CALGARY, AB, Nov. 12, 2020 /PRNewswire/ - Willow Biosciences
Inc. ("Willow" or the "Company")
(TSX: WLLW) (OTCQX: CANSF) has released its financial and
operating results for the three and nine months ended
September 30, 2020, reporting
significant advancement in its operations and strong liquidity.
"The third quarter represented another significant move forward
for us, as we completed our first pilot campaign as part of our
final development stage before we begin commercial production,
which is anticipated to commence around the middle of 2021. From
the pilot, and with our well-advanced downstream process, we were
able to produce appreciable quantities of CBG as sample material at
greater than 99% purity with no detectable THC. We saw significant
demand globally for our sample CBG from a variety of cosmetic, food
and beverage, and nutraceutical companies looking to qualify our
product for commercial purchase in 2021. Building on these results,
we plan to run at least one more pilot in the fourth quarter of
2020 to both further optimize our process for commercial production
as well as meet the demand for sample material of CBG from
potential customers. We are well positioned, both financially and
technically, to start producing at scale in 2021 and transition
from a research-based enterprise to a company with revenue
generating operations."
Highlights for the Quarter
- Willow continued to operate safely and effectively during the
during the quarter, as it has since the beginning of the on-going
COVID-19 pandemic. The Company's highest priority remains the
health and safety of its employees, partners and the communities
where it operates. Throughout the quarter Willow continued to
maintain measures that have been put in place to protect the
well-being of these stakeholders and is proud of the dedication of
its workforce to maintain safe operations and business continuity
during the on-going pandemic.
- As a result of reaching development milestones ahead of
schedule and in collaboration with its development partner, Albany
Molecular Research, Inc. ("AMRI"), Willow successfully
completed its 500 litre pilot program in Q3 2020, making it the
first company to produce material amounts of cannabinoids
biosynthetically.
- Willow successfully developed a scalable process for producing
cannabigerol ("CBG") with greater than 99% purity and no
detectable THC.
- Willow expanded its product portfolio with the generation of
lab strains producing the Varin Cannabinoids, Cannabigerovarin
("CBGV"), Cannabidivarin ("CBDV"), and
Tetrahydrocannabivarin ("THCV"), for further optimization
toward commercial targets.
- Willow began trading on the OTCQX Best Market, an upgrade from
the OTCQB Venture Market. This allows US investors to find current
financial disclosure and Real-Time Level 2 quotes for the Company
on www.otcmarket.com.
- Willow ended the quarter with strong liquidity, including
approximately $9.1 million of cash on
hand as at September 30, 2020.
- Subsequent to the quarter, on October
29, 2020, the Company issued 17,692,307 units at a price of
$0.65 per unit for gross proceeds of
$11.5 million. Each unit consists of
one common share of Willow ("Common Shares") and one half of
one Common Share purchase warrant of Willow (each whole warrant, a
"Warrant"). The Warrants have a strike price of $0.85 per Common Share, a 24-month term and a
forced accelerator clause that allows the Company to force exercise
of the Warrants if Willow trades at a 20-day VWAP of $1.20 or greater.
Operational Update
During the third quarter of 2020, Willow further improved its
cannabinoid production process through a combination of strain and
fermentation optimization and developed a commercially relevant
downstream process for production of greater than 99% pure CBG.
This CBG process was successfully scaled to a 500-litre pilot scale
in the third quarter of 2020 by Willow's development partner, AMRI,
to provide pure CBG samples for evaluation by prospective consumer
packaged goods customers. Willow will continue to optimize its
process at pilot scale with the goal of advancing to larger,
commercial-scale fermentation vessels in the first half of
2021. Willow is in the final stages of selecting its
late-stage development and manufacturing partner(s).
The success of the Company's proprietary yeast production
platform has enabled Willow to initiate work on the Varin
Cannabinoids during Q3. Willow has developed initial lab
strains for production of CBGV, CBDV and THCV, and is now focused
on strain and fermentation process optimization at bench scale to
further increase the production of Varin Cannabinoids toward
commercial targets. Third party scale up work for the Varin
Cannabinoids is expected to commence in the first half of 2021 and
be completed in the first half of 2022. First production of
research samples of the Varin Cannabinoids is expected in the
second half of 2021, with commercial sales in the first half of
2022.
The Company also continued to make substantial progress to
increase production of CBD and a yet-to-be-disclosed cannabinoid
through application of its proprietary strain engineering
technologies. In-house strain and process optimization will
continue through 2020 with scale-up development starting in early
2021.
Financial Update
Willow ended the quarter in a strong financial position, with
approximately $9.1 million in cash on
hand.
The Company's financial results are summarized as follows:
|
Three months
ended
September
30
|
|
2020
|
2019
|
Balance sheet
($000's):
|
|
|
Cash and cash
equivalents
|
9,092
|
24,042
|
Total
assets
|
16,048
|
38,623
|
Shareholder's
equity
|
3,627
|
24,727
|
Weighted average
shares outstanding
|
|
|
Basic and diluted
(000's)
|
78,892
|
78,634
|
Outlook
Willow anticipates transitioning into a revenue generating
development company in 2021. In the coming months and quarters, the
Company will be selecting its first manufacturing location and
partner to start commercial production. Concurrently, the Company
is working to secure commercial customers for its first
cannabinoid, CBG, with the goal of having a robust order book when
commercial production commences. Willow is seeing significant
interest from multiple jurisdictions for CBG, as well as other
cannabinoids Willow is developing manufacturing processes for.
Given the scalability of biosynthetic production via
fermentation, Willow has the capacity to significantly ramp up
production to both meet demand and lower per unit production costs.
As a result of the high purity profile, consistency, safety and
environment sustainability associated with Willow's manufacturing
technology, the Company is seeing strong demand developing for its
cannabinoids from a variety of consumer products companies.
A full description of Willow's third quarter 2020 results can be
found in Willow's unaudited condensed consolidated interim
financial statements and related management's discussion and
analysis which are available on SEDAR at www.sedar.com.
About Willow Biosciences Inc.
Willow is a Canadian biotechnology company based in Vancouver, British Columbia, that produces
high purity, plant-derived compounds that provide building blocks
for the global pharmaceutical, health and wellness, and consumer
packaged goods industries. Willow's current focus is in the
production of cannabinoids for the treatment for pain, anxiety,
obesity, brain disorders, among other significant indications.
Willow's science team has a proven track record of developing
manufacturing technologies for high purity compounds in pain and
cancer treatments. Willow's manufacturing process creates a
consistent, scalable and sustainable product that allows for the
discovery and development of new life changing drugs.
Forward-Looking Statements
This news release may include forward-looking statements
including opinions, assumptions, estimates and the Company's
assessment of future plans and operations, and, more particularly,
statements concerning: Willow's revised milestone projections,
including the timing and quantity of development scale-up
(including further pilot projects) and commercialization scale-up;
the timing of commercial sales and revenues resulting therefrom;
expected cost reductions from commencing commercial production;
discussions with potential customers (including the size of orders
therefrom), manufacturing partners and other key stakeholders;
timing for the selection of a manufacturing location and partner;
the ongoing COVID-19 outbreak and its impact on the Company; the
market size potential of the synthetic cannabinoid industry, the
demand for Willow's products and Willow's ability to capture market
share; Willow's entry into new global markets; and the business
plan of the Company, generally, including cannabinoid research and
production. When used in this news release, the words "will,"
"anticipate," "believe," "estimate," "expect," "intent," "may,"
"project," "should," and similar expressions are intended to be
among the statements that identify forward-looking statements. The
forward-looking statements are founded on the basis of expectations
and assumptions made by the Company which include, but are not
limited to: the success of Willow's strategic partnerships,
including the development of future strategic partnerships; the
financial strength of the Company; the ability of the Company to
fund its business plan using cash on hand and existing resources;
the market for Willow's products; the ability of the Company to
obtain and retain applicable licences; the ability of the Company
to obtain suitable manufacturing partners and other strategic
relationships; and the successful implementation of Willow's
production strategy, generally. Forward-looking statements are
subject to a wide range of risks and uncertainties, and although
the Company believes that the expectations represented by such
forward-looking statements are reasonable, there can be no
assurance that such expectations will be realized. Any number of
important factors could cause actual results to differ materially
from those in the forward-looking statements including, but not
limited to, risks associated with: the cannabinoid industry in
general; the success of the Company's research and development
strategies; infringement on intellectual property; failure to
benefit from partnerships or successfully integrate acquisitions;
actions and initiatives of federal and provincial governments and
changes to government policies and the execution and impact of
these actions, initiatives and policies; import/export and research
restrictions for cannabinoid-based operations; the size of the
medical-use and adult-use cannabinoid market; competition from
other industry participants; adverse U.S., Canadian and global
economic conditions; adverse global events and public-health
crises, including the current COVID-19 outbreak; failure to comply
with certain regulations; departure of key management personnel or
inability to attract and retain talent; and other factors more
fully described from time to time in the reports and filings made
by the Company with securities regulatory authorities. Please refer
to the AIF and the MD&A for additional risk factors relating to
Willow, which can be accessed either on Willow's website at
www.willowbio.com or under the Company's profile on
www.sedar.com.
Any financial outlook and future-oriented financial information
contained in this document regarding prospective financial
performance, financial position or cash flows is based on
assumptions about future events, including economic conditions and
proposed courses of action based on management's assessment of the
relevant information that is currently available. Projected
operational information contains forward-looking information and is
based on a number of material assumptions and factors, as are set
out above. These projections may also be considered to contain
future-oriented financial information or a financial outlook. The
actual results of the Company's operations for any period will
likely vary from the amounts set forth in these projections and
such variations may be material. Actual results will vary from
projected results. Readers are cautioned that any such financial
outlook and future-oriented financial information contained herein
should not be used for purposes other than those for which it is
disclosed herein.
The forward-looking statements contained in this news release
are made as of the date hereof and the Company does not undertake
any obligation to update publicly or to revise any of the included
forward-looking statements, except as required by applicable law.
The forward-looking statements contained herein are expressly
qualified by this cautionary statement.
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SOURCE Willow Biosciences Inc.