DanCann Pharma has just completed its first successful production run of biomaterial a few weeks after the company carried out a directed issue of shares and at the same time received loan capital of a double-digit DKK million amount.
In April, DanCann Pharma's production facilities BIOTECH PHARM1 were fully established and in June, the company activated the first cultivation activities in the new facility following a prior selection of genetics. After eight weeks, the first batch has just been harvested and made ready for further processing. The drying phase is followed by a comprehensive analysis of the result as well as tests for various microbiological conditions, including pesticides.
This batch is the first of 13 planned training batches that DanCann Pharma will implement in BIOTECH PHARM1 for the remainder of 2021. The process is a significant milestone towards the final approval of the facilities for production of cannabis biomaterial, also called a bulk product. Morten Martinsen, who is COO at DanCann Pharma, is very satisfied with the preliminary process:
"This and the upcoming training batches are important steps on our way to achieving our production goals. We can now get actual data for validation of processes, equipment, and growth conditions. We also get the opportunity to continuously optimize the process parameters in our advanced production facilities - and we will be able to evaluate the cannabis genetics that the analysis results show us. The whole purpose of the implementation of the many training batches is ultimately to ensure uniformity and consistency in the products, so that we can maximize our output for raw biomaterials," he says and thanks his production team for an extraordinarily great effort throughout the process.
Without yet knowing the analysis results, Morten Martinsen assesses that the process in connection with the first production has been very close to optimal. In the temperature- and moisture-sensitive development facilities, the cannabis genetics thrive perfectly, and it has been shown that it has only been necessary to use about one-sixth of the expected amount of fertilizer and nutrients. At the same time, water consumption has been significantly lower than anticipated. The high-tech set up in BIOTECH PHARM1 thus works as intended - and more sustainably - which has helped to give the Company's management an incentive and indication for further acceleration of the Company’s development.
"On 27 July, we carried out a directed issue of shares and at the same time received loan capital of a double-digit DKK million amount. It significantly strengthens our financial position and enables us to accelerate the establishment of Phase 2 of BIOTECH PHARM1. This means that we are now embarking on significantly expanding our production capacity. We believe that the right time for further investments in production facilities is now, as there is a great demand for cannabis biomaterial, especially in the German market, and especially THC-potent biomaterials, also called Tetrahydrocannabinol, which is one of the active substances among other is extracted from cannabis," says Jeppe Krog Rasmussen, CEO of DanCann Pharma.
DanCann Pharma's goal is to be able to have a capacity that can annually supply approximately 2.5 tons of dried biomaterial at competitive prices. The company will thus be able to supply more than 25% of the current German market with biomaterial products.
"The positive development in DanCann Pharma's activities, both financially and operationally, means that we can start production of the biomaterial to a significantly greater extent than previously expected. In fact, the goal now is to increase capacity by a factor of 10x, which will move the Company to a whole new level in the market," says Jeppe Krog Rasmussen.
Initially, however, this applies to the results of the recently completed training batch. After trimming and a week's stay in the drying room, the biomaterial must be sent for analysis, after which another week passes before the results are available.
"The first batch is of course something special. A milestone that is definitely worth marking. Now we're really getting started with actual products, but in fact I am most looking forward to the subsequent batches, so we can see if we succeed in hitting the uniformity of the product, which is the ultimate condition for us to be successful. So far, it looks really good," concludes Morten Martinsen.
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