IN V ESTOR P RE S E N TAT I O N Q 4 2 0 1 6 TM HEALTH - - PowerPoint PPT Presentation

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IN V ESTOR P RE S E N TAT I O N Q 4 2 0 1 6 TM HEALTH THERAPEUTICS ENHANCING HEALTH THROUGH CANNABIS SCIENCE T S X . V: E M H WWW.EMERALD.CARE D I S C L A I M E R THE STATEMENTS MADE IN THIS PRESENTATION MAY INCLUDE FORWARD-LOOKING


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SLIDE 1

WWW.EMERALD.CARE

ENHANCING HEALTH THROUGH CANNABIS SCIENCE

TM

HEALTH THERAPEUTICS

IN V ESTOR P RE S E N TAT I O N Q 4 2 0 1 6

T S X . V: E M H

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SLIDE 2

THE STATEMENTS MADE IN THIS PRESENTATION MAY INCLUDE FORWARD-LOOKING STATEMENTS REGARDING THE FUTURE OPERATIONS, OPPORTUNITIES OR FINANCIAL PERFORMANCE OF EMERALD HEALTH THERAPEUTICS (THE “COMPANY”). FORWARD LOOKING STATEMENTS INCLUDE THE ESTIMATED INCREASE IN THE COMPANY’S PRODUCTION SQUARE FOOTAGE; INCREASES IN THE COMPANY’S PRODUCTION; THE LEGALIZATION OF RECREATIONAL MARIHUANA; THE SIZE OF THE MEDICAL MARIHUANA MARKET AND THE RECREATIONAL MARIHUANA MARKET; THE COMPANY’S EXPANSION GOALS INCLUDING SCALABILITY, INCREASES IN SQUARE FOOTAGE, PRODUCTION AND REVENUE; THE COMPANY’S POSITION IN THE MARIHUANA MARKET IN RESPECT OF DEMAND AND COMPETITION; THE COMPANY BECOMING A LEADING BRAND IN CANNABIS-BASED PRODUCTS; AND THE COMPANY’S NEAR TO LONG TERM GOALS INCLUDING INCREASES IN PATIENT ACQUISITION, FACILITY EXPANSION, CLINICAL TRIALS AND PRODUCT DEVELOPMENT AS WELL AS MARKET CAPTURE, REVENUE AND CONSOLIDATION OF THE MARIHUANA MARKET. THESE FORWARD-LOOKING STATEMENTS ARE ONLY ESTIMATIONS BASED UPON THE INFORMATION AVAILABLE TO EMERALD HEALTH THERAPEUTICS, AS OF THE DATE OF THIS PRESENTATION. EXCEPT AS REQUIRED BY LAW, WE EXPRESSLY DISCLAIM ANY RESPONSIBILITY TO PUBLICLY UPDATE OR REVISE OUR FORWARD-LOOKING STATEMENTS, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE. THUS, THE FORWARD-LOOKING STATEMENTS HEREIN INVOLVE KNOWN AND UNKNOWN RISKS AND UNCERTAINTIES SUCH THAT ACTUAL FUTURE OPERATIONS, OPPORTUNITIES OR FINANCIAL PERFORMANCE MAY DIFFER MATERIALLY FROM THESE FORWARD-LOOKING STATEMENTS.

D I S C L A I M E R

THESE RISKS AND UNCERTAINTIES RELATE TO, AMONG OTHER THINGS, CHANGES IN LAWS, REGULATIONS AND GUIDELINES RELATING TO MEDICAL MARIHUANA AND THE POSSIBLE LEGALIZATION OF MARIHUANA BY THE FEDERAL GOVERNMENT; CHANGES IN GOVERNMENT; CHANGES IN GOVERNMENTAL POLICY; THE CONTINUED AVAILABILITY OF CAPITAL FINANCING AND GENERAL ECONOMIC, MARKET OR BUSINESS CONDITIONS; RELIANCE ON MANAGEMENT; THE INABILITY OF THE COMPANY TO EXPAND ITS CURRENT FACILITY OR OBTAIN ADDITIONAL FACILITY SPACE; FAILURE TO OBTAIN APPROVAL BY HEALTH CANADA FOR THE COMPANY TO INCREASE PRODUCTION AND PRODUCTION SQUARE FOOTAGE; UNFAVOURABLE PUBLICITY OR CONSUMER PERCEPTION OF THE MEDICAL MARIHUANA INDUSTRY; THE IMPACT OF ANY NEGATIVE SCIENTIFIC STUDIES ON THE EFFECTS OF CANNABIS; THE GROWTH IN THE MEDICAL AND RECREATIONAL MARIHUANA MARKETS BEING LESS THAN ANTICIPATED; INCREASED COMPETITION IN THE MARKET PLACE; THE COMPANY’S ABILITY TO MEET ITS NEAR AND LONG-TERM GOALS; AND THE COMPANY’S ABILITY TO RETAIN A COMPETITIVE ADVANTAGE IF MARIHUANA IS LEGALIZED AS WELL AS THE RISK FACTORS SET OUT IN THE COMPANY’S ANNUAL INFORMATION FORM AND OTHER PUBLICLY FILED DISCLOSURE DOCUMENTS. UNDUE RELIANCE SHOULD NOT BE PLACED ON FORWARD LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE HEREOF. ALL FORWARD-LOOKING STATEMENTS CONTAINED HEREIN ARE QUALIFIED IN THEIR ENTIRETY BY THE FOREGOING CAUTIONARY STATEMENTS. RELIANCE SHOULD NOT BE PLACED ON FORWARD LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE HEREOF. . WWW.EMERALD.CARE

2 / 18 | Q4 2016

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SLIDE 3

WWW.EMERALD.CARE

BIG 5

CANADIAN CANNABIS PUBCOS 2

100,000+ FT2

  • EST. PRODUCTION

SPACE BY 2018

100,000+ FT2 DRIED & OILS

LICENSE

DRIED & OILS $52M

MARKET CAP 1

$520M

AVERAGE VALUE AVERAGE VALUE

1 As of November 14, 2016 2 Big 5 Cannabis Pubcos: CGC, APH, ACB, MT, OGI

3 / 18 | Q4 2016

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SLIDE 4

T R A N S F O R M AT I O N A L M I L E S T O N E S

WWW.EMERALD.CARE

Production Expanded Sales Products & R&D H2 2017 H1 2018 Recreational Expansion H1 2017

LEGALIZATION

4 / 18 | Q4 2016

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SLIDE 5

H I G H G R O W T H P O T E N T I A L I N H I G H G R O W T H S E C T O R

WWW.EMERALD.CARE

$200M

MEDICAL MARKET

$5B

RECREATIONAL MARKET

2

LEGALIZATION

1 Projected market based on Health Canada Market Statistics: http://www.hc-sc.gc.ca/dhp-mps/marihuana/info/market-marche-eng.php 2 Market value based on Deloitte LLP: “Recreational Marijuana - Insights and opportunities” - June 2016

1

5 / 18 | Q4 2016

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SLIDE 6

E H T H I G H L I G H T S

WWW.EMERALD.CARE

Vertically integrated enterprise

SEED TO SALE

Dried and oil cannabis sales.

E-COMMERCE

Facility in Victoria, BC

PRODUCTION & CULTIVATION

Mass production

SCALABILITY

Limited competition

MARKET CAPTURE

Initial market $5.6B

REVENUE EXPANSION

CURRENT EXPANSION GOALS

LEGALIZATION

6 / 18 | Q4 2016

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SLIDE 7

A D VA N C E D P R O D U C T S & B R A N D I N G

WWW.EMERALD.CARE

DRIED CANNABIS CANNABIS OIL

CBX CBD THC:CBD THC THC+ > 3% CBD

CBG, CBC, THCV, CBDV THC = CBD < 17% THC > 17% THC

EASY FOR CONSUMERS & PHYSICIANS EMERALD RANGE

S T R O N G G E N E T I C D I V E R S I T Y

7 / 18 | Q4 2016

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SLIDE 8

EXPA N S ION TA R G E T S

WWW.EMERALD.CARE

PHASE 1 PHASE 2 PHASE 3

50,000 FT2 5,000 KG production / year $25M potential sales* 100,000 FT2 10,000 KG production / year $50M potential sales* 1 million + FT2 100,000+ KG production / year $500M+ potential sales*

LEGALIZATION

*Potential sales based on sale price of $5/g

8 / 18 | Q4 2016

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SLIDE 9

LOW -CO ST A DVA NTAGE

WWW.EMERALD.CARE

FRIENDLY CLIMATE

Optimal growing environment

BC UTILITY ADVANTAGE

3rd lowest electricity cost in Canada

AGRI-BUSINESS TRACK RECORD EXPERIENCED LABOUR POOL

Leading team with extensive history in cannabis production Management with proven success in scalable agriculture

9 / 18 | Q4 2016

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SLIDE 10

TA R G E T P R O D U C T I O N V S D E M A N D

WWW.EMERALD.CARE

CURRENT UPCOMING PHASE 1 PHASE 2 PHASE 3

  • expansion

recreational branding S U P P L Y medical

LEGALIZATION

10 / 18 | Q4 2016

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SLIDE 11

E X P E R I E N C E D M A N A G E M E N T T E A M

WWW.EMERALD.CARE

Bin Huang, PhD, MBA

President & CEO

Traviss Graham

VP Production

20+ years in life sciences including

15 years as CEO

15+ years in cannabis production,

processing, and product development.

Sandra Pratt, CPA, CA

CFO

Frey Garabagi, PhD

VP R&D and QAP

20+ years in accounting & finance:

Angiotech Pharmaceuticals

10+ years R&D in plant molecular

genetics and medical technologies

11 / 18 | Q4 2016

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SLIDE 12

WWW.EMERALD.CARE

THE E M E RA LD A DVA N TAG E

Emerald Health Sciences KEY STAKEHOLDER Life sciences, drug development, clinical testing, product approvals and distribution LEADERSHIP EXPERIENCE Clinical expertise & networks to expand patient base CLINICAL TRIALS Become the leading brand in cannabis-based products SUPERIOR BRAND

LEGALIZATION

12 / 18 | Q4 2016

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SLIDE 13

WWW.EMERALD.CARE

B O A R D O F D I R E C T O R S

Avtar Dhillon, MD

Chairman and former CEO of Inovio Pharmaceuticals, Inc.

Bob Rai, BSc

Chairman and CEO of Canadian Pacific Global Pharmaceuticals (NASDAQ:INO) and Board Member of several life sciences companies

Jim Heppell, BSc, LLB

Director and former CEO of Sophiris Bio Inc.

Punit Dhillon, BA

CEO of Oncosec (NASDAQ:ONCS) Director of Vanc Pharmaceutica Inc. (TSX:NPH) and 20+ years of pharmacy experience (NASDAQ:SPHS) and previous President and Director of BC Advantage Funds Former Vice President of Finance and Operations at Inovio Pharmaceuticals

13 / 18 | Q4 2016

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SLIDE 14

MEM B E RS H IP I N CA N N A BI S CA N ADA

WWW.EMERALD.CARE

EHB member of Cannabis Canada Association (CCA)

  • Avtar Dhillon – Board Member
  • Bin Huang – Company Representative
  • Maheep Dhillon – Regulations Committee Member

CCA provides industry feedback and recommendations in-person to Health Canada and Government Active voice on regulatory changes, patient advocacy and industry logistics www.cann-can.ca

14 / 18 | Q4 2016

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SLIDE 15

M O V I N G F O R W A R D

WWW.EMERALD.CARE

NEAR TO MID TERM MID TO LONG TERM

Patient acquisition Facility expansion Clinical trials Product development Legalization Market capture Mass revenue Consolidation

15 / 18 | Q4 2016

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SLIDE 16

WWW.EMERALD.CARE

C O M PA R A B L E S

Canopy $1.29B Mettrum Aurora

Market Cap1 Fully Licensed Scalability to meet demand

$553M $274M $517M Aphria Inc.

Quarterly Expense2

Organigram Supreme $7.5M $3.0M $4.3M $1.5M $327M $7.5M $204M $2.0M $52M $440K

1 As at November 14, 2016 2 Figures based on most recently published interim financials for each company as at November 14, 2016

Quarterly Revenue2

$7.0M $4.4M $4.2M $219K $894K $0 $100K 16 / 18 | Q4 2016

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SLIDE 17

I N V E S T M E N T H I G H L I G H T S

WWW.EMERALD.CARE

GROWTH SCALABILITY EXPERTISE

TM

17 / 18 | Q4 2016

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SLIDE 18

T H A N K Y O U !

WWW.EMERALD.CARE

T O L E A R N M O R E , P L E A S E C O N TA C T : S A N D Y P R A T T C F O T : + 1 8 O O 7 5 7 3 5 3 6 E : I N V E S T @ E M E R A L D . C A R E

18 / 18 | Q4 2016