Source: Emerald Health Therapeutics, Inc. 7/12/18
Emerald
Health Therapeutics, Inc. (TSXV:EMH) (OTCQX:EMHTF) (Emerald) is
providing an update on its differentiated strategy to excel in the
growing cannabis industry.
“In Emerald’s
view, the most compelling opportunities and growth in the cannabis
industry will arise in serving the unmet needs of individuals seeking
medicinal and wellness benefits. We also have evidence that adults using
cannabis for purely recreational benefits desire products with
predictable characteristics. Our vision is to enable both medicinal and
recreational users to ‘consume with confidence,’” said Chris Wagner, CEO
of Emerald.
“Our expectation of being in this
business is to develop unique, protected products that are preferred by
consumers, command high margins, and achieve attractive profit for the
company and its shareholders. Our seasoned team, having cumulatively
spent hundreds of years in medicine, pharmaceutical development and
sales, biotechnology R&D and clinical development, as well as
natural health product development, knows how to run the marathon of
developing high quality products based on the processes, tools, and
quality standards of the life sciences industry. Critically, we also
have tremendous consumer sales and marketing expertise, know-how to
position and brand products, and are adept at navigating the ins and
outs of dealing with large buyers.”
Emerald’s business plan is based on three pillars:
- Product Innovation:
Our focus is to conceive and patent novel ideas, license or develop
proprietary products, and display thoughtful leadership to position
these products to the marketplace. These products may be protected by
unique formulations, delivery methods, and applications. Even our
recreational products, often based on unique cannabis strains, will
benefit from our focus on delivering predictable doses and more
sophisticated delivery methods. These initiatives will be confidential
until appropriate turning points, but we have filed for patents and are
making great strides toward human studies. The dealer license held by
Northern Vine Labs, in which we own a majority stake, provides valuable
latitude to enable an array of research and product development
initiatives.
- Branding & Sales:
Executive Vice President of Sales, Marketing, and Operations, Paul
Dillman is well-versed in international consumer product marketing and
complemented by an expert internal team as well as the acclaimed
branding and advertising agency, DDB Canada. We are composing a highly
creative campaign that will uniquely and strongly position Emerald
products in the marketplace. We will initiate our communication around
this product line in August.
We have been in frequent and active discussions with all the provincial cannabis distribution agencies across Canada, and have had multiple tours of high-level executives of these agencies to allow them to see first-hand the magnitude and quality of our production capabilities. Our analysis and strategy is based on the reality that demand will clearly outweigh supply in the near-term. We have excellent relationships with the provincial distributors and are very well-positioned to engage in supply agreements. We do believe that sales growth under the existing medical framework represents an attractively high margin and preferable sales channel. While the initial awards of supply agreements do represent tangible evidence of a relationship, we are confident in our marketing strategy and we have elected to defer the formalization of these types of agreements.
We are taking a powerful strategic step to launch the non-cannabis Endo product line into natural health product, grocery, and pharmacy retail channels across Canada. With our first-hand learning that six of 10 cannabis users are also natural health product users, we are motivated by this unique opportunity to sell non-cannabis products that, like cannabis products, affect the endocannabinoid system, are complementary to our cannabis product line, and create an avenue for very proactive, widespread advertising that is not allowable for cannabis based products. Cross-branding is a marketer’s delight. Our branding for this product line will be powerful and pervasive.
- Production and Raw Material Sourcing:
While we avoided risking investor capital prior to the Canadian
government’s proclamation in April 2017 about cannabis legalization
plan, we moved quickly to consummate a unique production joint venture
with one of the largest, most experienced growers of plants in
greenhouses in North America, Village Farms International. In creating
the joint venture (JV), Pure Sunfarms, we did not just want a structure
of glass and metal, we wanted the opportunity to combine and share our
deep knowledge of cannabis and cannabis growing with Village Farms’ deep
knowledge of growing plants in very large greenhouses. This JV has
resulted in an optimal design and implementation of a world-class
cannabis growing facility. We have completed and have our cultivation
license for one quarter of the 1.1 million square feet. We are in
commercial production and will be harvesting and inventorying product
for the October 17 legal adult-use launch date. We have had a positive
experience with Health Canada and believe that with our track record and
our high standards in our operations we will receive our sales license
for Pure Sunfarms in a timely manner.
We have also not only gained an expanded and differentiated 75,000 square foot indoor production capability but also exposure to a new market – the second largest in Canada – with our acquisition of Agro-Biotech in Quebec.
Based on our view of the market and our business strategy, we will be agile and will ensure that we have access to all potential sources of cannabis raw material that will assure suitable quality and low-cost inputs for the value-added, downstream products we are working to develop. These sources may involve outdoor growing in Canada and could also involve sourcing dried flower or extracted product from other global sources. The sourcing of non-dried-flower raw material (e.g. oils) from international sources would also be enhanced by our ownership of a dealer’s license through Northern Vine Labs.
Emerald’s focus is on great execution and delivering highly appreciated, high margin products.
About Emerald Health Therapeutics, Inc.
Emerald
Health Therapeutics (TSXV: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. Emerald is preparing to serve the fully legalized
Canadian adult-use cannabis market starting October 17, 2018. Emerald
owns 50% of Pure Sunfarms, which is converting a licensed existing 1.1
million square foot greenhouse in Delta, BC and is now in commercial
production. It owns Agro-Biotech, a Québec-based licensed cannabis
grower with a 75,000 square foot indoor facility and is planning to add a
500,000 square foot greenhouse in Metro Vancouver. Emerald’s team is
highly experienced in life sciences, product development, large-scale
agri-business, and marketing, and is focused on developing value-added
cannabis-based products with potential wellness and medical benefits.
Emerald is part of the Emerald Health group,
which is broadly focused on developing pharmaceutical, botanical, and
nutraceutical products that may provide wellness and medical benefits by
interacting with the human body’s endocannabinoid system.
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