Investor Presentation January/February 2018 TSX-V: ABCN 1
Disclaimer Certain information included in this presentation, which was prepared on January 8, 2018 speaks only as of such date, including any information as to future financial or operating performance and other statements that express expectations or estimates of the future performance of ABcann Global Corporation and its subsidiaries (collectively, ABcann or the Company ), constitute forward-looking statements. The words may, will, could, should, would, suspect, outlook, believe, plan, anticipate, estimate, expect, intend, forecast, objective and continue (or the negative thereof), and words and expressions of similar import, are intended to identify forward-looking statements. Forward-looking statements in this presentation include statements regarding: potential health benefits of cannabis; expected future growth of the regulated cannabis market; the expected future evolution of the cannabis industry, including w respect of consumer touch, branding and promotion; ABcann s product differentiation; expected market growth and market scope; ABcann s proposed capacity expansion plan; ABcann s proposed acquisition of Harvest Medicine Inc., the expected benefits of such acquisition, and the expected increase in clinic locations and patients; ABcann s proposed brands; the expected success and timing of ABcann s product development activities; ABcann s proposed growth plan, including in respect of product lines, geographic expansion, building of capabilities and capacity and development of key strategies; and ABcann s potential future revenue drivers. In addition, this presentation contains future oriented financial information ( FOFI ), including statements regarding expected capital expenditures and revenue projections, which speaks only as of the date of this presentation. The FOFI has been prepared by management based on assumptions including that the Company will be able to obtain necessary approvals to proceed with its business plan; that the Company will follow regulatory requirements, and that management will be able to execute the Company s business plan as expected. FOFI is intended to provide prospective investors with an outlook on the Company s activities and information pertaining to the Company s longer-term objectives, and may not be appropriate for other purposes. By their very nature, forward-looking statements and FOFI involve inherent risks and uncertainties, both general and specific, which give rise to the possibility that forward-looking statements and FOFI will not be achieved. Certain material factors or assumptions are applied in FOFI and making forward-looking statements and FOFI, and actual results may differ materially from those expressed or implied in such statements. The Company cautions readers not to place undue reliance on these statements, as many important factors, many of which are beyond the Company s control, could cause actual results to differ from the expectations expressed in such forward-looking statements or FOFI. These factors include, but are not limited to, risks related to: the future evolution of the regulated cannabis market; industry, competition, customer, legal, taxation and accounting matters; adverse industry events; general economic conditions; loss of potential markets; future legislative and regulatory developments; inability to access sufficient capital in order to pursue business objectives on favourable terms or at all; the ability of the Company to implement its business plan; the risk that the Company will not obtain necessary regulatory approvals for the acquisition of Harvest Medicine Inc.; competition; product liability; crop failure; and other factors beyond the control of the Company. The foregoing lists of factors that may be affect future results is not exhaustive. When reviewing the Company s forward-looking statements and FOFI, readers should carefully consider the foregoing factors and other uncertainties and potential events. The Company does not intend, and disclaims any obligation, to update any forward-looking statements or FOFI, whether written or oral, or whether because of new information or otherwise, except as may be required by law. This presentation also includes information obtained by the Company from third parties, including, but not limited to, information regarding market data and the potential health benefits of cannabis. The Company believes such information to be accurate but has not independently verified such information. There is a risk that the assumptions made and conclusions drawn by the Company based on such third-party information are not accurate. Further, Health Canada has advised that cannabis is not an approved therapeutic drug in Canada and that, at present, while pointing to some potential therapeutic benefits, the scientific evidence does not establish the safety and efficacy of cannabis to the extent required by the Food and Drug Regulations for marketed drugs in Canada unless a specific cannabis product has received a notice of compliance from Health Canada and a Drug Identification Number (DIN). 2
Cannabis Industry Overview Cannabis has great therapeutic potential and has been used for centuries for medicinal purposes. Over 100 Cannabinoids Identified: Best known cannabinoids: THC and CBD Sourced botanically (complex process) or synthetically (simple process) Effective as stand-alone therapies or in combination (the entourage effect ) Brightfield Group predicts the regulated market will grow globally to over $40B by 2021 - Forbes Magazine (Nov 2017) Significant Health Benefits: Over a thousand medical papers have been published related to cannabinoid use Pain, Multiple Sclerosis, Spasticity, Epilepsy, Parkinson s Disease Cancer treatment, Cancer pain, Cancerinduced Nausea and Vomiting (CINV) Anti-inflammatory (e.g. Inflammatory Bowel Disease, Arthritis) Dermatological Indications (e.g. psoriasis) Psychiatric Disorders (e.g. Anxiety, PTSD, Sleep, Addiction) 3
Cannabis Industry Evolution Range of Possible Outcomes Consumer Touch Branding & Promotion Product Differentiation Market Growth Market Scope Government Restricted Commodity Static Local Private Creative Innovative Legalized Global Improved Industry Profitability 4
Business Foundation VISION To be a top 5 cannabis company recognized for high-quality, trusted and innovative products and services A Balance of Entrepreneurial Spirit & Corporate Discipline MISSION To supply high-quality, trusted and innovative cannabis products and services that make people feel better. VALUES Creativity Accountability Respect Excellence Speed 5
Revenue Projections Presence established in Germany, Australia and Israel 30% 20% 50% $500M Revenue * 75 Tons Volume * $6.67 Gram Net Price * 2017 2019 2021+ * Management forecast see Disclaimer on slide 2 $1M ABcann Revenue $500M $2B Global Market Opportunity $40B 6
ABcann Global in 60 Seconds Experienced Leadership Proprietary Technology Capacity Expansion Go-to-Market Initiatives Customer-Focused Culture Local & Global Focus 7
Barry Fishman Proven Business Builder Led Merus Labs (TSX, NASDAQ) for 3 years resulting in a compound annual growth rate above 50% and culminating in a cash sale for $342 million in July 2017 Former CEO of Teva Canada ~$1B Revenue, ~5 billion capsules/tablets of GMP production - Generics and Specialty Pharmaceuticals Experience serving as a Director of public companies in the Cannabis Industry Past Chair of the Canadian Generic Manufacturers Association - a $5 billion dollar industry Track record of success as the CEO of 3 complex, highly-regulated organizations with international operations Significant deal-making, M&A and capital raising experience 8
Outstanding Board & Advisors Former Canadian CEOs: Capital Market Experts: Leading Scientists: 9
Precisely Controlled Cultivation Every variable is precisely monitored and controlled to produce high quality, consistent cannabis product Air quality Light spectrum and cycles CO 2 levels Temp. and humidity Oxygen levels Plant nutrition Water quality and volume Climate controlled curing process Organically Grown Pesticide Free High-Yielding Exclusive Cannabis Partnership Advanced Technology Computer-Controlled Pharmaceutical-Grade 10
Capacity Expansion Plan Well-capitalized balance sheet with $70M in cash to fund future growth 3rd Party Supply 35 tons Napanee 17 tons Domestic Greenhouse 23 tons Capacity Phases (Tons at Year End) Phase 1 (2018): 15 Phase 2 (2019): 35 Phase 3 (2020): 55 Phase 4 (2021): 75 75 tons in 2021 = $500 million in revenue 11
Go-to-Market Differentiators Medical Science Premium Classic Medical Clinics (scalable expansion) Innovative Therapeutics (indoor controlled & GMP) Craft Organic (indoor controlled grow) Traditional Line (3 rd party & domestic greenhouse) Regulated cannabis is a disruptive global industry and companies that continuously innovate will emerge as winners 12
Medical Cannabis Clinic Acquisition Education focused, patient-centric, cannabis discovery center and clinic Acquiring over 1,200 new patients monthly from a single location One of Canada s most successful and fastest growing cannabis clinics Expand the highly-rated and scalable initial location to add over 15,000 active patients per year 13
Product Development Roadmap Dried cannabis hand-trimmed buds, Dried flower patient ready Transdermal, sublingual tabs, essential oils 2016/2017 H1/18 H2/18 2019+ Oils, caps and sprays Inhaled, softgels, combo products, edibles, beverages A robust pipeline of products has been approved for development 14
Growth Plan Phase 1 Phase 2 Building the platform Growth and scale 2014 2015 2016 2017 2018 2019 2020 2021+ 1 Creating the Foundation Pilot scale capabilities Initial product line Improved balance sheet Strengthened team 2 Scaling-up for growth Product line expansion Geographic expansion Build capabilities and capacity Develop key strategic partners 15
Customer-Focused Culture Capacity & Capability Key driver to maximize shareholder value Quality & Cost Leadership & Partnerships Customer Focused Science & Innovation Discipline & Speed Products & Service A lean integrated model ensures optimal business results Creating the right culture is an imperative A trusted source for medical and scientific information on cannabis Data and insights will drive innovative products and services 16
Geographic Expansion In February 2016 ABcann started selling medicinal cannabis in Canada. ABcann Global is well positioned to grow internationally. In January 2018 ABcann was granted an Australian Import License Domestic Medical Foothold established in Canada, Germany, Australia and Israel 17
Financial Summary As of January 2, 2018 Millions (CAD) Current Common Shares Outstanding 156.0 Current Debentures (1.39 w/average exercise price) 22.3 Warrants (0.51 w/average exercise price) 15.6 Options/RSU s 13.8 Total Issued and Outstanding 207.7 Daily Volume 2.0 Market Cap 273.0 Cash Balance $70.0 18
Our Real Competitive Advantage Talented Team Entrepreneurial Spirit Nimble. Responsive. Focused. Thank You! 19
Contact Information TSX-V: ABCN Headquarters 126 Vanluven Road Napanee, ON K7R 3L2 Canada Chief Financial Officer Michael Bumby 905.726.0995 michael.bumby@abcannglobal.com Chief Executive Officer Barry Fishman 416.662.5509 barry.fishman@abcannglobal.com 20
Appendix Team Bios 21
Executive Team Barry Fishman Chief Executive Officer Dr. Michael Bumby Chief Financial Officer Sung Kang Chief Marketing Officer Andrew LaCroix VP, International and General Counsel 20 years of experience as a business leader, most recently as CEO of international specialty pharmaceutical company Merus Labs. Previously served as CEO of both Teva Canada and Taro Canada, and was VP Marketing at Eli Lilly Canada and past Chair of the Canadian Generic Manufacturers Association. 20 years of experience in pharmaceuticals, previously CFO of three publicly held Canadian companies - most recently as CFO of Merus Lab. Key roles at Eli Lilly, including leading international BD activities for early and late stage assets at Lilly s Global Headquarters, and serving as regional CFO in Prague. Over 15 years of marketing experience, has held senior marketing leadership roles at companies including General Mills and Novartis Consumer. Formerly the Head of Marketing for the Mike s Beverage Company, a Division of Labatt Breweries. Over 20 years of legal experience starting at Stikeman Elliott and then managing his own practice. Andrew has been involved with ABcann since its inception as General Counsel, drafting and submitting the initial Health Canada license application 22
Executive Team (continued) Jenny Guan VP, Napanee Operations Neil Kapp VP, Business Development Randy Uens VP, Product Development John Molloy Executive Consultant An initial team member at ABcann with over 15 years experience in various key leadership roles in business operations and finance 30 years managing businesses in commercial development and recreation. Previously served as a managing partner and CFO of several companies. A serial entrepreneur who successfully developed the Rhinobag/Bagster, an alternative to using metal waste bins, and sold to Waste Management Inc. Former CEO of PARTEQ Innovations at Queen's University. Led to the formation of 48 companies based on Queen's research. 23
Board of Directors Paul Lucas (Chairman) Former CEO of Glaxo Canada with significant board experience in for-profit & non-profit sectors Ken Clement Visionary founder of ABcann with a large network of global cannabis contacts Daryl Kramp Former Member of Parliament, Municipal Counsellor, and successful entrepreneur Andrew LaCroix 20 Years of legal experience starting at Stikeman Elliott Barry Fishman (CEO) Former CEO of Merus Labs, Teva Canada and Taro Canada, Vice President of Marketing at Eli Lilly Canada Aaron Keay Creative capital markets expert with deep experience M&A and take-public transactions John Easson Corporate finance and M&A Advisor experiences ranging from start-ups to Canada s largest public companies Richard Fitzgerald Former CEO & Chairman of Diageo Canada broad leadership experience in alcohol and tobacco industries 24
Advisory Board Raphael Mechoulam, PhD Donald I. Abrams, MD Mike Dixon, PhD W. Brett Wilson The world-renowned cannabis scientist that discovered tetrahydrocannabinol (THC) and cannabidiol (CBD) Co-Author of The Chapter Cannabinoids and Cancer in the Oxford University Press Leading plant scientist specializing in controlled environmental systems Successful investor, Dragon on Dragon s Den, Order of Canada recipient Chris Hudalla, PhD Michael E. Shannon, MD Paul Daeninck, MD Recognized Leader in analytical chemistry and method development Accomplished Medical Advisor and Former Deputy Surgeon General for Canada Medical Oncologist and Palliative Medicine Consultant with Cancer Care Manitoba 25