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November 26, 2022


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Heritage Cannabis (CANN.C) to develop vape oil with Sugarbud’s biomass

On August 27, 2020 Heritage Cannabis (CANN.C) announced that its subsidiary Voyage Cannabis has begun development of full spectrum cannabis vape cartridges for Sugarbud Craft Growers (SUGR.V).

Heritage owns two licensed Canadian producers, Voyage Cannabis and CannaCure, both of which also have industrial hemp licences.

Working under these licences, Heritage has two additional subsidiaries, a medical services division (cannabis-based medical solutions) and Purefarma Solutions (extraction services).

Four months ago, Heritage announced Voyage had been given a cannabis oil sales license by Health Canada.

In May 2020 CANN announced that it will be launching its own series of formulated extraction products under the brand name Purefarma.”

Based in Alberta, Sugarbud is a $14 million Alberta-based craft cannabis company “focused on the cultivation and production of superior, select-batch, craft cannabis products.”

This development deal will operate under the terms of a previously announced agreement for contract manufacturing services.

The input biomass used in extraction and production will be high quality cannabis grown and supplied by Sugarbud.

“As Sugarbud’s manufacturing partner, Heritage will produce a unique full spectrum cannabis oil product using no harmful additives, flavours or carrier oils,” stated Clint Sharples, CEO of Heritage. “As we continue the launch of our own products the contract manufacturing business remains an important part of our strategy and future revenue stream.”

“As we prepare to launch our cannabis 2.0 products, it was important for us to select a manufacturing partner with a track record of producing products with consistency in the strain profile between the cannabis input material and the oil being produced,” stated John Kondrosky, CEO of Sugarbud. “We chose Heritage for this reason and for their ability to produce high-demand full spectrum cannabis oil products using no harmful additives, flavours or carrier oils.”

The Sugarbud vape oil collaboration isn’t the only deal CANN has cooking.

On August 18, 2020 CANN announced that it has entered into a two-year J.V with Cannahive to produce cannabis infused edible products under Heritage’s brands to be sold to the provincial and territorial boards as well as licensed retailers in Canada.

Cannahive provides experienced manufacturing management services and will contribute a portfolio of intellectual property (IP) and processing patents for pharma-grade commercial manufacturing of edible cannabis products.

The J.V. will operate at CannaCure, Heritage’s existing Health Canada licensed facility in Fort Erie, Ontario.

CannaCure will provide the facilities, warehousing, quality assurance and other required services.

Cannahive will provide production and packaging equipment and ongoing equipment maintenance. Proceeds from the J.V. will be equally shared between the parties after the payment of all direct costs incurred.

The J.V. will utilize Cannahive’s formulations for the production of gummies and chocolates, while CannaCure will provide the cannabis oil for all products.

“We are excited to be launching our edibles product vertical with the backing of the Cannahive team who has the talent and experience to make this next phase of Heritage’s strategy successful,” stated Sharples.

The rate of the deal-making can be dizzying, but there is method to CANN’s madness.

Heritage is positioning itself to radically expand its sales territory.

Earlier this month, CANN announced that it has agreed to buy Opticann – a “Colorado-based oral and topical cannabinoid company with the rights to exclusively sell CBD (cannabidiol) and CBG (cannabigerol) products made with the patented VESIsorb drug delivery system for optimized absorption and stability”.

Opticann has a supply and distribution agreement with Geocann LLC, a global cannabis organization with the exclusive worldwide rights to the patented VESIsorb delivery technology for cannabinoids, terpenes and flavonoid formulations.

Opticann has the right to brand and market a select portfolio of VESIsorb formulated oral and topical CBD and CBG products to major U.S. retailers including CVS, Walgreens, Rite-Aid and Walmart, among others.

VESIsorb dramatically improves the stability and absorption (bioavailability) of natural ingredients like cannabinoids, and is backed by a robust body of supporting scientific evidence spanning several decades.

In pharmacology, bioavailability is the fraction (%) of an drug that reaches the systemic circulation.

When a medication is intravenously (directly into the blood stream) its bioavailability is 100%.  When a medication is via other methods, its bioavailability is lower due to intestinal absorption and other metabolic inefficiencies.

The ability to increase bioavailability is a major obsession of the $1.3 trillion global pharmaceutical industry.

According to the peer-reviewed journal, Molecules, the VESIsorb technology delivered higher total absorption (a 440% increase in maximum plasma CBD concentration), and a 285% increase in total CBD exposure over eight hours.

“Heritage has done a host of deals with partners, suppliers, vendors, and acquisitions, that have brought them licenses and steady product supply and got them on shelves fast,” stated Equity Guru’s Chris Parry on February 8, 2020, “Heritage’s first revenues EVER came through in this past quarter at $3.56 million. We’re used to small cannabis outfits coming out of the blocks with a digit less than that”.

Voyage will produce vape cartridges for Sugarbud, with all formulation, preparation and packaging procedures performed in compliance with applicable regulations.

Sugarbud intends to bring the products to market in Q4 2020

– Lukas Kane

Full Disclosure: Heritage Cannabis is an Equity Guru marketing client.

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