New
joint venture, Emerald Health Naturals, secures exclusive Canadian
rights to sell proprietary non-cannabis health products that support the
human endocannabinoid system
Initiative
leverages natural health product development, marketing and sales
expertise of Emerald Health Bioceuticals, VANC Pharmaceuticals and GAB
Innovations to establish brand and sales in strategic distribution
channels
Emerald Health Therapeutics Inc. (EHT) (TSX-V:EMH) (OTCQX:EMHTF) (Frankfurt:TBD) launched
today a multi-pronged program to market and sell a proprietary,
award-winning non-cannabis line of endocannabinoid-supporting
nutritional products in Canadian grocery, natural health product, and
pharmacy stores. EHT has entered into a 51:49 joint venture, to be
called Emerald Health Naturals (EHN), with San Diego-based Emerald
Health Bioceuticals, Inc. (EHB). EHN has secured exclusive Canadian
marketing and sales rights to EHB’s unique nutritional supplements,
which use non-cannabis, non-psychoactive plant-based ingredients to
provide potentially beneficial support to the body’s endocannabinoid
system.
In this initiative, EHN has agreed to
acquire the assets of GAB Innovations (GAB) and has granted
non-exclusive sub-distribution rights to VANC Pharmaceuticals (VANC).
Both GAB and VANC have established networks and a history of sales
success in the natural health product and pharmacy channels. Gaetano
Morello, ND, the founder of GAB, has been appointed CEO of EHN.
Market
research commissioned by EHT identified that approximately 6 of 10
current legal cannabis users also use natural health products. This
strong consumer overlap between the two markets creates a unique
opportunity for EHT to establish its health brand and begin sales of
endocannabinoid-supporting products in natural health product channels.
These channels are not expected to be authorized to sell cannabis under
the anticipated Canadian federal cannabis regulations for recreational
use expected in 2018. If these channels are approved in the future, EHT
would be well positioned to leverage its brand and channel presence to
introduce its cannabis-based products into these channels.
“As
familiar and trusted sources of health products, we believe that
pharmacy, natural health product, and grocery stores will become
important channels for products that beneficially affect the
endocannabinoid system,” said Chris Wagner, CEO of EHT. “This acclaimed
non-cannabis product line gives us first-mover advantage in these
channels and positioning if they are approved to sell cannabis-based
products in the future. These channels would also be ideal for new
products we are developing around advancements in formulation, delivery,
and dosing.”
“We were recently honored with the
Best New Supplement Award at one of the largest natural product trade
shows, a testament to the quality and innovativeness of our product
line,” noted Jade Beutler, CEO of EHB. “We look forward to introducing
these natural health products to the Canadian marketplace, which along
with other legal cannabis markets is showing tremendous appetite for
non-psychoactive products that may provide wellness benefits.”
EHT is leveraging multiple relationships to launch this initiative:
- Formed a joint venture with San Diego-based Emerald Health Bioceuticals. EHT will receive 51% of the shares of EHN in exchange for an investment of $5,000,000. EHB will receive 49% of the shares of EHN in exchange for granting the joint venture exclusive Canadian distribution rights with respect to EHB’s product line.
EHB
developed and launched its over-the-counter product line of
cannabis-free nutritional supplements in the U.S. The products feature
PhytoCann-Complex™, EHB’s proprietary formulation designed to support
the body’s endocannabinoid system and its central role in the
orchestration, maintenance, and balance of health and wellbeing. The
products include Endo SleepTM, Endo InflameTM, Endo BrainTM, Endo BlissTM, Endo CalmTM.
EHB’s
management and scientific advisory board (SAB) comprise experts in
natural health medicine, product development, and marketing. They have
decades of experience working with active ingredients, desired
formulations, delivery and dosage forms, and have access to source
ingredients and industrial-scale, pharmaceutical quality manufacturing.
For example, the SAB includes Michael T. Murray, ND, a leading authority
on natural medicine, and Giovanni Appendino, PhD, a thought leader who
has researched cannabis and cannabinoids for over 15 years. CEO Jade
Beutler and the EHB leadership team have built significant, commercially
successful natural health product brands.
EHB
is a 70%-owned subsidiary of Emerald Health Sciences Inc. (Sciences),
which also owns approximately 37% of the issued and outstanding shares
of EHT. There will be no change in the share ownership of EHT by
Sciences as a result of the joint venture. The joint venture with EHB
was approved by the independent directors of EHT.
- Appointed Gaetano Morello, ND, as CEO of EHN. Dr. Morello is a clinician at the Complex Chronic Disease Program at BC Women’s Hospital in Vancouver and a private practice in West Vancouver. He treats complex chronic diseases including fibromyalgia, chronic fatigue syndrome, myalgic encephalomyelitis, and chronic lyme disease. He has seen first-hand not only the benefits of authorized cannabis on this population but also other plant extracts targeting the endocannabinoid system. He serves on the Quality Assurance Committee for the College of Naturopathic Physicians of British Columbia and other health and medical panels. Dr. Morello has a B.Sc. in Cell Biology/Nutrition from the University of British Columbia and a Doctorate in Naturopathic Medicine from Bastyr University.
- EHN has acquired certain assets of GAB,
a company founded by Dr. Morello that has been a distributor of
nutritional supplements into natural health channels since 1996. GAB has
represented some of North America’s leading manufacturers of natural
health supplements including Enzymatic Therapy, a leading manufacturer
of natural supplements; Thorne Research, a leading physician brand in
both Canada and the U.S.; as well as Terry Naturally, Wisdom Sweet Leaf,
and others. GAB has represented hundreds of SKUs to a network of over
2,000 health food and pharmacy stores across the country. GAB recently
sold its proprietary Sealicious® omega-3 product line to Natural Factors, one of Canada’s largest producers of natural supplements.
- Granted VANC Pharmaceuticals Inc. (TSX-V:VANC) (OTCQB:NUVPF) a non-exclusive right to distribute EHN’s endocannabinoid-supporting products to Canadian pharmacies. VANC has a well-established sales team and key relationships with Canada’s largest pharmaceutical wholesalers as well as pharmacy and grocery chains. VANC will concurrently issue to EHN 3,030,303 warrants to purchase shares of VANC.
“We believe the sales potential for
cannabis products in pharmacies is significant and providing these
products through the pharmacy channel would be a natural fit as
pharmacists play a key role in promoting public safety through education
and awareness. We will take a lead role to develop this channel with
Emerald Health Naturals, starting with these cannabis-free
endocannabinoid-supporting products,” said Bob Rai, CEO and Director of
VANC.
“Our mission is to broadly realize the
medicinal benefits of a range of products that interact with the
endocannabinoid system, which plays a vital role in modulating key
functions of the human body. Emerald Health Bioceuticals and its
internationally recognized advisors have created a unique product line
that we believe can assist the endocannabinoid system in its role,” said
Dr. Morello, CEO of EHN. “As a practitioner of natural medicine for
over 26 years, and having assessed hundreds of patients using legally
authorized cannabis, I believe Canada’s steps to legalize recreational
cannabis will be beneficial for patients with many medical conditions. I
am excited about the potential of EHT’s cannabis and non-cannabis
products, and to take on a role to help realize the medicinal and
commercial potential of these products.”
Completion of the transactions set out in this press release are subject to the approval of the TSX Venture Exchange.
About the Endocannabinoid System (ECS)
The
ECS is a biological system with a vital role in regulating human health
and disease. A lack of endocannabinoid “tone” may have adverse
consequences in various physiological processes. The ECS is activated by
endocannabinoids produced naturally in the body, but also by cannabis
or non-cannabis plant-based cannabinoids that mimic those produced in
the body. Phyto-CannTM Complex is formulated with
non-cannabis herbal and botanical cannabinoids that may favorably impact
the ECS, along with health and wellness.
About VANC Pharmaceuticals Inc.
VANC Pharmaceuticals
aims to become the partner of choice for forward-thinking pharmacies
across Canada. With an established sales force, distribution network,
and team of highly experienced professionals in pharmacy, point-of-care
testing and health technology, VANC’s goal is to provide pharmacists
with innovative, value-added products and services to expand their scope
of practice and support their evolving role as front-line healthcare
providers.
About Emerald Health Therapeutics
Emerald Health Therapeutics (TSX-V:EMH) (OTCQX:EMHTF) (Frankfurt:TBD)
is a Licensed Producer under Canada’s Access to Cannabis for Medical
Purposes Regulations and produces and sells dried cannabis and cannabis
oil for medical purposes. It is adding a 500,000 ft2
greenhouse in Metro Vancouver to serve the anticipated legal Canadian
adult-use cannabis market starting in 2018. Emerald owns 50% of a joint
venture with Village Farms International, Inc. that is converting an
existing 1.1 million ft2 greenhouse in Delta, BC to grow
cannabis. Emerald’s team is highly experienced in life sciences, product
development and large-scale agribusiness. Emerald Health Therapeutics
and Emerald Health Bioceuticals are both part of the Emerald Health group,
which includes multiple companies focused on developing cannabis and
cannabinoid products with potential wellness and medical benefits.
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