- ECS Botanics MC, a subsidiary of ECS Botanics (ECS), enters a collaborative supply and toll processing agreement with Sun Pharma
- Sun Pharma is an Australian-based subsidiary of Sun Pharmaceutical Industries, which is the fourth-largest speciality generic pharmaceutical company in the world
- Under the agreement, Sun Pharma will extract ECS’ medicinal cannabis biomass to produce good manufacturing practice resin for use in medicinal cannabis products
- This agreement allows ECS to maintain its asset model and encourage customers to purchase affordable and locally grown and manufactured medicinal cannabis oils
- ECS is down 2.94 per cent on the market with shares trading at 3.3 cents
ECS Botanics MC, a subsidiary of ECS Botanics (ECS), has entered a collaborative supply and toll processing agreement with Sun Pharma.
Sun Pharma is an Australian-based subsidiary of Sun Pharmaceutical Industries which is the fourth-largest specialty generic pharmaceutical company in the world.
Under the agreement, Sun Pharma will extract ECS’ medicinal cannabis biomass to produce good manufacturing practice (GMP) resin.
ECS has agreed to supply between 600 kilograms to 1750 kilograms of cannabis biomass over a five-year period, with Sun Pharma’s actual biomass requirements not yet certain.
Additionally, Sun Pharma has agreed to purchase, and ECS will supply, no less than 55 per cent of Sun Pharma’s annual cannabis biomass requirements.
Based on indicative volumes, this equates to total revenue between $6.6 million and $9.8 million for the five years.
Sun Pharma will also install a carbon dioxide extractor at its Port Fairy pharmaceutical facility to produce GMP decarboxylated resin for ECS at a reduced rate.
The resin produced will be used in the formulation of medicinal cannabis products.
This agreement allows ECS to maintain its asset model and encourage customers to purchase affordable and locally grown and manufactured medicinal cannabis oils.
Managing Director Alex Keach commented on the agreement.
“This arrangement positions ECS Botanics to capture a greater share of the existing medicinal cannabis oil market in Australia and overseas,” Mr Keach said.
“Furthermore, partnering with a globally significant company is encouraging for ECS Botanics’ major expansion plans to drive revenue growth and continually lower production costs.”
ECS was down 2.94 per cent on the market, with shares trading at 3.3 cents at 11:28 am AEDT.