgment, analysis and assumptions and each recipient should satisfy itself in relation to such matters. 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SV Pharma’s Vision
Our goal is to build Europe’s most innovative cannabis
extraction business and become the leading pharma
grade cannabis company in Europe, setting the gold-
standard in cultivation and extraction
3
Company Overview
Extraction and German THC Trading Large Scale Pharma
Refining Licence Operation
Short term cash generative Providing a foothold in the
Unlimited THC cultivation and
business largest medical cannabis
processing licence via JV with
market in Europe
SV Pharma has acquired leading pharma company
ethanol extraction and SV Pharma holds a trading
JV with Zada Pharmaceuticals
refining equipment from a licence for THC in Germany
Bosnia, GMP certified THC
leading US manufacturer to which includes import /
cultivation, extraction and
install in German facility. export and distribution.
processing facility
Will produce high grade CBD Licence currently allows for
SV Pharma holds 62% of JV with
distillate/isolate for trading of 160kg of flower per
Zada to contribute an initial €6
wholesale. year.
mill towards land and buildings.
Generating fast cash flow. Work underway to expand
Construction scheduled to
licence, increasing capacity,
Extraction scheduled to commence in Q2 2020.
for full commercialisation.
commence in Q1 2020.
4
4
European Hemp / CBD- A large undeveloped emerging market
• Traditionally used for food & fibre, hemp is now being used to produce a variety of medicinal
and healthcare products – largely hemp derived cannabidiol
• In Europe, hemp is defined as cannabis containing less than 0.2% THC
• The hemp flower can be used to
create crude oil, distillate and an
isolate depending on the intended
use
• Estimated current product demand
outstrips supply 5 to 1
• Significant demand in Europe for
consistent high quality CBD
• Germany cultivated 2,147 hectares
of hemp in 2017, 43% more than
2016 and increasing year on year
5
The Opportunity
• Europe is estimated to produce close to 1/4 of the world’s hemp crop
• European CBD market expected to boom - the market was estimated at $318 million in 2018
and is expected to grow over 400 percent through 2023 (1)
• But while hemp production and demand have rapidly grown, high quality extraction and
processing has lagged
• SV Pharma is poised to become a leading provider of CBD distillate and isolate in Europe
• With speed to market a priority we will capture this opportunity and become a top player in
the European extraction industry generating high returns on capital
6 (1) Brightfield Group - 26 March 2019
SV Pharma Extraction Overview
SV Pharma is expecting delivery of its first 500 Gallon Industrial Performance
Integrated Extraction and Recovery Solution on site in Germany in Q1 2020.
• Fully licensed operation to be located in Berlin, Germany with a focus on
scalability
• Ethanol extraction and recovery system represents the newest and most
innovative extraction technology in the marketplace
• First production planned for Q1 2020 – 3 month ramp up
• Scalable operations:
• 2nd extraction unit planned to come online in Q4 2020
• Working with equipment suppliers to manufacture new solutions for
specific products
• Rigid Quality Assurance
• Third-party testing at each stage (independent lab on site)
• GMP certification to commence in 2020
• Key Stats
• 360kg daily processing volume based on single shift
• Producing 23 liters of CBD distillate per shift
7
Extraction - Financials
Strong, scalable, cash generating business from the first year of operations
2020 2021
Total Production – Distillate (litres) 5,250 10,041
Total Revenue €12.3 mill €23.5 mill
EBITDA (€) €7 mill €15 mill
• Production commencing Q1 2020, ramp up phase of 3 months
• Production based on a conservative 8 runs per day (8 hour shift), 20 days per month
• MoU signed with hemp producers ensuring continuity of supply of high quality biomass, developing strong
relationships with farmers
• Offtake MoU signed with a major distributor in Europe for CBD distillate, crude oil and/or isolate
• Cashflow positive by Q2 2020
• Highly scalable – potential for 2nd Extraction unit – Q4 2020 doubling processing capacity
• Ability to produce full spectrum, crude, isolate and THC products with existing equipment to take advantages of
changing opportunities in the market
8
8
German Licencing and Distribution
SV Pharma’s German subsidiary holds a trading licence from
BfArM (German medical agency) to supply medical THC flower
• Germany is currently dependent on the import of medical
cannabis from abroad; 4,400 kg imported in 2018 with demand
expected to increase significantly
• Currently hold a limited licence to import, export and distribute
160kg pa of THC in Germany
• Extending this licence to allow for larger quantities to allow for
full commercialisation
• Building a distribution network outside of Germany to be well
positioned as the European medical cannabis market matures
and further develops
• Existing laboratory and R&D facilities located in Rostock
• Lease for certified GDP and GMP lab in negotiation
9
Pharmaceutical Applications
Joint Venture to construct a GMP certified, pharmaceutical grade
facility, including cultivation, extraction and processing. Construction
to commence in Q2 2020
• JV with Zada Pharmaceuticals, one of the largest pharmaceutical
companies in the Balkan region, with SV Pharma having a
controlling 62% interest
• Engrained ability to cultivate, process and export medical cannabis
(including unlimited THC) into Europe.
• Zada will invest circa €6m by way of land, facilities and
construction, SV Pharma will be responsible for equipment and fit-
out at an estimated cost of circa €6-8m
• Initial 50,000 sq. ft facility to be constructed, increasing to 100,000
sq. ft
10Zada Pharmaceuticals / SV Pharma Joint Venture
JV will utilise Zada’s pharma expertise to:
• Grow, conduct R&D, extract, process, import/export and distribute THC and CBD
• Opportunity to manufacture drugs via a sub-licence of GMP product licence (SPV Bosnia will apply
for its own licence once lab constructed and approved)
11Team
In-country professionals experienced in pharmaceutical, cannabis and corporate management
Burim Thaci – Chairman Greg Kuenzel – CEO
Burim is an experienced executive whose prior Greg holds a Bachelor of Business Degree and is a
accomplishments include leading and expanding Fellow of the Institute of Chartered Accountants in
operations and international trade for two large global England & Wales. He has many years of experience in
pharmaceutical production companies over the past providing accounting and corporate advice to public
ten years. Three and a half years of this was focused on companies in a diverse range of industry sectors. For
investment and management in the medical cannabis the past 15 years he has worked with predominantly
industry. As an executive manager with over 16 years’ UK listed companies holding senior financial and
experience, he is well-versed in project financing, management positions. Greg is a partner of Heytesbury
management and financial restructuring and change Corporate LLP. More recently he has advised a number
management of medical cannabis companies operating in the UK and
Europe.
Colby Riggle – Operations Director Nicola Baldwin – Corporate Counsel
Nicola has, for the last 10 years, worked with London-
Colby, as a native of California, has in excess of 15
based City & Westminster Corporate Finance LLP as its
years of experience in the cannabis space as both
in-house legal adviser. Prior to that she was employed
Master Grower for Calaveras Wellness Farms,
by a city law firm, now DMH Stallard. Her experience
Calaveras CA and The Cannabis Cooperative; and Head
includes corporate finance transactions, M&A and
of Operations at Incredible Extracts Oakland, CA. He
multi-jurisdictional IPOs. As well as being a practising
has experience managing teams of growers (for both
solicitor, Nicola regularly sits as a Magistrate in Central
indoor and outdoor operations) and has overseen
London
processing and extraction on an industrial scale
including for the pharmaceutical sector
12Team
In-country professionals experienced in pharmaceutical, cannabis and corporate management
Adrian Beeston – Executive Director MD. Ranjit S. Bhardwaj – R&D Director
Adrian is a private investor who specialises in the Dr Bhardwaj has been working in phytomedicine for
financing and structuring of small to medium size well over a decade, with a focus on cannabis and its
businesses and the flotation of these companies on the medicinal properties for the past 10 years. Dr
US, English and Canadian Exchanges. Prior to this he Bhardwaj and his team are currently undertaking R&D
was a Director of Thorpe-Beeston Investments Ltd, studies on numerous conditions, including nausea, loss
from 2002 until 2017. He moved to the UK from of appetite, spasticity, Tourette's syndrome, pain,
Canada in 2000, where he worked with Altium Capital, itching, glaucoma, epilepsy, asthma, psychiatric
a major pan-European corporate finance house, where symptoms, hyperactivity disorder / ADHD, Alzheimer's
he focused primarily on the raising of private equity disease, autoimmune and inflammatory diseases and
other syndromes. He is currently in the development
stage of several products created with the SV Pharma
team scientists in Germany and Bosnia
Herman Groenewoudt – Commercial
Director Dr. Ziga Bolta– Technological & Product
Prior to joining SV Pharma, Herman was the CEO of C3 Development Director
International B.V. Holding, which holds the Vitaponix
branded patent in agriculture and organic nutrition. Dr Bolta has extensive experience in business
Herman has previous experience in the cannabis development, product portfolio management, project
industry with a focus on nutrition. This includes management, intellectual property protection and
agriculture and glass house operation experience on a licensing. He has organised specialised Patient Focused
4-hectare facility in the Netherlands. Herman was also Certification training for the use of cannabis in
a director for international sales at ATCO Europe B.V. patients, cultivation and processing. Dr Bolta is a
for more than 6 years. Herman achieved the rank of chemical process engineer and a doctor of
Lieutenant during his service in the Royal Netherlands biotechnology (plant biotechnology).
Navy
13Use of Proceeds
Item £
Germany – capex, fit out, overheads 2,250,000
Bosnia 250,000
Corporate costs, legal and overheads 500,000
TOTAL 3,000,000
Highlights
• Establish extraction facility utilising cutting edge ethanol extraction
and refining system to produce high grade CBD products
• Generate fast short term cash flow
• Expand existing German licences to create commercial THC
opportunities
• Commence work on JV with Zada Pharmaceuticals in Bosnia holding
an unlimited THC production licence
14Financing Structure
Funding Vehicle SV Pharma Limited
Total Investment Amount £3,000,000
Pre-Money Valuation £20,000,000
Timing December 2019/January 2020
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