VIRTUAL ANALYST & INVESTOR DAY - NOVEMBER 19, 2020 TSX: VLNS | OTCQX: VLNCF - The ...
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VIRTUAL ANALYST & INVESTOR DAY NOVEMBER 19, 2020 TSX: VLNS | OTCQX: VLNCF
NOTICE TO RECIPIENT
This presentation (the “Presentation”) of The Valens Company Inc. (the “Company” or “The Valens Company” or “Valens”) is an overview only and does not contain all the
information that a prospective investor may require to make investment decisions. This Presentation is for information purposes only and does not constitute an offer to
sell or a solicitation to buy any securities of the Company. In making an investment decision, investors must rely on their own examination of the Company, including the
merits and risks involved. This presentation is confidential and contains confidential information and distribution of this presentation may also be restricted or prohibited
by law. Recipients are required to inform themselves of, and comply with, all such restrictions or prohibitions.
FORWARD LOOKING STATEMENTS
This Presentation contains forward-looking statements and forward-looking information (collectively, “forward-looking statements”) within the meaning of applicable
Canadian securities laws. Any statements that involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or
future events or performance (often but not always using phrases such as "expects", "is expected", "anticipates", "plans", "budget", "scheduled", "forecasts",
"estimates", "believes" or "intends", or variations of such words and phrases (including negative and grammatical variations), or stating that certain actions, events or
results "may", "could", "would", "should", "might" or "will" be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements and
are intended to identify forward-looking statements.
By their nature, forward-looking statements are based on assumptions and are subject to known and unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of the Company, or developments in the Company’s industry, to be materially different from any future results, performance
or achievements, or industry developments, expressed or implied by the forward-looking statements and information. These risks are described in the Company’s latest
Annual Information Form for the year ended November 30, 2019 and Management’s Discussion and Analysis of the Company for the three and nine month period ended
August 31, 2020 (the “MD&A”), each as filed with the Canadian securities regulatory authorities on SEDAR at www.sedar.com. Examples of forward-looking statements
include, without limitation: (A) financial forecasts of the Company; (B) the intention to grow the business and operations of the Company; (C) anticipated timing for the
availability of the Company’s products to market and expected sale prices; (D) expected growth in the number of users of medical and recreational marijuana anticipated
in various regional and international markets; and (E) the expansion of the Company’s business into other revenue streams. Actual results and developments are likely to
differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this Presentation.
Such forward-looking statements are based on a number of assumptions which may prove to be incorrect, including, but not limited to: expectations regarding the ability
of the Company to raise capital and grow through acquisitions; growth strategy, joint venture and other commercial opportunities, including cannabis-related legal
reform and regulatory changes with respect to the U.S. and other international markets, and the ability of the Company to capitalize on these opportunities through its
stated work program; and expected sources and uses of capital. There can be no assurance that forward-looking statements will prove to be accurate, as actual results
and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
The forward-looking statements and information contained in this Presentation are expressly qualified in their entirety by this cautionary statement. The forward-looking
statements and information included in this Presentation are made as of the date of this Presentation and the Company assumes no obligation to update such forward-
looking statements to reflect new information, subsequent events or otherwise unless required by applicable securities legislation.
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCF
Historical statements contained in this Presentation regarding past trends or activities should not be taken as a representation that such trends or activities will continue
in the future. In this regard, certain financial information contained herein has been extracted from, or based upon, information available in the public domain and/or
provided by the Company. In particular, historical results of the Company should not be taken as a representation that such trends will be replicated in the future. No
statement in this document is intended to be nor may be construed as a profit forecast.
CAUTIONARY NOTE REGARDING FUTURE-ORIENTED FINANCIAL INFORMATION
To the extent any forward-looking statement in this Presentation constitutes “future-oriented financial information” or “financial outlooks” within the meaning of
applicable Canadian securities laws, such information is being provided to demonstrate the anticipated market penetration and the reader is cautioned that this
information may not be appropriate for any other purpose and the reader should not place undue reliance on such future-oriented financial information and financial
outlooks. Future-oriented financial information and financial outlooks, as with forward-looking statements generally, are, without limitation, based on the assumptions
and subject to risks as set out above under the heading “Forward-Looking Statements”. The Company’s actual financial position and results of operations may differ
materially from management’s current expectations and, as a result, the Company’s revenue and expenses may differ materially from the revenue and expenses profiles
provided in this presentation. Such information is presented for illustrative purposes only and may not be an indication of the Company’s actual financial position or
results of operations.
THIRD PARTY INFORMATION
This Presentation includes market and industry data which was obtained from various publicly available third-party sources. In preparing this Presentation, the Company
has relied upon such data from certain of these sources and other sources believed by the Company to be true. Although the Company believes it to be reliable, the
Company has not independently verified any of the data or conclusions from third-party sources referred to in this presentation, or analyzed or verified the underlying
reports relied upon or referred to by such sources, or ascertained the underlying assumptions relied upon by such sources. The Company does not make any
representation or warranty as to the accuracy or completeness, or suitability for any given analytical purpose, of such data or conclusions and disclaims any liability to the
recipient from the recipient’s use of any such report or source, or the data or conclusions therein, including those reproduced herein.
USE OF NON-GAAP MEASURES
Adjusted EBITDA is a non-GAAP measure used by management that does not have any standardized meaning prescribed by IFRS and may not be comparable to similar
measures presented by other companies. Management defines adjusted EBITDA as loss and comprehensive loss from operations, as reported, before interest, tax,
depreciation and amortization, and adjusted for removing share-based payments, unrealized gains and losses from short term investments and other one-time and non-
cash items including impairment losses. Management believes adjusted EBITDA is a useful financial metric to assess its operating performance on an adjusted basis as
described above. A description of these financial measures, including a reconciliation of such measures, to the extent possible, against the most directly comparable IFRS
measure, can be found starting on page 12 of the MD&A.
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCF
AGENDA
• Introduction and Corporate Strategy Overview
Tyler Robson, CEO, Co-Founder & Chair
• Cannabis 2.0, 3.0 and Beyond: Market Trends and Opportunities
Everett Knight, EVP, Corporate Development and Capital Markets
• The Valens Company Advantage: Intellectual Property and Innovative Products
Quinn Shiskin, Director, Products & Innovation
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCF
AGENDA
• Scaling to Lead: Developing a Global Platform
Jeff Fallows, President
• The Australian Medicinal Market: Strategic Opportunities for Continued Growth
Dr. Sud Agarwal, CEO of Cannvalate
• Q&A
• Closing Remarks
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCF
INTRODUCTION & CORPORATE STRATEGY OVERVIEW Tyler Robson CEO, Co-Founder & Chair The Valens Company Inc. TSX: VLNS | OTCQX: VLNCF 6
THE VALENS COMPANY – EST. 2012
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCF
STEADY GROWTH TOWARD LEADERSHIP
Q2 2019 Q4 2019 Q2 2020
$43.1 million bought Granted direct-to-province sales licence First to launch cannabis-infused
deal financing SōRSE licence expansion beverages in Ontario
Established operations in GTA Entered Australian market with
with Pommies acquisition Cannvalate partnership
Graduated to TSX
$40 million debt facility
Q3 2019 Q1 2020 Q3 2020
Significantly increased cannabis Rebranded to Awarded Health Canada research licence
processing capacity The Valens Company 56 SKUs manufactured across four
Opened Toronto corporate office product lines and first shipments to
Began trading on the OTCQX Australia
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCF
TODAY FISCAL 2021
The Valens Company is the largest New derivative products including
third-party manufacturer of cannabis edibles and topicals
derivative products in Canada
New specialty products including
425,000 kg of cannabis processing hash and pre-rolls
capacity across five core technologies
Manufacturing capacity expansion
200+ employees in Kelowna and
Toronto Entry into new domestic and
international markets
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCF
OUR MISSION:
TO BRING THE BENEFITS OF
CANNABIS TO THE WORLD.
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFOUR STRATEGY: CUSTOM MANUFACTURING LEADERSHIP
HOW WE STARTED WHERE WE ARE GOING
Extraction Replicate ONE-STOP
SHOP business model in
both mature and evolving
global markets
WHERE WE ARE TODAY
Third-party processor,
manufacturer, and distributor of
cannabis derivative products
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFA FOCUSED PLAN TO CREATE SHAREHOLDER ROIC
Scaling operations and improving FOCUS INNOVATE
product development, manufacturing fundamentals diverse product
that drive portfolio and
and distribution capabilities revenue & maximize
profitability margins
GROW
market share across all
2.0 categories
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFDEVELOPING FIT FOR PURPOSE CONSUMER VERTICALS
MEDICAL RECREATIONAL HEALTH & WELLNESS
Delivery of a medically focused Expansion of consumer Development of wellness-focused
white label business case in key data-driven recreational offerings product solutions beyond
domestic channels and select that cover both mainstream and consumables to help brands
international markets specialty cannabis products capture non-cannabis users
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCF“
WE MEASURE OUR SUCCESS
AGAINST OUR ABILITY TO
INNOVATE AND EXECUTE,
BUILDING THE FOUNDATIONS
”
BEYOND CANNABIS 2.0
TYLER ROBSON
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFCANNABIS 2.0, 3.0 & BEYOND: MARKET TRENDS AND OPPORTUNITIES Everett Knight EVP, Corporate Development and Capital Markets The Valens Company Inc. TSX: VLNS | OTCQX: VLNCF 15
CANADA CONTINUES GROWTH DESPITE CHALLENGES
(1) (1)(2)
CURRENT MARKET SIZE BY PROVINCE ESTIMATED 2022 MARKET SIZE BY PROVINCE…
$803
$2,103
Annual Retail Sales (C$, M)
Annual Retail Sales (C$, M)
$631
$536
$438 $1,224
$735
$631
$155
$115 $91 $80 $56 $197 $168 $140 $112
$20 $75 $23
ON QC BC AB MB SK NS NB NL PE ON QC BC AB MB SK NS NB NL PE
$2.9B $5.4B
Total Market Size Total Market Size
(1) Based on August 2020 retail sales as reported by Statistics Canada
(2) Estimated 2022 market size by province assumes each province achieves the same sales per capita as Alberta which is partly dependent
on ongoing cannabis regulatory liberalization and legal reform and proportionate increases in consumer demand, which may not occur.
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCF2.0 PRODUCTS CAPTURING THE NON-CANNABIS MARKET
66% Edibles and drinkables can be
a great introductory way for
new users to familiarize
2x
of non-users are themselves with the cannabis
interested in experience
ingestible cannabis Mintel
Females (23%) were
3 million
almost twice as
Barriers to usage for likely as males (12%)
28% cannabis non-users to report using only
37% products other than
Smell Smoke Health
New consumers not interested in dried cannabis
purchasing dried cannabis products Effectively overcome by (flower/leaf)
may enter the market upon availability non-combustible/inhalable StatsCan
of new product formats - EY 36% format Mintel
Source: Mintel, StatsCan, EY
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFSTEADFAST FOCUS ON KEY GROWTH CATEGORIES
With the U.S. as a proxy for a more mature market, vapes, concentrates, and edibles
are key categories poised to outpace overall market growth in Canada.
Vapes Edibles Flower
56.6% -10.2%
19.5% +6.5% 12.0% 46.4% difference
13.0% difference +9.0%
difference
3.0%
Canada US Canada US Canada US
Concentrates Beverages Pre-Rolls
9.5% 18.3%
1.6% -9.6%
+8.1% -0.7%
difference difference
difference 0.9% 8.7%
1.4%
Canada US Canada US Canada US
Source: The Valens Company, Statistics Canada, Stifel, Headset, OCS. Note: US states include California, Colorado, Nevada, Oregon, and Washington
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFThe Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFOIL AND DERIVATIVE PRODUCTS CONTINUE TO GROW
FLOWER-BASED AND OIL-BASED PRODUCT
9
CANADIAN ANNUALIZED RETAIL SALES (C$,B)
SALES IN AB, BC AND ON (C$,M)
$2.88B* Product Segments
$3.00B $160M
Post 2.0
$140M
$2.50B
+1K
$120M
$2.00B
$100M Pre 2.0
$1.50B $80M
$60M
Retail Stores
$1.00B
$40M
$0.50B
$2.88B*
$20M
$0.00B $0M
Oct-18
Feb-19
Oct-19
Feb-20
Apr-19
Aug-19
Apr-20
Aug-20
Jun-19
Jun-20
Dec-18
Dec-19
Oct-19
Aug-19
Nov-19
Jan-20
Feb-20
May-20
Sep-19
Apr-20
Jul-20
Aug-20
Dec-19
Jun-20
Mar-20
Annualized Revenue
Source: Statistics Canada, Headset
Flower-based Products Oil-based Products
*Annualized sales based on daily retail sales data in August from Statistics Canada.
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFVALENS: LEADING CANADIAN VAPE MANUFACTURER
In October, including both licensed and unlicensed
customers, by unit volume Valens manufactured:
• 6 of the top 15 vape brands in Alberta
• 4 of the top 20 vape brands in Ontario
• 3 of the top 10 vape brands in British Columbia
VAPE UNITS SOLD THROUGH THE OCS THAT WERE MANUFACTURED BY VALENS
September 2020 October 2020
15.2% 17.7%
Source: The Valens Company, Headset, OCS
84.8% 82.3%
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFEXCESS SUPPLY AND LOWER SELLING PRICES FOR
FLOWER LEADS TO LOWER INPUT COSTS
As flower inventories continue to rise and flower pricing declines across every level of
the supply chain, Valens is able to lower its input costs while maintaining a broad
selection of cultivars to choose from.
UNPACKAGED INVENTORY OF FLOWER HELD BY CULTIVATORS AVERAGE RETAIL PRICE PER GRAM OF FLOWER
900,000kg 14
782,698kg
800,000kg 12
AB, $11.13
700,000kg ON, $10.63
10 BC, $9.78
600,000kg BC, $7.71
8 ON, $7.69
500,000kg
AB, $7.08
6
400,000kg
4
300,000kg
2
200,000kg
96,822kg
100,000kg 0
Jan-19 Apr-19 Jul-19 Oct-19 Jan-20 Apr-20 Jul-20
0kg
Oct-18 Jan-19 Apr-19 Jul-19 Oct-19 Jan-20 Apr-20 Jul-20 AB ON BC
Source: Health Canada, Headset, The Valens Company
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCF“
PR O DUC T S A L E S R E V E N UE UP 52 %
VS . Q 2‘20 DR IVE N BY C O N TIN UE D
R O L L OUT O F M A N U F AC T UR I N G
”
PL A TF OR M
EVERETT KNIGHT
The Valens Company Inc.
TSX: VLNS | OTCQX: VLNCF
52% 23R&D, INNOVATION NEEDED TO SUCCEED IN PREVAILING
AND FUTURE MARKETS
INNOVATION
Pushing the boundaries of
cannabinoid science and
consumer occasions
RESEARCH 3.0 CONSUMER
& DEVELOPMENT Delivering products that
Consumer data-driven are trusted, effective and
product development customizable
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFTHE VALENS COMPANY ADVANTAGE: INTELLECTUAL PROPERTY & INNOVATIVE PRODUCTS Quinn Shiskin Director, Products & Innovation The Valens Company Inc. TSX: VLNS | OTCQX: VLNCF 25
THE VALENS COMPANY ADVANTAGE
The Valens model leads in contract custom
manufacturing by giving our partners access to
all cannabis resin derivatives.
Proven world-class extraction platform:
• Co2 extraction pioneers
• First to market mass scale ethanol
extraction
• One of largest capacity hydrocarbon
extraction and product knowledge centers
• Solventless and terpene extraction
specialists
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFEXTRACTION AT CORE OF MANUFACTURING
EXCELLENCE
Super-Critical CO2
• Six high-capacity independent CO2
systems allows Valens to lead the
sector in vaporizer production
• Successfully launched 64 vape SKUs
nationwide
• Years of IP development allowing to
maximize yields and product quality.
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFSTATE OF THE ART PLATFORM
Cryogenic Ethanol
• Custom designed and backed by years
of data-driven results
• Over-achieved our targeted daily
throughput of +3,000lbs of biomass
• Mass production of full and
broad-spectrum winterized resin
• Ultra pure distillate; repeatable process
• Precursor extraction process for high
output, highly pure > 98% isolates
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFHIGH CAPACITY ISOLATES
CPG and pharma quality
High potency specification > 98%
Scaled process to meet demand
COMING SOON
THCA CBDA CBG CBN
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFCANNABIS SPECIALTY PRODUCTS
HYDROCARBON CRUMBLE DRY SIFTED & SPECIALTY BIOMASS PROCESSING
WAX / PRESSED
DAB TABLETS SUGAR WAX HASH ROSIN
Live Resin Derivatives
CRUMBLE LIVE RESIN QUEBEC HASH PRE ROLLS
CANNABIS LEAF
BADDER DIAMONDS PRESSED HASH BLUNTS
Largest hydrocarbon product capacity in
Canada
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFWELLNESS & BEVERAGES
WELLNESS MADE WITH SōRSE BY VALENS BEVERAGES MADE WITH SōRSE BY VALENS
Moisturizers Carbonated beverages
Relief rubs Drink drops
Massage oils PET bottles
Bath bombs Cans
Soft gels Small format shots
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFSTABILITY & SUPERIORITY OF SŌRSE
EMULSIONS ARE NOT CREATED FAILED EMULSION
EQUALLY
• Proven stability of emulsion
• Low sensory impact (cannabis
taste free)
• Repeatable experience
Source: SōRSE Technology
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFSTABILITY & SUPERIORITY OF SŌRSE
SōRSE BY VALENS - PROVEN SŌRSE PERFECTION
STABILITY
• No creaming, clarification or
sedimentation
• First sip is the same as your last,
complete homogeneity
Source: SōRSE Technology
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFGTA PRODUCTION STRATEGY
200 BOTTLES
PER MINUTE
PET Bottles & Can Filling
• Carbonated THC/CBD beverages
• Non-carbonated THC/CBD
beverages
• Drink drop formulations
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFTHE VALENS END-TO-END SOLUTION
VALENS SŌRSE VALENS
EXTRACTION TECHNOLOGY LABS
HIGH THROUGHPUT • CONSISTENCY • ON TIME
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFSCALING TO LEAD: DEVELOPING A GLOBAL PLATFORM Jeff Fallows President The Valens Company Inc. TSX: VLNS | OTCQX: VLNCF 36
K2 FACILITY EXPANSION
NEARING OPERATIONS
42,000 GMP
SQ FT COMPLIANT
END-TO-END
WITH FULL CPG SUPPLY
CHAIN CAPABILITIES
The Valens Company Inc.
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37
TSX: VLNS | OTCQX: VLNCFGTA FACILITY ON TRACK
FOR Q2’21 LICENSING
30,000 SōRSE BY
SQ FT VALENS
WHITE LABEL AND
CUSTOM MANUFACTURING
FOR BEVERAGES AND OTHER
2.0 & 3.0 PRODUCTS
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCF“
CANNABIS 2.O REPRESENTS 27% OF
THE CURRENT MARKET; CONSUMER
FEEDBACK AND DEMAND SHOW THIS
SEGMENT DOUBLING WITHIN A YEAR
”
50%
AND A HALF.
JEFF FALLOWS
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFA PORTFOLIO APPROACH THAT GROWS WITH
THE MARKET
7 12 15 64 185+
Third-party Unique Licensed Vape SKUs SKUs produced
brand Houses brands producers produced across Canada
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFBRAND PARTNERS STRATEGICALLY BALANCED ACROSS
CONSUMER & PRODUCT CATEGORIES
1 Cannabis Specialty Consumer
2 Cannabis Mass Consumer
3 Health & Wellness, Medical
CONCENTRATES HASH PRE-ROLLS VAPES OILS EDIBLES BEVERAGES DRINK DROPS TOPICALS /
SOFT-GELS
*Brand partners defined as unlicensed partners with launched products.
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFOUR STRATEGY: FIT FOR PURPOSE INT’L EXPANSION
Evaluating select U.S.
opportunities with entry
expected in the next 12
months (1) EU • Valens is currently able to
UNITED service many high-growth
STATES international markets without
EU level certification
MEXICO
• EU GMP Certification expected
in fiscal 2021
COLOMBIA
PERU
BRAZIL
AUSTRALIA
CURRENT AREAS OF
INTEREST
(1) Subject to U.S. federal and state legal and regulatory changes.
The Valens Company Inc.
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TSX: VLNS | OTCQX: VLNCFTHE AUSTRALIAN MEDICINAL MARKET: STRATEGIC OPPORTUNITIES FOR CONTINUED GROWTH Dr. Sud Agarwal CEO, Cannvalate The Valens Company Inc. TSX: VLNS | OTCQX: VLNCF 43
ABOUT CANNVALATE
1. Australia’s largest medicinal cannabis distribution network prescribing around 40-50% of all
Australia’s medicinal cannabis (consisting of over 2,600 prescribing doctors and 600 pharmacies)
2. Australia’s Cannabis CRO -The Medicinal Cannabis Research Collaboration (MCRC) are a premier
Contract Research Organisation (CRO) and collaboration between Cannvalate and Swinburne
University – a joint enterprise between a leading Australian medicinal cannabis company and world-
renowned researchers.
3. Assisting with Valens’ entry in to the Australian market and performing white-label sales to a number
of existing Cannvalate customers
4. Significant Shareholder equity in:
• ASX:IHL (MC = $115M)
• ASX:LSH (MC= $12M)
• ASX:MXC (MC=$40M)
Source: Cannvalate
44
www.cannvalate.com.auWHAT IS HAPPENING IN AUSTRALIA TODAY?
1. Australia is the fourth largest legal medicinal cannabis market globally by patient
numbers and $ value (USA > CAN > GER > AU)
2. The size of the Australian medicinal cannabis market is approximately $50m in
retail sales in 2020
3. Under 2% is domestically grown cannabis with the vast majority being imported
from Canada, EU or LATAM
4. 1% of the total population have a medical need for medicinal cannabis (Australian
Population = 25M and so TAM = 250,000)
5. There are no government subsidies on MC products currently – which means
consumers are paying $300-400/month for treatment. This is fully out-of-pocket
without insurance/ Medicare subsidy.
6. About 80% of cannabinoid prescriptions are for oil/ tincture with flower making up
close to 15% and the remaining 5% constituting all other forms
7. Over 30% of all cannabinoid prescriptions are for pure CBD oil
Source: Cannvalate, FreshLeaf Analytics, Prohibition Partners
45
www.cannvalate.com.auESTIMATES OF AUSTRALIAN MARKET GROWTH
Total Australian Medicinal Cannabis
Market Value $Million (AUD)
700
630
600
490
500
400 380
295
300
230
200 180
140
90
100
30
0
2019 2020 2021 2022 2023 2024 2025 2026 2027
Source: Cannvalate, Prohibition Partners, Business Market Insights
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MARKET SIZE – REGISTERED PATIENTS GLOBALLY
4
7
Authorized Medical Patients
5%
20%
19%
13%
7%
13%
13%
8%
Source: Cannvalate, PharmOut, Statistica, Medical Cannabis Network – Health Europa, Marijuana Policy Project
47
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GROWTH OF AUSTRALIAN PATIENT NUMBERS
4
8
Australia Patient Numbers
60,000
50,000
40,000
30,000
20,000 Active Patients
10,000 Linear (Active
Patients)
0
Jan-17 Jan-18 Jan-19 Jan-20 Jan-21
-10,000
-20,000
Source: Cannvalate, FreshLeaf Analytics
48
www.cannvalate.com.auPRODUCTS BY TYPE ON THE AUSTRALIAN MARKET
14%
3% Oil
Spray
Cream
16% Crystal
57% Lozenges
Capsules
3% Granulated Flower
7%
Flower
Source: Cannvalate, FreshLeaf Analytics
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AVERAGE DAILY DOSE (PATIENT REPORTED) MG/DAY
5
0
Average Daily Dose mg / day
160
140
120
100
80
138
60
40
20 49 44
0
Balanced High CBD CBD Isolate
Source: Cannvalate, Wikipedia, FreshLeaf Analytics
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PATIENT DAILY CANNABINOID DOSE (MG)
5
1
100
90 Patient daily
cannabinoid dose
80 (mg)
70
60
50
40
30
20
10
0
Q3 2018 Q1 2019 Q3 2019 Q1 2020 Q3 2020
Source: Cannvalate
51
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AUSTRALIA
5
2
• Australia is a large developed country in the Pacific
close with deep ties to Asia
• It is the second wealthiest country in the world (after
Switzerland)
• It has a large land mass with a low population
whom are mostly concentrated in 5 cities
• It has the world’s highest literacy
• It has the world's 4th highest life expectancy
• It has developed the world’s highest
expenditure (as % of total healthcare spend)
on complementary or alternative medicines
(>1/3 of total healthcare spend is on alternative
therapies)
• Average monthly spend per medicinal
cannabis patient is $300-$400 per month
Source: Cannvalate
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GATEWAY TO THE PACIFIC
5
3
Source: Cannvalate
53
www.cannvalate.com.auP
a
g
e
|
WHY IS AUSTRALIA AN ATTRACTIVE MARKET
5
4
FOR VALENS?
1. Pureplay medical market, an excellent diversification from Canadian adult-use
2. It is a derivative product dominated market with very little flower use
3. It is almost a pure import market with minimal domestic cultivation and very
limited domestic manufacturing
4. It is rapidly growing – likely to double in next 12 months
5. Australia is the second most wealthy country in the world so the high net
disposable income makes it less price-point sensitive than Canada
6. There is a relatively high use of illicit black-market cannabis in Australia today
(~10%)
7. There are numerous FTAs with Asia-Pacific allowing tariff-free access to
the most populous areas of the world
8. There is no cultivation capacity online currently but will
progressively come online in the next 12-18 months
Source: Cannvalate
54
www.cannvalate.com.auQ&A
TYLER JEFF CHRIS EVERETT QUINN
ROBSON FALLOWS BUYSEN KNIGHT SHISKIN
CEO, Co-Founder President CFO EVP, Corporate Director, Products
& Chair Development & & Innovation
Capital Markets
The Valens Company Inc.
55
TSX: VLNS | OTCQX: VLNCFCONCLUDING REMARKS Tyler Robson CEO, Co-Founder & Chair The Valens Company Inc. TSX: VLNS | OTCQX: VLNCF 56
THANK YOU FOR
ATTENDING
Contact us
IR@TheValensCompany.com
+1 647 956-8254
The Valens Company Inc.
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