Organigram Invests Additional $2.5 Mln In Hyasynth Biologicals
Organigram Holdings Inc., the parent company of Canada-based cannabis producer Organigram Inc., said it has invested an additional $2.5 million in Hyasynth Biologicals Inc., a Canada-based private biotechnology company that focuses on the manufacture of cannabinoids using biosynthesis.
Organigram’s additional investment comes as Hyasynth made the first sale of CBDa produced and extracted from yeast. CBDa is the naturally occurring form of cannabidiol or CBD, which is converted to CBD in processing. CBD is a chemical in the marijuana plant often used for medicinal purposes.
Biosynthesis is most commonly known as the primary production methodology for insulin used in the treatment of diabetes. Unlike chemical synthesis or agriculture methods, biosynthesis results in products and final ingredients that are pesticide-free and are based on natural ingredients.
Organigram noted that Hyasynth’s biosynthesis process uses patent-pending yeast strains and enzymes to produce pure cannabinoids without depending on cannabis plants.
In addition to its investment in Hyasynth, Organigram has the right to buy potentially all of Hyasynth’s cannabinoid or cannabinoid-related production at a 10 percent discount to the wholesale market price for a ten-year period following Hyasynth’s commencement of commercial production.
In September 2018, Organigram initially invested $5 million in Hyasynth in accordance with the terms of a debenture purchase agreement between the two companies. The latest $2.5 million investment marks the second of three tranches outlined in the agreement and brings Organigram’s total investment in Hyasynth to $7.5 million.
Organigram has a right to acquire the remaining $2.5 million of convertible secured debentures, which would bring its total investment in Hyasynth to $10 million upon Hyansynth’s achievement of another designated milestone and its with other terms and conditions.
In addition to the major cannabinoids such as CBD and tetrahydrocannabinol or THC, Hyasynth has submitted patent applications for the production of minor cannabinoids that are found in very low levels in cannabis plants and for which traditional cultivation is cost prohibitive.
Organigram also announced executive changes. The company said that Julie Chamberlain, Vice President of Marketing will be leaving the company effective November 6, 2020 for a General Manager role in a non-competing industry. Eric Williams, Director of Brand, will assume many of Julie’s responsibilities within the marketing team on an interim basis.
Cameron Bishop, Vice President of Public Affairs and Stakeholder Relations, has also left Organigram to pursue other interests as a consultant.
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