Avicanna Announces Filing of Interim Financial Statements for the Three-Month Period Ending September 30, 2021, Demonstrating Progressive Commercialization Results

Record gross revenue of $1,007,033 through steady growth and progression of global commercialization
Delivered a record number (27,041) of units of cannabis 2.0 products globally, an increase of 61% from Q2
25 listings of cannabis 2.0 products across adult use and medical channels in Canada.
Expanded into and completed exports into the 12 ^th international market.

/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF UNITED STATES SECURITIES LAWS/

Avicanna Inc. ("Avicanna" or the "Company) (TSX: AVCN) (OTCQX: AVCNF) (FSE: 0NN), a biopharmaceutical company focused on the development, manufacturing, and commercialization of plant-derived cannabinoid-based products, is pleased to announce the filing of the Company's third quarter financial statements and provide financial and corporate highlights.

"We are proud to present the meaningful progress we have made across all divisions in what is evidently our most successful quarter to date. We have evolved the organization from R&D stage to a rapidly expanding and truly global commercial-stage company with several business units now generating revenue across several markets. We have successfully established a strong footprint with our proprietary cannabis formulations in Canada across 3 channels including medical, clinical, and adult use, which is attributed to our scientific platform and evidence-based non-inhalation products. We continued to innovate, enhanced our intellectual property, and progressed our pharmaceutical pipeline. Finally, we advanced our global business model by opening our 12 ^th market and more importantly have successfully connected our proprietary formulations with our low-cost API and manufacturing infrastructure in Colombia to deliver advanced products to the global marketplace," commented Aras Azadian, CEO, Avicanna Inc.

Third quarter financial highlights

Gross revenue in the third quarter increased to $1,007,033 ($987,967 net) from $810,299 in the second quarter, and $279,515 in the first quarter of 2021, representing an increase of 24% over the second quarter and 260% over the first quarter revenues. The reported revenue represents cannabis-only sales with majority being new or recurring orders from proprietary finished products in the Canadian medical and adult use channels.

The Company delivered 27,041 units of its cannabis 2.0 products branded as RHO Phyto and Pura Earth, compared to 16,767 units in the second and 8,855 units in the first quarter of 2021, representing a growth of 61% over the second quarter and 205% over the first quarter of 2021.

Loss per share for the nine months ended September 31, 2021, was ($0.29) per share, compared with ($0.82) per share for the nine-month period ending September 30, 2020, representing an improvement of 64% from the same period in the previous year.

By the end of the third quarter, the Company had a total of 25 product listings across medical and adult use channels in Canada, compared to 17 in the second quarter and 6 in the first quarter of 2021, representing an increase of 96% over the second quarter and 316% over the first quarter of 2021.

Other strategic highlights during and subsequent to the third quarter

Entrance into new global markets and expansion of Aureus-branded products with exports of high CBD and THC cannabis extracts to Austria, Peru, and Brazil reaching a total of 11 countries across 4 continents.

Multi-year supply agreement with a Brazilian pharmaceutical company to supply industrial volumes of high THC and high CBD full spectrum cannabis extracts. The Company is expecting revenue of up to $4.0M in fiscal 2022 from this agreement.

Filing of a US Patent Application for a novel cannabinoid formulation for reducing incidence of seizures and sudden unexpected death in epilepsy. Research findings originated from cannabinoid-based collaborations with leading epilepsy researcher, Dr. Peter Carlen, at University Health Network ("UHN"). Avicanna's proprietary formulation showed promising pre-clinical results in reducing seizures and will continue to undergo preclinical and clinical development as a potential drug candidate.

Non-brokered private placement at a premium to the market price (at the time of close), issuing 4,587,022 common share units at a price of $0.85 per unit for gross proceeds of $3,898,969.

The Canadian launch of Viola-branded products in partnership with Medical Cannabis by Shoppers ^TM . Through this partnership Canadian medical and adult use consumers will have access to products by the equity-focused brand for the first time.

Santa Marta Golden Hemp S.A.S. ("SMGH"), the company's majority owned subsidiary met global conformity standards of Good Agricultural and Collection Practice ("GACP"), an international guide set forth by the European Medicines Agency. The certification will allow for the expansion of the Company's raw materials supply business to include organic and now GACP certified dried flower and biomass globally.

Conference Call Details

DATE:	November 12, 2021
TIME:	8:30 AM Eastern Time
LINK:	https://tinyurl.com/AVCNQ32021

About Avicanna

Avicanna is a Canadian commercial-stage biopharmaceutical company established in cannabinoid research, development, and evidence-based products for the global consumer, as well as medical and pharmaceutical market segments. In leading global cannabinoid advancements, Avicanna conducts most of its research in Canada at its R&D headquarters in the Johnson & Johnson Innovation Centre, JLABS @ Toronto, located in the MaRS Discovery District. The Company actively collaborates with leading Canadian academic and medical institutions. Avicanna has established an industry-leading scientific platform including advanced R&D and clinical development which has led to the commercialization of over twenty products across four main market segments:

Medical Cannabis & Wellness Products: Marketed under the RHO Phyto™ brand, or Magisterial Preparations, these medical and wellness products are an advanced line of pharmaceutical-grade cannabis products containing varying ratios of cannabidiol ("CBD") and tetrahydrocannabinol ("THC"). The product portfolio contains a full formulary of products including oral, sublingual, topical, and transdermal deliveries that have controlled dosing, enhanced absorption and stability studies supported by pre-clinical data. The advanced formulary is marketed with consumer, patient and medical community education and training. Avicanna's medical and wellness product portfolio also forms the foundation of the Company's pharmaceutical pipeline with the contribution of the formulations that form the basis of the products as well as the data generated from sales and participation of the products in real world evidence studies.
CBD Derma-Cosmetic Products: Marketed under the Pura H&W™ or Pura Earth™ brands, these registered, clinically tested, dermacosmetic products include a portfolio of functional CBD topical products.
Pharmaceuticals: Leveraging Avicanna's scientific platform, vertical integration, and real-world evidence, Avicanna has created a pipeline of patent-pending drug candidates which are indication-specific and in various stages of clinical development and commercialization. These cannabinoid-based drug candidates provide solutions for unmet medical needs in the areas of dermatology, chronic pain, and various neurological disorders. Avicanna's first pharmaceutical preparation (Trunerox ^TM ) is in the drug registration stage in South America.
Cannabis Raw Materials, Seeds, and Bulk Formulations: Marketed under the Aureus™ brand, the Company's raw material business has successfully completed sales to 11 countries. Aureus offers cannabis dried flower, standardized seeds, full spectrum extracts, and cannabinoid distillates, isolated cannabinoids (CBD, THC, cannabigerol ("CBG") and other rare cannabinoids), and bulk formulations derived from hemp and cannabis cultivars through its sustainable, economical, and industrial-scale subsidiaries based in Colombia. The majority of the Aureus products are produced at Santa Marta Golden Hemp S.A.S. ("SMGH"), the Company's majority-owned subsidiary, which is also Good Agricultural and Collection Practices ("GACP") certified and has United States Department of Agriculture ("USDA") National Organic Program certification for its hemp cultivar.

SOURCE Avicanna Inc.

Stay Connected

For more information about Avicanna, visit www.Avicanna.com, or contact Ivana Maric by email at info@avicanna.com .

The Company posts updates through videos from the official company YouTube channel https://www.youtube.com/channel/UCFXPBGdKSxOUOf_VZoSFSUA .

Cautionary Note Regarding Forward-Looking Information and Statements

This news release includes statements containing certain "forward-looking information" within the meaning of applicable securities law ("forward-looking statements"). Forward-looking statements are frequently characterized by words such as "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. These forward-looking statements are only predictions. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. Forward-looking statements are based on the opinions, estimates and assumptions of management in light of management's experience and perception of historical trends, current conditions and expected developments at the date the statements are made, such as current and future market conditions, the current and future regulatory environment and future approvals and permits. Forward-looking statements are subject to a variety of risks, uncertainties and other factors that management believes to be relevant and reasonable in the circumstances could cause actual events, results, level of activity, performance, prospects, opportunities or achievements to differ materially from those projected in the forward-looking statements, including general business and economic conditions, changes in laws and regulations, product demand, changes in prices of required commodities, competition, the effects of and responses to the COVID-19 pandemic and other risks, uncertainties and factors set out under the heading "Risk Factors" in the Company's annual information form dated April 15, 2020 (the " AIF ") and filed with Canadian securities regulators available on the Company's issuer profile on SEDAR at www.sedar.com. The Company cautions that the list of risks, uncertainties and other factors described in the AIF is not exhaustive and other factors could also adversely affect its results. Readers are urged to consider the risks, uncertainties and assumptions carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such information. The Company is under no obligation, and expressly disclaims any intention or obligation, to update or revise any forward looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities laws.

News Provided by GlobeNewswire via QuoteMedia

cannabis investing tsx:avcn

Cannabis leaf on road marked with "2025," with sunlight in the background.

New Cannabis Consumption Trends, Regulatory Shifts Seen Driving Market in 2025

Understanding trends in the cannabis industry is paramount for investors eyeing a market with steady growth potential, but the landscape is complex as products and regulations continue to evolve.

Consumption habits are changing as edibles, vaping and THC beverages gain traction, especially among younger users, and cannabis companies are adapting their offerings to meet shifting demand.

Meanwhile, regulatory uncertainty, particularly surrounding the future of the US Farm Bill and state-level restrictions on hemp-derived cannabinoids, continues to challenge the market.

Despite these headwinds, production data and long-term growth forecasts suggest the cannabis industry remains on a promising — albeit turbulent — path. Read on for more on key trends to watch in 2025.

Consumption methods evolving post-legalization

Shifts in consumer behavior are reshaping markets across the board, and the cannabis industry is no exception.

While smoking remains the dominant method of cannabis consumption, a recent report from the Centers for Disease Control and Prevention highlights the growing popularity of edibles, vaping and dabbing.

The report notes that vaping and dabbing are particularly pronounced among younger adults.

A separate study published by the American Medical Association and funded in part by the Canadian Institutes of Health Research also points to how product preferences have changed among Canadian users since legalization in 2018.

The study indicates that while the use of flower, cannabis concentrates, oil, tinctures and topicals has decreased during that time, the use of vape cartridges, edibles and beverages has increased.

Edibles and beverages were legalized in Canada in late 2019, and Truss Beverage was one of the first players to introduce cannabis-infused drinks. Truss was a joint venture formed by Molson Coors Canada (TSX:TPX.A,TSX:TPX.B) and HEXO, a cannabis company that has since been acquired by Tilray Brands (TSX:TLRY,NASDAQ:TLRY).

In early 2020, Tilray launched a lineup of confectionery, wellness products and beverages through its subsidiary, High Park; Canopy Growth (TSX:WEED,NASDAQ:CGC) made a similar move. These companies gradually brought their products to the US as more states legalized cannabis for medical and/or recreational use.

Today, established cannabis brands typically offer edibles and beverages alongside their other products. Organigram Global (TSX:OGI,NASDAQ:OGI) is one of the newest US entrants, with its April acquisition of Collective Project providing immediate access to the US hemp-derived THC beverage market.

Growing awareness of health and wellness, potentially amplified by the pandemic-led adoption of health trackers, appears to be making an impact on the alcoholic beverage market.

A 2023 Gallup poll reveals a two decade decline in alcohol consumption, particularly among younger adults, suggesting a shift towards more health-conscious lifestyles within this demographic.

Craft beer production declined by 4 percent year-on-year in 2024, according to data collected by the Brewers Association. This marked the largest drop in the industry's history, excluding the pandemic. For small, independent craft breweries, 2024 marked the third consecutive year of declining production. A drop in the number of operating small breweries last year provides further evidence of this trend, with 501 closures in 2024 versus 434 openings.

Challenges in the alcohol market extend beyond the brewing industry, with the New York Times recently reporting the closure of a handful of nightclubs facing decreased alcohol sales alongside rising insurance and rent costs.

Meanwhile, cannabis lounges have been popping up across the US for the last several years. As of early 2025, several states had legalized or were in the process of implementing regulations for cannabis consumption lounges.

Hemp market growth despite regulatory uncertainty

The burgeoning hemp industry is another segment of the expanding cannabis market.

The legalization of industrial hemp — defined as cannabis with a THC concentration of 0.3 percent or less — through the 2018 Farm Bill led to initial investment and optimistic projections for CBD wellness products and various industrial applications. The sector’s rapid evolution also brought the rise of hemp-derived intoxicating cannabinoids, creating a market that presented both opportunities and complexities for participants.

However, after an initial boom, a lack of infrastructure and clearly defined regulations for CBD, as well as state-level variations and market oversupply, ultimately contributed to a quick retraction.

2024 was a pivotal year for the US hemp industry, as the hemp-related provisions of the 2018 Farm Bill — originally set to expire in September 2023, but extended to December 31, 2024 — created an urgent need to address critical issues like THC limits and the regulation of novel hemp-derived cannabinoids. A major point of contention was the proposed shift from defining hemp based on Delta-9 THC concentration (0.3 percent or less) to “total THC,” which includes THCA.

This change had the potential to significantly impact farmers and processors, as many hemp varieties that are compliant under the Delta-9 THC rule could exceed the 0.3 percent limit when THCA is included.

Various bills and amendments were proposed in 2024 as part of the Farm Bill discussions, each with different approaches to regulating hemp. Separate regulatory frameworks for industrial hemp and hemp grown for cannabinoids were suggested, and many states took their own action, leading to a patchwork of regulations and even outright bans.

Despite challenges, data from the US Department of Agriculture suggests signs of recovery.

The department's annual National Hemp Report from 2024 points to an 18 percent increase in industrial hemp production value between 2022 and 2023, with output growth seen in specific sectors like floral (18 percent), fiber (133 percent) and seed hemp (414 percent). The 2025 report from the Department of Agriculture indicates further expansion, with notable increases observed in both acreage (up 64 percent from 2023) and value (46 percent).

The 2024 Farm Bill ultimately did not pass, and right now the hemp industry is operating under a temporary extension of the 2018 Farm Bill under the American Relief Act of 2025, signed into law on December 21, 2024.

The 2018 Farm Bill is now set to expire on September 30, 2025.

While analysts for Markets and Markets project that the North American hemp industry will grow at a CAGR of 22.4 percent and ultimately reach a valuation of US$30.24 billion by 2029, the future of the industry will be heavily influenced by the outcome of the ongoing Farm Bill discussions.

US cannabis legalization remains stalled

Although there is clear demand for cannabis products, the now-defunct rescheduling process in the US is likely to continue casting a shadow of uncertainty over the industry's long-term trajectory.

Legal and procedural delays, including allegations of improper conduct and bias within the US Drug Enforcement Administration (DEA), led to hearing cancellations, and the new administration of US President Donald Trump has brought leadership changes to key agencies like the DEA and the Department of Justice.

Terry Cole, who Trump nominated to be DEA administrator on February 11, has a history of opposing cannabis legalization in the country. Similarly, Pam Bondi, Trump’s pick to lead the justice department, staunchly opposed a movement to legalize medical cannabis during her tenure as Florida’s attorney general.

While there have been bipartisan efforts in Congress to end federal cannabis prohibition and establish regulations for eventual legalization, the DEA’s actions and statements indicate a potential stall or reversal of progress.

In addition to that, new research is adding complexity to the debate.

A study published in the American Journal of Psychiatry this past March highlights an association between the use of high-potency cannabis strains and increased risks of psychosis, a factor that may not have been fully considered by the Department of Health and Human Services. As stronger cannabis strains become more widely available, a reassessment of their potential health risks may be required.

Investor takeaway

While the cannabis industry holds promise for growth and innovation, investors must remain acutely aware of the regulatory uncertainties and market volatility that will undoubtedly shape its trajectory in the years to come.

Don’t forget to follow us @INN_Cannabis for real-time news updates!

Securities Disclosure: I, Meagen Seatter, hold no direct investment interest in any company mentioned in this article.

Avicanna Announces Filing of Interim Financial Statements for the Three-Month Period Ending September 30, 2021, Demonstrating Progressive Commercialization Results

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In this article

Guide to cannabis in Australia: New South Wales

Guide to cannabis in Australia: Victoria

Guide to cannabis in Australia: Queensland

Guide to cannabis in Australia: South Australia

Guide to cannabis in Australia: Western Australia

Guide to cannabis in Australia: Tasmania

Guide to cannabis in Australia: Northern Territory

Guide to cannabis in Australia: Australian Capital Territory

Consumption methods evolving post-legalization

Hemp market growth despite regulatory uncertainty

US cannabis legalization remains stalled

Investor takeaway

1. Botanix Pharmaceuticals (ASX:BOT)

2. Vitura Health (ASX:VIT)

3. IDT Australia (ASX:IDT)

4. Little Green Pharma (ASX:LGP)

5. Neurotech (ASX:NTI)

6. ECS Botanics (ASX:ECS)

7. Cann Group (ASX:CAN)

8. Althea (ASX:AGH)

9. Ecofibre (ASX:EOF)

10. Argent Biopharma (ASX:RGT)

Road to cannabis rescheduling hits another speed bump

Pennsylvania governor proposes legal cannabis market in state budget

Senate committee re-examines the SAFER Banking Act

Aurora, Canopy Growth report earnings

US lawmakers unlikely to prioritize banking reform

Cannabis rescheduling meets delays and controversies

Virginia makes progress on adult-use cannabis

Tilray sees growth across all segments in quarterly results

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