Khiron Life Sciences is continuing its efforts to focus on Colombia to continue to generate demand.
At the same time, the company is reducing non-core, cash-intensive activities. As part of this initiative, the company began wind-down of its cultivation and extraction operations in Colombia in early 2023 and has now ceased all its own upstream activities. As a result, the company has reduced the total direct labor headcount by more than 70% in Khiron Colombia SAS from June 2022 to April 2023, as well as a reduction in senior executive compensation and positions by more than 50%.
The company has entered into a partnership with an accredited 3rd Party contract manufacturing organization (CMO) in Colombia to outsource the production of Khiron-branded medical cannabis products. Under this agreement, Khiron's partner has: i) purchased Khiron's extraction and laboratory equipment, ii) stored the company's existing inventory of dried flower and full-spectrum extracts to manufacture the final product for the company. In addition, Khiron's partner will distribute products to Khiron and Zerenia's patients across Colombia. Through this partnership, Khiron will also be able to leverage the partner's established network of over 300 hospitals and pharmacies across Colombia to increase product sales.
Alvaro Torres, CEO of Khiron, comments: "Since we started Khiron, our core focus has always been to generate patient demand with a unique B2C business model centered around our clinics and selling products at high margins. Our long-term intention has never been to be fully vertically integrated, but this was necessary for the company to gain the first-mover advantage and needed to become a leader in Colombia and Latin America. With this and upcoming optimization initiatives, we continue to demonstrate our strict discipline on spending while ensuring a proper growth trajectory. The partnership with our CMO ensures complete regulatory compliance, the safety of our high-quality inventory, agile operations, and access to a strong network of pharmacies and clinics."
For more information:
Khiron Life Sciences Corp.
khiron.ca