Durrant Pate/Contributor

Apollon Formularies, a UK-based international pharmaceutical company, is acquiring local medical cannabis company, Citiva Jamaica LLC, through its domestic affiliate, Apollon Formularies Jamaica.

The parties have reached a sale agreement, which will be done through a part-cash and part shares transaction. In consideration for the acquisition, Apollon will pay US$60,000 cash as well as issue 18,465,910 new ordinary shares in Apollon to CJL Holdings, a US-based group, which owns Citiva Jamaica.

The shares will be subject to a nine-month, orderly market, lock-in agreement with one-third of the shares becoming unrestricted after each three-month period from the transaction date. Following completion of the acquisition, CJL Holdings will hold approximately 2.39 per cent of Apollon’s enlarged, issued share capital.

Terms of the sale agreement

Under the terms of the arrangement, Apollon Jamaica will acquire a 96 per cent ownership of Citiva Jamaica (in stages) with the University of West Indies (UWI) Mona campus potentially holding 10 per cent, subject to the company offering them an increase from four per cent to 10 per cent. Citiva is based in the Medical School of UWI.

The deal is expected to create significant revenue growth for the company over the next 12 months. The acquisition of Citiva Jamaica, originally started by Josh Stanley, gives Apollon Jamaica ownership of a world-class research, cultivation, manufacturing and processing facility affiliated with the Medical School of UWI.

The acquisition delivers on Apollon’s previously stated desire to become a vertically integrated, globally recognised medical cannabis business providing treatments and medicines for various human afflictions with a specific focus on cancer.

Transaction highlights:

• Apollon Jamaica has acquired a university-affiliated, world-class research, cultivation, manufacturing, and processing facility for medical-grade cannabis.
• Citiva Jamaica’s facilities give the company a clear path to large-scale manufacturing of high-quality medical grade, full and broad-spectrum oils with GMP certification for use in its patent-protected cancer, chronic pain and inflammation treatments, including for international marketing and distribution.
• Importantly, Apollon can now achieve the final approval step with the Ministry of Health and Wellness in Jamaica to distribute its patented cannabis-based medical products into the Jamaican national pharmacy and dispensary network, the broader Caribbean Community (CARICOM), the Southern African Development Community (SADC) as well as other targeted markets globally.
• The Citiva Jamaica facility comes with a Cannabis License Authority-issued cultivation licence, extensive indoor cultivation facilities with cannabis cultivars currently growing and nearing harvest time, approximately 30-35 kilograms of processed full-spectrum medical cannabis oil, and processing equipment.

Along with an established manufacturing facility, Apollon Jamaica will acquire Citiva Jamaica’s overall business model which, in addition to existing processing and cultivation facilities, also provides cannabinoid product development and treatment programmes to target specific illnesses and diseases. These include but are not limited to certain cancers and childhood epilepsy.

Apollon Jamaica will also acquire a CLA-issued cultivation licence and associated infrastructure including existing product stock and soon-to-be harvested crops. Following the acquisition, Apollon Jamaica will finalize minor local permits required to achieve full GMP certification.

These will allow Apollon Jamaica to export its products globally as well as expand into the national pharmacy and dispensary network in Jamaica, thereby providing significant revenue streams for the company.

Principals commenting on the acquisition

Stephen Barnhill Jnr., Jamaican and North American chief operating officer of Apollon Formularies, hailed the move saying, “This acquisition of Citiva Jamaica is a transformative achievement and will allow access to global markets for our trademarked and patent-protected formulations; expanded university-affiliated research and development collaborations, including formulation discovery and clinical trials and provides immediate licensed cultivation for Apollon specific cultivars and strains.”

In addition, he stated that this acquisition significantly accelerates the goals of the Jamaican operations allowing the following accomplishments by year-end.

These include initiating human clinical trials, having products approved by the Ministry of Health and sold in Jamaican pharmacies nationwide, and establishing significant global distribution for its medical cannabis.

David Palmieri, director of operations at Citiva Jamaica, commented, “we are proud of the progress we have made since signing the collaboration agreement with UWI in 2015. We’ve worked extremely hard to get everything in place, and I’m pleased that Apollon Formularies will continue upgrading the facilities to achieve GMP certification which will further strengthen the Jamaican medical cannabis industry and help promote it worldwide, we look forward to being a shareholder in this very exciting company.”