PharmaCielo (PCLO.V) has completed initial shipments of its active pharmaceutical ingredients (APIs) to two customers in Brazil following the confirmation of the Company’s compliance with Brazilian Good Manufacturing Practices (GMP) standards.
“These initial precommercial shipments, and the GMP confirmation that was conducted by one of the companies, provide further confirmation of Pharmacielo’s product quality and the excellence of its production processes…Further, these relationships demonstrate that larger and more sophisticated end-product producers are actively coming to market looking for a reliable source of high-quality extracts and formulation expertise. Pharmacielo is positioned to supply these customers with consistent quality, at industry-leading scale. We look forward to working with both customers over the next several months as their teams integrate our APIs into their custom formulations,” said Henning von Koss, chief executive officer of Pharmacielo.
Although cannabis restrictions remain tight in Brazil, the country’s medical cannabis sector has made considerable progress. In 2019, the National Health Surveillance’s (ANVISA) RDC 327 regulation permitted cannabis products to be sold in Brazilian pharmacies. More recently, in 2020 the amount of prescriptions in Brazil was estimated to be over 14,500, marking a 135% increased compared to 2019 according to Prohibition Partners. With this in mind, PharmaCielo has positioned itself comfortably as a supplier for two large Brazilian pharmaceuticals companies.
The Company’s first shipment was received by one of Brazil’s largest phyto-therapeutics companies. For context, phyto-therapy refers to the study and use of natural extracts as medicine or health-promoting agents. Putting two and two together, it makes sense that a phyto-therapeutics company would have an interest in a medicinal-grade cannabis products company like PharmaCielo. The company plans on integrating PharmaCielo’s APIs into custom formulations for current and future product registry and sales in the local market. The second shipment arrived at a large pharmaceuticals company that already has a cannabidiol product in-market. However, this company intends to use PharmaCielo as a primary supplier.
For the 12 months ended June 30, 2021, PharmaCielo had high expectations of $37.9 million in revenues in anticipation of sales under supply agreements with XPhyto and CBD Export. The Company has since withdrawn its expectations following a series of events including a delay related to the completion of the Company’s Rionegro Processing and Extraction Centre. Moreover, a delay in PharmaCielo’s production of EU-GMP compliant product postponed any meaningful commercial activity, serving as another swift punch to the Company’s gut or rather, its pockets.
PharmaCielo’s share price opened at $1.50 and is currently trading at $1.42 as of 1:48PM ET. This indicates that the Company’s stock performance has dipped following the latest news.