Medipharm Labs and TerrAscend Corp Enter $27 Million Cannabis Distillate Agreement

Medipharm Labs (TSX: LABS) and TerrAscend Corp (CSE: TER) announced a significant transaction this morning, wherein Medipharm will supply a minimum of $27 million in cannabis distillate to TerrAscend over the next two years. The contract has the potential to expand to $192 million under certain conditions.

The cannabis distillate will be utilized by TerrAscend to produce branded products for the “rec 2.0” market, which includes items such as vapes and other concentrates. A series of branded products are expected to be released by TerrAscend Canada this fall.

The base agreement will see TerrAscend purchase a minimum of $27 million in cannabis distillate from Medipharm Labs in a 24 month period ending September 2021, with an option to acquire up to $105 million in distillate subject to availability of product. A one year extension also exists for the agreement, which has a minimum purchase value of $10 million in distillate. The extension comes with a right of first refusal for an additional $51 million in cannabis concentrate, subject to availability, for TerrAscend Corp.

The result of the numerous optional extensions and additional purchases is a contract that may be up to $192 million in value. However, the minimum purchases result in a contract that is $27 million in size as a base line.

The deal is the second significant supply agreement for Medipharm Labs announced as of late, following last weeks announcement of a second manufacturing agreement with that of Cronos Group.

Medipharm Labs closed yesterdays session at $4.77 on the Toronto Stock Exchange.


Information for this briefing was found via Sedar, Medipharm Labs and TerrAscend Corp. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

Four Countries Control the Fertilizer That Feeds the World | Sage Potash

$10,000 Gold Is Just A Question of Time | Florian Grummes

What Happens If Silver Finally Breaks $50? | Gary Thompson – Silver47

Recommended

Emerita Resources Expands El Cura Drill Program By 10,000 Metres As Deposit Remains Open For Expansion

ESGold Signs MOU For Tailings Project In Colombia With Grades Up To 42 g/t Gold, 280 g/t Silver

Related News

Medipharm Labs Sees CEO Pat McCutcheon Step Down From Role, Remain As Chairman

Medipharm Labs (TSX: LABS) this morning announced drastic changes to its leadership role, with the...

Thursday, December 10, 2020, 07:38:42 AM

TerrAscend Reports Q4 Revenues of $65.3 Million, Net Loss Of $109.3 Million

TerrAscend Corp (CSE: TER) this morning reported its fourth quarter and full year 2020 financial...

Tuesday, March 23, 2021, 07:58:44 AM

Canaccord: 2020 To Be Transition Year For Medipharm Labs

Last week, Medipharm Labs (TSX: LABS) reported their second-quarter earnings. Revenue came in at $13.9...

Saturday, August 22, 2020, 01:38:00 PM

Medipharm Labs Sees Revenues Crater 65.8% Quarter Over Quarter

Medipharm Labs (TSX: LABS) has seen its revenues absolutely implode in a single quarter. The...

Thursday, June 18, 2020, 08:35:37 AM

Medipharm Secures $37.8 Million In Convertible Notes

Medipharm Labs (TSX: LABS) this morning announced that it has secured aggregate gross proceeds of...

Monday, June 8, 2020, 08:55:34 AM