- AusCann (AC8) enters a binding term sheet with European Cannabis Corporation (Eurocann) to expand into the European cannabis market
- Under the term sheet, the companies will work together to establish a joint steering committee to focus on SEDDS, AusCann’s drug delivery technology
- AusCann has also entered a secure commercial loan facility with Eurocann to scale up its cannabis cultivation and extraction capabilities
- The loan has a limit of $5 million, an interest rate on drawn funds of 7.5 per cent per year and a default rate of 9.5 per cent per year
- Shares in AusCann ended the day up 7.81 per cent and trading at 6.9 cents
AusCann (AC8) has entered a binding term sheet with European Cannabis Corporation (Eurocann) to expand into the European cannabis market.
Eurocann is an unlisted public Australian company that owns 100 per cent of HAPA Pharma GmbH in Germany.
Under the term sheet, the companies will work together to establish a joint steering committee to focus on SEDDS, AusCann’s drug delivery technology.
This will see the development of standardised dosage form cannabis products for commercialisation in Germany.
The companies will also work together on the import of EU-GMP cannabis products into Australia with HAPA to exclusively manufacture and supply certain EU-GMP medicinal cannabis products to AusCann.
Loan facility
AusCann has also entered a secure commercial loan facility with Eurocann to scale up its cannabis cultivation and extraction capabilities.
The loan has a limit of $5 million, an interest rate on drawn funds of 7.5 per cent per year and a default rate of 9.5 per cent per year.
A $1 million repayment will occur on the first and second anniversaries of the date of the drawdown with the remaining funds to be paid on the third anniversary.
Drawdown is subject to the execution and delivery of originals of the loan agreement, an original of the term sheet and AusCann completing due diligence.
MMIC research agreement
Further, AusCann has entered a research agreement with Monash University’s Medicines Manufacturing Innovation Centre to enhance the production capabilities of SEDDS for the European market.
The research agreement aims to optimise the SEDDS technology to be able to supply bulk THC and CBD powders as single active ingredients.
Shares in AusCann were up 7.81 per cent and were trading at 6.9 cents at market close.