FAQs for journalists

When exactly did Bionorica decide to sell the cannabis business or bring a research partner on board?

We have known for a long time that a very extensive and cost-intensive research programme is needed to develop the various therapeutic options in the field of medical cannabis. In addition, numerous new and financially strong competitors are entering the market. This is a great challenge for us as a mid-size company. That is why we looked for cooperations and partnerships to expand on what we already achieved, particularly in the area of research. The Canadian company Canopy Growth, which is also focussed on evidence-based therapies, is in our opinion ideally suited for this. For this reason we decided on the sale of our cannabis business in conjunction with a long-term research cooperation with Canopy Growth.

Why was nothing said about the forthcoming sale of the cannabis business at the Bionorica SE annual press conference in March 2019?

At that time we were still in negotiations. From a purely legal perspective Bionorica would not have been able to say anything – keyword ‘price sensitive information’.

Isn’t the financial power of Bionorica SE sufficient to develop the corresponding potential in the market for medical cannabis itself, especially since Bionorica has a high equity ratio of more than 74 per cent?

We are not big enough for the demands on the research programme or the increasing competition. Besides, we have to focus on our core business.

Could Bionorica have listed its cannabis business on the stock exchange itself as an alternative to the sale?

The current outlook with Canopy Growth appears to be more promising to us.

Why did Bionorica decide to sell its cannabis business to Canopy Growth?

The decisive factor was the basic common understanding of evidence-based cannabis medicine and its intensive further development to the highest pharmaceutical standard. For Professor Dr Michael A Popp, owner and CEO of Bionorica SE, the research partnership with Canopy Growth is the opportunity to pursue his vision. The aim is to develop a wide range of new therapies for critically ill patients on the basis of a broad clinical research programme. In this context we will also realise the previously planned dronabinol studies.

Canopy Growth is mainly a provider of cannabis flowers. Is a sale to such a company not a business contradiction for Bionorica as a provider of pure active substances such as dronabinol?

Dronabinol and CBD have now been added to the Canopy Growth portfolio. Our long-term research cooperation is focussed on these two cannabinoids.

Would it have been possible for Bionorica to use the increasing turnover from the dronabinol business to avoid neglecting the core business of herbal medicines in the context of forthcoming investments rather than carry out the sale?

That was not an option because the investment needed in the cannabis sector is enormous.

How high will the proceeds from the sale of the Bionorica cannabis business be?

The selling price is 225.9 million euros. However, the amount of the sale was not decisive. For several reasons Canopy will be the better home in the future for the cannabis business and the C3 and Bionorica employees working in this segment.

What will Bionorica do with this influx of funds?

Bionorica will invest the incoming funds in new markets, its core business and research.

Will the dronabinol study presented at the Bionorica SE annual press conference in March 2019 now be shelved?

No, the clinical trial started in November 2018 to investigate the effect of dronabinol in treating spasticity in patients with multiple sclerosis is an important element of the research cooperation with Canopy Growth.

In 2018 dronabinol generated many millions of euros in turnover for Bionorica. Is Bionorica still standing by the growth forecast for 2019, even without dronabinol?

The growth forecast for the Bionorica core business remains valid.

What will happen to Bionorica’s cannabinoid production facilities and the current contracts?

They will be transferred to Canopy Growth.

How many employees will be affected by the sale of your cannabis business?

We have around 100 employees at Bionorica ethics GmbH, THC Pharm GmbH and C3 Ethics Austria GmbH who will switch to Canopy Growth.

How safe are the jobs of the Bionorica employees who will now switch to Canopy Growth?

All employment contracts will be taken over and the locations in Neumarkt in der Oberpfalz, Frankfurt am Main and Vienna will be retained. Canopy Growth has a very good growth outlook and important markets for medical cannabis, such as Germany and Austria, are continuing to expand.

How long will the cooperation between Bionorica and Canopy Growth last?

The research cooperation within the framework of the studies is naturally designed to run for several years.

In which countries in Eastern Europe will Bionorica be active in sales for Canopy Growth?

That will be examined on a case-by-case basis; Bionorica is well positioned in many CIS countries.

What turnover does Bionorica expect from this business?

Our calculations on this are still too preliminary for us to communicate them.

 

Effective: May 2nd, 2019