THC GLOBAL GROUP (ASX: THC) Corporate Presentation | September 2019
THC Global Group Limited (ASX:THC) A Vertically Integrated Global Cannabis Company A Farm-to-Pharma business model focused on delivering low cost, high quality cannabis to both patients and the global cannabis export market 2
FARM TO PHARMA VERTICAL INTEGRATION R E S E A R C H & C A N N A B I S P H A R M A G M P E X P O R T & D E V E L O P M E N T C U L T I V A T I O N M A N U F A C T U R E P A T I E N T S Proprietary Cannabis Low-cost cannabis Pharma-grade GMP Supply of finished Sativa strains and cultivation in Australia certified API isolates, product to patients and ‘Next-Generation’ with multiple scalable broad and full wholesale into global medicine development operations spectrum extracts cannabis market 3
AUSTRALIAN CANNABIS FACILITIES ‘ B U N D Y ’ ‘ B A L L I N A ’ ‘ E D E N F A R M S ’ ‘ S O U T H P O R T ’ C U L T I V A T I O N C U L T I V A T I O N C U L T I V A T I O N M A N U F A C T U R E 66,000m 2 of operational hydroponics 73,500m 2 USDA Certified Organic Farm-to-Pharma cannabis operation Pharma grade GMP manufacture of greenhouses with adjacent 180,000m 2 with cannabis strain development, agricultural land proposed to be API, full-spectrum, broad-spectrum of open field agricultural land tissue culturing, cultivation and small developed into a large scale cannabis extracts at largest facility in Southern Ready to commence cultivating in scale manufacturing for product cultivation facility – to progress as Hemisphere – initial 120,000kg annual large scale within months development all on one site plant material requirement increases throughput 4
'EDEN FARMS’ CULTIVATION An operational hydroponics cultivation facility with scalability to support the rapid increase in production at THC Global’s Manufacturing Facility S C A L A B L E O P E R A T I O N 66,000m 2 of hydroponic greenhouses and 180,000m 2 of agricultural land for open-field cultivation at significantly reduced cost-per-gram R E A D Y T O C U L T I V A T E Already operational as one of the largest Continental Cucumber producers in Australia – hydroponic cannabis cultivation able to commence within months with additional open-field cannabis or hemp to be considered (subject to approvals) M I N I M A L C A P E X Site secured through lease agreement with current owner and operator – securing capacity without +$100m capex in design, construction, and approvals 5
‘BUNDY’ CULTIVATION Fully Licenced for Farm to Pharma Production – research, cultivation and manufacturing capabilities all on site with tissue culturing facility to support other cultivation projects using proprietary strains F A R M T O P H A R M A Cultivation already underway with existing research, cultivation and manufacturing licences. ‘Bundy’ Facility cannabis will be used for commercial production as well as medicine development. P R O P R I E T A R Y S T R A I N S Access to the largest holding of Plant Breeder Right (PBR) registered Cannabis Sativa strains in Australia. Known genetic traceability a major asset in Asian markets applying strict pharmaceutical regulations. S T R O N G T E A M Experienced agricultural team established at the ‘Bundy’ Facility to support upcoming increase in production volumes. 6
‘BALLINA’ CULTIVATION Additional large scale cultivation project for plant material expansion capacity S E C U R E D P R O J E C T 73,500m 2 agricultural land in Northern NSW secured to establish a large scale cannabis cultivation site with up to 40,000m 2 of greenhouses. Project to be commenced as internal demand for plant material surpasses current production capacity – minimising pre-revenue capex U S D A C E R T I F I E D O R G A N I C The site is USDA certified organic land, allowing for potential organic cultivation should there be significant demand in global markets for organic cannabis P R O J E C T P A R T N E R Project in partnership with Meluka Health which includes off-take of cannabis from Ballina project for their Cannabis Honey and research into tea-tree + cannabis blended health products 7
E X P O R T S C A L E C A P A C I T Y Capacity to support the entire near term Australian patient demand and be a global exporter commencing early 2020 Above: The Australian Federal Minister for Health, The Hon. Greg Hunt (centre), accompanied by Angie Bell MP , the Federal Member for Moncrieff (L) and Rob Molhoek MP, the State Member for Southport (R), with THC Global Chairman, L A R G E S T I N Steven Xu (Far L), and THC Global CEO, Ken Charteris (Far R) at THC Global’s Manufacturing Facility in August 2019. S O U T H E R N H E M I S P H E R E THC Global’s facility is the largest pharmaceutical bio-extraction facility in the Southern Hemisphere PHARMA-GRADE GMP Product validation to be completed in Q4 2019 as remaining permits MANUFACTURING FACILITY and certifications are granted. Will be delivering product to Australian patients at prices far below current cost of imported products available Low cost and scalable production of pharma-grade GMP certified in market in early 2020. product will allow THC Global to compete internationally with existing majors players on price whilst being able to scale Capability for GMP API isolates, broad spectrum and full spectrum production and exceeding quality expectations. extracts with additional finished product capacity to be established for creams, tablets, powders, sublinguals and other medicines. 8
INITIAL MEDICINES RANGE All products to be Australian Register of Therapeutic Goods (ARTG) listed enabling global exports C A N N D E O C A N N D E O C A N N D E O T H C R A N G E T H C | C B D R A N G E C B D R A N G E Tar geted Tar geted avai l abi l i ty i n Avai l abl e i n avai l abi l i ty i n Mi d 2020 Mi d 2020 ear l y 2020 9 Product design and final specifications are subject to change
EXTENDED MEDICINES RANGE Expecting to launch extended range through 2020-21 for the domestic and global export markets All products to be Australian Register of Therapeutic Goods (ARTG) listed enabling global exports D R I E D F L O W E R G E L C A P S U L E S G E L - T A B S T O P I C A L S 10 Product design and final specifications are subject to change
MEDICINAL CANNABIS REVENUE TIMELINE Timeline to revenue from THC Global’s Australian Medicinal Cannabis production assets First full spectrum oil ARTG listings completed produced at to enable export from Manufacturing Facility Australia Nov 2019 Feb 2020 Jun 2020 Dec 2019 Apr 2020 Completion of GMP and First commercial scale Significant production TGA licencing of cannabis harvest scale up to commence Manufacturing Facility completed export 11
AUSTRALIAN CANNABIS MARKET A rapidly growing market with significant regulatory barriers for patient access and competition entry H I G H C O S T I M P O R T S The Australian patient demand is currently supported THC Global Group almost entirely by high-cost imported product. Australian Operations THC Global expects to be selling Australian medicinal cannabis to Australian patients at 1/2 of the cost whilst still being profitable. P A T I E N T G R O W T H Whilst there has been rapid growth in patient numbers in Australia, real numbers remain low - 10,000 patients expected to grow to 100,000 patients by 2021. THC Global has enough production capacity to service the entire near term projected Australian patient demand and still be a major global exporter. 12
GLOBAL MARKET POTENTIAL Low cost high quality scalable production enabling THC Global to be globally competitive G L O B A L L Y C O M P E T I T I V E Low cost production whilst meeting or exceeding the European standards and other quality expectations at scale, enables THC Global to compete with Aurora, Tilray, Canopy and other global majors I N C R E A S I N G P A T I E N T N U M B E R S Patient numbers continue to increase rapidly globally however there are only few GMP certified producers with scalability to meet global demand for isolates and extracts that meet European and other quality standards H I G H V A L U E P R O D U C T THC Global’s focus on delivering medicinal products Proposed Initial Target Markets produced to pharma-grade GMP spec including isolates and extracts places THC Global far higher up the value chain compared to dried flower cultivators 13
CANADIAN OPERATIONS A diversified business group with a unique strategy targeted for the Canadian market C A N N A B I S O P E R A T I O N S H Y D R O P O N I C S E Q U I P M E N T THC Global’s Crystal Mountain is a hydroponics Secured an 11 acre property in Nova Scotia, Canada equipment wholesale supplier into the global with a Letter of Readiness from Health Canada for market, and has recently commenced B2C sales. development of a cannabis production site. Offers over 600 products, primarily within Canada Targeting to supply Australian products to Canada’s and Europe with a number of trademarked products. 300,000+ patients accessing medicinal cannabis. Strong revenue growth expected to continue, Expecting to distribute THC Global’s Australian targeting supply to micro-LPs and other small scale medicinal cannabis products into Canada through cannabis cultivators as this target market expands. 2020 with TGO93 and EU GMP certification 14
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