Cronos Group, Inc. (TSX: CRON) and Ginkgo Bioworks announced this morning that its partnership has achieved the productivity target for cannabigerolic acid (CBGA). The milestone is part of the two companies’ set of productivity targets in aiming to produce eight cultured cannabinoids.
This achievement sets the ground for Cronos Group’s planned cannabigerol product launch this fall. The cannabis firm was able to take advantage Ginkgo Bioworks’ platform for organism design and development to achieve commercial-scale production for the cannabinoid.
“Ginkgo’s platform enables companies across a multitude of industries to reach their customers with better products. We are proud to use our combined capabilities to make the benefits of cannabinoids more accessible to consumers,” said Cronos Group President and CEO Kurt Schmidt.
The partnership between the two companies was launched in 2018 with the goal of accessing rare molecules in the cannabis plant to develop eight molecules. Cronos Group provides its expertise on cannabis biological structure while Ginkgo Bioworks brings to the table its knowledge on designing microorganisms for the production of cultured products.
With the achievement of the final productivity target for CBGA, Cronos Group is expected to issue a milestone payment of approximately 1.5 million common shares.
Earlier this month, the cannabinoid company posted -101% gross margin for Q2 2021, leading Canaccord Genuity to lower its 12-month price target for the company down to $7.00. Meanwhile, Ginkgo Bioworks announced in May 2021 its reverse merger deal with Soaring Eagle Acquisition Corp. (Nasdaq: SRNG).
Cronos Group last traded at $7.90 on the TSX.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization unless otherwise mentioned. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.